22 Oct 2010 12:30
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR ANY OTHER JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL
THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES IN THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR ANY OTHER JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND DOES NOT CONSTITUTE A PROSPECTUS OR PROSPECTUS EQUIVALENT DOCUMENT. COPIES OF THE COMPANY'S PROSPECTUS DATED 20 OCTOBER 2010 ARE AVAILABLE FROM POWERFLUTE'S REGISTERED OFFICE AND WEBSITE: www.powerflute.com
TERMS USED IN THIS ANNOUNCEMENT HAVE THE SAME MEANING AS THOSE DEFINED IN THE COMPANY'S PROSPECTUS.
POWERFLUTE OYJ
("Powerflute" or the "Company")
22 October 2010
THE BOARD OF DIRECTORS OF POWERFLUTE OYJ HAS RESOLVED ON THE 3 FOR 4 RIGHTS ISSUE AND PLACING TO RAISE APPROXIMATELY EUR 19.9 MILLION
Powerflute announced on 20 October 2010 a 3 for 4 Rights Issue and Placing to raise approximately EUR 19.9 million. Based on the authorisation granted today by the Extraordinary General Meeting, the Board of Directors of Powerflute has today, 22 October 2010, formally resolved to proceed with the Rights Issue and Placing. The Board of Directors has resolved to issue 108,613,630 New Shares at a Subscription Price of 12 pence per share (or EUR 0.1372 based on the exchange rate as at 18 October 2010) to Qualifying Shareholders and Qualifying DI Holders (the "Rights Issue Shares") and to issue 36,386,370New Shares at the same Subscription Price to institutional investors (the "Placing Shares") in accordance with the terms and conditions attached hereto as Appendix 1. Further information on the Rights Issue and Placing is provided in the announcement made by the Company on 20 October 2010.
The Rights Issue Shares to be issued in the Rights Issue represent approximately 75.0 per cent of the Existing Shares and 37.5 per cent of the Enlarged Share Capital and the Placing Shares to be issued in the Placing represent approximately 25.1 per cent of the Existing Shares and 12.6 per cent of the Enlarged Share Capital. The Rights Issue Shares and the Placing Shares to be issued in the Rights Issue and the Placing respectively represent together approximately 100.1 per cent of the existing shares and 50.0 per cent of the Enlarged Share Capital.
Powerflute intends to raise gross proceeds of approximately EUR 19.9 million through the Rights Issue and Placing and the Company intends to use the proceeds primarily to invest in development projects, for general working capital needs and to reduce leverage.
The Qualifying Shareholders who are registered on the shareholder register of the Company maintained by Euroclear Finland Ltd, and Qualifying DI Holders on the register of such holders maintained in the UK by Capita IRG Trustees Limited, on the Record Date of 27 October 2010 will be offered Rights Issue Shares under the Rights Issue on the basis of:
one (1) Subscription Right for every one (1) Existing Share or Depositary Interest held by Qualifying Shareholders or Qualifying DI Holders on the Record Date of 27 October 2010, with every four (4) Subscription Rights entitling a holder to subscribe for three (3) Rights Issue Shares at the Subscription Price of 12 pence (EUR 0.1372) per Rights Issue Share.
Therefore 144,818,174 Subscription Rights will be issued corresponding to the number of Shares in issue and outstanding on the Record Date allowing Qualifying Shareholders and Qualifying DI Holders to subscribe for 108,613,630 Rights Issue Shares. Fractions of Rights Issue Shares cannot be subscribed for.
The Subscription Price represents a 22.6 per cent. discount to the closing middle-market price of a Share on 19 October 2010 and a 14.3 per cent. discount to the theoretical ex-rights price of a Share based upon the closing price of the Shares on AIM on 19 October 2010 (being the last Dealing Day before the Company's announcement of the proposed Rights Issue and Placing).
Trading in Subscription Rights on First North and AIM is expected to commence on 1 November 2010 and expires on First North on 9 November 2010 and on AIM at 4.30pm (London time) on 5 November 2010.
The Placing is only open to institutional investors procured by Collins Stewart and the Subscription Price for the Placing Shares is the same as for the Rights Issue Shares, being 12 pence per New Share (EUR 0.1372). The total aggregate Subscription Price for the Placing Shares will be credited to the Company's reserve for invested non-restricted equity.
The subscription period for the Placing commences on 1 November 2010 and ends on the date when the Company's Board of Directors approve the subscriptions made in the Rights Issue, which is due to occur on or about 22 November 2010.
For further information, please contact:
| Powerflute Oyj Dermot Smurfit (Chairman) Marco Casiraghi (Chief Executive Officer) David Walton (Chief Financial Officer) |
| c/o Billy Clegg, Financial Dynamics +44 (0)20 7269 7157 |
|
Collins Stewart Europe Limited Piers Coombs Mark Dickenson Stewart Wallace |
|
+44 (0)20 7523 8350 |
| E.Öhman J:or Fondkommission AB Ms Arja Väyrynen |
|
+358 9 8866 6029 |
| Financial Dynamics Billy Clegg |
| +44 (0)20 7831 3113 |
| K Capital Source Mark Kenny Jonathan Neilan |
| +353 (1) 631 5500 |
General
This Announcement is not for release, publication or distribution in or into Australia, Canada, Japan or the United States or any other jurisdiction in which the same would be unlawful.
This Announcement does not constitute or form part of any offer or invitation to sell, or any solicitation of any offer to purchase any securities in Australia, Canada, Japan or the United States or any other jurisdiction in which the same would be unlawful and should not be relied upon in connection with any decision to acquire any securities in the capital of the Company.
This Announcement is for information only and does not constitute an offer or invitation to acquire or dispose of any securities or investment advice in any jurisdiction.
This Announcement is an advertisement and not a prospectus and investors should not subscribe for or purchase shares (or depositary interests representing such shares) in the Company in connection with the proposed Rights Issue or Placing except on the basis of information contained in the Prospectus published by the Company in connection with the proposed Rights Issue and Placing. Copies of the Prospectus are available from the Company's website (www.powerflute.com).
This Announcement has been issued by and is the sole responsibility of the Company. No representation or warranty express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by Collins Stewart or by any of its affiliates or agents as to, or in relation to, the accuracy or completeness of this Announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefore is expressly disclaimed.
Collins Stewart, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting as nominated adviser, broker and underwriter exclusively for Powerflute Oyj and for no-one else in connection with the Rights Issue and Placing and will not regard any other person (whether or not a recipient of the Prospectus) as a client in relation to the Rights Issue and Placing and will not be responsible to anyone other than Powerflute Oyj for providing the protections afforded to its clients, nor for providing advice in connection with the Rights Issue and Placing or any other matter referred to herein.
About Powerflute
Powerflute Oyj ("the Company" or "Powerflute") is a packaging group with established positions in Nordic semi-chemical fluting and coated woodfree papers.
