ARTICLES OF ASSOCIATION OF ENTERPRISE ESTONIA

1. GENERAL PROVISIONS

1.1. Enterprise Estonia /Ettevõtluse Arendamise Sihtasutus/ (the abbreviated form being EAS; hereinafter the Foundation) is a state foundation.

1.2. The registered office of the Foundation is Tallinn, Republic of Estonia.

1.3. The founder of the Foundation is the Republic of Estonia. The body exercising the founder’s rights in the Foundation is the Ministry of Economic Affairs and Communications (hereinafter the Founder).

1.4. The Foundation consists of structural units. The tasks of structural units have been provided for in the statutes of the structural units approved by the Supervisory Board.

2. OBJECTIVE AND MAIN TASKS

2.1. The objective of the Foundation is to help Estonia become a state with the best business environment, to increase the competitiveness of entrepreneurs and awareness of the state.

2.2. The Foundation shall follow in its activities the national strategic documents relating to the areas specified in clause 2.1 of the Articles of Association.

2.3. The main task of the Foundation is, pursuant to national development plans and policies, to:

2.3.1. provide counselling and training, cooperation opportunities and financial assistance for entrepreneurs, research institutions, the public and non-profit sectors;

2.3.2. ensure the purposeful and efficient implementation of funds and resources targeted at the development of entrepreneurship in Estonia, including to act as an implementing agency, in the following areas: attraction of foreign investments, exports of products and services, technological development and innovation, tourism, regional development, development of small and medium-sized entrepreneurship;
2.3.3. collect, systematise, analyse and communicate information in areas specified in clause 2.3.2 of the Articles of Association;

2.3.4. make proposals on national strategic documents in areas specified in clause 2.3.2 of the Articles of Association;

2.3.5. collect, systematise, analyse and present information about international and foreign support measures and support systems provided for the development of entrepreneurship in Estonia, and provide the respective counselling;

2.3.6. create and provide paid services required for the development of entrepreneurship;

2.3.7. development and provision of other services required for the development of business environment.

2.4. In order to perform its main tasks, the Foundation cooperates with other persons, including with Estonian, foreign and international institutions.

3. MANAGEMENT

3.1. The managing bodies of the Foundation are the Supervisory Board and Management Board.

3.2. A member of the managing body of the Foundation shall not be a person:

3.2.1. whose culpable acts or omissions have resulted in the bankruptcy of any person;

3.2.2. whose culpable acts or omissions have resulted in the withdrawal of an authorisation issued to a legal person;

3.2.3. who is subject to a prohibition on business;

3.2.4. whose culpable acts or omissions have caused harm to a legal person;

3.2.5. who has a punishment in force for an economic criminal offence or a criminal offence related to the office held, or a criminal offence against property. The prohibition does not apply to persons whose information concerning punishment has been deleted from the criminal records database.

3.3. The restrictions provided for in sub-clauses 3.2.1–3.2.4 of the Articles of Association continue to apply for five (5) years after the declaration of bankruptcy, the withdrawal of the authorisation, the termination of the prohibition on business or payment of compensation for the harm caused.

3.4. A member of the managing body of the Foundation shall not be a person who has a substantive conflict of interest with the Foundation, the source of which may, inter alia, include a circumstance that the person or a related party of the person:

3.4.1. has substantial business interests in relation to the Foundation, which among other things are reflected in owning a qualifying holding in or being a member of the managing body of a legal person which is a significant buyer of goods from or seller of goods to, or supplier of services to or customer of, the Foundation;

3.4.2. has personal (incl. business) interest in receiving the benefits granted by the Foundation;

3.4.3. is a partner of a general partnership or the general partner of a limited partnership that is engaged in the same economic activities as the Foundation, where neither the person nor the general or limited partnership of which that person is a partner is a co-founder of that Foundation;

3.4.4. owns a qualifying holding in a company that is engaged in the same economic activities as the Foundation, where neither the person nor the company in which that person owns the qualifying holding is a co-founder of that Foundation;

3.4.5. is a member of the managing body of a company that operates in the same area of activity as the Foundation, except where that company is a partially state-owned company, or a company that belongs to the same group as the partially state-owned company, or a company that is a co-founder of the Foundation;

3.4.6. is a self-employed person who is engaged in the same economic activities as the Foundation and who is not a co-founder of the Foundation.

