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ANNUAL GENERAL MEETING 2005

The Annual General Meeting of KONE was held Wednesday, 18 May, 2005.

  • The shareholders of KONE Corporation are hereby summoned to the Annual General Meeting of Shareholders to be held in the Helsinki Fair Centre, Congress Wing, at Messuaukio 1, 00520 Helsinki, Finland on Wednesday, 18 May, 2005 at 10.00 a.m. Shareholder registration will begin at 9:00 a.m.

    The meeting shall decide on the following matters pertaining to the Annual General Meeting as stated in Article 12 of the company's Articles of Association:

    1. The financial statement, which shall comprise the Income Statement, the Balance Sheet, and the Annual Report, as well as the consolidated financial statements comprising the Consolidated Income Statement and the Consolidated Balance Sheet;

    2. The Auditors' Report, as well as the Auditors' Report concerning the whole group of companies

    3. The approval of the Income Statement and the Balance Sheet, as well as the Consolidated Income Statement and the Consolidated Balance Sheet

    4. Any measures occasioned by the profit or loss according to the approved Consolidated Balance Sheet

    5. Granting release from liability to the members of the Board of Directors and to the President

    6. The number of members and alternate members of the Board of Directors, and their remunerations

    7. The number of Auditors and their remunerations

    8. Election of the Chairman of the Board of Directors and its other regular members and alternate members

    9. Election of the Auditors and their alternates.

    The financial statement for the extended accounting period 1 January, 2004 – 31 March, 2005 as well as the Board of Directors’ proposal for distribution of dividends will be published on 2 May, 2005. The distribution of dividends will occur in May prior to the demerger of KONE Corporation into new KONE Corporation and Cargotec Corporation on 31 May, 2005. The Nomination Committee and the Audit Committee propose that the current Board members and auditors will be re-elected and continue until the demerger of KONE Corporation.

    Information

    Copies of documents concerning the financial statements may be inspected by the shareholders one week prior to the Annual General Meeting at the Company headquarters at Kartanontie 1, Helsinki and on the Company’s internet site www.konecorp.com/agm.

    Right to participate

    In order to take part in the Annual General Meeting, shareholders must be registered in the shareholders’ register maintained by the Finnish Central Securities Depository by 6 May, 2005. Shareholders who have placed their shares in trust must temporarily re-register the shares in their own names by 6 May, 2005 in order to participate in the meeting.

    Notifying of participation

    A shareholder who wishes to participate in the Annual General Meeting must notify the Company not later than 4:00 p.m. on 13 May, 2005. Notification can be made by:

    • mail to: KONE Corporation, Share register, Kartanontie 1, 00330 Helsinki;
    • telefax: + 358 20 475 4309;
    • telephone: +358 20 475 4332 / Ulla Silvonen; or
    • completing the electronic registration form available at www.konecorp.com/agm

    Shareholders are also requested to notify the Company of any proxies for the Annual General Meeting so that they are in the Company’s possession by 13 May, 2005.

    Helsinki, 18 March, 2005
    THE BOARD OF DIRECTORS

  • KONE Corporation’s Annual General Meeting was held in Helsinki on 18 May, 2005. The meeting approved the financial statements and discharged the responsible parties from liability for the accounting period 1 January, 2004–31 March, 2005.

    The Annual General Meeting approved dividends of EUR 1.98 for each of the 9,526,089 class A shares and EUR 2.00 for the 54,228,666 outstanding class B shares. The date of record for dividend distribution is 23 May, 2005, and dividends will be payable on 30 May, 2005. The rest of the distributable equity, EUR 1 899 million, will be retained and carried forward.

    The number of members of the Board of Directors was confirmed at seven. Antti Herlin was re-elected as chairman of the Board. Re-elected as full members of the Board were Matti Alahuhta, Jean-Pierre Chauvarie, Sirkka Hämäläinen-Lindfors, Masayuki Shimono, Iiro Viinanen and Gerhard Wendt. The Chairman of the Board’s monthly salary was confirmed to be EUR 3,500 and Board members’ salaries to be EUR 2,000 per month, with the exception that Board members employed by KONE do not receive remuneration for serving on the Board.

    Authorized public accountants Jukka Ala-Mello and PricewaterhouseCoopers Oy were nominated as auditors with authorized public accountants Niina Raninen and Pasi Karppinen as deputies. The auditors’ fees will be paid upon invoicing.