Through its subsidiary Savon Sellu Oy, the Group operates a paper mill in Kuopio, Finland which produces a specialised form of semi-chemical fluting made from birchwood sourced principally in Finland and Russia. Corrugated boxes manufactured using Nordic semi-chemical fluting demonstrate exceptional strength and moisture resistance and are extensively used for transportation of fruit and vegetables, high-value industrial goods such as electrical appliances and automotive components. The Kuopio mill has the capacity to produce up to 300,000 tonnes per annum and is one of three suppliers of Nordic semi-chemical fluting in Europe.
Through its subsidiary Papierfabrik Scheufelen, the Group operates a paper mill in Lenningen, Germany which produces a range of coated woodfree papers from mixed hardwood and softwood pulps. Coated woodfree papers are used in the production of printed promotional material such as brochures, leaflets and other point of sale materials for producers and distributors of premium branded goods. The Lenningen mill has the capacity to produce up to 300,000 tonnes per annum and supplies the majority of its products into the European market where total demand has historically been in excess of 7.7 million tonnes per annum.
APPENDIX I
Terms and conditions of the Rights Issue and Placing
The terms and conditions of the Rights Issue are set out below. Further, certain additional terms and conditions and instructions applicable to Qualifying DI Holders are described below in this section. You should acquaint yourself with the descriptions below when considering participation in the Rights Issue. The terms and conditions of the Placing also appear below. The Placing is addressed to the Placees only and is not open to the Shareholders or other investors.
Overview
At the Extraordinary General Meeting convened on 22 October 2010 it was resolved that the Company's Board of Directors were authorised to issue up to an aggregate maximum of 145,000,000 New Shares. The Directors have therefore pursuant to such authorisation resolved to issue 108,613,630 Rights Issue Shares at the Subscription Price to the Qualifying Shareholders in accordance with the terms and conditions set out in this announcement.
Qualifying Shareholders and Qualifying DI Holders will be offered Rights Issue Shares under the Rights Issue on the basis of:
one (1) Subscription Right for every one (1) Existing Share or Depositary Interest held by Qualifying Shareholders or Qualifying DI Holders on the Record Date, with every four (4) Subscription Rights entitling a holder to subscribe for three (3) Rights Issue Shares at the Subscription Price of 12 pence (EUR 0.1372) per Rights Issue Share.
Therefore 144,818,174 Subscription Rights will be issued corresponding to the number of Shares in issue and outstanding on the Record Date allowing Qualifying Shareholders and Qualifying DI Holders to subscribe for 108,613,630 Rights Issue Shares. Fractions of Rights Issue Shares cannot be subscribed for.
The Directors have also resolved to issue 36,386,370 Placing Shares at the Subscription Price to Placees procured by Collins Stewart or directly by the Company based on the authorisation granted to the Board of Directors to issue new Shares in the Company by its Annual General Meeting on 29 April 2010.
The Rights Issue Shares to be issued in the Rights Issue represent approximately 75.0 per cent. of the Existing Shares and 37.5 per cent. of the Enlarged Share Capital and the Placing Shares to be issued in the Placing represent approximately 25.1 per cent. of the Existing Shares and 12.6 per cent. of the Enlarged Share Capital.
The Rights Issue Shares and the Placing Shares to be issued in the Rights Issue and the Placing respectively represent together approximately 100.1 per cent. of the Existing Shares and 50.0 per cent. of the Enlarged Share Capital.
Shareholders will not be entitled to apply for Rights Issue Shares in excess of their pro rata entitlement. Shareholders, other than Placees, are not entitled to participate in the Placing.
Subscription Rights
Qualifying Shareholders and Qualifying DI Holders shall receive one (1) Subscription Right for every one (1) Existing Share or Depositary Interest held and registered in their name on the Record Date, on the terms and conditions set out in the Prospectus, every four (4) Subscription Rights entitling a holder to subscribe for three (3) Rights Issue Shares. Fractions of Rights Issue Shares cannot be subscribed for. The Subscription Rights will be freely negotiable.
The Depositary holds certain Existing Shares and accordingly will receive Subscription Rights on behalf of Qualifying DI Holders. The Depositary will pass on the Subscription Rights made in its favour in the form of Depositary Interests to Qualifying DI Holders in accordance with the terms of the Deed Poll as described below.
The Subscription Rights will be admitted to trading on First North and on AIM. Shareholders should note that it will not be possible to trade Subscription Rights between AIM and First North. Subscription Rights received for Existing Depositary Interests may only be traded on AIM and Subscription Rights received for Existing Shares may only be traded on First North.
The Subscription Rights are expected to be admitted to trading on First North from 10:00 a.m. Helsinki time on 1 November 2010 until 7:00 p.m. Helsinki time on 9 November 2010. The Subscription Rights are expected to be admitted to trading on AIM from 8:00 a.m. London time on 1 November 2010 until 4:30 p.m. London time on 5 November 2010.
Subscription Price
The Subscription Price for Rights Issue Shares is 12 pence per Rights Issue Share and New Depositary Interest. Qualifying Shareholders may subscribe for Rights Issue Shares in Euro at a Subscription Price of EUR 0.1372 per Rights Issue Share, calculated using the exchange rate of 1.1432 (EUR:GBP) at 18 October 2010. The Subscription Price will be credited to the Company's reserve for invested non-restricted equity. The Subscription Price of 12 pence per Rights Issue Share represents a discount of 42.8 per cent. from the closing price of the Company's Shares on First North on 19 October 2010 and a discount of 22.6 per cent. from the closing price of the Company's Shares on AIM on 19 October 2010.
The subscription amounts payable by each Shareholder in connection with the subscription of the Rights Issue Shares shall be rounded upwards to the closest full euro cent.
Subscription Period
The Subscription Period for Rights Issue Shares based on Subscription Rights issued to Qualifying Shareholders will commence on 1 November 2010 at 10:00 a.m. (Helsinki time) and expire on 16 November 2010 at 4:00 p.m. (Helsinki time) (the "First North Subscription Period"). Account operators may impose a deadline for subscription that is earlier than the expiration of the First North Subscription Period.
The Subscription Period for Rights Issue Shares based on Subscription Rights issued in the form of Depositary Interests to Qualifying DI Holders will commence on 1 November 2010 at 8:00 a.m. (London time) and expire on 10 November 2010 at 11:00 a.m. (London time) (the "AIM Subscription Period"). Account operators may impose a deadline for subscription that is earlier than the expiration of the AIM Subscription Period.
Submission of Subscription Orders by Qualifying Shareholders
General
Each Qualifying Shareholder is expected to receive a credit to his Euroclear Finland book-entry account of his Subscription Rights on or before 1 November 2010.
