METSO'S BOARD OF DIRECTORS' PROPOSALS TO THE ANNUAL GENERAL MEETING ON MARCH 28, 2001
Metso Corporation's Board of Directors has decided to propose to the Annual General Meeting, planned to take place on March 28, 2001, that the last day for the shareholders to report to the company of taking part in the Annual General Meeting may not be earlier than ten days before the meeting; that the Board is authorized to decide on acquiring and surrendering of the Corporation's own shares; that warrants be issued to the key personnel of the Corporation and that the Board is authorized to decide on raising of the share capital by a subscription issue, a convertible bonds issue and/or an issue of options.
Amendment to section 10 of the Articles of Association
Board proposes an amendment to section 10 of the Articles of Association. The last day for the shareholders to report to the company of taking part in the Annual General Meeting may not be earlier than ten days before the meeting.
After the amendment, section 10 will read as follows:
The notice convening the general meeting of shareholders must be delivered to the shareholders by a newspaper announcement which is published in at least two (2) newspapers which are chosen by the Board of Directors and which are published regularly in Helsinki, or in some other verifiable way no more than two (2) months and no less than twelve (12) days before the meeting."
To be allowed to take part in a general meeting of shareholders a shareholder must report to the company by that day at the latest which is mentioned in the notice convening the meeting and which may not be earlier than ten (10) days before the general meeting of shareholders."
Authorization of the Board to decide on acquiring the Corporation's own shares
Metso's Board proposes that it be authorized to decide on acquiring of the Corporation's own shares within one year following the shareholders' meeting with its distributable funds provided that the combined par value of the shares thus acquired corresponds to no more than 5 % of the Corporation's total share capital at the moment of acquisition. The authorization also entitles the Board to decide on canceling the acquired shares by reducing the share capital.
The authorization entitles the Board to acquire the Corporation's own shares for use as payment in possible future corporate acquisitions or in financing investments. According to the authorization, the shares are to be acquired through public trading on the Helsinki Exchanges, at the share price prevailing on the day of acquisition. The acquisition price will be paid to the sellers within the payment period stipulated by the rules of the Helsinki Exchanges and the Finnish Central Securities Depository Ltd.
Since the maximum amount of the shares to be repurchased is 5 percent of the total amount of the shares and voting rights of the Corporation and as the Corporation has only one series of shares, the repurchase of the shares will have no impact on the division of the ownership of shares and the voting rights of the Corporation.
In addition, the Board proposes that the authorization given to the Board in the general shareholders' meeting on March 29, 2000 to acquire Corporation's own shares, be cancelled.
Authorization of the Board to decide on surrendering the Corporation's own shares
Board proposes that it be authorized within one year following the shareholders' meeting to decide on surrendering the Corporation's own shares acquired by the Corporation. The authorization will cover the surrender of all shares acquired on the basis of the acquisition authorization given to the Board.
The authorization will entitle the Board to decide to whom and in which order the Corporation's own shares are surrendered. The Board may surrender the Corporation's own shares for use as payment in possible future corporate acquisitions or in financing investments.
In addition, the Board proposes that the authorization given to the Board in the general shareholders' meeting on March 29, 2000, to surrender its own shares be cancelled.
Board proposes warrant issue to the company's key personnel
Board proposes to the Annual General Meeting of Shareholders to be held on March 28, 2001, that warrants be issued to the key personnel of Metso Corporation to encourage and commit the key personnel to the employer.
The number of warrants issued will be 1,000,000 entitling to subscription of a maximum of 1,000,000 shares of the Corporation.
Of the warrants, 500,000 will be marked with the letter A and 500,000 with the letter B. The share subscription price shall be fifteen euro and sixty cent (15.60 euro). From the share subscription price shall as per the dividend record date be deducted the amount of the dividend distributed after 1 March 2001 but before the date of subscription for shares. The share subscription period for the warrants shall begin in stages on 1 April 2001 and 1 April 2003 and shall end on 30 April 2005 for all warrants.
The purpose of the warrants is to encourage the key personnel of the company to work on a long-term basis in order to increase the shareholder value.
Authorization of the Board to decide on raising of the share capital by a subscription issue, a convertible bonds issue and/or an issue of options
Board proposes that it be authorized within one year following the shareholders’ meeting to decide on raising the share capital by one or several subscription issues, by one or several convertible bond issues, and/or by the issue of share options, provided that in the subscription issue or convertible bonds issue or issue of options at most 25,000,000 new shares of the Corporation with a par value of one euro (EUR 1) and seventy cents (70 c) may be subscribed, and that the Corporation’s share capital may be raised by no more than EUR 42,500,000.
The authorization entitles the Board to deviate from shareholders’ pre-emptive rights to subscribe for new shares, convertible bonds or options, and to decide on the subscription prices and the other terms and conditions of subscription, and the terms and conditions of the convertible bonds or options. The shareholders’ pre-emptive rights to subscribe can be deviated from provided that the Corporation has substantial financial grounds for doing so, such as financing corporate acquisitions, enabling joint operation arrangements or other development of the Corporation’s business operations. The Board may not deviate from the pre-emptive subscription rights for the benefit of a person belonging to the inner circle of the Corporation. When the share capital is raised by a subscription issue, the Board will be entitled to decide that the shares can be subscribed in exchange for property in kind, or otherwise on certain conditions.
Terms of the warrants in Metso Corporation in 2001
WARRANTS IN METSO CORPORATION IN 2001
In its meeting on February 13, 2001 the Board of Directors (“Board of Directors”) of Metso Corporation (the “Company”) has resolved to propose to the Annual General Meeting of Shareholders to be held on March 28, 2001 that warrants be issued to the key personnel of Metso on the following terms and conditions:
I ISSUANCE OF WARRANTS
1. Number of warrants
The number of warrants issued will be 1,000,000 which entitle to subscribe for a total of 1,000,000 shares in Metso Corporation.
