Division 1 Increase of Share Capital

§ 192. Resolution on increase of share capital

(1)

A resolution on increase of share capital shall be adopted if at least two-thirds of the votes of the shareholders who participate in the meeting or, in the case specified in subsection 174 (2) of this Code, at least two-thirds of the votes of the shareholders are in favour, unless the articles of association prescribe a greater majority requirement.

(2)

If the articles of association must be amended due to the increase of share capital, amendment of the articles of association shall be decided before share capital is increased.

(3)

A resolution on increase of share capital shall not be adopted before entry of the private limited company in the commercial register.

(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773)

§ 1921. Resolution on increase of share capital

The following shall be set out in a resolution on increase of share capital:

1)

the number of new shares and their nominal values and the amount of increase of share capital;

2)

if the nominal values of the shares are increased, the new nominal values of existing shares;

3)

specifications for the rights attaching to the new shares;

4)

the time and place for payment for the new shares and whether and to what extent the shares are to be paid by a monetary or non-monetary contribution; in the case of a non-monetary contribution, the item of the contribution;

5)

if the shares are issued at a premium, the amount of the premium;

6)

in the case of a bonus issue, reference to the underlying balance sheet and equity categories, and the amount of each equity category used to carry out the bonus issue.

(17.06.98 entered into force 10.07.98 - RT I 1998, 59, 941)

§ 193. Pre-emptive right of shareholder

(1)

Upon increase of share capital, a shareholder has the right to acquire issued shares in proportion to the shareholders share unless the resolution on increase of share capital prescribes otherwise. The pre-emptive right of shareholders to acquire shares may be excluded by a resolution of shareholders supported by at lest three-quarters of the shares represented at the meeting or, in the case specified in subsection 174 (2) of this Code, by at least three-quarters of the votes of the shareholders, unless the articles of association prescribe a greater majority requirement.

(17.06.98 entered into force 10.07.98 - RT I 1998, 59, 941; 22.03.2000 entered into force 17.04.2000 - RT I 2000, 29, 172)

(2)

If a shareholder does not wish to exercise the right specified in subsection (1) of this section, the other shareholders have the right to acquire the new shares.

(3)

If the shareholders do not wish to exercise the right specified in subsections (1) and (2) of this section, the new shares may be acquired by third persons.

§ 194. Application of foundation provisions

The provisions of §§ 140-143, subsection 144 (2) and subsections 520 (2), (3), (5) and (6) of this Code shall apply to an increase of share capital unless this division prescribes otherwise. (06.06.2001 entered into force 07.07.2001 - RT I 2001, 56, 336)

§ 1941. Set-off of claim

Upon an increase of share capital, payment for a new share or for a share increasing the size of a share may, pursuant to a resolution of shareholders, be set off against a claim of the shareholder or the person acquiring the share against the private limited company if this does not harm the interests of the private limited company or of its creditors. A claim shall be valuated as a non-monetary contribution.

(17.06.98 entered into force 10.07.98 - RT I 1998, 59, 941)

§ 195. Bonus issue

(1)

A private limited company may increase share capital from the shareholders equity of the private limited company without making contributions (bonus issue).

(2)

The shareholders may decide on a bonus issue after approval of the annual balance sheet. If a bonus issue is decided more than seven months after the date as at which the annual balance sheet is prepared, an interim balance sheet shall be prepared and approved by the shareholders pursuant to the procedure prescribed for preparation and approval of an annual report.

(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773)

(3)

Upon a bonus issue, the share of a shareholder shall be increased in proportion to the nominal value of the shareholders share.

(4)

Upon a bonus issue, the private limited companys own share shall also be increased.

§ 196. Submission of petition to commercial register

(1)

If share capital is paid in full or a bonus issue is conducted, the management board shall submit a petition to the commercial register for entry of the increase of share capital in the commercial register. The following shall be appended to the petition:

1)

the resolution of the shareholders;

2)

the new text of the articles of association if the articles of association are amended;

(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773)

3)

the minutes of the meeting of shareholders or, in the case provided for in § 173 of this Code, the record of voting;

4)

upon increase of share capital by new contributions, a bank notice concerning payment of the share capital;

5)

upon a bonus issue, the annual report or interim balance sheet on which it is based;

(17.06.98 entered into force 10.07.98 - RT I 1998, 59, 941; 22.03.2000 entered into force 17.04.2000 - RT I 2000, 29, 172)

6)

upon payment by a non-monetary contribution, documents certifying the value of the contribution and its transfer;

61)

if the shares are entered in the Estonian Central Register of Securities, a notice from the Estonian Central Register of Securities confirming that the management board has notified the register of the increase in share capital;

(14.06.2000 entered into force 01.01.2001 - RT I 2000, 57, 373)

7)

other documents prescribed by law.

(2)

The members of the management board shall certify the transfer of a non-monetary contribution to the private limited company by their signatures. If the non-monetary contribution is an immovable, an extract from the land register shall be appended to the petition.

(3)

The management board shall submit a petition for entry of the increase of share capital in the commercial register within six months after adoption of the resolution on increase of share capital.

(4)

Share capital shall be deemed to be increased and the rights arising from the newly issued or increased portion of shares shall be deemed to have arisen as of the making of such entry in the commercial register.

(17.06.98 entered into force 10.07.98 - RT I 1998, 59, 941)

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