The Subscription Rights constitute a separate security for the purposes of Euroclear Finland and can accordingly be transferred, in whole or in part, by means of Euroclear Finland in the same manner as any other security that is admitted to Euroclear Finland.
In the case of Qualifying Shareholders who are registered in the Shareholders' register maintained by Euroclear Finland, subscription orders can be submitted through the following subscription places:
FIM Bank Ltd. ("FIM")
Pohjoisesplanadi 33 A
00100 Helsinki
Finland
Contact information:
FIM Customer Service: asiakaspalvelu@fim.com
telephone +358 9 6134 6250
In addition, subscription orders may be submitted to the Account Operators who have an agreement with FIM on reception of subscriptions. Account Operators may impose a deadline for subscription that is earlier than the expiration of the Subscription Period.
Subscription for Rights Issue Shares shall be effected through cash payment of the Subscription Price. In order to subscribe for Rights Issue Shares, the holder of Subscription Rights shall follow the instructions provided by the holder's Account Operator. In the event the holder does not receive instructions from its Account Operator, the holder should contact the above mentioned subscription place to effect the subscription. The Subscription Price must be paid in full at the time of the subscription in accordance with the instructions given by the subscription place or the Account Operator within the payment period determined by the Account Operator.
Those Shareholders of the Company or other investors participating in the Rights Issue, whose Shares of the Company or Subscription Rights are registered in the name of a nominee, shall give a subscription order in accordance with the instructions of the nominee.
Subscription Rights which have not been exercised by the end of the First North Subscription Period on 16 November 2010 will expire as having no value.
A subscription made pursuant to the Subscription Rights is binding and it cannot be amended or cancelled except as provided in the paragraph below entitled "- Right to withdrawal in accordance with the Finnish Securities Market Act".
Procedure for acceptance and payment
Negotiability of the Subscription Rights
The Subscription Rights are freely negotiable and they can be traded on First North as of 1 November 2010. The public trading of the Subscription Rights expires on 9 November 2010. The trading price of the Subscription Rights will be determined on the basis of the prevailing market situation. The holder of Subscription Rights may assign the Subscription Rights by giving a sales assignment to its own Account Operator or to any securities broker. The ISIN code of the Subscription Rights is FI4000018775. The trading code is POW1VU0110 on First North and POWS on AIM.
Time limits set for investors
The holder of Subscription Rights should pay particular attention to giving instructions concerning the Rights Issue to the Depositary or an Account Operator in accordance with the set time limit.
Certain Account Operators seek to sell unexercised Subscription Rights on behalf of their customers on First North pursuant to their asset management agreements. Thus, they might instruct their customers to give their subscription assignment in good time prior to the expiration of the trading with the Subscription Rights. Especially when purchasing Subscription Rights in the secondary market close to the end of the First North Subscription Period, it should be noted that, in accordance with the normal clearing rules of First North, the Subscription Rights are entered into the investor's book-entry account only three business days after purchase, after which Subscription Rights can be used for subscribing for Rights Issue Shares. All Subscription Rights that are not used by the end of the First North Subscription Period will expire as having no value.
Submission of Subscription Orders by Qualifying DI Holders
If you have any questions on the procedure for acceptance and payment in respect of Subscription Rights held in the form of Depositary Interests in CREST, you should contact Capita IRG Trustees Limited on 08716640335 from within the UK (calls cost 10 pence per minute plus network extras) or if calling from overseas +44(0)2086393153 during normal office hours. Please note that for legal reasons, Capita Registrars cannot provide financial advice on the merits of the Rights Issue or as to whether you should take up your Subscription Rights.
The action to be taken by Qualifying Shareholders in respect of Rights Issue Shares and Qualifying DI Holders in respect of New Depositary Interests differs.
If you are a Qualifying DI Holder and do not have a registered address in an Excluded Territory (subject to certain limited exceptions), please refer to the CREST Manual for further information on the CREST procedures referred to below.
If you are a Qualifying DI Holder who is a CREST sponsored member, you should request your CREST sponsor to take the necessary actions specified below to take up your entitlement or otherwise to deal with your Subscription Rights.
General
Subject as provided in relation to certain Restricted Shareholders, each Qualifying DI Holder is expected to receive a credit to his CREST stock account of his entitlement to New Depositary Interests by 11:00 a.m. on 1 November 2010. The CREST stock account to be credited will be an account under the participant ID and member account ID that apply to the Existing Depositary Interests held on the Record Date by the Qualifying DI Holder in respect of which the Subscription Rights are credited by the Receiving Agent, on behalf of the Depositary.
The minimum number of New Depositary Interests a Qualifying DI Holder may take up is one.
The Subscription Rights constitute a separate security for the purposes of CREST and can accordingly be transferred, in whole or in part, by means of CREST in the same manner as any other security that is admitted to CREST.
If for any reason it is impracticable to credit the stock accounts of Qualifying DI Holders or to enable the Subscription Rights, letters of entitlement shall, unless the Company (in consultation with Collins Stewart) agrees otherwise, be sent by the Depositary in substitution for the Subscription Rights which have not been so credited or enabled and the expected timetable as set out in the Prospectus may, with the consent of Collins Stewart, be adjusted as appropriate. References to dates and times in the Prospectus should be read as subject to any such adjustment. The Company, in consultation with Collins Stewart, will make an appropriate announcement to a Regulatory Information Service giving details of the revised dates but Qualifying DI Holders may not receive any further written communication.
Qualifying DI Holders who wish to take up all or part of their entitlements in respect of, or otherwise to transfer all or part of, their Subscription Rights held by them in CREST should refer to the CREST Manual for further information on the CREST procedures referred to below. If you are a Qualifying DI Holder who is a CREST sponsored member, you should consult your CREST sponsor if you wish to take up your entitlement as only your CREST sponsor will be able to take the necessary action to take up your entitlement or otherwise to deal with your Subscription Rights.
Subscription Rights which have not been exercised by the end of the AIM Subscription Period at 11 a.m. at 10 November 2010 will expire as having no value.
A subscription made pursuant to the Subscription Rights is binding and it cannot be amended or cancelled except as provided above under the heading "- Right to withdrawal in accordance with the Finnish Securities Market Act".
Procedure for acceptance and payment
USE Instructions
Qualifying DI Holders who wish to take up all or part of their entitlement in respect of Subscription Rights in CREST must send (or, if they are CREST sponsored members, procure that their CREST sponsor sends) a USE Instruction (and not, for the avoidance of confusion, an MTM instruction with which they may be more familiar) to Euroclear which, on its settlement, will have the following effect:
·; The crediting of a stock account of the Depositary under the participant ID and member account ID specified below, with the number of Subscription Rights to be taken up; and
·; The creation of a settlement bank payment obligation (as this term is defined in the CREST Manual), in accordance with the RTGS payment mechanism (as this term is defined in the CREST Manual), in favour of the RTGS settlement bank of the Receiving Agent (on behalf of the Depositary) in respect of the full amount payable on the take up of the Subscription Rights referred to above.