3.5. For the purposes of sub-clause 3.4 of the Articles of Association, a related party means the spouse, parent, children and grandchildren of the person as well as a person who has a shared household with the member of a managing body.

3.6. In the event of a conflict of interests as well as if other matters related to a member of the managing body of the Foundation or to the person specified in clause 3.5 of the Articles of Association are being decided, the relevant member of the managing body shall not participate in adopting resolutions on the respective matter and shall not vote on this matter.

4. SUPERVISORY BOARD

4.1. The Supervisory Board shall plan the activities of the Foundation, organise the management of the Foundation and supervise the activities of the Foundation.

4.2. The Supervisory Board shall have three (3) to seven (7) members. The specific number of members of the Supervisory Board is determined by the Founder on the basis of the objectives, total assets and economic situation of the Foundation in a manner that the efficient performance of the tasks of the Supervisory Board in planning and organising the activities of the Foundation and in supervising the activities of the Management Board is ensured. A member of the Supervisory Board shall be appointed and removed by the Founder. The term of office of members of the Supervisory Board is three (3) years. At least one member of the Supervisory Board is elected by the Founder at the proposal of the Minister of Finance. The Founder has the right to remove a member of the Supervisory Board at any time, regardless of the reason.

4.3. The Supervisory Board is competent to:

4.3.1. establish the operational strategy of the Foundation;

4.3.2. approve the annual budget and action plan of the Foundation as well as the annual activity goals of the Foundation by the beginning of the financial year, at the latest, and make subsequent amendments thereto;

4.3.3. endorse and approve the annual report of the Foundation;

4.3.4. determine the number of members of the Management Board and appoint and remove member(s) of the Management Board;

4.3.5. determine the amount of remuneration payable to member(s) of the Management Board and procedure for payment thereof;

4.3.6. approve of the structure of the Foundation;

4.3.7. grant consent to the Management Board for conclusion of transactions which are beyond the scope of everyday economic activities, primarily for entry into finance lease agreements or for conclusion of transactions that involve raising loans, in the agreement on the acquisition of an immovable or right of superficies for no charge, assumption of an obligation, in accordance with applicable legislation, to use the assets for a specific purpose and to pay the contractual penalty, acquisition and extinguishment of a holding in a company, or transfer of immovables and registered movables or encumbrance thereof with a real right;

4.3.8. appoint and remove the auditor(s) and determine the number and procedure for remuneration of the auditor(s);

4.3.9. ensure internal control and review of an internal audit in accordance with clause 8 of the Articles of Association;

4.3.10. provide an assessment on the activities of the Foundation within one (1) month of the approval of the annual report of the Foundation;

4.3.11. adopt the rules of procedure of the Supervisory Board

4.3.12. determine the area of responsibility of a member of the Management Board at the proposal of the chairman of the Management Board;

4.3.13. represent the Foundation in disputes and conclusion of transactions with the Management Board;

4.3.14. before approving the annual report, the Supervisory Board is required to hear the sworn auditor who audited the annual accounts.

4.4. Remuneration of a member of the Supervisory Board:

4.4.1. the remuneration of the members of the Supervisory Board shall be determined by the Founder at the rate and pursuant to the procedure established by legislation;

4.4.2. equal remuneration is set to the members of the Supervisory Board. The Founder may set a higher remuneration for the chairman of the Supervisory Board compared to other members of the Supervisory Board as well as set additional remuneration for a member of the Supervisory Board in connection with their participation in the work of an audit committee specified in the Auditors Activities Act or another body of the Supervisory Board;

4.4.3. when paying remuneration to a member of the Supervisory Board, the member’s participation in the meetings of the Supervisory Board and in the work of the Supervisory Board is taken into account;

4.4.4. if the chairman of the Supervisory Board does not perform the obligations arising from clause 4.5.7 of these Articles of Association without a good reason, the Founder may suspend the payment of remuneration to the chairman of the Supervisory Board or reduce such remuneration proportionately to the period during which the obligation was not complied with. The remuneration is reduced in accordance with the provisions of subsection 85 (11) of the State Assets Act;

4.4.5. upon removal of a member of the Supervisory Board from the Supervisory Board, no compensation is paid to the member.

