Klaipedos Nafta AB - Notification on material event

Notice on the convened extraordinary general meeting of shareholders of Klaipėdos Nafta AB

We hereby inform you that on the initiative and by the decision of the Board of
AB Klaipėdos nafta, code 110648893, registered at Burių st. 19, Klaipėda
(hereinafter, the “Company”), an extraordinary general meeting of shareholders
of the Company was convened on 4 December 2013 at 1.00 p.m. The meeting was
held in the registered office of the Company at Burių st.19, Klaipėda. 

Agenda of the meeting:

Regarding approval of the decisions of the Board of AB Klaipėdos Nafta to
conclude, sign, undertake and fulfil obligations under the Agreement on the
margin payment and mortgage of property and under the Maximum conditional and
ordinary mortgage agreement, which will be concluded with the Ministry of
Finance of the Republic of Lithuania. 

Decision adopted:

On the approval of the decisions of the Board of AB Klaipėdos Nafta to
conclude, sign, undertake and fulfil obligations under the Agreement on the
margin payment and mortgage of property and under the Maximum conditional and
ordinary mortgage agreement, which will be concluded with the Ministry of
Finance of the Republic of Lithuania: 

“To approve the decisions of the Board of AB Klaipėdos Nafta:

1. To conclude with the Ministry of Finance of the Republic of Lithuania an
Agreement on the margin payment and mortgage of property, including all its
amendments, supplementations and other modifications (hereinafter referred to
as Margin Payment Agreement), which relates to the future state guarantee
agreement (hereinafter referred to as State Guarantee Agreement), which the
Ministry of Finance of the Republic of Lithuania will conclude with the
European Investment Bank (hereinafter referred to as EIB) and which will serve
as guarantee for the obligations of AB Klaipėdos Nafta to EIB in the amount of
up to EUR  81,093,605 under Credit Agreement FI No 82.631 LT Serapis No
2012-0490 on the co-financing of the Liquefied Natural Gas Terminal (LNGT)
project concluded with EIB on 9 July 2013, to sign it and to undertake and
fulfil all the obligations under the Margin Payment Agreement. In addition, to
sign, undertake obligations and fulfil any other agreements and documents as
necessary and desired in order to obtain the said state guarantee and/or to
secure its validity, and to take any other related actions, including payment
of the margin payment in the amount of EUR 81,093.61, as provided in the Margin
Payment Agreement. 

2. In order to ensure appropriate and timely future fulfilment of the
obligation of AB Klaipėdos Nafta to pay to the Ministry of Finance of the
Republic of Lithuania the sums provided in the debt repayment agreement that
will equal the sums paid by the Ministry of Finance of the Republic of
Lithuania to EIB under the State Guarantee Agreement, to mortgage the property
listed below in this item for the benefit of the Ministry of Finance of the
Republic of Lithuania (the State): 

(a) 3.2670 ha parcel of land located at the address: Klaipėdos r. sav. Dovilų
sen. Kiškėnų k., parcel unique No 4400-2382-2820, registry No 44/1524424; 

(b) all the below-listed property which will be created during the LNGT project
and which AB Klaipėdos Nafta will acquire as ownership while developing and
upon completing the LNGT project, i.e.: 

- immovable property (control room/dispatcher room on the embankment's
high-pressure gas platform; the room of the pump station and of the power
cabinets on the embankment service platform; engineering networks - the gas
main link; the building of the operating room of the gas metering station
(control and domestic premises); the building of the gas metering station with
a penthouse for gas filters; access road, car parking lot; fence) 

and

- as a complex of property - all movable items (installations/equipment) to be
installed/built in on and/or next to the embankment, in the gas metering
station (GMS), and other movable items (installations/equipment) which will
relate to the terminal (including the link) or to its operation and will be
built/installed in or next to the terminal (including the link) that are
required for ensuring appropriate functioning of the terminal, any objects that
due to their movable nature should not be registered as separate items in the
register of immovable property, including but not limited to items that
comprise the mooring system (including quick release mooring hooks, the load
control system, the environment monitoring system, ancillary mooring system); 2
high-pressure natural gas reloading sleeves with the required piping,
collectors and hydraulic power units required for transportation of compressed
natural gas; an access ladder system; 2 marine jib-cranes and a telpher in the
pump station building; a fire extinguishing system (including towers and
hydrants); an electricity system (which, inter alia, consists of diesel
generator equipment and its control cabinet and an electrical distribution
apparatus); a control system (including a control panel); a communications link
from ship to shore; a monitoring system: GMS fire protection system; GMS
security system; items that comprise the GMS gas refinement node (including the
items the comprise the automated control system for GMS installations), a gas
metering system in GMS (including chromatographs, an automatic gas flow
analyser, items that comprise the automatic gas flow regulation system and
SCADA, other items comprising the gas metering system), computer hardware. 

