Fortum Corporation to apply for the listing of the 2001A options issued to key
Fortum Corporation Stock Exchange Release 7 October 2005
Fortum Corporation to apply for the listing of the 2001A options issued to key employees on the Main List of the Helsinki Stock Exchange The Board of Directors of Fortum Corporation has decided to apply for the trading of the 2001A options offered to its key employees in 2001 on the Main List of the Helsinki Stock Exchange, with the listing to commence on 17 October 2005. The Annual General Meeting of Fortum Corporation decided on 4 April 2001 to issue options to the Group's key employees. Altogether 8,000,000 of these options were marked with the code 2001A. In March 2002, a total of 2,525,000 of the options were annulled. On 30 September 2005 a total of 4,937,500 Fortum's 2001A options were held by key employees. The rest of the 2001A options have been allocated to Fortum's wholly owned subsidiary Fortum Assets Oy and will be annulled before the listing commences. The maximum total number of options for which listing is sought is 4,937,500. Each option gives the right to subscribe for one Fortum Corporation share with a nominal value of 3.40 euros. A maximum of 4,937,500 shares may be subscribed for based on the total amount of options, and the share capital may increase by a maximum of 16,787,500 euros as a result of the share subscriptions. The shares subscribed for with options represent no more than 0.57 percent of Fortum Corporation's share capital. The subscription period for shares on the basis of these options will run from 17 October 2005 to 1 May 2007. The share subscription price on the basis of the options equals the nominal value of the share, 3.40 euros. Future dividends do not reduce the subscription price since the terms and conditions of the options state that the subscription price must not be less than the nominal value of the share. The options will be transferred to the book-entry securities system before their listing. Shares can be subscribed for at the asset management branches of Nordea Bank Finland Plc. The entitlement of the shares subscribed for with the options to a dividend, and other shareholder rights, will commence once the increase in the share capital has been entered into the trade register. Fortum Corporation Carola Teir-Lehtinen Senior Vice President, Corporate Communications For further information, please contact: Jouni Huttunen, tel. +358 10 452 4649 Distribution: Helsinki Stock Exchange Key media ENCLOSURE Terms and conditions WARRANTS IN FORTUM CORPORATION 2001 The Annual General Meeting of Shareholders of Fortum Corporation has on 4 April 2001 resolved that warrants be issued to the key personnel of the Fortum Group and to a wholly owned subsidiary of Fortum Corporation, determined by the Board of Directors, on the following terms and conditions: I ISSUANCE OF WARRANTS 1. Number of warrants The number of warrants issued will be 24,000,000, and they entitle for subscription of a total of 24,000,000 shares in Fortum Corporation. 2. Warrants Of the warrants 8,000,000 will be marked with the symbol 2001A, 8,000,000 will be marked with the symbol 2001B and 8,000,000 will be marked with the symbol 2001C. The persons to whom warrants will be issued will be notified in writing by the Company about the issue of warrants. The warrants will, by the resolution of the Board of Directors, be given 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 Fortum Group and to a wholly owned subsidiary of Fortum Corporation, determined by the Board of Directors. It is proposed that the shareholders' pre-emptive right to subscription be deviated from since the warrants are intended to form part of the Group's incentive and commitment program for the key personnel. 4. Distribution of warrants The Board of Directors decides upon the distribution of the warrants. Warrants shall be distributed to a wholly owned subsidiary of Fortum Corporation to such extent that the warrants are not distributed to key personnel of the Fortum Group. The Board of Directors of Fortum Corporation shall later on decide upon the further distribution of the warrants issued to the subsidiary to the key personnel employed by or to be recruited by the Fortum Group. 5. Transfer of warrants and obligation to offer warrants The warrants are freely transferable, when the relevant share subscription period has begun. The warrants shall be kept by the Company on behalf of the subscriber until the start of the subscription period. The subscriber shall have the right to receive the warrants in his possession at the start of the relevant subscription period. Should the warrant-holder transfer his warrants, such person is obliged to inform the Company about the transfer without delay. The Board of Directors may, as an exception to the above, permit the transfer of a warrant also at an earlier date. Should a warrant-holder cease to be employed by or in the service of the Fortum Group for any other reason than the death or retirement or disability of the employee, before 15 April 2006, such a person shall without delay offer to the Company or its order, free of charge, those warrants for which the share subscription period in accordance with Section II.2 had not begun at the last day of his/her employment. Regardless of whether the subscriber