Annual general meeting 2007

The Annual General Meeting of KONE was held Monday February 26, 2007.

The shareholders of KONE Corporation are hereby summoned to the Annual General Meeting to be held at the Finlandia Hall, address Mannerheimintie 13, Helsinki, Finland on Monday, 26 February 2007 at 11:00 a.m. Shareholder registration will begin at 10:00 a.m.
The meeting shall decide on the following matters:
1. Matters pertaining to the Annual General Meeting as stated in Article 13 of KONE’s Articles of Association and in Chapter 5 of Companies Act:
- presentation of the parent company and consolidated financial statements and Board of Directors´ Report ,as well as the auditors’ reports
- approval of the parent company and consolidated financial statements
- measures occasioned by the profit or loss according to the approved parent company´s and consolidated balance sheet
- granting of discharge from liability to the members of the Board of Directors and the President & CEO
- the number of members and deputy members of the Board of Directors and their remuneration
- the number of auditors and their remuneration
- election of the ordinary and possible deputy members of the Board of Directors and the auditors.
The financial statement for the financial year 2006 as well as the Board of Directors’ proposal for distribution of dividends was published on 26 January 2007. The Board of Directors proposes that a dividend of EUR 0.99 be paid for each 19 052 178 class A share and EUR 1.00 for each outstanding 106 675 697 class B share. If the Annual General Meeting approves the Board of Directors´ proposal for dividends, the date of record for dividend distribution is 1 March 2007 and dividends will be paid on 8 March 2007. KONE Corporation´s Compensation and Nomination Committee proposes that the number of Board Members, the Board Members and their remuneration be kept otherwise unchanged, but that the number of members be decreased from the current eight to seven and one deputy member be elected. Therefore the Board Members Antti Herlin, Sirkka Hämäläinen-Lindfors, Matti Alahuhta, Reino Hanhinen, Sirpa Pietikäinen, Masayuki Shimono and Iiro Viinanen would be re-elected to the Board and Jussi Herlin would be elected a new deputy member. Of the current Board Members Jean-Pierre Chauvarie would not be re-elected. KONE´s Audit Committee proposes that authorised public accountants PricewaterhouseCoopers and Heikki Lassila be elected as auditors.
2. Proposal by the Board of Directors to authorize the Board of Directors to decide to repurchase KONE’s own shares with assets distributable as profit:
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 12,785,000 shares may be repurchased, of which no more than 1,905,000 may be class A shares and 10,880,000 class B shares, taking into consideration the provisions of the Companies Act regarding the maximum amount of its 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. The minimum and maximum consideration for the shares to be purchased is determined for both class A and class B shares on the basis of the trading price for class B shares determined on the Helsinki Stock Exchange on the time of purchase.
The class A shares shall be purchased in proportion to the existing class A share 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 to purchase 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 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 non-restricted equity of the Company.
This authorization shall replace the authorization granted by the Annual General Meeting on 27 February 2006 and shall remain in effect for a period of one year from the date of the decision of the Annual General Meeting.
3. Proposal by the Board of Directors to authorize the Board of Directors to decide to distribute any shares repurchased by KONE:
The authorization is limited to a maximum of 1,905,000 class A shares and 10,880,000 class B shares. The Board of Directors is authorized to decide to whom and in which order the repurchased shares are 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 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 NASDAQ OMX Helsinki Ltd 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 NASDAQ OMX Helsinki Ltd.
This authorization shall replace the authorization granted by the Annual General Meeting on 27 February 2006 and shall remain in effect for a period of one year from the date of decision of the Annual General Meeting.
4. Proposal by the Board of Directors to authorize the Board of Directors to decide to grant option rights in deviation from the shareholders’ pre-emptive subscription right to key personnel of the group and to a wholly owned subsidiary of the company
On the basis of this authorization, the Board of Directors may decide to grant to the key personnel of the group or to the company’s wholly owned subsidiary, Kone Capital Oy, option rights, which entitle to subscribe a maximum of 2,000,000 new class B shares. The company has a weighty financial reason to grant option rights, because the option rights are intended to form a part of the group’s incentive and commitment plan for key personnel.
This authorization will remain in force for one year following the decision of the Annual General Meeting.
Information
KONE’s financial statements and the proposals by the Board of Directors concerning the authorizations to repurchase and distribute its own shares may be inspected by shareholders one week prior to the Annual General Meeting at KONE 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 Annual General Meeting, shareholders must be registered in the shareholders’ register maintained by the Finnish Central Securities Depository by 16 February 2007. Shareholders who have placed their shares in trust must contact their account operator in order for the shareholder to be temporarily re-registered in the shareholders’ register by 16 February 2007 in order to participate in the Meeting.
Notification of participation
A shareholder who wishes to attend the Meeting must notify the Company no later than 4:00 p.m. on 21 February 2007. Notification can be made:
- on KONE’s internet pages at www.kone.com/agm;
- by mail: KONE Corporation, Share register, PL 7, 02151 Espoo, Finland;
- by telefax: + 358 (0)204 75 4523; or
- by telephone: +358 (0)204 75 4548.
Shareholders are also requested to notify the Company of any proxies for the Annual General Meeting so that the proxies are in the Company’s possession by 21 February 2007.
Helsinki, 26 January 2007
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. List of votes
4. Election of person to check the minutes and persons to control the counting of the votes
5. Legitimacy and quorum of the meeting
6. Review of CEO & President and presentation of Financial Statements 2006 of both group and parent company including the Board Report as well as the Auditor’s report.