4.5. Work organisation of the Supervisory Board

4.5.1. The members of the Supervisory Board elect a chairman from among themselves who shall organise the work of the Supervisory Board. The chairman of the Supervisory Board shall represent the Supervisory Board, organise the activities thereof and chair the meetings of the Supervisory Board. During the absence of the chairman of the Supervisory Board, the latter shall appoint a member of the Supervisory Board substituting for the chairman.

4.5.2. Meetings of the Supervisory Board shall be held as necessary but not less frequently than once every three (3) months. Meetings of the Supervisory Board are called by the chairman of the Supervisory Board or by the member of the Supervisory Board substituting for the chairman. A meeting of the Supervisory Board shall be called if this is demanded by the Founder, a member of the Supervisory Board, the Management Board or an auditor. The notice of the meeting shall be sent to the members of the Supervisory Board by an ordinary letter or electronically. The notice shall set out the time and place of the meeting and the agenda of the meeting.

4.5.3. Meetings of the Supervisory Board have a quorum if over one-half of the members of the Supervisory Board, including the chairman of the Supervisory Board or a member of the Supervisory Board substituting for the chairman, participate in the meeting. Each member of the Supervisory Board has one vote. A member of the Supervisory Board does not have the right to abstain from voting or to remain undecided, except in events provided by law. A member of the Supervisory Board may not participate in voting if approval of entry into a transaction between the member and the Foundation is being decided, or if approval of entry into a transaction between a third party and the Foundation is being decided if the interests of the member of the Supervisory Board arising from such transaction are in conflict with the interests of the Foundation.

4.5.4. Resolutions of the Supervisory Board are adopted if over one-half of the members of the Supervisory Board who participate in the meeting vote in favour. In the election of a person, the candidate who receives more votes than the others shall be deemed to be elected.

4.5.5. The Supervisory Board may adopt a resolution without calling a meeting if at least 2/3 of the members of the Supervisory Board vote in favour of the resolution in a format that can be reproduced in writing. In order to adopt resolutions without calling a meeting, the chairman of the Supervisory Board shall send the corresponding draft resolution to the members of the Supervisory Board, specifying a term during which the members of the Supervisory Board must present their position on it. The term may not be shorter than 3 (three) business days. If a member of the Supervisory Board does not give notice of whether the member is in favour of or opposed to the resolution during this term, it shall be deemed that the member did not participate in the meeting.

4.5.6. Minutes shall be taken of meetings of the Supervisory Board, and when drawing up the minutes, the requirements provided for in the State Assets Act shall be met. The minutes of the meeting of the Supervisory Board shall be signed by all the members of the Supervisory Board who participate in the meeting and the recording secretary. The dissenting opinion of a member of the Supervisory Board shall be entered in the minutes, which shall be confirmed by the signature of the member.

4.5.7. The Supervisory Board must observe the requirements established by the Minister of Finance in regard to drawing up minutes and the information to be recorded in the minutes of the meetings of the Supervisory Boards of the Foundation, as well as the requirements regarding submission of the information specified in clause 4.5.8, provided that such requirements have been enacted.

4.5.8. The chairman of the Supervisory Board must submit the following to the Founder and the Minister of Finance:

4.5.8.1. the agenda of a meeting of the Supervisory Board at least three business days before the meeting is held and, within one month following the holding of the meeting of the Supervisory Board, a copy of the minutes of the meeting together with the materials for the meeting;

4.5.8.2. in the case that a resolution of the Supervisory Board is adopted without calling a meeting, the draft resolution of the Supervisory Board at the same time that it is transmitted to the members of the Supervisory Board, and the record of the vote or the results of the vote within five business days following the vote.

4.5.9. In order to perform its tasks, the Supervisory Board has the right to obtain information concerning the activities of the Foundation from the Management Board.

5. MANAGEMENT BOARD

5.1. The Management Board shall manage and represent the Foundation.

5.2. The members of the Management Board shall be appointed and removed by the Supervisory Board. The Management Board shall have one (1) (manager) to five (5) members. The right of the Management Board to represent the Foundation may be restricted by a resolution of the Supervisory Board.

5.3. The term of office of members of the Management Board is four (4) years.

5.4. The rules of procedure of the members of the Management Board and other conditions shall be determined in a contract of a member of the Management Board.