    KONE will demerge on 1 June, 2005 into two new separately listed companies: KONE Corporation and Cargotec Corporation. The current Board members and auditors will continue in their positions until the demerger. The last trading day for shares and option rights of the demerging corporation is May 31, 2005. Trading in the shares and option rights of the companies to be established in the demerger will begin on 1 June 2005.

Extraordinary General Meeting June 17, 2005

The Extraordinarely General Meeting of KONE was held on Friday, 17 June, 2005.

  • The shareholders of New KONE Corporation (Business ID 1927400-1), to be established in connection with the demerger of Kone Corporation (Business ID 0110139-9), are hereby summoned to the Extraordinary Shareholders’ Meeting to be held at Merisali of Hotel Kalastajatorppa, address Kalastajatorpantie 1, Helsinki, Finland on Friday, 17 June, 2005 at 11.00 a.m. Shareholder registration will begin at 10:00 a.m.

    The meeting shall decide on the following matters:

    1. Addition to the Board of the Directors

    KONE Corporation’s Nomination Committee has proposed to the Extraordinary Shareholders’ Meeting, that the number of members to New KONE Corporation’s Board of Directors be raised to eight (8), and that the new member of the Board be Reino Hanhinen, (M.Sc. (Eng), D.Sc. (Tech.) h.c.). In accordance with the Demerger Plan, the other members of the Board are Matti Alahuhta, Jean-Pierre Chauvarie, Antti Herlin, Sirkka Hämäläinen-Lindfors, Masayuki Shimono, Gerhard Wendt and Iiro Viinanen.

    Reino Hanhinen, b. 1943, M.Sc. (Eng.), D.Sc. (Tech.) h.c., is the President and CEO of YIT Corporation since 1987 and Group CEO since 2000. He has held several positions in YIT Corporation since 1968. Hanhinen is a member of YIT's Board of Directors since 1988 and Chairman, 1989–2000.

    2. Proposal to authorize the Board of Directors of New KONE Corporation to decide to repurchase the Company’s own shares with assets distributable as profit as follows:

    The Company’s own repurchased shares shall be used as compensation in possible acquisitions and in other arrangements as well as to develop the Company’s capital structure.

    Altogether no more than 6,367,000 shares may be repurchased, of which no more than 952,000 are class A shares and 5,415,000 are class B shares, taking into consideration the provisions of the Companies Act regarding the maximum amount of own shares that the Company is allowed to possess. The proposed amount corresponds to nearly 10 per cent of the share capital of the Company and the total voting rights.

    The class A shares shall be purchased in proportion to the existing shareholdings at the price equivalent to the average price of class B shares paid in the Helsinki Stock Exchange at the time of purchase. Any holder who wants to offer his class A shares to the Company must state his intention in writing to the Board of Directors. The Company may deviate from the obligation of purchasing shares in proportion to the shareholding if all the holders of class A shares give their permission.

    Class B shares shall be purchased at public trading in the Helsinki Stock Exchange at the market price. The purchase price will be paid to the shareholders according to rules of the Helsinki Stock Exchange and the rules of the Finnish Central Securities Depository Ltd. The shares are not repurchased in proportion to the holdings of the shareholders as they are purchased in public trading.

    As the class B shares are to be purchased in public trading, no information on the effect on the shareholding and the division of voting rights is available before the purchase. The repurchase of shares decreases the free equity of the Company.

    This authorization shall remain in effect for a period of one year from the date of decision of the Extraordinary Shareholders’ Meeting.

    3. Proposal to authorize the Board of Directors of New KONE Corporation to decide to distribute any shares repurchased by the Company as follows:

    The authorization is limited to a maximum of 952,000 class A shares and 5,415,000 class B shares repurchased by the Company. The Board of Directors is authorized to decide to whom and in which order the repurchased shares will be distributed. The Board of Directors may decide on the distribution of repurchased shares otherwise than in proportion to the existing pre-emptive right of shareholders to purchase the Company’s own shares.

    The repurchased shares may be used as compensation in acquisitions and in other arrangements in the manner and to the extent decided by the Board of Directors. The Board of Directors has also the right to decide on the distribution of the shares in public trading in the Helsinki Stock Exchange to be used as compensation in possible acquisitions.

    The shares shall be distributed at least at the market price quoted for class B shares in the Helsinki Stock Exchange at the moment of their transfer.

    This authorization shall remain in effect for a period of one year from the date of decision of the Extraordinary Shareholders’ Meeting.