Contents of USE Instructions
The USE Instruction must be properly authenticated in accordance with Euroclear's specifications and must contain, in addition to the other information that is required for settlement in CREST, the following details:
·; The number of Subscription Rights to which the acceptance relates;
·; The participant ID of the accepting Qualifying DI Holder;
·; The member account ID of the accepting Qualifying DI Holder from which the Subscription Rights are to be debited;
·; The participant ID of the Receiving Agent (on behalf of the Depositary which is 9RA01);
·; The member account ID of the Receiving Agent (on behalf of the Depositary which is 40146POW);
·; The amount payable by means of the CREST assured payment arrangements on settlement of the USE Instruction. This must be the full amount payable on take up of the number of Subscription Rights to which the acceptance relates;
·; The intended settlement date (which must be on or before 11:00 a.m. (London time) on 10 November 2010);
·; The Subscription Rights ISIN code which is FI4000018775;
·; The Corporate Action Number for the Rights Issue. This will be available by viewing the relevant corporate action details in CREST;
·; A contact name and telephone number (in the free format shared note field); and
·; A priority of at least 80.
Valid acceptance
A USE Instruction complying with each of the requirements as to authentication and contents set out in this paragraph will constitute a valid acceptance where either:
(a) The USE Instruction settles by not later than 11:00 a.m. (London time) on 10 November 2010; or
(b) At the discretion of the Company (in consultation with Collins Stewart and as exercised by the Depositary): (i) the USE Instruction is received by Euroclear by not later than 11:00 a.m. (London time) on 10 November 2010; (ii) the number of Subscription Rights inserted in the USE Instruction is credited to the CREST stock member account of the accepting Qualifying DI Holder specified in the USE Instruction at 11:00 a.m. (London time) on 10 November 2010; and (iii) the relevant USE Instruction settles by 11:00 a.m. (London time) on 10 November 2010 (or such later date as the Company, in consultation with Collins Stewart, has determined).
A USE Instruction will be treated as having been received by Euroclear for these purposes at the time at which the instruction is processed by the Network Provider's Communications Host (as this term is defined in the CREST Manual) at Euroclear of the network provider used by the Qualifying DI Holder (or by his CREST sponsor as the case may be). This will be conclusively determined by the input time stamp applied to the USE Instruction by the Network Provider's Communications Host.
As soon as practicable after 11:00 a.m. (London time) on 10 November 2010, the Receiving Agent (on behalf of the Depositary) shall calculate the number of Subscription Rights which the Qualifying DI Holders have indicated (pursuant to their respective USE Instructions) that they wish to take up and the Depositary shall complete and submit its instruction to the Receiving Agent reflecting such instructions, together with a cheque drawn for the appropriate amount, in accordance with the procedure set out herein.
Representations, warranties and undertakings of Qualifying DI Holders
A Qualifying DI Holder who makes a valid acceptance in accordance with this paragraph represents, warrants and undertakes to the Depositary, the Company and Collins Stewart that he has taken (or procured to be taken), and will take (or will procure to be taken), whatever action is required to be taken by him or by his CREST sponsor (as appropriate) to ensure that the USE Instruction concerned is capable of settlement at 11:00 a.m. (London time) on 10 November 2010 and remains capable of settlement at all times after that until 2:00 p.m. (London time) on 10 November 2010 (or until such later time and date as the Company, in consultation with Collins Stewart may determine). In particular, each Qualifying DI Holder represents, warrants and undertakes that at 11:00 a.m. (London time) on 10 November 2010 and at all times thereafter until 2:00 p.m. (London time) on 10 November 2010 (or until such later time and date as the Company, in consultation with Collins Stewart may determine) there will be sufficient Headroom within the Cap (as those terms are defined in the CREST Manual) in respect of the cash memorandum account to be debited with the amount payable on acceptance to permit the USE Instruction to settle. Qualifying DI Holders who are CREST sponsored members should contact their CREST sponsor if they are in any doubt.
If there is insufficient Headroom within the Cap (as those terms are defined in the CREST manual) in respect of the cash memorandum account of a Qualifying DI Holder for such amount to be debited or the acceptance of the Qualifying DI Holder (or of the CREST sponsor as the case may be) is otherwise treated as invalid and New Depositary Interests have already been allotted to such Qualifying DI Holder, Collins Stewart may (in their absolute discretion as to manner, timing and terms) make arrangements for the sale of such New Depositary Interests on behalf of that Qualifying DI Holder and hold the proceeds of sale (net of the Company's reasonable estimate of any loss that he has suffered as a result of the acceptance being treated as invalid and of the expenses of sale including, without limitation, any duties or taxes payable by the Qualifying DI Holder pursuant to the provisions of this paragraph in respect of the acquisition of such New Depositary Interests) on behalf of such Qualifying DI Holder. None of the Depositary, the Company, Collins Stewart nor any other person shall be responsible for, or have any liability for, any loss, expenses or damage suffered by such Qualifying DI Holder as a result.
CREST procedures and timings
Qualifying DI Holders should note that Euroclear does not make available special procedures in CREST for any particular corporate action.
Normal system timings and limitations will therefore apply in relation to the input of a USE Instruction and its settlement in connection with the Rights Issue. It is the responsibility of the Qualifying DI Holder concerned to take (or, if the Qualifying DI Holder is a CREST sponsored member, to procure that his CREST sponsor takes) the action necessary to ensure that a valid acceptance is received as stated above by 11:00 a.m. (London time) on 10 November 2010. In this connection, Qualifying DI Holders (and where applicable CREST sponsors) are referred in particular to those sections of the CREST Manual concerning practical limitations of the CREST system and timings.
Qualifying DI Holder's undertaking to pay
A Qualifying DI Holder who makes a valid acceptance in accordance with the procedures set out in section "- Procedure for acceptance and payment": (a) undertakes to pay to the Receiving Agent (on behalf of the Depositary), or procure the payment to the Receiving Agent (on behalf of the Depositary) of, the amount payable in Pounds Sterling on acceptance in accordance with the above procedures or in such other manner as the Company may require (it being acknowledged that, where payment is made by means of the RTGS payment mechanism (as defined in the CREST Manual) the creation of an RTGS settlement bank payment obligation in Pounds Sterling in favour of the Receiving Agent's RTGS settlement bank (as defined in the CREST Manual), in accordance with the RTGS payment mechanism shall, to the extent of the obligation so created, discharge in full the obligation of the CREST member (or CREST sponsored member) to pay to the Receiving Agent (on behalf of the Depositary) the amount payable on acceptance); and (b) requests that the New Depositary Interests, to which they will become entitled, be issued to them on the terms set out in the Prospectus and subject to the Deed Poll.