5.5. The members of the Management Board shall be appointed and removed by the Supervisory Board, taking into account the provisions of these Articles of Association. The Supervisory Board has the right to remove a member of the Management Board at any time, regardless of the reason.

5.6. Upon performing its tasks, the Management Board shall:

5.6.1. manage the daily activities of the Foundation;

5.6.2. ensure the implementation of the resolutions of the Supervisory Board and assume liability for it;

5.6.3. ensure the preparation of the annual report;

5.6.4. submit the annual budget and action plan to the Supervisory Board for approval;

5.6.5. act on behalf of the Foundation and represent the Foundation, taking into account the restrictions established by the Supervisory Board;

5.6.6. dispose of the assets of the Foundation, enter into agreements on behalf of the Foundation and open accounts in credit institutions;

5.6.7. enter into, amend and terminate employment contracts with employees;

5.6.8. issue powers of attorney for the representation of the Foundation;

5.6.9. submits at least once every three (3) months an overview of the activities of the Foundation to the Supervisory Board.

5.7. If the Management Board has more than two members, the members of the Management Board shall elect a chairman of the Management Board from among themselves who shall organise the activities of the Management Board. If the Supervisory Board has determined that the management of the activities of the Management Board is an area of responsibility of a member of the Management Board, the members of the Management Board shall observe such guideline of the Supervisory Board when electing the chairman of the Management Board. If the Management Board has an even number of members and the votes divide equally upon adopting resolutions of the Management Board, the chairman of Management Board shall have a deciding vote.

5.8. Upon performing tasks, the chairman of the Management Board shall, among other things, perform the following obligations:

5.8.1. determine the obligations of a member of the Management Board, taking into account the areas of responsibility determined by the Supervisory Board;

5.8.2. appoint a member of the Management Board substituting another member of the Management Board during a temporary absence of the latter;

5.8.3. call the meetings of the Management Board, determine the place of the meeting and issues to be discussed at the meeting;

5.8.4. appoint the recording secretary of the meeting of the Management Board and sign the minutes of the meeting of the Management Board;

5.8.5. make a proposal to the Supervisory Board on the appointment or removal of a member of the Management Board, as well as on the determination of the area of responsibility of a member of the Management Board;

5.8.6. make a proposal to the Supervisory Board on entry into a contract of a member of the Management Board with members of the Management Board;

5.8.7. provide the Supervisory Board with an opinion on establishment of the remuneration of the chairman and the members of the Management Board and expenses to be compensated for;

5.8.8. participate in the meetings of the Supervisory Board;

5.8.9. communicate with the public and third parties and deliver opinions on behalf of the Management Board and the Foundation.

5.9. Remuneration is only paid to the member of the Management Board on the basis of a contract of a member of the Management Board entered into with that member. Where the member of the Management Board performs other tasks required for the Foundation in addition to those of the member of the Management Board of the Foundation, such tasks may only be remunerated if this is stipulated in the contract of a member of the Management Board.

5.10. Additional remuneration may be paid to a member of the Management Board, taking into account the effectiveness of the work of the member. Reasons must be given for setting a specific amount of additional remuneration, having regard to the attainment of the objectives set to the Foundation. The total amount of additional remuneration paid during the financial year may not exceed the amount equivalent to four times the average monthly remuneration paid to the member of the Management Board in the previous financial year.

5.11. A member of the Management Board may be granted severance pay only where the member is removed from the Management Board on the motion of the Supervisory Board before the expiration of the term of office. Severance pay may be granted in the amount equivalent to up to three months’ remuneration of the member of the Management Board as effective at the time of the removal.

6. ADVISORY BOARD

6.1. To achieve the objectives of the Foundation, advisory boards performing the advisory function in the area of activity of a structural unit of the Foundation or a sub-unit thereof may be formed.

6.2. Members of an advisory board shall be elected and removed by the Management Board. An advisory board shall have three (3) to eleven (11) members.

6.3. An advisory board shall be formed by a resolution of the Management Board, which shall determine at least the tasks, members, terms of fulfilment of tasks and rules of procedure of the advisory board.

7. ASSETS

7.1. The assets of the Foundation are formed of:

7.1.1. allocations from the state budget;

7.1.2. funds received from fundraising events and economic activities of the Foundation;

7.1.3. assets transferred to the Foundation free of charge or irrevocably by private and/or public persons of Estonia or foreign states;

7.1.4. other sources in accordance with legislation.

