Kesko Corporation's Annual General Meeting today adopted the
financial statements for 2006 and discharged the Board of
Directors' members and the Managing Director from liability. The
Annual General Meeting also decided to distribute €1.50 per share
as dividends, as proposed by the Board of Directors. In addition,
the Annual General Meeting approved the Board of Directors'
proposals to amend the Articles of Association, to authorise the
Board to issue shares and to grant stock options. A total of some
717 shareholders attended the Annual General Meeting.
The Annual General Meeting handled the matters that fall under its
authority and the other matters listed below.
Decisions of the Annual General Meeting
Adoption of financial statements
The Annual General Meeting adopted Kesko Corporation's financial
statements for 2006 which include consolidated financial
statements.
Use of profit
In accordance with the Board of Directors' proposal, the Annual
General Meeting decided to pay a dividend of €1.50 per share on
Kesko Corporation's shares, or a total amount of €146,314,669.50.
The record date for dividend distribution is 29 March 2007 and the
pay date is 5 April 2007.
The dividends shall be paid to shareholders registered in the
Kesko Corporation's register of shareholders kept by the Finnish
Central Securities Depository Ltd on the record date for dividend
distribution, 29 March 2007. Because the registration practice
takes three banking days, the dividends shall be paid to those who
hold the shares at the end of 26 March 2007, the date of the
Annual General Meeting. Consequently, dividends on shares traded
on the date of the Annual General Meeting shall be paid to buyers.
Further in accordance with the Board of Directors' proposal for
profit distribution, €300,000.00 were reserved for charitable
donations at the discretion of the Board of Directors.
€736,663,528.42 were left in non-restricted equity.
Discharge from liability
The Annual General Meeting discharged the Board of Directors'
members and the Managing Director from liability for the financial
year 2006.
Board of Directors
The Annual General Meeting decided to leave the number of Board
members unchanged at seven (7).
The members of the Board of Directors elected by the Annual
General Meeting of 27 March 2006 are retailer Pentti Kalliala,
Ilpo Kokkila, Executive Vice President Maarit Näkyvä, Seppo
Paatelainen, Keijo Suila, retailer Jukka Säilä and retailer Heikki
Takamäki. The term of office of each Board member, in accordance
with the Articles of Association, is three (3) years with the term
starting at the close of the General Meeting electing the member
and expiring at the close of the third (3rd) Annual General
Meeting after the election (in 2009).
The Annual General Meeting decided to leave the Board members'
fees unchanged. The Board members' fees confirmed by the Annual
General Meeting are as follows:
Monthly fees:
fee/m
o, €
Chairman of the Board of 5,000
Directors
Deputy Chairman of the 3,500
Board of Directors
Board member 2,500
Meeting fees:
fee/meet
ing, €
Fee for a Board of 500
Directors' meeting
Fee for a Committee 500
meeting
Fee to the Committee 1,000
Chairman for a
Committee meeting,
unless he/she also
acts as Chairman or
Deputy Chairman
of the Board of
Directors
In addition, daily allowances and compensation for travelling
expenses are paid to the members of the Board of Directors and
those of the Board of Directors' Committees in accordance with the
general travel rules of Kesko.
Auditor
The auditor elected for the company by the Annual General Meeting
is Authorised Public Accountants PricewaterhouseCoopers Oy, with
Pekka Nikula, B.Sc. (Econ.), APA, as the auditor with principal
responsibility. The auditor's fee and compensation are paid as per
invoice.
Board of Directors' proposal to amend the Articles of Association
The Annual General Meeting approved as proposed the Board of
Directors' proposal to amend the Articles of Association. The
company's new Articles of Association are attached to this release
(Appendix 1).
Board of Directors' proposal to authorise the Board to issue
shares
The Annual General Meeting approved the Board of Directors'
proposal to authorise the Board to issue shares as proposed. The
share issuance authorisation approved for the Board is attached to
this release (Appendix 2).
Board of Directors' proposal to grant stock options
The Annual General Meeting approved the Board's proposal to grant
stock options as proposed. The terms and conditions of the stock
option scheme are attached to this release (Appendix 3).
Shareholder's proposal to amend the Articles of Association
The Annual General Meeting rejected the proposal of shareholder
FIM Maltti Erikoissijoitusrahasto to add new subsections 3-7 to §4
of the Articles of Association in force before the Annual General
Meeting.
Effect of the dividend on Kesko Corporation's option schemes
The dividend decided by the Annual General Meeting reduces the
subscription prices of shares subscribed for with the 2003D, 2003E
and 2003F stock options of Kesko Corporation's year 2003 scheme in
accordance with the terms and conditions of the scheme.