This future obligation of AB Klaipėdos Nafta secured by mortgage will emerge
once the Ministry of Finance of the Republic of Lithuania pays to EIB the sums
under the State Guarantee Agreement. Once the Ministry of Finance of the
Republic of Lithuania has made such a payment to EIB, the parties to the
mortgage agreement will define the conditions of the obligation of AB Klaipėdos
Nafta to repay the corresponding amounts in the debt repayment agreement. 

The parcel of land specified in clause 2(a) shall be mortgaged under primary
maximum ordinary mortgage whereas the immovable items and the property complex
listed in clause 2(b) shall be mortgaged under primary maximum conditional
mortgage. 

For the purpose of mortgaging the property listed in clause 2, to conclude and
sign a maximum conditional and ordinary mortgage agreement with the Ministry of
Finance of the Republic of Lithuania (hereinafter referred to as Mortgage
Agreement) and any other documents related to the Mortgage Agreement, undertake
and fulfil all obligations arising from the Mortgage Agreement (including
property insurance and valuation, as defined in the Mortgage Agreement), and
take other actions required for appropriate conclusion, signing, submission,
registration, validity and performance of the Mortgage Agreement. 

Since the property listed in clause 2(b) is being mortgaged as future property,
clause 2(b) provides a preliminary list of such mortgaged property. Regardless
of the above, the Board hereby decides to mortgage the entire terminal that
will be created during the LNGT project, including the link, which comprises
immovable property, and as a complex of property, movable property installed
and/or built in or next to such immovable property (installations/equipment),
which will be owned by AB Klaipėdos Nafta. Once the conditions for the coming
into effect of conditional mortgage specified in the Mortgage Agreement emerge,
the list of property mortgaged under the Mortgage Agreement may be adjusted
under the procedure defined in the Mortgage Agreement so that it matches the
actual composition of the immovable property comprising the LNGT that was
created and whose ownership was obtained by AB Klaipėdos Nafta and of the
movable property (installations/equipment) installed/built in and/or next to
that property. The Board also hereby decides on the conclusion, signing and
registration of the amendments to the Mortgage Agreement that are required for
the implementation of the said adjustment of the list of property mortgaged
under the Mortgage Agreement and no separate decision of the Board to make
those amendments will be required. 

3. AB Klaipėdos Nafta may conclude a Mortgage Agreement specified in clause 2
and sign any related documents as well as take other required actions and may
pay the margin payment specified in clause 1 only after receiving a
confirmation from the European Commission that the state guarantee granted to
the European Investment Bank is not considered state aid under the Treaty on
the Functioning of the European Union or is considered state aid compatible
with the internal market under the Treaty. This decision of the Board will be
totally sufficient for undertaking the obligations specified in clauses 1 and
2, signing the documents and taking the actions as soon as such confirmation of
the European Commission is received, and a separate additional decision of the
Board on matters listed in this decision will not be required. 

4. The head of AB Klaipėdos Nafta or another person duly authorised by him is
being authorised and empowered to: On behalf of AB Klaipėdos Nafta and at his
discretion, negotiate and agree on all the documents specified in clauses 1 and
2 of this decision, including but not limited to the conditions of the Margin
Payment Agreement, the Mortgage Agreement and of the amendments in its clause 2
and the conditions of any related documents; conclude, sign and register these
documents, including but not limited to the Margin Payment Agreement, the
Mortgage Agreement and the amendments in its clause 2, and any other related
documents and take any other actions required or recommended in order to duly
conclude, sign, submit and register the transactions provided in this decision
(including amendments, supplementations and other modifications to such
documents); conclude, sign and submit the required documents and take any other
actions required for stating, confirmation and/or registration in the
respective registries of the emergence of the conditional mortgage conditions
defined in the Mortgage Agreement. 

5. Establish that the decisions of the Board specified above in clauses 1 to 4
will take effect after having been supported by the general shareholders'
meeting of AB Klaipėdos Nafta.” 

As it was already published in the relevant Company's notifications on the
material events, on 9 July 2013 Klaipėdos Nafta AB has concluded the Credit
Agreement with the European Investment Bank (EIB) regarding granting a credit
of up to EUR 87 million for the implementation of the project of the liquefied
natural gas terminal, under which the EIB will finance up to 50% of the Project
implementation costs. As well, on 20 November 2013, the European Commission has
found that state aid for the liquefied natural gas terminal project, developed
by the Company, is state aid compatible with the internal market. 




         Director of Finance and Administration Department, Mantas Bartuška, (+
370 46) 391 763