has offered his warrants to the company or not, the company is entitled to inform the subscriber in writing that the subscriber has lost his warrants on the basis of the above- mentioned reasons. Should the warrants be transferred to the book-entry system, the Company has the right, whether or not the warrants have been offered to the Company, to request and get transferred all the warrants, for which the share subscription period had not begun, from the subscriber's book-entry securities account to the book-entry securities account appointed 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) new share in Fortum Corporation. The nominal value of each share is 3.40 euro. As a result of the subscriptions the number of shares in Fortum Corporation may be increased by a maximum of 24,000,000 shares and the share capital by a maximum of 81,600,000 euro. The subsidiary of Fortum Corporation shall not be entitled to subscribe shares in Fortum Corporation on the basis of the warrants. 2. Shares subscription and payment The subscription period shall begin: - for warrant 2001A on 15 October 2005, - for warrant 2001B on 15 January 2006 and - for warrant 2001C on 15 April 2006. The subscription period, however, does not begin with any warrants unless the share quotation of the Fortum Corporation share, during calendar years 2001 - 2004 has developed at least as well as a European utilities index, and unless the average four (4) successive year profit per share, after 31 December 2000, is 105 per cent of the average profit per share for the accounting periods 1998 - 2000, rectified of exceptional entries. Should the above key figure not be attained due to a corporate acquisition, arrangement or some other comparable significant change, the Board of Directors shall estimate the fulfillment of objectives without those significant changes. The share subscription period shall, for all warrants, end on 1 May 2007. The share subscription shall take place at the head office of Fortum Corporation and possibly at another location to be determined later. Payment of shares subscribed shall be effected upon subscription to the bank account appointed by the Company. 3. Share subscription price The share subscription price shall be: - for warrant 2001A the trade volume weighted average quotation of the Fortum Corporation share in the Helsinki Exchanges between 1 April 2001 and 31 March 2005, - for warrant 2001B the trade volume weighted average quotation of the Fortum Corporation share in the Helsinki Exchanges between 1 October 2001 and 30 September 2005 and - for warrant 2001C the trade volume weighted average quotation of the Fortum Corporation share in the Helsinki Exchanges between 1 April 2002 and 31 March 2006. The development of the Fortum Corporation share is compared to a European utilities index. From the share subscription price of the warrants, shall be deducted twice the percentage with which the appreciation of the Fortum Corporation share exceeds the appreciation of the comparison index during the period for determination of the subscription price, as well as the amount of the cash dividends distributed during the period for determination of the subscription price. The above determined share subscription price shall nevertheless always amount to at least the trade volume weighted average quotation of the Fortum Corporation share in the Helsinki Exchanges between 1 April and 30 April 2001. From the share subscription price of the warrants shall be deducted the amount of the cash dividend distributed after the beginning of the period for determination of the subscription price but before the date of the share subscription. The share subscription price will be round up to the nearest full cent. The share subscription price shall be 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 Dividend rights of the shares and 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 another 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, provided that the above mentioned subscription terms and conditions of the share subscription are fulfilled. After such date no subscription right shall exist. In the above situations the warrant-holder has no right to require that the company redeems the warrants from him for market value. If the Company, after the beginning of the period and right 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 Company's own shares does not require the Company to take any action in relation to the warrants. In case, 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, or as referred to in Chapter 6 Section 6 of the Finnish Securities Market Act, or as referred to in Section VI in the Articles of Association, arise, 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, provided that the above- mentioned subscription terms and conditions of the share subscription are fulfilled. 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. 7. 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. The Board of Directors decides on other matters related to the warrants. The warrant documentation is kept available for inspection at the head office of Fortum Corporation in Espoo. This is an English-language translation of the Finnish-language documents. In case of any discrepancy between the Finnish and English texts, the Finnish- language documents are decisive.