The Board of Directors of UPM-Kymmene Corporation proposes to the Extraordinary General Meeting to be held on 13 June, 2000 to make a decision to pay an extra dividend of EUR 0.90 per share.
The Board of Directors in addition proposes to the Meeting the invalidation of the Company's 7,538,000 own shares held by the company and that the Meeting to make a decision on the purchase of a maximum of 12,900,000 of the Company's own shares. Furthermore, the Board of Directors proposes to the Meeting the authorization of the disposal of the Company's own shares.
UPM-Kymmene has earlier purchased during 1998-1999 a total of 21.1 million of the Company's own shares, of which earlier has been invalidated a total of 12.8 million shares.
The Board of Directors made a decision on the enclosed Summons to an Extraordinary General Meeting of Shareholders.
SUMMONS TO AN EXTRAORDINARY GENERAL MEETING OF SHAREHOLDERS
The shareholders of UPM-Kymmene Corporation are hereby summoned to the Company's Extraordinary General Meeting of shareholders to be held on Tuesday, 13th June, 2000 at 3 p.m. in Finlandia Hall, address Mannerheimintie 13e, FIN-00100 Helsinki. The names of the participants will be checked and the voting slips issued as from 2 p.m.
The following matters will be dealt with at the meeting:
1. The Board of Directors's proposal to the General Meeting that an extra dividend of 0.90 euros per share be paid. The dividend will be paid to shareholders who are registered in the list of shareholders maintained by Finnish Central Securities Depository Ltd. atthe record date. In accordance with the decision of the Board of Directors, the record date for the dividend payment is 16th June, 2000. The Board of Directors proposes to the General Meeting that the dividend be paid on 23rd June, 2000. Also the shares that have been subscribed before 1st May, 2000 under 1994 subordinated convertible bond loan entitle the holders to the aforementioned dividend.
Dividends payable to shareholders domiciled abroad will be subject to tax at source.
2. The Board of Directors' proposal to reduce the share capital.
The contents of the proposal are as follows:
The aim of reducing the share capital is to invalidate the Company's own shares held by the Company.
The share capital of the Company 449.128.118,84 euros will be reduced by 12,678,011.44 euros.
The share capital will be reduced by invalidating the Company's own shares held by the Company without payment.
The number of shares will be reduced by 7,538,000.
The invalidation will concern only the Company's own shares held by the Company.
The purchase price of the shares will be deducted from the distributable shareholders' equity. The restricted shareholders' equity will not be reduced, since the book value (equivalent value) of the invalidated shares will be transferred from the share capital into a premium fund.
The reduction of the share capital will not affect the distribution of share ownership and voting power in the Company, since the shares to be invalidated will be in the possession of the Company.
3. The Board of Directors' proposal that the General Meeting decide to purchase the Company's own shares using distributable funds on the following terms:
The Company's own shares shall be purchased for use as payment when the Company acquires property pertaining to its business operations, and as payment in possible corporate acquisitions in the manner and to the extent decided by the Board of Directors.
No less than 100 and no more than 12,900,000 shares shall be purchased.
The shares shall be purchased other than in proportion to existing shareholdings through public trading on the Helsinki Stock Exchange.
The shares shall be purchased other than in proportion to existing shareholdings, since the Company's shares are publicly traded on the Helsinki Stock Exchange and since it is intended that the shares will be purchased through public trading.
The shares shall be purchased at the market price quoted for them in public trading at the moment of purchase. The purchase price shall be paid to the sellers within the payment time specified in the rules of the Helsinki Stock Exchange and Finnish Central Securities Depository Ltd.
The purchase of the shares will reduce the distributable unrestricted shareholders' equity of the Company.
Since the maximum number of shares to be purchased will be less than 5% of the total number of the Company's shares and less than 5% of the total voting power carried by the shares, the purchase of the shares will not have a notable impact on the distribution of share ownership and voting power within the Company.
On 15th May, 2000 the total number of the Company's shares held by persons regarded as company insiders according to the Companies Act was 34,366,556 shares out of a total number of 259,501,453 shares, representing 13.24% of the Company's share capital. Prior to the purchase of the Company's own shares, insiders hold 13.24% of the total voting rights conferred by the shares. Since it is intended that the own shares will be purchased through public trading on the Helsinki Stock Exchange without knowledge of the sellers, the insiders' portion of the Company's share capital and voting power after the purchase of own shares cannot be predetermined.
4. The Board of Directors' proposal that the General Meeting authorise the Board of Directors to decide on the disposal of the Company's own shares purchased on the basis of the aforementioned decision on the following conditions:
The authorisation is limited to a maximum of 12,900,000 of the Company's own shares.
The Board of Directors is authorised to decide to whom and in what order the own shares will be disposed of. The Board of Directors may decide on the disposal of own shares otherwise than in proportion to the existing pre-emptive right of shareholders to purchase the Company's own shares.
The shares shall be used as payment when the Company acquires property pertaining to its business activities, and as payment in possible corporate acquisitions in the manner and to the extent decided by the Board of Directors. The shares shall be disposed of at the market price quoted for them in public trading on the Helsinki Stock Exchange at the moment of their disposal.
This authorisation shall remain in effect for a period of one year from the date of the decision of the General Meeting at which it was given.
Copies of documents concerning the reduction of share capital, the purchase of the Company's own shares and the proposals on the authorisation of the Board of Directors, as well as other documents required by the Companies Act may be inspected by the shareholders as of 5th June, 2000 at the Head Office of UPM-Kymmene Corporation (address given below). Copies of these documents will be sent to shareholders on request.
RIGHT TO ATTEND THE MEETING
Shareholders who wish to attend the General Meeting must be registered in the list of the Company's shareholders maintained by Finnish Central Securities Depository Ltd. no later than 8th June, 2000.
Shareholders whose shares have not been transferred into the book-entry securities system may also attend the Meeting provided that they were registered in the shareholders' list of Kymmene Corporation before 21st August, 1992, or in the shareholders' list of Repola Ltd. before 28th February, 1994, or that they have notified the company of their share ownership and established their valid title and right to attend the Meeting. In this case the shareholders must present to the Meeting their share certificates or proof of their whereabouts, or other evidence that the title to the shares has not been transferred to a book-entry account.
Shareholders wishing to attend the Extraordinary General Meeting of shareholders shall inform the Company thereof in writing no later than by Thursday, 8th June, 2000, at 4 p.m. to: UPM-Kymmene Corporation, Share Register, Eteläesplanadi 2, P.O.Box 380, FIN-00101 Helsinki, by telephone to no. +358 (0)2041 50108 or +358 (0)2041 50109, or by telefax to no. +358(0)2041 50333. Individual persons may also send in their notice of attendance by internet at the address www.upm-kymmene.com. Written notices of attendance must arrive before the date and time given above. Possible proxies shall be submitted to the Company in connection with the notice of attendance.
Helsinki, 16th May, 2000
BOARD OF DIRECTORS