KONE Corporation: Notice to the General Meeting
KONE Corporation, stock exchange release, January 28, 2020 at 2.00 p.m. EET
KONE Corporation: Notice to the General Meeting
Notice is given to the shareholders of KONE Corporation of the Annual General Meeting to be held on Tuesday 25 February 2020 at 11.00 a.m. at the Main Auditorium of the Finlandia Hall (entrances M4 and K4), Mannerheimintie 13, Helsinki. The reception of participants will commence at 10.00 a.m.
A. Matters on the agenda of the General Meeting
At the General Meeting, the following matters will be considered:
1. Opening of the meeting
2. Calling the meeting to order
3. Election of person to scrutinize the minutes and persons to supervise the counting of votes
4. Recording the legality of the meeting
5. Recording the attendance at the meeting and adoption of the list of votes
6. Presentation of the annual accounts, the report of the Board of Directors and the auditor’s report for the year 2019
Review by the President and CEO
7. Adoption of the annual accounts
8. Resolution on the use of the profit shown on the balance sheet and the payment of dividends
The Board of Directors proposes that for the financial year 2019 a dividend of EUR 1.6975 is paid for each class A share and a dividend of EUR 1.70 is paid for each class B share. The date of record for dividend distribution is proposed to be 27 February 2020 and the dividend is proposed to be paid on 5 March 2020.
9. Resolution on the discharge of the members of the Board of Directors and the President and CEO from liability
10. Consideration of the Remuneration Policy for governing bodies
11. Resolution on the remuneration of the members of the Board of Directors
The Nomination and Compensation Committee of the Board of Directors proposes that the board members’ annual compensation is increased as follows: Chairman of the Board of Directors EUR 60,000 (previously EUR 55,000), Vice Chairman EUR 50,000 (EUR 45,000) and board members EUR 45,000 (EUR 40,000) per year. According to the proposal, 40 percent of the annual remuneration will be paid in class B shares of KONE Corporation and the rest in cash. Further the Nomination and Compensation Committee proposes that EUR 500 fee per meeting is paid for each member for Board and Committee meetings but anyhow EUR 3,000 fee is paid per Committee meeting for a Chairman of the Committee residing outside of Finland and EUR 2,000 fee per Committee meeting for those members residing outside of Finland. Possible travel expenses are proposed to be reimbursed according to the travel policy of the Company.
12. Resolution on the number of members of the Board of Directors
The Nomination and Compensation Committee of the Board Directors proposes that the number of board members is increased to be nine
13. Election of members of the Board of Directors
The Nomination and Compensation Committee of the Board of Directors proposes that Matti Alahuhta, Anne Brunila, Antti Herlin, Iiris Herlin, Jussi Herlin, Ravi Kant, Juhani Kaskeala and Sirpa Pietikäinen are re-elected to the Board of Directors and Susan Duinhoven is elected as a new member to the Board of Directors.
The proposed new member of the Board of Directors, Ms. Susan Duinhoven, Ph.D. (Physical Chemistry), B. Sc. (Physical Chemistry), born 1965, a Dutch citizen, has served as President and CEO of Sanoma Corporation since 2015. She has previously served as CEO of Koninklijke Wegener N.V. 2013-2015, CEO of Western Europe/CEO Netherlands at Thomas Cook Group Plc 2010-2013, Managing Director of Benelux & New Acquisitions Europe at Reader´s Digest 2008-2010, CEO at De Gule Sider A/S 2005-2007. She has been a member of Sanoma Corporation´s Board of Directors 2015-2016. Based on the evaluation of KONE Board of Directors, Susan Duinhoven is independent of both the company and of significant shareholders.
Of the other proposed members of the Board of Directors, Matti Alahuhta, Anne Brunila, Iiris Herlin, Ravi Kant, Juhani Kaskeala and Sirpa Pietikäinen are independent of the Corporation. With the exception of Antti Herlin, Iiris Herlin and Jussi Herlin, the other Board members are independent of the Corporation’s significant shareholders.
14. Amending of the Articles of Association
The Board of Directors proposes that the Articles of Association are amended by updating the article concerning the line of business of the company (2 §) and changing the articles concerning the auditing (7§ and 10§). By amending the Articles of Association in respect of auditing, the company prepares for the changes regarding the election of the auditor as further described in item 15 of this notice to general meeting. The Board of Directors’ proposal for amending the Articles of Association with respect to articles 2§, 7§ and 10§ is presented in Annex 1 of this notice to general meeting.