7.2. Procedure for transfer of assets

7.2.1. The Foundation keeps all of its funds in the Ministry of Finance, makes payments from its funds through the Ministry of Finance, and may hold accounts in credit or financial institutions only upon agreement with the Ministry of Finance.

7.2.2. Assets shall be transferred to the Foundation on the basis of an agreement and/or record of delivery and receipt.

7.2.3. The Foundation may not acquire assets if the condition for the acquisition of the assets is the assumption of such obligations on the Foundation, which are not in accordance with the objectives of the Foundation or give any advantages to the transferor of the assets to the Foundation in comparison with other beneficiaries.

7.2.4. The general principles of supervision over the acquisition, use and disposal of assets shall be established by the Supervisory Board of the Foundation.

7.2.5. Upon acquisition of an immovable or right of superficies for no charge, the Foundation assumes the obligation to use the assets for a specific purpose, and to pay the contractual penalty, in accordance with the provisions of section 33 of the State Assets Act.

7.3. General procedure for use and disposal of assets

7.3.1. The assets of the Foundation are used for the following:

7.3.1.1. attainment of the objectives and performance of the main tasks of the Foundation

7.3.1.2. covering of the current expenses and the remuneration of employees of the Foundation.

7.3.2. The use and disposal of the assets of the Foundation is decided by the Management Board of the Foundation in accordance with the Articles of Association and legislation.

7.3.3. The Foundation shall not grant loans to or secure the loans of the Founder or the member(s) of the Management Board or Supervisory Board of the Foundation, or persons with an equivalent economic interest, unless otherwise provided by law.

7.3.4. The state Foundation may not grant loans, secure any obligations of third parties, enter into deposit agreements with credit or financial institutions, or invest its funds in financial assets, including securities, unless this is authorised by the Articles of Association.

7.3.5. The Foundation may raise loans and enter into finance lease agreements only in accordance with a unanimous resolution of all the members of the Supervisory Board.

7.3.6. The Foundation may use its income only to achieve the objectives specified in its Articles of Association.

7.3.7. All of the Foundation’s income and expenditures are reflected in a balanced budget drawn up in conformity with the Foundation’s financial plan, with the budget position rules set out in section 6 of the State Budget Act, with the net debt rule set out in section 10 of the same Act, and with any restrictions established in accordance with section 11 of the same Act.

7.3.8. Each year, the Foundation draws up and presents, in accordance with the rules set out in section 12 of the State Budget Act, a financial plan to serve as a basis for the preparation of the Foundation’s budget.

8. REPORTING, INTERNAL CONTROL AND INTERNAL AUDIT

8.1. The financial year of the Foundation begins on 1 January and ends on 31 December.

8.2. Preparation, submission and approval of report

8.2.1. After the end of the financial year, the Management Board shall prepare the annual report and submit it to the auditor(s) for auditing. The Management Board shall submit the annual report along with the auditor’s (auditors’) report to the Supervisory Board for approval within four (4) months after the end of the financial year.

8.2.2. The Foundation shall submit a copy of the audited and approved annual report to the Ministry of Finance and to the National Audit Office within four (4) months following the end of the financial year. An overview of the work of the Supervisory Board in organising, managing and supervising the activities of the Foundation, together with the total of remuneration payments made to members of the Supervisory and Management Board during the financial year, is enclosed with the report.

8.2.3. The Foundation shall disclose its income statement, balance sheet and cash flow statement on its webpage once a quarter by the end of the month following the quarter, at the latest.

8.3. Auditor(s)

8.3.1. The Foundation has the auditor(s), who are appointed, whose number is established and whose procedure for remuneration is determined by the Supervisory Board, unless otherwise provided for in law. An auditor may be appointed to conduct a single audit or for a specified term.

8.3.2. The Founder is entitled to demand the carrying out of a special audit, and to use a structural unit of the agency managed by the Founder to carry out the audit.

8.4. Internal audit issues

8.4.1. The Foundation is under an obligation to ensure the functioning of the internal control system.

8.4.2. The Foundation shall create a position of an internal auditor or commission the services of an internal auditor from an audit firm, provided that, on the balance sheet date of the reporting year, the balance sheet total of the Foundation exceeds two million euros or the revenue of the reporting year exceeds two million euros.

