Annex to Oriola-KD Corporation Stock Exchange Release 1 February 2007 at 8.40 a.m.
NOTICE OF THE 2007 ANNUAL GENERAL MEETING OF ORIOLA-KD CORPORATION
Notice is hereby given that the Annual General Meeting of Shareholders of Oriola-KD Corporation (the “Company”) will be held on Tuesday, 13 March 2007 at 5pm at Helsinki Fair Centre, address Helsinki Fair Centre, Conference Wing, Messuaukio 1, 00520 Helsinki, Finland. Registration commences on site at 3pm. Coffee will be served following the meeting.
The following matters will be on the agenda of the Meeting:
1. Matters mentioned in Article 10 of the Articles of Association, including:
The number of members, composition and remuneration of the Board of Directors
In accordance with the recommendation by the Company’s Nomination Committee, the Board proposes the following:
The number of members of the Board shall be confirmed as seven (7) and the following shall be re-elected to the Board: Mr. Pauli Kulvik, Ms. Outi Raitasuo, Mr. Anti Remes, Mr. Olli Riikkala, Mr. Jaakko Uotila and Mr. Mika Vidgrén. Mr. Harry Brade, M.Sc., MBA shall be elected as a new member tot the Board. The Board proposes that Mr. Olli Riikkala be elected Chairman of the Board.
The remuneration to the Chairman of the Board shall be set at EUR 40,000 for the term of office, that to the Vice Chairman at EUR 25,000 and to other members of the Board at EUR 20,000. Forty percent of the remuneration would be used to acquire the Company’s Class B shares on the stock exchange and 60% would be paid in cash. Remuneration would be paid no later than on 1 August 2007. The Chairman of the Board would receive EUR 800 in attendance fee for each meeting and other Board members EUR 400. Attendance fees would also be paid to members of the Company and Board Committees. The Chairman of the Board would further have a company-paid phone. The travel expenses of all members of the Board of Directors would be reimbursed in accordance with the Company's travel regulations.
Election and remuneration of auditors
In accordance with the Board’s Audit Committee’s recommendation, the Board proposes that Ernst & Young Oy, who have put forward Mr. Rabbe Nevalainen , Authorised Public Accountant as principal auditor, be elected auditor for the Company. Authorised Public Accountant, Ms. Anu Ojala would be elected deputy auditor. The auditors would be reimbursed according to invoice.
2. Authorisation to the Board to decide on targeted (directed) repurchase of own shares and bonus issue to the Company
The Board proposes that it be granted the following authorisation to acquire own shares:
The Board is authorised to acquire for the Company its own Class B shares (“B shares”). The number of B shares to be acquired pursuant to this authorisation shall not exceed 1,450,000.
The shares acquired pursuant to the authorisation shall be purchased in public trading organised by the Helsinki Exchanges. The maximum consideration payable for each B share acquired pursuant to the authorisation is the highest publicly quoted price of the B share in the month of acquisition. The purpose of the authorisation is to enable the use of own treasury shares in the incentive scheme for the Company’s top management and to hedge against the risk of taxes and other similar expenditure arising from the incentive scheme.
The Board shall decide on all other matters relating to the acquisition of B shares.
This authorisation shall remain in force for a period not to exceed eighteen (18) months from the decision taken by the Annual General Meeting.
The Board proposes that it be granted the following share issue authorisation in order to issue shares to the Company itself without charge:
The Board is authorised to decide on a bonus issue to the Company itself in one or more instalments. The number of B shares to be issued pursuant to this authorisation shall not exceed 1,450,000.
The Board shall decide on all other matters relating to the issue of B shares.
The purpose of the authorisation is to enable the creation of own shares for use in the incentive scheme for the Company’s top management and to hedge against the risk of taxes and other similar expenditure arising from the incentive scheme.
This authorisation shall remain in force for a period not to exceed four (4) years from the decision taken by the Annual General Meeting.
The number of shares coming into the possession of the Company pursuant to both the aforementioned authorisations shall not exceed 1,450,000 B shares, which represents 1.03% of all Company shares and 0.12% of total votes.
3. Authorisation to the Board to decide on a targeted (directed) share issue for the purposes of creating a share incentive scheme for management and selling B shares on the stock exchange
The Board proposes that in addition to the aforementioned authorisations it be granted the following share issue authorisation:
The Board is authorised to disapply shareholders’ pre-emption rights and issue Class B shares (“B shares”) . The B shares to be issued may be either new or own B shares held by the Company as treasury shares. This authorisation shall remain in force for a period not to exceed four (4) years from the decision taken by the Annual General Meeting. The authorisation concerns a total of 1,450,000 shares. The share issue may be a bonus issue.
The Board may execute this authorisation in the share incentive scheme for top management in the Oriola-KD Group in respect of 650,000 B shares. The share incentive scheme is intended as a part of the incentive scheme for the President and CEO and other top management. The incentive scheme comprises three earning periods of one year. The Board decides on the target group of the earning period and the bonuses of the key employees in the target group at the beginning of each earning period. The shares would be issued or given to the persons mentioned, subject to decision by the Board of Directors, on the basis of the development of Oriola-KD’s operating profit and return on capital employed (ROCE) in 2007–2009. Any B shares to be issued as part of the share incentive scheme shall be issued or given between 1 January 2008 and 31 December 2010. The said shares represent 0.46% of all Company shares and 0.06% of total votes.
In addition to the incentive scheme described above, the Board may sell no more than 800,000 B shares in public trading organised by the Helsinki Exchanges. The purpose of the sale of B shares on the stock exchange is to enable the use of the Company’s treasury shares to hedge against the risk arising from the taxes and other similar expenditure arising from the share incentive scheme.
The Board shall decide on all other matters relating to the share issues and the incentive scheme for top management.
Payment of dividend
The Board proposes that the sum of EUR 0,06 per share be paid as dividend on the basis of the balance sheet to be adopted for the financial year ending 31 December 2006.
In the event that the Annual General Meeting accepts the Board’s proposal, dividend shall be paid to those who at the record date of 16 March 2007 were entered as a Company shareholder in the Company's shareholder register kept by the Finnish Central Securities Depository Ltd. The date of payment of dividend is 23 March 2007
Documents
The documents required under the Companies Act are available as of 18 February 2007 on the Company's website at www.oriola-kd.com. Copies of the documents shall be sent to shareholders upon request. The printed Annual Report is only sent to shareholders upon specific request.
Advance notification
Eligibility to attend the Annual General Meeting is vested in shareholders who are registered as such by 3 March 2007 in the shareholder register maintained by the Finnish Central Securities Depository Ltd. in the manner provided for in Chapter 4:2 of the Companies Act.
Pursuant to Article 11 of the Articles of Association, shareholders wishing to attend the General Meeting should notify the Company of their intention to do so by the date mentioned in the notice of the meeting. Instructions on notification will be given in the notice of the meeting to be published on or about 18 February 2007 in Helsingin Sanomat newspaper. Shareholders may notify of their intent to attend as from the said date of publication either on the Company’s website, to the telephone numbers given in the notice or in writing. The deadline for notification is 4pm Finnish time on 7 March 2007.
Espoo, 1 February 2007
Oriola-KD Corporation
Board of Directors
Oriola-KD Corporation
Eero Hautaniemi Henry Haarla
President and CEO General Counsel