    Information

    Documents concerning the proposals to repurchase and distribute the Company’s own shares may be inspected by the shareholders one week prior to the Extraordinary Shareholders’ Meeting at the Company headquarters at Kartanontie 1, Helsinki and on the Company’s internet site www.konecorp.com/agm.

    Right to participate

    In order to take part in the Extraordinary Shareholders’ Meeting, shareholders must be registered in the shareholders’ register maintained by the Finnish Central Securities Depository by 7 June, 2005. Shareholders who have placed their shares in trust must temporarily re-register the shares in their own names by 7 June, 2005 in order to participate in the meeting.

    Notifying of participation

    A shareholder who wishes to participate in the Extraordinary Shareholders’ Meeting must notify the Company not later than 4:00 p.m. on 13 June, 2005. Notification can be made by:

    • Mail to: KONE Corporation, Share register, Kartanontie 1, 00330 Helsinki, Finland;
    • Telefax: + 358 20 475 4309;
    • Telephone: +358 20 475 4332 / Ulla Silvonen; or
    • Completing the electronic registration form available at www.konecorp.com/agm

    Shareholders are also requested to notify the Company of any proxies for the Extraordinary Shareholders’ Meeting so that they are in the Company’s possession by 13 June, 2005.

    Helsinki, 2 May, 2005

    The Board of Directors

  • KONE Corporation’s Extraordinary Shareholders’ Meeting was held in Helsinki on 17 June, 2005. The Shareholders’ Meeting decided upon the following items:

    1. Addition to the Board of the Directors

    The Extraordinary Shareholders’ Meeting decided to raise the number of members to KONE Corporation’s Board of Directors to eight, and elected Reino Hanhinen as the new member of the Board, in accordance with the Nomination Committee’s proposal. The other members of the Board are Antti Herlin (chairman), Sirkka Hämäläinen-Lindfors (vice chairman), Matti Alahuhta, Jean-Pierre Chauvarie, Masayuki Shimono, Gerhard Wendt and Iiro Viinanen.

    2. Authorization to Acquire and Distribute Own Shares

    The Board of Directors’ proposal that the Annual General Meeting authorize the Board of Directors to repurchase KONE’s own shares with assets distributable as profit was approved. Altogether no more than 6,367,000 shares may be repurchased, of which no more than 952,000 are class A shares and 5,415,000 are class B shares, taking into consideration the provisions of the Companies Act regarding the maximum amount of own shares that the Company is allowed to possess. The proposed amount corresponds to nearly 10 percent of the share capital of the Company and the total voting rights.

    In addition, the Board of Directors was authorized to decide to whom and in which order the repurchased shares will be distributed. The Board of Directors may decide on the distribution of repurchased shares otherwise than in proportion to the existing pre-emptive right of shareholders to purchase the Company’s own shares. The repurchased shares may be used as compensation in acquisitions and in other arrangements in the manner and to the extent decided by the Board of Directors. The Board of Directors also has the right to decide on the distribution of the shares in public trading on the Helsinki Stock Exchange to be used as compensation in possible acquisitions. The shares shall be distributed at least at the market price quoted for class B shares on the Helsinki Stock Exchange at the moment of their transfer.

    These authorizations shall remain in effect for a period of one year from the date of decision of the Extraordinary Shareholders’ Meeting. Precise information about the authorization to acquire and distribute own shares can be found in the invitation to the Extraordinary Shareholders’ Meeting, which has been published on the KONE website at www.kone.com.

Extraordinary General Meeting June 17, 2005

The Extraordinary General Meeting of KONE was held on Monday November 21, 2005.

  • The shareholders of KONE Corporation are hereby summoned to the Extraordinary Shareholders’ Meeting to be held at Helsinki Fair Centre, address Messuaukio 1, Helsinki, Finland on Monday, 21 November, 2005 at 2.00 p.m. Shareholder registration will begin at 1:00 p.m.

    Matti Alahuhta, President of KONE, will start the meeting with a business review, after which the meeting shall decide on the following matters:

    1. The Board’s proposal for a share split

    The Board proposes that, in order to improve share liquidity, the number of the company’s shares be increased in proportion to the holdings of the shareholders by doubling the number of shares from 63,867,465 to 127,734,930 shares without increasing the share capital. The number of class A shares will increase to 19,052,178 and the number of class B shares to 108,682,752. As a result, each share with the current accounting par value of EUR 1.00 will be split into two shares with accounting par values of EUR 0.50.

    These share amounts include 42,180 new class B shares subscribed for with KONE 2005 option rights in October. The increase in the company’s share capital will be registered on or about 26 October, 2005.