If the payment obligations of the Qualifying DI Holder in relation to such New Depositary Interests are not discharged in full and such New Depositary Interests have already been issued to him, Collins Stewart may (in its absolute discretion as to the manner, timing and terms) make arrangements for the sale of such New Depositary Interests on behalf of that Qualifying DI Holder and hold the proceeds of sale (net of expenses including, without limitation, any duties or taxes payable on the transfer of such Depositary Interests, and all amounts payable by the Qualifying DI Holder pursuant to the provisions of this paragraph in respect of the acquisition of such New Depositary Interests) or an amount equal to the original payment of the Qualifying DI Holder (whichever is lower) on trust for him. In these circumstances, none of the Depositary, Collins Stewart nor the Company shall be responsible for, or have any liability for, any loss, expenses or damage arising as a result.
Discretion as to rejection and validity of acceptances
The Company (in consultation with Collins Stewart and as exercised by the Depositary) may:
(a) Reject any acceptance constituted by a USE Instruction, which is otherwise valid, in the event of breach of any of the representations, warranties and undertakings set out or referred to in this section). Where an acceptance is made as described in this paragraph which is otherwise valid, and the USE Instruction concerned fails to settle by 11:00 a.m. (London time) on 10 November 2010 (or by such later time and date as the Company and Collins Stewart may determine), the Company and Collins Stewart shall be entitled to assume, for the purposes of their right to reject an acceptance as described in this paragraph, that there has been a breach of the representations, warranties and undertakings set out or referred to in this section;
(b) Treat as valid (and binding on the Qualifying DI Holder concerned) an acceptance which does not comply in all respects with the requirements as to validity set out or referred to in this section;
(c) Accept an alternative properly authenticated dematerialised instruction from a Qualifying DI Holder (or where applicable a CREST sponsor) as constituting a valid acceptance in substitution for, or in addition to, a USE Instruction and subject to such further terms and conditions as the Company and Collins Stewart may determine;
(d) Treat a properly authenticated dematerialised instruction (in this sub-paragraph the "first instruction") as not constituting a valid acceptance if, at the time at which the Receiving Agent (on behalf of the Depositary) receives a properly authenticated dematerialised instruction giving details of the first instruction, the Receiving Agent (on behalf of the Depositary) has received actual notice from Euroclear of any of the matters specified in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001 in relation to the first instruction. These matters include notice that any information contained in the first instruction was incorrect or notice of lack of authority to send the first instruction; and
(e) Accept an alternative instruction or notification from a Qualifying DI Holder (or where applicable a CREST sponsor), or extend the time for acceptance and/or settlement of a USE Instruction or any alternative instruction or notification if, for reasons or due to circumstances outside the control of any Qualifying DI Holder (or where applicable CREST sponsor), the Qualifying DI Holder is unable validly to take up all or part of his Subscription Rights by means of the above procedures. In normal circumstances, this discretion is only likely to be exercised in the event of any interruption, failure or breakdown of CREST (or of any part of CREST) or on the part of facilities and/or systems operated by the Receiving Agent (on behalf of the Depositary) in connection with CREST.
Money Laundering Regulations
If you hold your Subscription Rights in CREST and apply to take up all or part of your entitlement as agent for one or more persons and you are not a UK or EU regulated person or institution (e.g. a UK financial institution), then, irrespective of the value of the application, the Receiving Agent (on behalf of the Depositary) is required to take reasonable measures to establish the identity of the person or persons on whose behalf you are making the application. You must therefore contact the Receiving Agent (on behalf of the Depositary) before sending any USE Instruction or other instruction so that appropriate measures may be taken.
Submission of a USE Instruction which constitutes, or which may on its settlement constitute, a valid acceptance as described above constitutes a warranty and undertaking by the applicant to provide promptly to the Receiving Agent (on behalf of the Depositary) any information the Receiving Agent (on behalf of the Depositary) may specify as being required for the purposes of the Money Laundering Regulations or FSMA. Pending the provision of evidence satisfactory to the Receiving Agent (on behalf of the Depositary) as to identity, the Receiving Agent (on behalf of the Depositary), having consulted with the Company and Collins Stewart, may take, or omit to take, such action as it may determine to prevent or delay settlement of the USE Instruction. If satisfactory evidence of identity has not been provided within a reasonable time, then the Receiving Agent (on behalf of the Depositary) will not permit the USE Instruction concerned to proceed to settlement but without prejudice to the right of the Company and/or Collins Stewart to take proceedings to recover any loss suffered by it/them as a result of failure by the applicant to provide satisfactory evidence.
Representations and warranties of Qualifying DI Holders
A Qualifying DI Holder who makes a valid acceptance in accordance with the procedures set out in this Part II represents and warrants to the Company, the Depositary and Collins Stewart that, except where proof has been provided to the Depositary's and the Company's satisfaction that such person's acceptance will not result in the contravention of any applicable legal requirement in any jurisdiction: (i) such person is not within the United States, (ii) such person is not a Restricted Shareholder or in any territory in which it is otherwise unlawful to make or accept an offer to acquire Subscription Rights or New Depositary Interests, (iii) such person is not accepting on a non-discretionary basis for a person within the United States or any territory referred to in (ii) above at the time the instruction to accept was given, and (iv) such person is not acquiring Subscription Rights or New Depositary Interests with a view to the offer, sale, resale, transfer, delivery or distribution, directly or indirectly, of any such Subscription Rights or New Depositary Interests into the United States or any territory referred to in (ii) above.
The Depositary, as instructed by the Company, may treat as invalid any USE Instruction which appears to the Receiving Agent (on behalf of the Depositary) to have been despatched from the United States or any other Excluded Territory or otherwise in a manner which may involve a breach of the laws of any jurisdiction or if it or its agents believes the same may violate any applicable legal or regulatory requirement or purports to exclude the warranty required by this paragraph.
Decisions regarding the Rights Issue
The Company's Board of Directors will approve all subscriptions made pursuant to the Subscription Rights which, in its absolute discretion, it considers to have been made in accordance with the terms and conditions of the Rights Issue and applicable laws and regulations.
The Company will publish the final results of the Rights Issue on a Regulatory Information Service in the United Kingdom and in an announcement in Finland on or about 22 November 2010.
Procedure for Rights Issue Shares not taken up in the Rights Issue
Rights Issue Shares which are not taken up by Qualifying Shareholders or Qualified DI Holders pursuant to the Rights Issue will be allocated for subscription first to subscribers procured by Collins Stewart (including Executive Directors) pursuant to the Placing and Underwriting Agreement (subject to a maximum number of 8,538,629 Rights Issue Shares) and then to Bacchantes (or its nominee) pursuant to the Bacchantes Agreement (subject to a maximum number of 58,309,037 Rights Issue Shares) prior to the issuance by the Company of the Rights Issue Shares.
