The 2007 Annual General Meeting of Shareholders of AS Baltika was held at 13:00 on Monday, 21 May 2007 in the premises of Baltika at Veerenni Street 24, Tallinn. A total of 3,478,776 votes that represented 55.97% of the share capital of AS Baltika were present and the Annual General Meeting was competent to pass resolutions. The agenda of the General Meeting were as follows: 1. Approval of the 2006 Annual Report 2. Profit distribution 3. Amendment of the Articles of Association 4. Increase of the share capital via fund issue 5. Election and remuneration of the auditor 6. Issue of convertible bonds 7. Presentation of the Baltika Group's plans and goals in 2007 Decisions of the Annual General Meeting of Shareholders: 1. Approval of the 2006 Annual Report To approve the 2006 Annual Report of AS Baltika as presented. The number of votes in favour of the resolution was 3,455,770 representing 99.34% of the registered participants. 2. Profit distribution To approve 2006 net profit of AS Baltika in the amount of 87,376,520 kroons (5,584,377 euros) and transfer it to the retained earnings. To transfer 12,821,900 kroons (819,469 euros) from retained earnings to statutory reserve. To pay out dividends from retained earnings in the amount of 14,915,880 kroons (953,298 euros); dividend per share is 2.40 kroons (0.15 euros). Dividend per share applied to the number of shares after the fund issue shall be 0.80 kroons (0.05 euros). To fix the list of shareholders entitled to receive the dividends on 3 June 2007 at 23:59 and pay out the dividends by 12 June 2007 the latest. The number of votes in favour of the resolution was 3,444,770 representing 99.02% of the registered participants. 3. Amendment of the Articles of Association To change the first sentence of the article 3.1. of the Articles of Association and state that the minimum capital of the company is 100,000,000 kroons (6,391,165 euros) and the maximum capital is 400,000,000 kroons (25,564,659 euros). To approve the new Articles of Association. The number of votes in favour of the resolution was 3,455,770 representing 99.34% of the registered participants. 4. Increase of the share capital via fund issue To increase the share capital of AS Baltika by means of fund issue in the amount of 124,299,000 kroons (7,944,154 euros) on the account of retained earnings and share premium by issuing 1,242,990 new ordinary shares with a nominal value of 10 kroons (0.64 euros). The fund issue shall be carried out on the basis of the 2006 Annual Report of AS Baltika that has been approved by the shareholders together with the profit distribution. The fund issue shall be carried out on the account of retained earnings in the amount of 65,210,501 kroons (4,167,711 euros) and share premium in the amount of 59,088,499 kroons (3,776,443 euros). The share capital after the fund issue shall be 186,448,500 kroons (11,916,231 euros) consisting of 18,644,850 shares. As a result of the fund issue, each shareholder entered in the share registry as of 8 June 2007 at 23:59 shall receive two (2) new shares per each share owned by the shareholder. The issued shares are entitled to dividends that are paid out of the net profits of the financial year starting on 01.01.2007. The number of votes in favour of the resolution was 3,455,770 representing 99.34% of the registered participants. 5. Election and remuneration of the auditor To elect AS PricewaterhouseCoopers as the auditing company for the financial year 2007 and remunerate the auditor pursuant to an agreement concluded. The number of votes in favour of the resolution was 3,455,620 representing 99.33% of the registered participants. 6. Issue of convertible bonds To issue 124,000 convertible bonds of AS Baltika. The entire issue of the bonds shall, with deviation from the shareholders' pre-emptive rights to subscription, be offered for subscription to management of Baltika's group of companies. The persons to whom the subscription is offered shall be approved by the Council. The aim of the issuance of bonds is to tie the motivation of the team who is going to implement the goals of the 2007-2008 strategy period with the increase of the value of the company and to receive means necessary for the financing of the development of the company by the issuance of new shares. The total value of bonds will be 124,000 Estonian kroons (7,925 euros) and the value of each bond is one Estonian kroon (0.06 euros). Two different bonds will be issued, bond E and bond F. There will be 62,000 E bonds and 62,000 F bonds. The bonds have to be paid for together with the subscription. The bond subscription periods are as follows: - 62,000 E bonds during the period of 04.06.-15.06.2007; - 62,000 F bonds during the period of 02.06.-13.06.2008. Each bond entitles its holder to subscribe for three (3) shares of the Company with the nominal value of 10 kroons (0.64 euros). As a result of the subscriptions the share capital of AS Baltika may be increased by a maximum of 372,000 new shares, i.e. by a maximum of 3,720,000 kroons (237,751 euros). The share subscription periods are as follows: - for E bond during the period of 01.07.-31.12.2008; - for F Bond during the period of 01.07.-31.12.2009. The share subscription price is the weighted average price of the traded shares of AS Baltika on the Tallinn Stock Exchange on the first day of each bond subscription period. The amount between share subscription price and nominal value of the share is premium. The price of the bond paid shall be calculated as part of the payment for the share subscription price. The Management Board of AS Baltika shall pass the decision on the increase of the share capital in the amount of par value of subscribed for and fully paid shares within two months from the expiry of the date of each share subscription period. Shares subscribed for by the holders of the bonds shall entitle the holder to all shareholder rights starting from the date the increase of the share capital has been duly registered with the Commercial Register. The number of votes in favour of the resolution was 3,455,620 representing 99.33% of the registered participants. Revision of 2007 sales growth estimate Baltika Group published its plans and goals for 2007 at the beginning of the year with the 2006 annual results. The published estimate for net sales growth was at least 40% per annum. In conjunction with the downgrade of the wholesale sales prognosis, the Group's new sales growth estimate for 2007 is at least 33%, whereas retail sales should increase by at least 40% yoy, wholesale should decrease by around 10% and other sales should grow around 50% yoy. The decline in wholesale comes mainly from more conservative sales policy with the Russian wholesale partner. Triin Palge Head of investor relations +372 630 2886 triin.palge@baltikagroup.com