    2. The Board’s proposal to amend the terms of the KONE 2005 Option Plan

    The Board proposes that in the event that the Extraordinary Shareholders’ Meeting approves the share split, the number of shares that can be subscribed for with KONE 2005A and 2005B option rights be increased in proportion to the split. The total accounting par value of shares to be subscribed and the total subscription price remain unchanged. As a result, one option right will entitle to subscription for six (6) class B shares to a price of EUR 8.04 per share.

    3. The Board’s proposal to issue new option rights to key personnel of the KONE Group as well as to a wholly-owned subsidiary of KONE Corporation.

    It is proposed that the shareholders’ pre-emptive subscription rights be deviated from since the option rights are to form a part of the incentive and commitment program for key personnel. In the event that the Extraordinary Shareholders’ Meeting approves the share-split proposal by the Board of Directors, the maximum number of option rights issued will be 2,000,000. One option right will entitle the holder to subscription of one KONE Corporation class B share and, in total, to subscription of a maximum of 2,000,000 shares. The option rights will be marked with the symbol 2005C.

    The share subscription price for 2005C option rights shall be the trade volume weighted average price of the KONE Corporation B share on the Helsinki Stock Exchange between 24 October 2005 and 18 November 2005. After the subscription price has been determined and up until the time of share subscription, the amount of KONE Corporation’s dividend shall be deducted from the subscription price as per the dividend record date.

    The share subscription period for 2005C option rights shall be 1 April 2008–30 April 2010. However, the share subscription period begins only if following criteria have been attained: the average turnover growth of the KONE Group for financial years 2006 and 2007 exceeds market growth and the Earnings before Interest and Taxes (EBIT) of the KONE Group for the financial year 2006 exceeds the EBIT for the financial year 2005 and the EBIT for the financial year 2007 exceeds the EBIT for the financial year 2006. If the above mentioned criteria have not been attained, stock options 2005C expire in the manner decided by the Board of Directors.

    As a result of subscriptions with 2005C option rights, the share capital of KONE Corporation can increase by a maximum of EUR 1,000,000 and the number of B shares by a maximum of 2,000,000 new class B shares.

    Information

    Documents concerning the proposals for the increase in the number of shares, the amendment of the terms of KONE 2005 option plan and the issuance of new option rights may be inspected by the shareholders one week prior to the Extraordinary Shareholders’ Meeting at the Company headquarters at Kartanontie 1, Helsinki and on the Company’s internet site at www.kone.com/agm. Copies of the documents will be sent to shareholders upon request, and they will also be available at the Meeting.

    Right to participate

    In order to take part in the Extraordinary Shareholders’ Meeting, shareholders must be registered in the shareholders’ register maintained by the Finnish Central Securities Depository by 11 November, 2005. Shareholders who have placed their shares in trust must temporarily re-register the shares in their own names by 11 November, 2005 in order to participate in the meeting.

    Notification of participation

    A shareholder who wishes to attend the Meeting must notify the Company not later than 4:00 p.m. on 16 November 2005. Notification can be made:

    • Through KONE’s internet pages at www.kone.com/agm;
    • By mail to: KONE Corporation, Share register, Kartanontie 1, 00330 Helsinki, Finland;
    • By telefax: + 358 20 475 4309; or
    • By telephone: +358 20 475 4332.

    Shareholders are also requested to notify the Company of any proxies for the Extraordinary Shareholders’ Meeting so that the proxies are in the Company’s possession by 16 November, 2005.

    Helsinki, 24 October, 2005

    The Board of Directors

  • At the General Meeting, the following matters will be considered:

    1. Opening of the meeting

    2. Election of chairman and secretary for the meeting

    3. Election of one person to audit the minutes

    4. Legitimacy and quorum of the meeting

    5. List of votes

    6. Business review, Matti Alahuhta, President

    7. The Board’s proposal for a share split

    8. The Board’s proposal to amend the terms of KONE 2005 Option Plan

    9. The Board’s proposal to issue new option rights to key personnel of the KONE Group as well as to a wholly-owned subsidiary of KONE Corporation

    10. Other possible matters

    11. Closing of the Meeting

  • The Board's proposal for a share split (item 7 on the Agenda)

    The Board proposes that, in order to improve share liquidity, the number of the company’s shares be increased in proportion to the holdings of the shareholders by doubling the number of shares from 63,867,465 to 127,734,930 shares without increasing the share capital. The number of class A shares will increase to 19,052,178 and the number of class B shares to 108,682,752. As a result, each share with the current accounting par value of EUR 1.00 will be split into two shares with accounting par values of EUR 0.50.