Subscription undertakings and underwriting
Bestinver, Bacchantes and all of the Directors who hold Shares have each separately through the Subscription Undertakings undertaken to take up their pro rata entitlements to subscribe for Rights Issue Shares in the Rights Issue, which in total corresponds to 52.4 per cent of all Rights Issue Shares.
Collins Stewart has conditionally agreed to underwrite 8,538,629 Rights Issue Shares being offered as part of the Rights Issue in accordance with the terms and subject to the conditions set out in the Placing and Underwriting Agreement, which in total correspond to 7.9 per cent of all Rights Issue Shares. The Executive Directors have pursuant to the Executive Management Subscription Letters undertaken to subscribe for all the Rights Issue Shares underwritten by Collins Stewart. At any time prior to the commencement of the Interim Share Trading Period, Collins Stewart may terminate the Placing and Underwriting Agreement in certain circumstances, in which case the Rights Issue and the Placing will be revoked and neither will proceed. After that time, however, Collins Stewart shall not be entitled to terminate the Placing and Underwriting Agreement. The circumstances in which Collins Stewart has the right to terminate the Placing and Underwriting Agreement include, inter alia, any material breach of any warranty given by the Company in the Placing and Underwriting Agreement, upon the occurrence of a force majeure event or if there arises material adverse change in the financial position or prospects of the Company. The Placing is conditional upon completion of the Rights Issue.
Further, Bacchantes has agreed in addition to its (and its nominee's) pro rata entitlement which it has irrevocably agreed to take up (or procure to be taken up by its nominee) pursuant to the Bacchantes Agreement to subscribe for (or procure the subscription by its nominee for) up to 58,309,037 Rights Issue Shares not taken up by existing Shareholders pursuant to the Rights Issue or subscribed for pursuant to the Placing and Underwriting Agreements. Bacchantes' obligations under the Bacchantes Agreement are subject to obtaining a waiver by the Board of the mandatory bid provisions pursuant to Article 14 of the Articles, as amended, in relation to the subscription for Rights Issue Shares by Bacchantes (or its nominee).
The Subscription Undertakings, the Bacchantes Agreement and the Placing and Underwriting Agreement have been entered into as at the date of the Prospectus. The Executive Management Subscription Letters given to Collins Stewart have also been executed as at the date of the Prospectus. All Placees have committed to the Placing by entering into placing or subscription letters executed prior to or as at the date of the Prospectus.
See also risks related to the Shares under the section "Risk factors" in the Prospectus.
Right of withdrawal in accordance with the Finnish Securities Market Act
If the Prospectus is supplemented due to an error or omission in accordance with the Finnish Securities Market Act investors who have made a subscription prior to the publication of the supplement to the Prospectus are entitled to withdraw their subscription according to the Finnish Securities Market Act within two (2) business days, or, if so decided by the FFSA for special reasons, within a longer period not, however, exceeding four (4) business days, after the publication of the supplement to the Prospectus. A withdrawal of a subscription may only be made in respect of all the Rights Issue Shares to which a Shareholder is entitled. Investors will be notified of their right of withdrawal in an announcement of Company published on a Regulatory Information Service and an announcement in Finland in connection with the publication of the supplement, in which announcement also further instructions relating to the use of the right to withdrawal will be given. Furthermore, the exercise of withdrawal rights will not be permitted after payment by the relevant person in respect of their Rights Issue Shares or New Depositary Interests in full and the allotment of the Rights Issue Shares or the issue of New Depositary Interests to such person becoming unconditional. In such circumstances, Shareholders are advised to consult their professional advisers.
If a subscription is withdrawn, the institution to which subscription instructions were submitted to will refund the Subscription Price paid to the bank account notified by the investor in connection with the subscription. Subsequently, the Subscription Rights will be re-entered into the Qualifying Shareholder's book-entry account within approximately three (3) business days after the withdrawal notification has been submitted. In the case of Qualifying DI Holders, the Subscription Rights will be re-credited to the Qualifying DI Holder's CREST stock account in the form of New Depositary Interests approximately three (3) business days after the withdrawal notification has been submitted. The funds will be refunded without interest.
If a Shareholder has sold or otherwise transferred its Subscription Rights, such sale or transfer cannot be withdrawn.
Interim Shares and registration of Shares to book-entry accounts and trading
After a subscription has been effected, Interim Shares will be entered into the subscriber's book-entry account in Euroclear Finland. The Depositary accordingly will receive Interim Shares on behalf of subscribers of Rights Issue Shares who will take up Rights Issue Shares in the form of New Depositary Interests. The Depositary will pass on Interim Shares corresponding to the Rights Issue Shares issued to it to such subscribers in accordance with the terms of the Deed Poll.
The ISIN code of the Interim Shares and of the Depositary Interests representing Interim Shares will be FI4000018783. The trading code will be POW1VN0110 on First North and POWI on AIM.
Trading in Interim Shares corresponding to the Rights Issue Shares as a separate class of securities is expected to commence on First North on the first trading day after the expiration of the First North Subscription Period, on or about 17 November 2010 and trading in Depository Interests representing Interim Shares is expected to commence on AIM on or about 17 November 2010.
Interim Shares corresponding to Rights Issue Shares will be automatically combined with the Existing Shares (ISIN code FI0009015291, trading code POW1V on First North and POWR on AIM) after the registration of the Rights Issue Shares with the Trade Register. The combination is expected to take place on or about 24 November 2010.
The Rights Issue Shares subscribed for pursuant to the Subscription Rights are expected to be entered into the subscriber's book-entry account in Euroclear Finland on or about 23 November 2010. Subscribers of Rights Issue Shares who take up Rights Issue Shares in the form of New Depositary Interests are expected to have New Depository Interests credited to CREST stock accounts on or about 24 November 2010.
The Rights Issue Shares are expected to be admitted to trading on AIM and First North on or about 24 November 2010 and will rank pari passu with the Existing Shares. The Rights Issue Shares will be freely negotiable.
Dividends
The Rights Issue Shares will, when issued and fully paid, rank pari passu in all respects with the Existing Shares, including the right to receive all dividends or other distributions made, paid or declared after the registration of the Rights Issue Shares with the Trade Register, which is expected to occur on or about 23 November 2010. See "Part I: Letter from the chairman of the Company - Dividends and dividend policy" and "Part VII: Additional information - Shareholders' rights" of the Prospectus.
Voting rights
Each Rights Issue Share entitles the holder to one vote at General Meetings. See "Part VII: Additional information - Shareholders' rights" of the Prospectus.