7. Approval of the Financial Statements, Income Statement, the Balance Sheet, the Consolidated Income Statement and Consolidated Balance Sheet
8. Decision of dividends in accordance with the approved Balance Sheet
9. Granting of discharge from liability for the Board Members and the CEO & President
10. Deciding on the number of the Members and deputy Members of the Board of Directors
11. Deciding on the remuneration payable to the Members and deputy Members of the Board
12. Election of the Board Members and, if necessary, deputy Members
13. Deciding on the number of the Auditors
14. Deciding on the Auditor remuneration
15. Election of the Auditors
16. Proposal by the Board of Directors to authorize the Board of Directors to decide to repurchase KONE’s own shares with assets distributable as profit
17. Proposal by the Board of Directors to authorize the Board of Directors to decide to distribute any shares repurchased by KONE
18. Proposal by the Board of Directors to authorize the Board of Directors to decide to grant option rights in deviation from the shareholders’ pre-emptive subscription right to key personnel of the group and to a wholly owned subsidiary of the company
19. Closing of the Meeting
Proposal by the Board of Directors to authorize the Board of Directors to decide to repurchase KONE’s own shares with assets distributable as profit
The Board of Directors proposes that Annual General Meeting authorizes the Board of Directors to decide to repurchase own shares with assets distributable as profit as follows:
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 12,785,000 shares may be repurchased, of which no more than 1,905,000 may be class A shares and 10,880,000 class B shares, taking into consideration the provisions of the Companies Act regarding the maximum amount of its 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. The minimum and maximum consideration for the shares to be purchased is determined for both class A and class B shares on the basis of the trading price for class B shares determined on the Helsinki Stock Exchange on the time of purchase.
The class A shares shall be purchased in proportion to the existing class A share 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 to purchase 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 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 non-restricted equity of the Company.
This authorization shall replace the authorization granted by the Annual General Meeting on 27 February 2006 and shall remain in effect for a period of one year from the date of the decision of the Annual General Meeting.
Proposal by the Board of Directors to authorize the Board of Directors to decide to distribute any shares repurchased by KONE
The Board of Directors proposes that Annual General Meeting authorizes the Board of Directors to decide to distribute own shares repurchased by KONE as follows:
The authorization is limited to a maximum of 1,905,000 class A shares and 10,880,000 class B shares. The Board of Directors is authorized to decide to whom and in which order the repurchased shares are 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 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 Helsinki Stock Exchange 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 Helsinki Stock Exchange.
This authorization shall replace the authorization granted by the Annual General Meeting on 27 February 2006 and shall remain in effect for a period of one year from the date of decision of the Annual General Meeting.
Proposal by the Board of Directors to authorize the Board of Directors to decide to grant option rights in deviation from the shareholders’ pre-emptive subscription right to key personnel of the group and to a wholly owned subsidiary of the company
The Board of Directors proposes that Annual General Meeting authorizes the Board of Directors to decide to grant option rights in deviation from the shareholders´ pre-emptive subscription right to key personnel and to wholly owned subsidiary Kone Capital Oy.
On the basis of this authorization, the Board of Directors may decide to grant option rights, which entitle to subscribe a maximum of 2,000,000 new class B shares. The company has a weighty financial reason to grant option rights, because the option rights are intended to form a part of the group’s incentive and commitment plan for key personnel.
This authorization will remain in force for one year following the decision of the Annual General Meeting.
Decisions taken by KONE Corporation's annual general meeting and Board of Directors
Matters relating to the annual general meeting
KONE Corporation’s Annual General Meeting was held in Helsinki on 26 February, 2007. The meeting approved the financial statements and discharged the responsible parties from liability for the financial period 1 January–31 December, 2006.
The Annual General Meeting approved dividends of EUR 0.99 for each of the 19,052,178 class A shares and EUR 1.00 for the 106,669,697 outstanding class B shares. The date of record for dividend distribution is 1 March, 2007, and dividends will be payable on 8 March, 2007. The rest of the distributable equity, EUR 1,146 million, will be retained and carried forward.
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. Jussi Herlin was elected as deputy Member. The term of the Board ends at the next Annual General Meeting.
The Annual General Meeting confirmed a monthly salary of EUR 4,000 for the Chairman of the Board, EUR 3,000 for the Vice Chairman, EUR 2,000 for Board Members and EUR 1,000 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.
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 12,785,000 shares may be repurchased, of which no more than 1,905,000 may be class A shares and 10,880,000 class B shares, taking into consideration the provisions of the Companies Act regarding the maximum amount of its 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’ 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 1,905,000 class A shares and 10,880,000 class B shares. The Board of Directors is authorized to decide to whom and in which order the repurchased shares are 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 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 Helsinki Stock Exchange (currently known as NASDAQ OMX Helsinki Ltd) 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 Helsinki Stock Exchange (currently know as NASDAQ OMX Helsinki Ltd).
These authorizations shall remain in effect for a period of one year from the date of decision of the Annual General Meeting. Precise information about the authorization to acquire and distribute own shares can be found in the invitation to the Annual General Meeting, which has been published on the KONE website at www.kone.com.
Authorization to decide to grant option rights in deviation from the shareholders’ pre-emptive subscription right to key personnel of the group and to a wholly owned subsidiary of the company
The Board of Directors’ proposal that the Annual General Meeting authorize the Board of Directors to grant option rights was approved. On the basis of this authorization, the Board of Directors may decide to grant to the key personnel of the group or to the company’s wholly owned subsidiary, Kone Capital Oy, option rights, which entitle to subscribe a maximum of 2,000,000 new class B shares. The company has a weighty financial reason to grant option rights, because the option rights are intended to form a part of the group’s incentive and commitment plan for key personnel.
This authorization will remain in force for one year following the 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 Chairman and Sirkka Hämäläinen-Lindfors as Vice Chairman.
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.
Presentation by the President & CEO