As from 29 March 2007, the record date for the payment of
dividends, the prices of new B shares subscribed for with the
above stock options shall be as follows:
Opti ISIN B share Exercise Trading
on code subscription period symbol
price
2003 FI000960 €3.03 1.4.2005- KESBVEW10
D 9317 30.4.2008 3
2003 FI000960 €10.59 1.4.2006- KESBVEW20
E 9325 30.4.2009 3
2003 FI000960 €16.48 1.4.2007- KESBVEW30
F 9333 30.4.2010 3
The Board of Directors' proposals to the Annual General Meeting
were published in a stock exchange release on 6 February 2007. The
notice of the Annual General Meeting was also published in a stock
exchange release on 27 February 2007.
Further information is available from Corporate Executive Vice
President Juhani Järvi, telephone +358 1053 22209.
Kesko Corporation
Harri Utoslahti
Communications Manager
DISTRIBUTION
Helsinki Stock Exchange
Main news media
APPENDICES
Appendix 1 (Translation)
KESKO CORPORATIONS' ARTICLES OF ASSOCIATION
§1
Company name and domicile
The company name is Kesko Oyj, which is Kesko Abp in Swedish,
Kesko Corporation in English and Kesko AG in German.
The company domicile is Helsinki.
§2
Line of business
The company acts as the parent company of the Kesko Group and
conducts the operations specified later both by itself and through
subsidiaries and joint ventures.
The company carries on wholesale trade in consumer goods and
capital goods. The company has consumer goods and other products
made for it, and acts as an intermediary for raw materials,
machines and equipment. The company also engages in distribution,
forwarding, department store trade and other retail trade and
restaurant business.
The company provides services which support entrepreneurial-based
retail trade in particular. The company develops business and co-
operation concepts for the retail trade, arranges the building of
business premises and information management systems and sells and
leases them, and acts as an intermediary for the products and
services needed in retail trading.
The company engages in real estate and securities investment, as
well as other investment activity. The company can also carry out
other operations related to the business operations specified in
this section.
§3
Shares
The company has A shares and B shares. Concerning A shares the
minimum number is one (1) and the maximum number two hundred and
fifty million (250,000,000), while concerning B shares the minimum
number is one (1) and the maximum number two hundred and fifty
million (250,000,000), provided that the total number of shares is
at minimum two (2) and at maximum four hundred million
(400,000,000).
Each A share entitles the holder to ten (10) votes and each B
share to one (1) vote.
The company's shares are included in the book-entry securities
system.
§4
Board of Directors
The company has a Board of Directors, which is responsible for
company management and the appropriate organisation of operations.
The Board of Directors is formed of at least five (5) but no more
than eight (8) members.
The term of the Board of Directors' members is three (3) years so
that the term begins at the close of the General Meeting electing
the members and expires at the close of the third (3rd) subsequent
Annual General Meeting.
The Board of Directors elects a Chairman from among its members.
The Board of Directors meets at the Chairman's request. The Board
has a quorum when more than a half (1/2) of its members are
present. If the votes are evenly divided, the opinion with which
the Chairman agrees shall become the decision.
§5
Managing Director
The company has a Managing Director who is the Chief Executive
Officer.
§6
Auditor
The company has one (1) auditor who shall be a firm of auditors
authorised by the Central Chamber of Commerce.
The term of the auditor is the company's financial period and the
auditor's duties terminate at the close of the Annual General
Meeting following the election.
§7
Right of representation
The members of the Board of Directors, and the persons authorised
by the Board of Directors, are entitled to sign for the company,
always two (2) jointly.
§8
Financial period
The company's financial period is the calendar year.
§9
Notice of meeting
An invitation to a General Meeting shall be given to shareholders
by means of an announcement which shall be published in at least
two (2) national newspapers. The announcement shall be published
at the earliest two (2) months and at the latest one (1) week
before the date referred to in § 2.2 of chapter 4 of the Finnish
Companies Act.
To have the right to attend a General Meeting, shareholders shall
register with the company not later than on the date stated in the
announcement of the meeting, which date may not be earlier than
ten (10) days prior to the meeting.
§10
Annual General Meeting
The Annual General Meeting shall be held by the end of June each
year. The following matters shall be on the agenda of the meeting:
Presentation of:
1. the financial statements including the consolidated
financial statements, and the annual report
2. the audit report;
Decisions on:
3. the adoption of the financial statements;
4. the use of the profit shown in the balance sheet;
5. the discharge from liability of the members of the Board
of Directors and the Managing Director;
6. the fees and the basis for the reimbursement of expenses
to the members of the Board of Directors and the auditors;
7. the number of the Board of Directors' members;
Election of:
8. the members of Board of Directors when needed and
9. the auditor.
Appendix 2 (Translation)
THE BOARD OF DIRECTORS' SHARE ISSUE AUTHORISATION
The maximum number of shares issued
By virtue of authorisation, the Board of Directors is authorised
to decide about the issuance of up to 20,000,000 new B shares. The
shares will not have a nominal value.