Right to cancel the Rights Issue
The Company's Board of Directors shall have the right to cancel the Rights Issue prior to the expiry of the First North Subscription Period in the event of a material change in the market conditions or financial condition of the Company or the Company's business. If the Company's Board of Directors decides to cancel the Rights Issue, the paid Subscription Prices will be refunded to investors on or about the third (3) business day after such decision has been made by the Company's Board of Directors. If the investor's bank account is in another financial institution than the place of subscription, the refund will be paid to such Finnish bank account in accordance with the payment schedule of the financial institutions on or about two (2) business days later, at the latest. The funds will be refunded without interest. If the Company's Board of Directors decides to cancel the Rights Issue, the Company will publish such decision and further instructions to investors in an announcement.
Publication of the results of the Rights Issue and confirmation of the subscriptions
The Company will publish the final results of the Rights Issue on a Regulatory Information Service and in an announcement in Finland on or about 22 November 2010.
No confirmation letters of acceptance of subscriptions made pursuant to the Subscription Rights will be sent.
Commissions
No separate costs or commissions will be charged to Qualifying Shareholders or Qualifying DI Holders who take up their entitlements to Rights Issue Shares. Account operators and brokers may charge a fee for the trading of the Subscription Rights pursuant to their prevailing rates. Account operators will charge commissions for the maintenance of the book-entry account and any transactions on it pursuant to their pricelist.
Other matters
Other issues and practical matters relating to the Rights Issue will be resolved by the Company's Board of Directors.
Documents on display
The documents referred to in Chapter 5, Section 21 of the Finnish Companies Act are available during the First North Subscription Period at the Company's head office, at Sorsasalo, FI-70101 Kuopio, Finland.
Times and dates
The Company shall, in its discretion and after consultation with the Depositary, its financial and legal advisers (and with the agreement of Collins Stewart), be entitled to amend the date that dealings in Subscription Rights commence and amend or extend the latest date for acceptance under the Rights Issue and all related dates set out in the Prospectus and in such circumstances shall notify the London Stock Exchange, First North, a Regulatory Information Service, and, if appropriate, Shareholders, but Qualifying Shareholders and Qualifying DI Holders may not receive any further written communication.
If a supplementary prospectus is issued by the Company two days or fewer prior to the date specified in the Prospectus as the latest date for acceptance under the Rights Issue (or such later date as may be agreed between the Company and Collins Stewart), the latest date of acceptance under the Rights Issue shall be extended to the date which is three Dealing Days after the date of issue of the supplementary prospectus (and the dates and times of principal events due to take place following such date shall be extended accordingly).
Governing law and jurisdiction
The terms and conditions of the Rights Issue as set out in the Prospectus and any non-contractual obligation related thereto shall be governed by, and construed in accordance with, Finnish law. The courts of Finland are to have exclusive jurisdiction to settle any dispute which may arise out of or in connection with the Rights Issue or the Prospectus. By accepting rights under the Rights Issue in accordance with the instructions set out in the Prospectus, Qualifying Shareholders and Qualifying DI Holders irrevocably submit to the jurisdiction of the courts of Finland and waive any objection to proceedings in any such court on the ground of venue or on the ground that proceedings have been brought in an inconvenient forum.
Restricted Shareholders
General
Qualifying Shareholders and Qualifying DI Holders who are resident in, or who are citizens of, or who have a registered address in countries other than Finland or the United Kingdom may be affected by the laws of the relevant jurisdiction. Those persons should consult their professional advisers whether they require any governmental or other consent or need to observe any other formalities to enable them to take up their rights.
This section sets out the restrictions applicable to Restricted Shareholders or persons (including, without limitation, custodians, nominees and trustees) who have a contractual or legal obligation to forward the Prospectus to a jurisdiction outside Finland or the United Kingdom or who hold Shares or Depositary Interests for the account or benefit of any such person.
Subscription Rights will be allotted to all Qualifying Shareholders, including Restricted Shareholders. However, Subscription Rights will not be credited to CREST accounts of Restricted Shareholders or to their agents or intermediaries, except where the Company (or, in the case of Depositary Interest Holders, the Depositary in consultation with the Company) and Collins Stewart are satisfied that such action would not result in a contravention of any registration or other legal requirement in any such jurisdiction.
Receipt of the Prospectus or the crediting of Subscription Rights to a stock account in CREST or a book-entry account in Euroclear Finland does not and will not constitute an offer in those jurisdictions in which it would be illegal to make an offer and, in those circumstances, the Prospectus must be treated as sent for information only and should not be copied or redistributed. A person who has received or receives a copy of the Prospectus and/or who receives a credit of Subscription Rights to a stock account in CREST or a book-entry account in Euroclear Finland in any Excluded Territory may not treat the same as constituting an invitation or offer to him, nor should he deal with Subscription Rights in CREST or in Euroclear Finland, in an Excluded Territory, unless such an invitation or offer could lawfully be made to him or the Subscription Rights in CREST or Euroclear Finland could lawfully be used or dealt with without contravention of any registration or other legal or regulatory requirements.
Accordingly, persons who have received a copy of the Prospectus or whose stock account in CREST or book-entry account in Euroclear Finland is credited with Subscription Rights should not, in connection with the Rights Issue, distribute or send the same in or into, or transfer Subscription Rights to any person in or into, any Excluded Territory. If a credit of Subscription Rights in CREST or Euroclear Finland is received by any person in an Excluded Territory, or by his agent or nominee, he must not seek to take up the rights referred to in the Prospectus or transfer the Subscription Rights in CREST or Euroclear Finland unless the Company (or, in the case of DI Holders, the Depositary in consultation with the Company) and Collins Stewart determine that such actions would not violate applicable legal or regulatory requirements. Any person who does forward the Prospectus in or into any Excluded Territory (whether under a contractual or legal obligation or otherwise) should draw the recipient's attention to the contents of this section.
Subject to the provisions of this section, any Restricted Shareholder (including, without limitation, agents, nominees and trustees) wishing to take up his rights under the Rights Issue must satisfy himself as to full observance of the applicable laws of the relevant territory including obtaining any requisite governmental or other consents, observing any other requisite formalities and paying any issue, transfer or other taxes due in such territories. The comments set out in this section are intended as a general guide only and any Qualifying Shareholder or Qualifying DI Holder who is in any doubt as to his position should consult his professional adviser without delay.
The Company (or, in the case of DI Holders, the Depositary in consultation with the Company) and Collins Stewart may treat as invalid any acceptance or purported acceptance of the offer of Subscription Rights, Rights Issue Shares or New Depositary Interests which appears to the Company or Collins Stewart or their respective agents to have been executed, effected or despatched in a manner which may involve a breach of the laws or regulations of any Excluded Territory or in the case of a credit of New Depositary Interests in CREST, a Qualifying DI Holder, whose registered address is in any of the Excluded Territories or any other jurisdiction outside Finland and the United Kingdom in which it would be unlawful to make such a credit or in the case of a credit of Rights Issue Shares in Euroclear Finland, a Qualifying Shareholder, whose registered address is in any of the Excluded Territories or any other jurisdiction outside Finland and the United Kingdom in which it would be unlawful to make such a credit, or if the Company (or, in the case of DI Holders, the Depositary in consultation with the Company) or Collins Stewart believe or their respective agents believe that the same may violate applicable legal or regulatory requirements. The attention of Qualifying Shareholders and Qualifying DI Holders with registered addresses in the United States or holding Existing Shares or Existing Depositary Interests on behalf of persons with such addresses is drawn to the paragraph below on Rights Issue restrictions relating to the United States.
