UPM's share capital increase based on subscriptions for stock options

In October 2004, a total of 36,150 stock options 1998A, issued to key personnel of UPM, were used for the subscription of 72,300 UPM shares. Furthermore, a total of 5,000 stock options 1998B, were used for the subscription of 10,000 shares. The shares have been registered in the Finnish Trade Register on November 24, 2004.

As a result of the subscriptions UPM's share capital was increased by 82,300 new shares, i.e., by EUR 139,910. After the registration, the total number of UPM shares is 523,664.452 and the share capital of the company is now EUR 890,229,568.40. The book equivalent value of one share is EUR 1.70

After giving effect to the bonus issue 2003, each stock option A and B entitles its holder to subscribe two UPM shares. In accordance with the Stock Option Terms and Conditions, the share subscription price shall be reduced by the amount of dividends distributed before the date of share subscription. The share subscription price for the stock option A is currently EUR 21.71 for two shares, and for the stock option B EUR 26.75 for two shares. The share subscription period for stock options 1998A began on April 1, 2001 and for stock options 1998B on April 1, 2003. The option scheme is based on the resolution by the Annual General Meeting of Shareholders on March 25, 1998. The stock options A have been listed on the Helsinki Stock Exchange as of April 2, 2001 and the stock options B as of April 1, 2003.

The new shares are entitled to dividend for the financial period during which they are subscribed. Other shareholder rights shall begin from the date on which the increase in share capital is recorded on the Trade Register of Finland. An application has been submitted for listing the new shares together with the old shares at the Helsinki Stock Exchange’s Main List as of November 25, 2004.

UPM
Corporate Communications
November 24, 2004