8.4.3. The Foundation may forgo creating a position of an internal auditor or commissioning the services of an internal auditor if, in the view of the Supervisory Board, this may prove economically expedient. The corresponding resolution of the Supervisory Board must be previously endorsed by the Founder.

8.5. Audit Committee

8.5.1. An audit committee is formed at the Foundation, which is an advisory body of the Supervisory Board in the area of accounting, auditing, risk management, internal control and audit, exercise of supervision and budget preparation and legality of activities.

8.5.2. The members and chairman of an audit committee shall be elected and removed by the Supervisory Board on the basis of the following principles:

8.5.2.1. an audit committee shall have at least two members, at least two of whom shall be experts in accounting, finance or law. In order to elect a member of the audit committee, the written consent of the person is required;

8.5.2.2. an internal auditor, member of the Management Board, secretary general of a ministry or a person performing the audit shall not be a member of an audit committee;

8.5.2.3. the chairman of the Supervisory Board shall not be the chairman of an audit committee.

8.5.3. Members of an audit committee are remunerated on the grounds arising from the Auditors Activities Act.

9. AMENDMENT OF ARTICLES OF ASSOCIATION

9.1. Persons entitled to amend the Articles of Association:

9.1.1. the Articles of Association may only be amended by the resolution of the Founder;

9.1.2. if the Articles of Association of the Foundation must be amended due to changed circumstances, but the persons entitled to amend the Articles of Association fail to do so, a court may decide on amendment of the Articles of Association at the request of the Founder, the Supervisory Board or an interested person.

9.2. Restrictions on amendments:
the Founder may amend the Articles of Association only in order to take into account changed circumstances in accordance with the objectives of the Foundation.

10. MERGER, DIVISION OR DISSOLUTION

10.1. Merger and division

10.1.1. The Foundation may merge with another foundation by the Founder’s resolution in accordance with the State Assets Acts either as an acquiring foundation or as a foundation being acquired provided that such possibility is prescribed in the articles of association of the foundation acquiring the Foundation or of the foundation that is being acquired.

10.1.2. Pursuant to the State Assets Acts, the Foundation may, by the Founder’s resolution, divide into foundations and may only participate in the division of foundations provided that such possibility is prescribed in the articles of association of the foundations participating in the division.

10.1.3. The Foundation may only acquire or transfer a qualifying holding in a company and participate in the establishment of another foundation by the Founder’s resolution in accordance with the State Assets Acts.

10.1.4. The Foundation whose founders include the state only participates in a company whose activities are directly related to attaining the objective of the Foundation.

10.2. Dissolution

10.2.1. The Foundation may be dissolved:

10.2.1.1. by the resolution of the Founder in accordance with the State Assets Act;

10.2.1.2. on other grounds provided for in legislation.

10.3. Liquidation

10.3.1. The Foundation shall be liquidated (liquidation proceedings) upon dissolution, unless otherwise provided for in law.

10.3.2. The liquidators of the Foundation shall be appointed by the Supervisory Board.

10.3.3. The liquidators shall have the rights and obligations provided by law and the liquidation shall take place pursuant to the procedure provided by law. Liquidators shall deposit the documents of the Foundation with the Founder.

10.4. Distribution of assets

10.4.1. The assets remaining after the settlement of all the claims of creditors and the deposit of money in accordance with the liquidation proceedings are transferred to the Founder.

 

 

Translated by ESTONIAN-ENGLISH SWORN TRANSLATOR MARIKA BOROVIKOVA.

Appointed to office on 8 January 2015, professional certificate no. 39, issued on 27 January 2015.
Office: Küüni 5b, 2nd floor, 51004 Tartu, Estonia; Ahtri 6A, 10151 Tallinn, Estonia;
phone: +372 744 0088 (Tartu), +372 626 4281 (Tallinn); e-mail: dokumendid@luisa.ee;
website: www.luisa.ee.
Information about sworn translators: http://www.just.ee.
Chamber of Sworn Translators: http://www.vandetolgid.ee.

Translation registration number 605.
Tartu, 19 November 2018

This document consists of nineteen (19) numbered pages bound with string and an embossing seal.

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