AUTHORISATION TO RAISE SHARE CAPITAL AND TO ISSUE WARRANTS TO KEY PERSONNEL ON SHAREHOLDER’S MEETING AGENDA
Incap Corporations Board of Directors decided, on 17 March 2000, to propose that the Annual General Meeting of Shareholders authorise the board to raise the companys share capital and to issue warrants to the companys key personnel and Board of Directors, thereby deviating from the shareholders’ pre-emptive right to subscription. The purpose of these procedures is to prepare for further growth and development of the company.
Incap Corporations Annual General Meeting of Shareholders will be held at 11.00 a.m. on Tuesday, 11 April 2000, in the America cabinet of the Technopolis Oulu main building at Teknologiantie 1, Oulu, Finland. In addition to the issues to be discussed by an ordinary shareholders meeting by virtue paragraph 12 of the articles of association, the following matters will also be introduced for discussion:
Authorisation to decide upon increase of share capital
The Board of Directors proposes that the General Meeting of Shareholders decide to grant the Board of Directors of the company an authorisation to decide upon an increase of the share capital of the company in the manner set out in sections 1-6 below and according to Chapter 4 Section 1 of the Companies Act through one or several:
a) issues of new shares; and/or
b) grants of warrants; and/or
c) taking of convertible loans.
The terms of the authorisation are:
1) The share capital of the company may be increased in one or more instalments so that the new shares to be subscribed in the new issue and/or to be subscribed on the basis of the warrants and/or the shares to be issued at the conversion of the convertible bonds may together increase the share capital of the company by a maximum of 1,170,396.96 euro so that in the above mentioned new issues and/or subscriptions on the basis of the warrants and/or subscriptions taking place at the conversion of the convertible bonds a maximum of 702,022 shares, with the book value equivalent of 1.68 euro per share, may be subscribed.
2) The authorisation include a right to deviate from the shareholders pre-emptive right to subscription of new shares. The pre-emptive right of subscription of the shareholders may be deviated from provided that a weighty financial reason for this exists, such as the financing of a corporate acquisition or financing, execution or enabling of other corporate restructurings, the strengthening or development of the financial or capital structure of the company or the execution of some other arrangement related to the development of the companys business.
3) The Board of Directors may not deviate from the pre-emptive right to subscription for the benefit of a person belonging to the inner circle of the company. Otherwise the Board of Directors of the company is entitled to decide on who shall have the right to subscribe for new shares in a new issue, to subscribe for warrants or subscribe for the convertible loan. The new shares and/or the warrants and/or the convertible loan may be subscribed against a contribution in kind according to Chapter 4 Section 6 of the Companies Act (734/1978, as amended) or otherwise with specific terms.
4) The Board of Directors of the company is entitled to decide upon the grounds on which the subscription price is determined and to decide upon the subscription price for the shares to be subscribed in the new issue and/or to be subscribed on the basis of the warrants and/or at the conversion of the convertible bonds. The subscription price may not, however, be lower than the book value equivalent of the share.
5) The Board of Directors of the company is within the limits set out in the Companies Act (734/1978, as amended) authorised to decide upon all other matters and terms related to the new issue and/or the warrants and/or the convertible loan such as the interest possibly payable on the convertible loan.
6) The authorisation is valid for one year after the decision of the General Meeting of Shareholders.
Issue of warrants
The Board of Directors proposes warrants to be issued to the key personnel of the Incap Group and to the members of the Board of Directors of Incap Corporation and Incap Group and to a wholly-owned subsidiary of Incap Corporation.
The number of warrants issued will be 550,000. Of the warrants 137,500 will be marked with the letter A, 137,500 with the letter B, 137,500 with the letter C and 137,500 with the letter D. The warrants entitle to subscription of a maximum of 550,000 shares in Incap Corporation. The share subscription price is 12 euro. From the share subscription price shall, annually, as per the dividend record date be deducted the amount of the cash dividend distributed after 11 April but before the date of subscription for shares.
The share subscription period for the warrants shall begin in stages on 1 December 2000, 1 December 2001, 1 December 2002 and 1 December 2003 and shall end on 31 January 2005 for all warrants. In addition, the purpose of the warrants is to standardise the incentive programs of the Group in such a manner that the warrant holders of the 1998 warrants are offered a possibility to convert their warrants to the warrants now being issued.
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 shareholder value. The purpose of the warrants is also to commit the key personnel to the employer by an obligation to offer the warrants received back to the company without compensation for possible accrued value if the employment ends before 1 December 2003.
In our capacity of auditors of Incap Corporation, we hereby, as our statement in accordance with Section 4, Paragraph 4 a, Subparagraph 2 of the Companies Act regarding the proposal of the Board of Directors to issue warrants, state that in our opinion the proposal of the Board of Directors gives correct and sufficient information about the grounds for determination of the subscription price and the reasons for the deviation from the shareholders pre-emptive subscription right.