    The Board’s proposal to amend the terms of the KONE 2005 Option Plan (item 8 on the Agenda)

    The Board proposes that, in the event that the Extraordinary Shareholders’ Meeting approves the share split, the number of shares that can be subscribed for with KONE 2005A and 2005B option rights be increased in proportion to the split. The total accounting par value of shares to be subscribed and the total subscription price remain unchanged. As a result, one option right will entitle to subscription for six (6) class B shares to a price of EUR 8.04 per share. KONE 2005 Option Plan is based on the option plan of the demerged Kone Corporation which was introduced by the extraordinary shareholders' meeting in November 2000. In connection with the demerger of Kone, the option rights were exchanged to new option rights of the new companies established in the demerger.

    The Board’s proposal to issue new option rights to key personnel of the KONE Group as well as to a wholly-owned subsidiary of KONE Corporation (item 9 on the Agenda)

    See the stock exchange release from 24 October 2005 for more information.

    Statement of the Board of Directors on events occurred after the interim accounts 6-9/2005 significantly affecting the position of the corporation

    On 10 October, 2005 KONE Corporation received a Statement of Objections from the European Commission concerning its investigation of localized anticompetitive practices in the elevator and escalator industry in Belgium, Germany, Luxemburg and the Netherlands. KONE has fully cooperated with the European Commission since the initiation of the investigation in January 2004. The company is now analyzing the Statement of Objections and will submit its reply to the Commission in due course.

    On 21 October, 2005 the Board of Directors proposed to convene an Extraordinary Shareholders’ Meeting to decide on, in order to improve share liquidity, increase in the number of the company’s shares in proportion to the holdings of the shareholders by doubling the number of shares. As a result, each share with the current accounting par value of EUR 1.00 will be split into two shares with accounting par values of EUR 0.50.

    24 October, 2005

    BOARD OF DIRECTORS

    Auditors' Statement

    To the General Meeting of KONE Corporation

    Pursuant to Chapter 4, Section 12 b, Paragraph 1, and Section 4 a, Paragraph 1, Subparagraph 4 and Paragraph 2 in the Companies' Act we, as auditors of KONE Corporation, state on the proposal dated 24 October 2005 of the Board of Directors to the Extraordinary General Meeting to issue stock options that, in our opinion:

    the interim report 1.6.-30.9.2005 published during the financial period 1.6.-31.12.2005 has been prepared in accordance with the rules and regulations governing the preparation of an interim report;

    the statement dated 24 October 2005 of the Board of Directors defined in the Companies' Act Chapter 4, Section 4 a, Paragraph 1, Subparagraph 3 on the events occurred after the interim report 1.6.-30.9.2005 significantly affecting the position of KONE Corporation has been prepared in accordance with the prevailing rules and regulations; and

    the proposal dated 24.10.2005 of the Board of Directors gives a true and fair view concerning the basis for determining the subscription price and the reasons for deviation from the shareholders' pre-emptive rights to the subscription.

    Helsinki, October 24, 2005

    PricewaterhouseCoopers Oy

    Authorised Public Accountants

    Jouko Malinen

    Authorised Public Accountant

    Jukka Ala-Mello

    Authorised Public Accountant

  • KONE Corporation’s Extraordinary Shareholders’ Meeting was held in Helsinki on 21 November, 2005. The Shareholders’ Meeting decided upon the following items:

    1. Share split

    The Shareholders’ Meeting approved the Board proposal that the number of the company’s shares be increased in proportion to the holdings of the shareholders by doubling the number of shares from 63,867,465 to 127,734,930 shares without increasing the share capital. The number of class A shares will increase to 19,052,178 and the number of class B shares to 108,682,752. As a result, each share with the current accounting par value of EUR 1.00 will be split into two shares with accounting par values of EUR 0.50.

    The increase in the number of shares is expected to be entered into the Trade Register on Monday 28 November, 2005. Trading of the split shares will start on Tuesday 29 November, 2005.

    2. Amending the terms of the KONE 2005 Option Plan

    The Board proposal that the number of shares that can be subscribed for with KONE 2005A and 2005B option rights be increased in proportion to the split was approved. The total accounting par value of shares to be subscribed and the total subscription price remain unchanged. As a result, one option right will entitle to subscription for six (6) class B shares to a price of EUR 8.04 per share.