15. Resolutions regarding auditing
KONE Corporation is obliged to organize the selection of the auditor for the term of 2021 in accordance with audit firm selection procedure set forth in the EU Audit Regulation due to the mandatory auditor rotation governed by the Audit Regulation. Because the EU Audit Regulation requires to include a minimum of two candidates in the recommendation of the Board’s Audit Committee and restricts the candidates’ possibilities to provide services until the general meeting where the election is made, the Board of Directors proposes due to practical reasons that the Annual General Meeting would elect the auditor for the term of 2021 already in this 2020 Annual General Meeting.
Based on the above and on the recommendation of the Board’s Audit Committee, the Board of Directors proposes the following resolutions 15. a)–15. e) to be made for the terms of 2020 and 2021 regarding the remuneration, number and election of auditors.
15. a) Resolution on the remuneration of the auditor for terms 2020–2021
The Board of Directors proposes on the recommendation of the Board’s Audit Committee that for the terms 2020–2021, each respectively, the auditor or auditors to be elected are reimbursed as per their invoice.
15. b) Resolution on the number of auditors for term 2020
The Board of Directors proposes on the recommendation of the Board’s Audit Committee that two auditors are elected for the term commencing on 25 February 2020 and ending at the conclusion of the following annual general meeting.
15. c) Resolution on the number of auditors for term 2021
The Board of Directors proposes on the recommendation of the Board’s Audit Committee that one auditor is elected for the term commencing from 2021 annual general meeting and ending at the conclusion of the following annual general meeting.
15. d) Election of auditor for term 2020
The Board of Directors proposes on the recommendation of the Board’s Audit Committee that authorized public accountants PricewaterhouseCoopers Oy and Jouko Malinen are re-elected as auditors from this Annual General Meeting.
15. e) Election of auditor for term 2021
The Board of Directors proposes on the recommendation of the Board’s Audit Committee that audit firm Ernst & Young Oy is elected as the auditor from the 2021 annual general meeting.
Proposal regarding the election of auditor for the term of 2021 (no 15. e)) is conditional upon the Annual General Meeting resolving to amend 7§ of the Articles of Association as set out above in item 14 in the Board of Directors’ proposal. The resolution comes into force after the Articles of Association have been registered.
16. Authorizing the Board of Directors to decide on the repurchase of the Company’s own shares
The Board of Directors proposes that the General Meeting authorizes the Board of Directors to decide on the repurchase of no more than 52,930,000 treasury shares with assets from the company’s unrestricted equity, so that a maximum of 7,620,000 class A shares and a maximum of 45,310,000 class B shares may be repurchased. The consideration to be paid for the repurchased shares with respect to both class A and class B shares will be determined based on the trading price determined for class B shares on the Nasdaq Helsinki on the date of repurchase.
Class A shares will be repurchased in proportion to holdings of class A shareholders at a price equivalent to the average price paid for the company’s class B shares on the Nasdaq Helsinki on the date of repurchase. Any shareholder wishing to offer his or her class A shares for repurchase by the company must state his or her intention to the company’s Board of Directors in writing. The company may deviate from the obligation to repurchase shares in proportion to the shareholders' holdings if all the holders of class A shares give their consent. Class B shares will be purchased in public trading on the Nasdaq Helsinki at the market price as per the time of purchase.
The Board of Directors proposes that the authorization will be valid until the conclusion of the following annual general meeting, however, at the latest until 30 June 2021. The authorization terminates the authorization to decide on the repurchase of the company’s own shares given to the Board of Directors by the Annual General Meeting on 26 February 2019.
17. Authorizing the Board of Directors to decide on the issuance of shares as well as the issuance of options and other special rights entitling to shares
The Board of Directors proposes to the General Meeting that the Board of Directors be authorized to decide on the issuance of shares as well as the issuance of options and other special rights entitling to shares referred to in chapter 10 section 1 of the Finnish Companies Act as follows:
The number of shares to be issued based on this authorization shall not exceed 7,620,000 class A shares and 45,310,000 class B shares. The Board of Directors decides on all the conditions of the issuance of shares and of special rights entitling to shares. The authorization concerns both the issuance of new shares as well as the transfer of treasury shares. The issuance of shares and of special rights entitling to shares may be carried out in deviation from the shareholders’ pre-emptive rights (directed issue).
The Board of Directors proposes that the authorization will be valid until the conclusion of the following annual general meeting, however, at the latest until 30 June 2021.
18. Closing of the meeting
B. Documents of the General Meeting
The draft resolutions of the Board of Directors and its committees relating to the agenda of the General Meeting, the Remuneration Policy, this notice and Company’s annual accounts, the report of the Board of Directors and the Auditor’s report are on view at KONE Corporation’s website at www.kone.com/en/investors/annual-general-meetings/. The Remuneration Policy is also attached to this notice to general meeting as Annex 2. The draft resolutions of the Board of Directors and its committees, the Remuneration Policy and the annual accounts are also on view at the General Meeting. Copies of these documents and of this notice will be sent to shareholders upon request. The minutes of the General Meeting are available on the above-mentioned website no later than 10 March 2020.
