2007-02-26 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 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.

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.

Sender:

KONE Corporation

Jukka Ala-Mello
Secretary to the Board of Directors

Minna Mars
Senior Vice President,
Corporate Communications & IR

For further information, please contact:

Minna Mars, SVP, Corporate Communications & IR, tel. +358 (0)204 75 4501

KONE is one of the world’s leading elevator and escalator companies. It provides its customers with industry-leading elevators and escalators and innovative solutions for their maintenance and modernization. KONE also provides maintenance of automatic building doors. In 2006, KONE had annual net sales of EUR 3.6 billion and about 29,000 employees. Its class B shares are listed on the Helsinki Stock Exchange in Finland.