    3. Issuing new option rights to key personnel of the KONE Group as well as to a wholly-owned subsidiary of KONE Corporation

    The Shareholders’ Meeting approved the Board proposal to issue new option rights to key personnel of the KONE group as well as to a wholly-owned subsidiary of KONE Corporation. The option program will include a maximum of 300 key employees and subsidiary directors globally. Some of the personnel included in the program belong to the inner circle of the company. These persons currently own a maximum of 0.1 percent of the shares and 0.04 percent of the voting rights in the company. The company’s CEO, President and members of the executive board are not included in the program.

    The shareholders’ pre-emptive subscription rights will be deviated from since the option rights are to form a part of the incentive and commitment program for key personnel. The maximum number of option rights issued will be 2,000,000. One option right will entitle the holder to subscription of one KONE Corporation class B share and, in total, to subscription of a maximum of 2,000,000 shares. The option rights will be marked with the symbol 2005C.

    The share subscription price for 2005C option rights is the trade volume weighted average price of the KONE Corporation B share on the Helsinki Stock Exchange between 24 October 2005 and 18 November 2005, which was EUR 28.40 (split adjusted). The amount of KONE Corporation’s dividend paid after the determination of the subscription price shall be deducted from the subscription price up until the time of share subscription, as per the dividend record date.

    The share subscription period for 2005C option rights shall be 1 April 2008–30 April 2010. However, the share subscription period will begin only if the following criteria have been attained: the average net sales growth of the KONE Group for financial years 2006 and 2007 exceeds market growth and the Earnings before Interest and Taxes (EBIT) of the KONE Group for the financial year 2006 exceeds the EBIT for the financial year 2005 and the EBIT for the financial year 2007 exceeds the EBIT for the financial year 2006. If the above-mentioned criteria have not been attained, stock options 2005C expire in the manner decided by the Board of Directors.

    As a result of subscriptions with 2005C option rights, the share capital of KONE Corporation can increase by a maximum of EUR 1,000,000 and the number of B shares by a maximum of 2,000,000 new class B shares.

    The complete terms and conditions of the option program are available in the Investors section of KONE’s Corporate website www. kone.com.

Shareholders’ Meeting of Demerged KONE Corporation

  • Decisions of the Shareholders' Meeting of Demerged Kone Corporation, Determination of the Acquisition Cost of KONE and Cargotec Shares, and Publication of KONE’s Interim Report

    A Shareholders' Meeting of the demerged Kone Corporation (business ID 0110139-9) was held in Helsinki on 7 September 2005. The meeting approved the final settlement of the demerger and the financial statements and the consolidated financial statements for the period 1 April 2005-31 May 2005 included therein. The Shareholders' Meeting discharged the members of the Board of Directors and the President from liability for the period 1 April 2005-31 May 2005.

    The proportion of net assets transferred to new KONE and Cargotec according to the final settlement approved by the Shareholders’ Meeting is as follows:
    KONE Corporation: 45.08%
    Cargotec Corporation: 54.92%

    According to the advance ruling from the Finnish Central Board of Taxation, the acquisition cost of new KONE and Cargotec shares is considered to be the part of the acquisition cost of Kone Corporation’s shares that corresponds to the proportion of the net assets of Kone Corporation transferred to new KONE and Cargotec. If it is apparent that the proportion of the net assets of new KONE and Cargotec substantially differs from the proportion of the current values of new KONE and Cargotec shares, the proportion of the current values is used as the basis for dividing the acquisition cost between the shares. On 9 June 2005, an announcement was made concerning the proportion of the current values, which was:

    Proportion based on first day’s average weighted trading price:
    KONE Corporation: 64.49%
    Cargotec Corporation: 35.51%

    Proportion based on first five days’ average weighted trading price:
    KONE Corporation: 64.66%
    Cargotec Corporation: 35.34%

    The final determination of the acquisition cost will be made by the tax authority of the shareholder.

    As a consequence of the demerger coming into effect on 1 June 2005, KONE Corporation’s first financial reporting period is 1 June, 2005-31 December 2005. Accordingly, the Corporation should have produced interim reports for periods ending in August and November. The Finnish Financial Supervision Authority has granted KONE Corporation an exception, allowing KONE to publish its interim report for June-September 2005 so that it includes the 3-month information for the July-September period. As indicated in previously published plans, the interim report for June-September 2005 and the pro forma review for January-September 2005 will be published on 21 October, 2005.