Issue for consideration
New B shares can only be issued against payment ("Issue for
consideration").
Subscription right and directed issue
The new shares can be issued:
· to the company's existing shareholders in proportion to
their existing shareholdings regardless of whether they consist of
A or B shares; or,
· in a directed issue deviating from shareholders' pre-
emptive rights in order for the issued shares to be used as
consideration in possible company acquisitions, other company
business arrangements, or to finance investments.
The company must have a weighty financial reason for deviating
from pre-emptive rights.
Subscription price and its recognition in the balance sheet
The Board of Directors decides about the subscription price of the
issued shares.
The Board of Directors also has the authority to issue shares
against non-cash consideration.
The subscription price is recognised in the reserve of invested
non-restricted equity.
Validity of authorisation
The share issue authorisation will be valid for two (2) years
after the decision by the General Meeting.
Other terms
The Board of Directors shall make decisions concerning any other
matters relating to share issues.
Appendix 3
KESKO CORPORATION'S STOCK OPTION SCHEME 2007 TERMS AND CONDITIONS
I STOCK OPTION TERMS AND CONDITIONS
1. Number of stock options
Kesko Corporation ("the Company") shall grant a maximum of
3,000,000 options which entitle to subscribe for a maximum number
of 3,000,000 new Company B shares in aggregate.
2. Stock options
1. Of the stock options 1,000,000 shall be marked with the symbol
2007A, 1,000,000 with the symbol 2007B and 1,000,000 with the
symbol 2007C.
2. The stock options shall be issued in the book-entry securities
system.
3. Granting stock options
1. As decided by the Board of Directors, the stock options shall
be granted for no consideration to the management of the Company
and the other Group companies ("Kesko"), and to the rest of the
key Kesko personnel ("Option recipients").
2. To Sincera Oy ("Sincera"), a wholly owned subsidiary of the
Company, shall be granted those options which, by virtue of the
Board of Directors' decision, shall not be granted to the Option
recipients. The Company's Board of Directors shall decide about
granting options first granted to Sincera, or options returned to
it, to Option recipients employed by Kesko or to be hired by
Kesko.
3. At the issuing stage, all 2007B and 2007C options, and those of
2007A options not granted to Option recipients, shall be granted
to Sincera.
4. The Company shall notify Option recipients about their
eligibility in writing. Options shall be granted as soon as the
Option recipient has accepted the offer made by the Company.
5. Since the options are intended to be part of Kesko's share-
based incentive system, the Company has a statutory weighty
financial reason for granting options.
4. Transferability of options and obligation to offer options
1. The options for which the share subscription period specified
at Section II.2 has not begun must not be transferred to a third
party or pledged. The stock options are freely transferable after
the relevant share subscription period has begun. In case an
Option recipient transfers his or her stock options, he or she is
obliged to inform the Company without delay about the transfer in
writing. The above notwithstanding, the Board of Directors may
accept the transfer of stock options even prior to such date.
2. If an Option recipient ceases to be employed by the Kesko
Group, for any reason other than his or her death, he or she must
without delay offer, with no consideration, to the Company or to a
party ordered by the Company, those stock options which were not
exercisable by virtue of Section II.2 on the last day of his or
her employment. However, the Board of Directors may, in individual
cases, decide that the Option recipient may keep all or some of
the options under offering obligation.
3. Regardless of whether the Option recipient has or has not
offered his or her options to the Company or a party ordered by
the Company, the Company may inform the Option recipient in
writing that he or she has lost the options. Regardless of whether
the Company or a party ordered by the Company has or has not been
offered the stock options, the Company has right to apply for a
transfer and to transfer all options under offering obligation
from the Option recipient's book-entry account to an account
indicated by the Company without the consent of the Option
recipient. In addition, the Company has right to register any
option transfer restrictions and other restrictions concerning the
stock options to the Option recipient's book-entry account without
his or her consent.
II SHARE SUBSCRIPTION TERMS AND CONDITIONS
1. Right to subscribe for new shares
1. Each stock option entitles its holder to subscribe for one (1)
new Kesko B share. As a result of the subscriptions, the number of
the Company shares may be increased by a maximum of 3,000,000 new
B shares. The share subscription price shall be recognised in the
reserve of invested non-restricted equity.
2. Sincera cannot subscribe for shares with stock options.
2. Subscription and payment
1. Subscription periods shall be:
- for stock option 2007A 1 April 2010 - 30 April 2012,
- for stock option 2007B 1 April 2011 - 30 April 2013 and
- for stock option 2007C 1 April 2012 - 30 April 2014.
2. The share subscription shall take place at the main office of
the Company or at some other location to be notified later by the
Company. Payment for shares shall be effected upon subscription to
the bank account appointed by the Company. The Company shall
decide on all matters concerning share subscription.
