SPONDA PLC'S ANNUAL GENERAL MEETING ON 23 MARCH 2005

The following matters will be on the agenda:

 

 

The Board of Directors proposes to the Annual General Meeting that a dividend of EUR 0.50 per share be paid on the financial year 2004. The dividend will be paid to shareholders who are registered in the Company's shareholder register maintained by the Finnish Central Securities Depository Ltd on the record date, 30 March 2005. The Board proposes that the dividend be paid on 6 April 2005.

 

The Nomination Committee established by the shareholders at the AGM in 2004, and representing approximately 35.8 % of the votes carried by all the shares, proposes that the number of members on the Board of Directors be confirmed as six; that the following be re-elected to the Board of Directors, all of whom have given their consent to re-election: Kaj-Gustaf Bergh, Maija-Liisa Friman, Harri Pynnä, Anssi Soila and Jarmo Väisänen; and that Tuula Entelä be elected to the Board as a new member. The Committee further proposes that the fees paid to the members of the Board of Directors be confirmed as follows: to the chairman of the Board 3,350 euros per month, to the deputy chairman of the Board 2,000 euros per month, and to the other members of the Board 1,750 euros per month. An additional 300 euros will be paid to each member for attendance at the Board's meetings.

 

The shareholder holding 34.5 % of the total number of votes in the Company has informed the Company that he will propose that the firm of authorized public accountants KPMG Oy Ab and Sixten Nyman APA be appointed as the Company's auditors and that Fredrik Westerlund APA be appointed the deputy auditor until the close of the next Annual General Meeting.

 

 

Proposal of the Ministry of Finance, the Company's largest shareholder, on the establishment of a Nomination Committee:

 

That the Annual General Meeting decides to establish a Nomination Committee to prepare proposals on the composition of the Board of Directors and their remuneration for consideration by the following Annual General Meeting. The Nomination Committee shall consist of the representatives of the three (3) largest shareholders as well as the Chairman of the Board of Directors as an expert member. The right to appoint the Committee members representing the shareholders shall belong to those shareholders whose holding of the voting rights carried by all the Company's shares is largest on 1 December preceding the Annual General Meeting. The Nomination Committee shall be convened by the Chairman of the Board of Directors and the Committee shall elect a chairman from among its members. The Nomination Committee shall present its proposal to the Company's Board of Directors no later than on 1 February preceding the Annual General Meeting.

 

 

3.  Proposal by the Board of Directors requesting authorization to decide on the purchase of the Company's own shares

 

The Board of Directors will be authorized for one year from the AGM to purchase at most 3,900,000 of the Company's own shares using distributable funds provided that after the purchase the aggregate nominal value of the shares owned by the Company and its subsidiary Companies, or the voting rights carried by these shares, may not exceed five (5) % of the Company's total share capital or the voting rights carried by all the shares.

 

The shares may be purchased otherwise than in proportion to shareholders' existing holdings in public trading on the Helsinki Exchanges.

 

The shares may be purchased for use by the Company as consideration when the Company acquires assets related to its business operations, as consideration in possible corporate acquisitions and other development of the Company's business operations, and for use in incentive schemes for key employees, in the manner and to the extent determined by the Board, or for the purpose of disposal or annulment.

 

The shares will be purchased at the market price formed during public trading on the Helsinki Exchanges and prevailing at the time of purchase. The purchase price of the shares will be paid to the sellers within the payment period stipulated by the guidelines of the Helsinki Exchanges and the regulations of the Finnish Central Securities Depository.

 

The Board will decide on the other terms and conditions concerning the purchase of the Company's own shares.

 

The purchase of the Company's own shares will reduce the Company's distributable non-restricted shareholders' equity.

 

Since the total number of shares that may be purchased may not exceed 5 % of the Company's total number of shares and the total number of voting rights carried by these shares, the purchase of the Company's own shares will have no significant impact on the distribution of ownership or voting rights in the Company.

