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Matters Relating to the Annual General Meeting
KONE Corporation’s Annual General Meeting was held in Helsinki on February 25, 2008. The meeting approved the financial statements and discharged the responsible parties from liability for the financial period January1–December 31, 2007.
The Annual General Meeting approved dividends of EUR 1.29 for each of the 19,052,178 class A shares and EUR 1.30 for the 106,955,663 outstanding class B shares. The date of record for dividend distribution is February 28, 2008, and dividends will be payable on March 6, 2008.
The number of Members of the Board of Directors was confirmed as seven and it was decided to elect one deputy Member. Re-elected as full Members of the Board were Matti Alahuhta, Reino Hanhinen, Antti Herlin, Sirkka Hämäläinen-Lindfors, Masayuki Shimono, Iiro Viinanen and Sirpa Pietikäinen and as deputy Member Jussi Herlin.
The Annual General Meeting confirmed an annual compensation of EUR 54,000 for the Chairman of the Board, EUR 42,000 for the Vice Chairman, EUR 30,000 for Board Members and EUR 15,000 for the deputy Member. In addition, a compensation of EUR 500 was approved for attendance at Board and Committee meetings.
Authorized public accountants Heikki Lassila and PricewaterhouseCoopers Oy were nominated as auditors.
Amendment of the Articles of Association
According to the Board of Directors’ proposal, the Annual General Meeting decided to amend the Articles of Association due to the new Companies Act, which entered into force on September 1, 2006. The new Articles of Association can be found at www.kone.com.
Share split, i.e. increasing the number of shares through a share issue without payment
The Annual General Meeting approved the Board of Directors’ proposal to increase the number of shares in the company by issuing new shares to the shareholders without payment in proportion to their holdings so that one class A share will be given for each class A share and one class B share will be given for each class B share. After the share issue, there will be a total of 38,104,356 class A shares and a total of 218,600,832 class B shares.
The share issue will be implemented in the book-entry system and does not require measures by the shareholders. The shareholders who are registered in the company’s shareholder register on the record date, February 28, 2008, are entitled to shares. New shares will produce shareholder rights as of the registration of the share issue, however, the new shares will not entitle their holders to the dividends to be decided in the General Meeting held on February 25, 2008.
The new shares are to be admitted to public trading and entered into the book-entry system on February 29, 2008.
Terms and Conditions for 2005A, 2005 B, 2005C and 2007 Option Rights
The General Meeting decided that the share subscription period for the 2005C option rights will begin on April 1, 2008. In addition, it was decided that EUR 0.25 of the subscription price to be paid for the new shares issued based on the 2005A, 2005B, 2005C, and 2007 option rights will be credited to the share capital, and that the remaining part will be credited to the paid-up unrestricted equity reserve. Due to the increase in the number of shares, the Annual General Meeting decided that the number of shares to be subscribed for based on the 2005A, 2005B, 2005C and 2007 option rights will increase, and the share subscription price will decrease in the same proportion. The terms and conditions for all option rights can be found at www.kone.com.
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. The shares may be repurchased in order to develop the capital structure of the Company, finance or carry out possible acquisitions, implement the Company’s share-based incentive plans, or to be transferred for other purposes or to be cancelled.
Altogether no more than 25,570,000 shares may be repurchased, of which no more than 3,810,000 may be class A shares and 21,760,000 class B shares.
In addition, the Board of Directors’ proposal that the Annual General Meeting authorize the Board of Directors to decide on the distribution of any shares repurchased by the company was approved. The authorization is limited to a maximum of 3,810,000 class A shares and 21,760,000 class B shares. The Board shall have the right to decide to whom to issue the shares, i.e. to issue shares in deviation of the pre-emptive rights of shareholders.
The repurchased shares may be used as compensation in acquisitions and in other arrangements as well as to implement the Company’s share-based incentive plans 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 in the OMX Nordic Exhange Helsinki for the purpose of financing possible acquisitions. The shares shall be distributed at least at the market price at the moment of their transfer determined on the basis of the trading price for class B shares determined in public trading in the OMX Nordic Exchange Helsinki.
These authorizations shall remain in effect for a period of one year from the date of decision of the Annual General Meeting.
Decisions by the Board of Directors
At its meeting held after the Annual General Meeting, the Board of Directors elected from among its members Antti Herlin as its Chair and Sirkka Hämäläinen-Lindfors as Vice Chair.
Antti Herlin was elected as Chairman of the Audit Committee. Sirkka Hämäläinen-Lindfors and Iiro Viinanen were elected as independent members of the Committee.
Antti Herlin was elected as Chairman of the Nomination and Compensation Committee. Reino Hanhinen and Sirkka Hämäläinen-Lindfors were elected as independent members of the Committee.
KONE is one of the world’s leading elevator and escalator companies. It provides customers with industry-leading elevators, escalators and innovative solutions for maintenance and modernization. KONE also provides maintenance services for automatic building doors. In 2007, KONE had annual net sales of EUR 4.1 billion and approximately 32,500 employees. KONE class B shares are listed on the OMX Nordic Exchange Helsinki in Finland. www.kone.com
For further information, please contact:
Jukka Ala-Mello, Secretary to the Board, tel. +358 (0)204 75 4226
Secretary to the Board of Directors
Senior Vice President,
Corporate Communications & IR