3. Subscription price
1. The subscription price shall be:
- for stock option 2007A, the trade volume weighted average
quotation of the Company B share on the Helsinki Stock Exchange
between 1 April and 30 April 2007,
- for stock option 2007B, the trade volume weighted average
quotation of the Company B share on the Helsinki Stock Exchange
between 1 April and 30 April 2008 and
- for stock option 2007C, the trade volume weighted average
quotation of the Company B share on the Helsinki Stock Exchange
between 1 April and 30 April 2009.
2. The subscription price of stock options shall be reduced in
special situations at times specified hereinafter at Sections
II.7.1 - II.7.2. The subscription price per share must
nevertheless always be at least €0.01.
4. Registration of stock options and shares
The stock options with which shares have been subscribed are
removed from the holder's book-entry account and the shares
subscribed for and fully paid are registered in the holder's book-
entry account.
5. Shareholder rights
Dividend rights of the shares and other shareholder rights
commence after the shares have been entered in the Trade Register.
6. Share issues, options and other special rights before share
subscription
If the Company, prior to share subscription, decides to issue
shares or new stock options or other special rights entitling to
shares, stock option holders shall have the same or equal rights
with shareholders. Equality is ensured in the manner determined by
the Board of Directors, i.e. by adjusting the quantities of shares
available for subscription, or share subscription prices, or both.
7. Rights in certain cases
1. If the Company distributes dividends or funds from the reserve
of invested non-restricted equity, from the subscription price of
a stock option is deducted the amount of the dividend or
distributable invested non-restricted equity decided after the
beginning of the period for the determination of the subscription
price but before the subscription as at the record date for each
dividend distribution or other distribution of funds.
2. If the Company reduces its share capital by distributing share
capital to shareholders, from the subscription price of a stock
option is deducted the amount of distributable share capital
decided after the beginning of the period for the determination of
the subscription price but before the subscription, as at the
record date of repayment of share capital.
3. If the Company is placed in liquidation before the share
subscription, the stock option holder is given an opportunity to
subscribe for the shares with his or her options before the
liquidation begins within a period of time determined by the Board
of Directors. If the Company is removed from the register prior to
the share subscription, the option holder has the same or equal
rights with a shareholder.
4. If the Company decides to merge into another company as the
company being acquired, or into a company to be formed in a
combination merger, or if the Company decides to demerge, the
stock option holders are given, prior to the merger or demerger,
the right to subscribe for the shares with his or her stock
options in a manner and within a period of time determined by the
Board of Directors. If the transfer of stock options is prohibited
by virtue of the above Section I.4.1, the stock option holder is,
however, entitled to transfer his or her stock options prior to
the merger or demerger within a period of time determined by the
Board of Directors. The provisions of Chapter 16 Section 13 of the
Finnish Companies Act shall be applied to the redemption of the
stock options.
5. A buy-back or redemption of own shares by the Company, or the
acquisition of stock options or other special rights entitling to
shares by the Company, shall not affect the position of stock
option holders. However, if the Company decides to acquire or
redeem own shares from all shareholders, stock option holders
shall be made an equal offer.
6. In case, before the end of subscription period, a situation
referred to in Chapter 18 Section 1 of the Finnish Companies Act
arises, in which a shareholder holds over 90% of all shares of the
Company and therefore has the right and obligation to redeem all
shares of the Company, the stock option holders are reserved the
right to subscribe for the shares with their stock options within
a period of time determined by the Company's Board of Directors.
Option holders are also entitled to sell their options to the
redeemer notwithstanding the transfer restriction referred to at
item I.4.1. A shareholder whose ownership of Company shares and
voting rights have exceeded 90%, is entitled to buy the stock
options of the option holder, and when a shareholder exercises
this right the stock option holder is under obligation to sell
them to the shareholder at a current price.
7. If the Company, prior to the share subscription, decides to
combine its share series, stock option holders have equal rights
with the holders of the Company's B shares.
III OTHER TERMS AND CONDITIONS
1. These terms and conditions are governed by Finnish law. Any
disputes concerning stock options shall be settled by arbitration
in accordance with the Rules of the Arbitration Institute of the
Central Chamber of Commerce of Finland.
2. The Company's Board of Directors shall decide on other matters
relating to options and may impose binding rules on Option
recipients.
3. The Company is entitled to withdraw, with no consideration, the
stock options which have not been transferred or with which shares
have not been subscribed for, if the stock option holder acts
against these terms and conditions, decisions made or orders given
by the Company Board of Directors on the basis of these terms and
conditions, or applicable law or orders of the authorities.
4. These terms and conditions have been prepared in Finnish,
Swedish and English. In case of any discrepancy between the
Finnish, Swedish and English terms and conditions, the Finnish
terms and conditions shall apply.
5. The stock option documentation is available for inspection at
the Company's main office in Helsinki.