 

Pursuant to the Companies Act, the members of the Company's inner circle owned altogether 28,328,050 of the Company's 78,828,275 shares on 24 February 2005, representing 35.9 % of the Company's total share capital and voting rights. Since the Company intends to purchase shares in public trading on the Helsinki Exchanges without information on the sellers of the shares, it is not possible to assess what proportion of the total share capital and voting rights will be held by members of the Company's inner circle after the purchase of the shares.

The Board proposes that this authorization remain in force until the Annual General Meeting in 2006, however for no longer than one year from the close of the Annual General Meeting. The Board also proposes that the authorization granted by the AGM on 7 April 2004 to acquire the Company's own shares be cancelled.

 

4.  Proposal by the Board of Directors requesting authorization to decide on the surrender of Sponda Plc shares

 

The Board of Directors will be authorized to surrender the Company's shares purchased by the Company. The Board may surrender at most 5 % of the total number of shares and voting rights. The Board will be authorized to decide to whom and in what order the Company's own shares will be surrendered.

The Board may surrender the Company's own shares otherwise than in proportion to the pre-emptive rights of shareholders.

The shares may be surrendered as consideration when the Company acquires assets related to its business operations and as consideration in possible corporate acquisitions and other development of the Company's business operations, or for use in incentive schemes for key employees, in the manner and to the extent decided by the Board.

The Board will decide on the surrender price of the shares and how this price will be determined. The shares may be surrendered for consideration other than cash. The Board will decide on the other terms and conditions pertaining to the surrender of the Company's own shares.

 

The purpose of the authorization is to create the opportunity for the Company to use the Sponda Plc shares in its own possession as consideration in corporate acquisitions or the acquisition of assets and for personnel incentive schemes.

 

For this reason the Board considers that there are weighty financial grounds supporting its right to decide on the surrender of the Company's own shares other than in proportion to the pre-emptive right of shareholders. The shares may not be surrendered in the interests of a member of the Company's inner circle, as defined in Chapter 1, Section 4 §1 of the Companies Act.

 

 

Since the Board of Directors will be authorized to decide to whom and in what order the Company's own shares shall be surrendered, when the decision is made to exercise this authorization it will not be possible to assess the effects of surrender on the distribution of ownership and voting power. Since the Company's own shares do not confer the right to participate in General Meetings, nor do they carry voting rights, the surrender of the Company's own shares will reduce the relative proportion of the voting power held by the shareholders.

 

Pursuant to the Companies Act, on 24 February 2005 the members of the Company's inner circle held altogether 28,328,050 shares, representing 35.9 % of the Company's share capital.

 

Documents on view

 

Copies of the financial statements and the proposals of the Board of Directors mentioned in points 2-4 above will be available for inspection by shareholders from 16 March 2005 at the Company's head office in Helsinki (Fabianinkatu 23, 00130 Helsinki). Copies of the documents will be mailed to shareholders upon request.

 

 

Right to participate in the meeting

 

Shareholders who have been registered in the Company's shareholder register maintained by the Finnish Central Securities Depository Ltd on 11 March 2005 shall have the right to attend the Meeting.

 

Shareholders who wish to attend the Meeting must notify the Company of their intention to participate no later than 4.00 pm on 16 March 2005:

 

-          either in writing to Sponda Plc, Ms Pia Arrhenius, PO Box 940, FIN-00101 Helsinki, Finland,

-          or by telephone on +358 (0) 9 6805 8459, Ms Pia Arrhenius,

-          or by telefax on +358 (0) 9 6805 8258,

-          or by e-mail to pia.arrhenius@sponda.fi

-          or on Sponda's website at http:/www.sponda.fi.

 

Notification by letter, telefax, e-mail or the Internet must reach the Company before the above deadline. Shareholders wishing to vote by proxy should submit their forms of proxy to reach the Company before the above deadline.

 

Shareholders registered in nominee accounts

 

Notification by shareholders registered in nominee accounts, and information on these shareholders' representatives at the AGM, should be sent to their asset managers. The asset managers will record the names of such nominee-registered shareholders in the Company's shareholder register prepared by the Finnish Central Securities Depository for the AGM.