C. Instructions for the participants in the General Meeting
1. Right to participate and registration
Each shareholder, who is registered in the shareholders’ register of the Company held by Euroclear Finland Ltd. on the record date of the General Meeting, which is 13 February 2020, has the right to participate in the General Meeting. A shareholder, whose shares are registered on his/her personal Finnish book-entry account, is registered in the shareholders’ register of the Company. Any changes in the ownership of shares after the record date of the Annual General Meeting do not affect the right to participate in the meeting nor the number of votes of the shareholder.
A shareholder, who wants to participate in the General Meeting, shall register with the company for the meeting no later than on 20 February 2020 at 3.00 p.m. by giving prior notice of participation. Such notice can be given:
- on KONE Corporation’s website: www.kone.com/en/investors/annual-general-meetings/
- by regular mail to: KONE Corporation, Share Register, P.O. Box 7, FI-02151 Espoo, Finland
- by telefax +358 20 475 4523
- by telephone +358 20 770 6873.
In connection with the registration, a shareholder shall provide his/her name, personal/business identification number, address, telephone number and the name of any assistant or proxy representative, as well as the personal identification number of a proxy representative. The personal information is used only in connection with the general meeting and with the processing of related registrations.
The shareholder, his/her authorized representative or proxy representative shall, where necessary, be able to prove his/her identity and/or right of representation.
2. Proxy representative and powers of attorney
A shareholder may participate in the General Meeting and exercise his or her rights at the meeting by way of proxy representation. A proxy representative shall produce a dated proxy document or otherwise in a reliable manner demonstrate his or her right to represent the shareholder at the General Meeting. When a shareholder participates in the general meeting by means of several proxy representatives representing the shareholder with shares in different securities accounts, the shares by which each proxy representative represents the shareholder shall be identified in connection with the registration for the general meeting. Any proxy documents should be delivered in originals to KONE Corporation, Share Register, P.O. Box 7, FI-02151 Espoo, Finland before the last date for registration.
3. Holders of nominee registered shares
A holder of nominee registered shares has the right to participate in the General Meeting by virtue of such shares, based on which he or she on the record date of the General Meeting, i.e. 13 February 2020, is entitled to be registered in the shareholders’ register held by Euroclear Finland Ltd. The right to participate in the General Meeting requires, in addition, that the shareholder on the basis of such shares has been temporarily registered into the shareholders’ register held by Euroclear Finland Ltd. at the latest by 20 February 2020 by 10.00 am. This registration is sufficient for holders of nominee registered shares wanting to participate in the General Meeting. Any changes in the ownership of shares after the record date of the Annual General Meeting do not affect the right to participate in the meeting nor the number of votes of the shareholder.
A holder of nominee registered shares is advised to request without delay necessary instructions regarding the registration in the temporary shareholder’s register of the company, the issuing of proxy documents and registration for the General Meeting from his/her custodian bank. The account management organization of the custodian bank has to temporarily register a holder of nominee registered shares, who wants to participate in the General Meeting, into the shareholders’ register of the company no later than the time stated above.
4. Other instructions and information
Pursuant to chapter 5, section 25 of the Finnish Companies Act, a shareholder who is present at the General Meeting has the right to request information with respect to the matters to be considered at the General Meeting.
On the date of this notice 28 January 2020, the total number of shares in KONE Corporation is 529,395,860 shares constituted of 76,208,712 class A shares and 453,187,148 class B shares. Based on the articles of association, each class A share entitles its holder to one vote and each full ten class B shares entitle their holder to one vote, but each shareholder has a minimum of one vote.
The participants of the General Meeting are kindly notified that coffee will be served after the meeting.
In Helsinki, 28 January 2020
KONE Corporation
THE BOARD OF DIRECTORS
ANNEXES
Annex 1 Amending of the Articles of Association
Annex 2 Remuneration Policy
About KONE
At KONE, our mission is to improve the flow of urban life. As a global leader in the elevator and escalator industry, KONE provides elevators, escalators and automatic building doors, as well as solutions for maintenance and modernization to add value to buildings throughout their life cycle. Through more effective People Flow®, we make people's journeys safe, convenient and reliable, in taller, smarter buildings. In 2019, KONE had annual sales of EUR 10 billion, and at the end of the year approximately 60,000 employees. KONE class B shares are listed on the Nasdaq Helsinki Ltd. in Finland.
www.kone.com