Of the warrants 500,000 will be marked with the letter A and 500,000 with the letter B.
The persons to which warrants will be issued will be notified in writing by the Company about the issue of warrants. The warrants will be delivered to the recipient when he or she has accepted the offer of the Company. Warrant certificates shall upon request be delivered to the warrant holder at the start of the relevant subscription period unless the warrants have been transferred to the book-entry system.
3. Right to warrants
The warrants shall, with deviation from the shareholders’ pre-emptive right to subscription, be issued to the key personnel of the Metso and to Rauma Investment Oy, a wholly-owned subsidiary of Metso Corporation. It is proposed that the shareholders’ pre-emptive right to subscription be deviated from since the warrants are intended to form part of the Corporation’s incentive program for the key personnel.
4. Distribution of warrants
The Board of Directors decides upon the distribution of the warrants. Rauma Investment Oy, shall be distributed warrants to such extent that the warrants are not distributed to the key personnel of Metso. The Board of Directors of Metso Corporation shall later on decide upon the further distribution of the warrants issued to the subsidiary to the key personnel of Metso.
5. Assignment of warrants and obligation to offer warrants
The warrants are freely assignable when the relevant share subscription period has begun. The Board of Directors may, as an exception to the above, permit the assignment of a warrant also at an earlier date.
Should a subscriber cease to be employed by or in the service of the Metso before 1 April 2003 for any other reason than retirement or death, such person shall without delay offer to the Company free of charge the warrants for which the share subscription period in accordance with Section II.2 had not begun at the last day of such person’s employment.
II TERMS AND CONDITIONS OF THE SHARE SUBSCRIPTION
1. Right to subscribe new shares
Each warrant entitles its holder to subscribe for one (1) share in Metso Corporation. The nominal value of each share is 1.70 euro. As a result of the subscriptions the share capital of Metso Corporation may be increased by a maximum of 1,000,000 new shares, i.e. by a maximum of 1,700,000 euro.
2. Share subscription and payment
The subscription period shall begin:
- for warrant A on 1 April 2001 and
- for warrant B on 1 April 2003.
The share subscription period shall end on 30 April 2005 for all warrants.
The share subscription shall take place at the head office of Metso Corporation and possibly at another location to be determined later. Payment of shares subscribed shall be effected on subscription.
3. Share subscription price
The share subscription price shall be fifteen euro and sixty cent (15.60 euro). From the share subscription price shall as per the dividend record date be deducted the amount of the dividend distributed after 1 March 2001 but before the date of subscription for shares. The share subscription price shall nevertheless always amount to at least the nominal value of the share.
4. Registration of shares
Shares subscribed for and fully paid shall be registered in the book-entry account of the subscriber.
5. Shareholder rights
The shares shall entitle to dividend for the financial year in which the subscription takes place. Other shareholder rights shall commence when the increase of the share capital has been registered with the Trade Register.
6. Share issues, convertible bonds and warrants before share subscription
Should the Company, before the subscription for shares, increase its share capital through an issue of new shares, or issue convertible bonds or warrants in such a manner that the subscription or receiving of these is based on the shareholding in Metso Corporation, a warrant holder shall have the same right as or an equal right to that of a shareholder. Equality is reached in the manner determined by the Board of Directors by adjusting the amount of shares available for subscription, the subscription price or both of these.
Should the Company, before the subscription for shares, increase its share capital by way of a bonus issue, the subscription ratio shall be amended so that the ratio to the share capital of shares to be subscribed for by virtue of warrants remains unchanged. If the number of shares that can be subscribed for by virtue of one warrant should be a fraction, the fractional part shall be taken into account by reducing the subscription price.
7. Rights in certain cases
If the Company reduces its share capital before the subscription of shares, the subscription right accorded by the terms of the warrant shall be adjusted accordingly as specified in the resolution to reduce the share capital.
If the Company is placed in liquidation before the subscription of shares, the warrant holder shall be given an opportunity to exercise his subscription right before the liquidation begins within a period of time determined by the Board of Directors.
If the Company resolves to merge in an other company as the company being acquired or in a company to be formed in a combination merger or if the Company resolves to be divided, the warrant holder shall before the merger or division be given the right to subscribe for the shares within the period of time determined by the Board of Directors. After such date no subscription right shall exist.
If the Company resolves to acquire its own shares by an offer made to all shareholders, the warrant holders shall be made an equivalent offer. In other cases acquisition of the Company’s own shares does not require the Company to take any action in relation to the warrants.
Should, before the end of the subscription period, a situation as referred to in Chapter 14 Section 19 of the Finnish Companies Act, in which a shareholder possesses over 90% of the shares of the Company and therefore has the right and obligation to redeem the shares of the remaining shareholders arise or if a redemption right is created pursuant to Article 12 of the Company’s Articles of Association, the warrant holders shall be entitled to use their right of subscription by virtue of the warrant within a period of time defined by the Board of Directors.
If the nominal value of the share is changed while the share capital remains unchanged, the subscription terms shall be amended so that the total nominal value of the shares available for subscription and the total subscription price remain the same.
Converting the Company from a public company into a private company will not affect the terms and conditions of the warrants.
8. Dispute resolution
Disputes arising in relation to the warrants shall be settled by arbitration in accordance with the Arbitration Rules of the Central Chamber of Commerce.
9. Other matters
The Board of Directors may decide on the transfer of the warrants to the book-entry system at a later date and on the resulting technical amendments to the terms and conditions. Other matters related to the warrants are decided on by the Board of Directors. The warrant documentation is kept available for inspection at the head office of Metso Corporation in Helsinki.