Oulu, 17 March 2000
KMPG Wideri Oy Ab, Tapio Raappana, APA
Public display of documents
The annual accounts documents and the broad’s proposals will be on display from 27 March, 2000 onwards in the Oulu office at Teknologiantie 13, Oulu, Finland, and shareholders will be sent copies of them upon request. The printed annual report for 1999 will be sent to the shareholders on week 12.
Attendance at the Annual General Meeting
All shareholders registered on the register of shareholders held by Finnish Central Securities Depository on 6 April, 2000 at the latest shall be entitled to attend the Annual General Meeting.
The shareholders intending to attend the Annual General Meeting and to exercise their right to vote must give notice of their intention on Thursday 6 April, 2000 at 16.00 at the latest by notifying the Oulu office by telephone +358 8 5514 567 / Maija Aronen or by writing to Incap Corporation, Teknologiantie 13, FIN-90570 Oulu. The possible proxies must be submitted at the time of giving notice.
Payment of dividend
The Board of Directors proposes to the Annual General Meeting that a dividend of 0.17 euro per share be paid for the year 1999. The dividend shall be paid to the shareholders registered on the register of shareholders held by Finnish Central Securities Depository on the record date, Friday 14 April, 2000. The board of directors proposes that the dividend be paid on 26 April, 2000.
The interim report for January – March 2000 will be published on 4 May, 2000.
Helsinki, 17 March 2000
Board of Directors
For further information, please contact Rauni Nokela, Vice President, Finance & Administration, tel +358 400 383 409.
APPENDIX Warrants in Incap Corporation 2000
WARRANTS IN INCAP CORPORATION 2000
In its meeting on 17 March 2000 the Board of Directors (Board of Directors) of Incap Corporation (Incap or the Company) has resolved to propose to the Annual General Meeting of Shareholders to be held on 11 April 2000 that warrants be issued to the key persons of the Incap Group as well as to the members of the Boards of Directors of Incap Corporation and other companies belonging to the Incap Group on the following terms and conditions:
I ISSUANCE OF WARRANTS
1. Number of warrants
The number of warrants issued will be 550,000 which entitle to subscribe for a total of 550,000 shares in Incap Corporation.
Of the warrants 137,500 will be marked with the letter A, 137,500 with the letter B, 137,500 with the letter C and 137,500 with the letter D. 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 persons of the Incap Group, to the members of the Boards of Directors of Incap Corporation and other companies belonging to the Incap Group and to Euro-Ketju Oy, a wholly-owned subsidiary of Incap 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 Groups incentive program for the key persons. Through the grant of warrants it is also intended to standardise the incentive programmes of the Incap Group by offering persons who have received warrants in 1998 an opportunity to exchange the warrants currently held for warrants now to be granted.
4. Distribution of warrants
The Board of Directors decides upon the distribution of the warrants. Euro-Ketju Oy shall be distributed warrants to such extent that the warrants are not distributed to key persons of the Incap Group or to the members of the Boards of Directors of Incap Corporation or other companies belonging to the Incap Group. The Board of Directors of Incap Corporation shall later on decide upon the further distribution of the warrants issued to the subsidiary to the key persons employed by or to be recruited by the Incap Group or to the members of the Boards of Directors of Incap Corporation or other companies belonging to the Incap Group. A member of the Board of Directors of Incap Corporation shall be granted 2,500 warrants annually and a member of the Board of Directors of other companies belonging to the Incap Group 1,250 warrants annually so that in year 2000 warrants A shall be granted, in year 2001 warrants B, in year 2002 warrants C and in year 2003 warrants D. The warrants shall be granted to the members of the Boards of Directors one week after the General Meeting of Shareholders has elected them members of the Board of Directors.
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 Incap Group before 1 December 2003, 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 persons employment. This obligation is not, however, applicable to those members of the Boards of Directors who are not full-time employed by the Company.
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 Incap Corporation. The book-value equivalent of each share is 1.68 euro (not an exact value). As a result of the subscriptions the share capital of Incap Corporation may be increased by a maximum of 550,000 shares, i.e. by a maximum of 924,000 euro (not an exact value).
2. Shares subscription and payment
The subscription period shall begin:
for warrant A on 1 December 2000,
for warrant B on 1 December 2001,
for warrant C on 1 December 2002 and
for warrant D on 1 December 2003.
The share subscription period shall, for all warrants, end on 31 December 2005.
The share subscription shall take place at the head office of Incap 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 twelve (12) euro. From the share subscription price shall as per the dividend record date be deducted the amount of the cash dividend distributed after 11 April 2000 but before the date of subscription for shares. The share subscription price shall nevertheless always amount to at least the book-value equivalent 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, 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, after the beginning of the period of subscription, 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 Companys own shares does not require the Company to take any action in relation to the warrants.
In case 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, the warrant holders shall be entitled to use their right of subscription by virtue of the warrant within a period of time determined by the Board of Directors.
If the book-value equivalent of the share is changed while the share capital remains unchanged, the subscription terms shall be amended so that the total book-value equivalent 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 these 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 Incap Corporation in Oulu.