• discussion and approval of UNIPETROL’s annual report for the year 2005, including the discussion of the expected development of UNIPETROL’s operations in the year 2006 and the related matter of transferring UNIPETROL’s shareholding in KAUČUK, a.s. and SPOLANA a.s. to third parties,
• approval of the amendment to UNIPETROL’s articles of association so that the decision on strategic objectives and basic tasks of the long-term business plan of UNIPETROL and their modifications is vested to the shareholders’ general meeting, and
• approval of the removal of Mr. Miloslav Suchánek from his position of the member of UNIPETROL’s Supervisory Board and the election of Mr. Vlastimil Janeček to such position.

In its request and other communication delivered to UNIPETROL, Goldenfrazil alleges that, while selling its shares in KAUČUK and SPOLANA, UNIPETROL does not act in compliance with Czech law. In particular, Goldenfrazil asserts that:

(i)  Unipetrol’s minority shareholders are deprived of the opportunity to obtain information about UNIPETROL’s strategic objectives and plans;

(ii) the pending divestment processes of KAUČUK and SPOLANA are not conducted in a manner that would ensure their transparency and objectivity from the perspective of all UNIPETROL’s shareholders; and

(iii)  the pending divestment processes of KAUČUK and SPOLANA, if completed under the current terms, may result in a loss on the part of UNIPETROL.

The view of UNIPETROL’s Board of Directors in this respect is as follows:

UNIPETROL regularly provides all relevant information about its business activities and future prospects to all UNIPETROL’s shareholders and that all divestment processes, including the two pending divestment processes of KAUČUK and SPOLANA, are carried out in a transparent manner, comply with Czech law, follow the highest market standards and best practices and are lead to achieve the utmost benefit for UNIPETROL and its shareholders. This can be clearly demonstrated by the following facts:

(i) divestment processes of KAUČUK and SPOLANA were launched consistent with the 2005 Equity Story communicated to all UNIPETROL’s shareholders as well as the main strategic objectives and key targets within long-term activity plan of UNIPETROL presented at the shareholders’ general meeting on 13 April 2006 as tenders open to all eligible participants which are based on the principles of the equal treatment and non-discrimination of all participants;

(ii) in both divestment processes, the procedure of transparency has been applied with all steps fully documented. Assistance of reputable external financial and legal advisers in both processes is another element to the adopted procedure;

(iii) both divestment processes are managed by UNIPETROL’s Board of Directors with the assistance of external advisers and monitored at regular intervals and overseen by UNIPETROL’s Supervisory Board and its respective committees. The divestment processes will be approved by UNIPETROL’s Supervisory Board before their completion;

(iv) information about the two divestment processes was provided to the broad spectrum of potentially interested investors – in case of SPOLANA, the open tender allowed for unlimited number of participants, while in case of KAUČUK, 32 internationally recognized business-oriented bidders were invited to participate in the tender processes;

(v) offers submitted within both divestment processes by the bidders were evaluated diligently and with the maximum objectivity through the set of the pre-defined professional evaluation criteria, established in cooperation with the external advisers. Selection of the winning bidder is based on evaluation of parameters being the maximization of the proceeds from the divestments with the optimization of further relationship with the rest of UNIPETROL Group;

(vi) value of the divested shares in KAUČUK and SPOLANA was analyzed by external independent valuators and constitutes the benchmark for the parameters of the transactions;

(vii) amount of the purchase price for the divested shares in KAUČUK and SPOLANA offered by the selected bidder will also be confirmed by fairness opinions of reputable independent firms;

(viii) the value of the divested shares in KAUČUK and SPOLANA will be reconfirmed by independent Czech court-appointed experts;

(ix) both divestment processes will be evaluated by independent reputable firms in fairness opinions which will confirm that the divestment processes were conducted and performed up to the highest market standards and best practices; and

(x) UNIPETROL will provide, to the extent permitted by applicable Czech law, to all its shareholders relevant information concerning both divestment processes upon their completion.

In light of the above, UNIPETROL’s Board of Directors rejects all Goldenfrazil’s assertions stated in its request to convene the EGM and other communication as untrue, purpose-oriented and without merit.

Finally, the Board of Directors considers important to inform UNIPETROL’s shareholders that, according to the data published by the Czech National Bank, Goldenfrazil was a 3.58% shareholder of UNIPETROL only for one week starting from 16 August 2006 and ending on 23 August 2006 when Goldenfrazil reduced its shareholding back to zero. The fact that Goldenfrazil delivered its request to convene the EGM just one day before it disposed of its UNIPETROL shares casts serious doubt as to Goldenfrazil’s true business intention vis-à-vis UNIPETROL, its shareholders and other stakeholders.​