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Affects of the proposed demerger plan and extended accounting period on KONE 2004 option rights

Stock Exchange Release Published 01/11/2004

Affects of the proposed demerger plan and extended accounting period on KONE 2004 option rights

According to the terms of the KONE 2004 option program, KONE B shares can be subscribed with option rights annually from 2 January to 30 November on the dates separately defined by the board of directors. In respect of the A option rights the subscription period commenced on 1 April, 2004 and ends on 31 March, 2008. The subscription period for the B option rights commences on 1 April, 2005 and ends on 31 March, 2009. The option rights have been entered into the book-entry system and the A option rights were listed on the main list of the Helsinki Exchanges on 1 April, 2004. The B option rights are estimated to be listed on 1 April, 2005.
Based on the terms of the option rights, the board of directors has decided to allow subscription of shares with option rights also from 1 December, 2004 to 30 December, 2004 due to the proposed extension of the accounting period to 31 March, 2005. Subscription will, however, not be allowed one month prior to the end of the accounting period, from 1 March, 2005 to 31 March, 2005. The board will accept share subscriptions made in January and February, 2005 and these shares will qualify for dividend payment for the extended financial year. Other rights related to the shares shall commence on the date when the increase in the share capital is entered in the Trade Register.
The board has also decided that if an extra-ordinary shareholder’s meeting approves the proposed demerger plan, share subscriptions will not be allowed one month prior to the estimated demerger date 31 May, 2005, or from 1 May, 2005 to 31 May, 2005.
The share subscription price of 24.67 euros based on the terms of the KONE 2004 option program is to be divided between the two corporations formed in the demerger, KONE Corporation and Cargotec Corporation, option rights and recalculated to reflect the market value of KONE Corporation and Cargotec Corporation at the time of their listing. The market value to be used in recalculating the new subscription price is the trade volume weighted average price of the first six (6) trading days of New KONE shares and Cargotec shares, excluding the first trading day. The subscription price of New KONE and Cargotec shares is anticipated to be disclosed on 13 June, 2005.
According to the demerger plan, the subscription period for shares in New KONE and Cargotec will commence on 13 June, 2005. The subscription period is subject to the execution of the demerger on 31 May, 2005.
The terms of the KONE 2004 option program and the terms for the new option programs of New KONE and Cargotec can be found in the appendices of the demerger plan which was signed on 1 November, 2004.
Sender:
KONE Corporation
Tapio Hakakari
Director, secretary to the Board of Directors
Minna Mars
Senior Vice President, Corporate Communications & IR
For further information, please contact:
Tapio Hakakari, Director, secretary to the Board of Directors, tel. +358 (0)204 75 4226
www.konecorp.com

2004-11-01 Affects of the proposed demerger plan and extended accounting period on KONE 2004 option rights

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