Notwithstanding any other provision of the Prospectus, the Company (or, in the case of DI Holders, the Depositary in consultation with the Company) and Collins Stewart reserve the right to permit any Qualifying Shareholder to take up his rights if the Company (or, in the case of DI Holders, the Depositary in consultation with the Company) and Collins Stewart in their sole and absolute discretion are satisfied that the transaction in question is exempt from or not subject to the legislation or regulations giving rise to the restrictions in question. If the Company (or, in the case of DI Holders, the Depositary in consultation with the Company) and Collins Stewart are so satisfied, the Company will arrange for Subscription Rights to be credited to the relevant Euroclear Finland stock account of the relevant Qualifying Shareholder or, if he is a Qualifying DI Holder, the Depositary will arrange for Subscription Rights to be credited to the relevant CREST stock account.
Those Shareholders who wish, and are permitted, to take up their entitlement should note that payments must be made as described in these terms and conditions.
The provisions of this section will apply to all Restricted Shareholders who do not or are unable to take up Rights Issue Shares or New DIs allotted or credited to them. Accordingly, such Restricted Shareholders will be treated as not having taken up their rights to Rights Issue Shares or New DIs and such Rights Issue Shares and New DIs will be subscribed for pursuant to the Bacchantes Agreement and the Placing and Underwriting Agreement described above.
Offering restrictions relating to the United States
The Subscription Rights, the Rights Issue Shares and the New DIs have not been and will not be registered under the Securities Act or under any relevant securities laws of any state or other jurisdiction of the United States and may not be offered, sold, taken up, exercised, resold, renounced, transferred or delivered, directly or indirectly, within the United States except pursuant to an applicable exemption from the registration requirements of the Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States. The Subscription Rights, the Rights Issue Shares and the New Depositary Interests have not been approved or disapproved by the United States Securities and Exchange Commission, any state securities commission in the United States or any other US regulatory authority, nor have any of the foregoing authorities passed upon or endorsed the merits of the offering of the Subscription Rights, the Rights Issue Shares or the New Depositary Interests or the accuracy or adequacy of the Prospectus. Any representation to the contrary is a criminal offence in the United States.
Accordingly, the Company is not extending the Rights Issue into the United States unless an exemption from the registration requirements of the Securities Act is available and, subject to certain exceptions, the Prospectus does not constitute and will not constitute an offer or an invitation to apply for or an offer or an invitation to acquire any Subscription Rights, Rights Issue Shares or New Depositary Interests in the United States. Subject to certain exceptions, the Prospectus will not be sent to, and no Subscription Rights will be credited to a stock account in CREST of, any Shareholder with a registered address in the United States.
The Company will not be bound to allot (on a non-provisional basis) or issue any Rights Issue Shares to any person with an address in, or who is otherwise located in, the United States in whose favour any Subscription Rights or Rights Issue Shares may be transferred or renounced. The Company may treat as invalid any acceptance or purported subscription of Subscription Rights or Rights Issue Shares if it: (a) appears to the Company that the Qualifying Shareholder has an address in the United States or any of the other Excluded Territories or such allotment or subscription may otherwise involve a breach of the laws of any jurisdiction or if it or its agents believe the same may violate any applicable legal or regulatory requirement or (b) purports to exclude the representations and warranties required by this section. In addition, FIM, in consultation with the Company, and Collins Stewart reserve the right to reject any payment sent by or on behalf of any Qualifying Shareholder with a registered address in the United States in respect of the Subscription Rights. In addition, the Depositary, in consultation with the Company and Collins Stewart reserve the right to reject any USE Instruction sent by or on behalf of any Qualifying DI Holder with a registered address in the United States in respect of the Subscription Rights.
Until the expiration of the 40-day period beginning on the date of the Prospectus, an offer to sell or a sale of, or acquisition of, the Rights Issue Shares or the Subscription Rights within the United States by a broker/dealer (whether or not it is participating in the Rights Issue) may violate the registration requirements of the Securities Act.
Other overseas territories
Qualifying Shareholders and Qualifying DI Holders in jurisdictions other than the Excluded Territories may, subject to the laws of their relevant jurisdiction, accept their rights under the Rights Issue in accordance with the instructions set out in the Prospectus.
Qualifying Shareholders and Qualifying DI Holders who have registered addresses, or who are citizens of countries other than Finland or the United Kingdom should consult their appropriate professional advisers whether they require any governmental or other consents or need to observe any other formalities to enable them to take up their Subscription Rights or to acquire Rights Issue Shares or New DIs.
If you are in any doubt as to your eligibility to accept the offer of Rights Issue Shares, New DIs or to deal with Subscription Rights, you should contact your appropriate professional advisor immediately.
Taxation
Certain Finnish and UK tax considerations with regard to the Rights Issue are set out in "Part VI Taxation and securities markets information" of the Prospectus. The information contained in "Part VI Taxation and securities markets information" of the Prospectus is intended only as a general guide to the current tax position in Finland and the United Kingdom.
Qualifying Shareholders in Finland or the United Kingdom should consult their own tax advisers regarding the tax treatment of the Rights Issue in light of their own circumstances. Any person who is in any doubt as to his or her tax position or who is subject to tax in any other jurisdiction should consult an appropriate professional tax adviser immediately.
Terms and conditions of the Placing
The Directors have resolved to issue 36,386,370 Placing Shares, based on the authorisation granted to the Board of Directors to issue new shares in the Company by its Extraordinary General Meeting held on 22 October 2010, to Placees at the Subscription Price. Pursuant to the Placing and Underwriting Agreement, Collins Stewart has agreed to use reasonable endeavours to procure Placees for the Placing Shares at the Subscription Price.
The Placees shall comprise institutional investors within the European Union and include the existing Shareholders Bestinver (and/or its nominees) and Gartmore Investment Management Limited. Other Shareholders are not entitled to participate in the Placing. Collins Stewart has not agreed to subscribe for any Placing Shares not taken up by Placees and accordingly, the Placing has not been underwritten.
The key terms and conditions of the Placing are set out below:
·; The Placing is only open to Placees.
·; The subscription period for the Placing commences on 1 November 2010 and ends on the date when the Company's Board of Directors approve the subscriptions made in the Rights Issue, which occur on or about 22 November 2010.
·; The Board will decide upon the allotment of the Placing Shares to the Placees.
·; The subscription price for the Placing Shares is the same as for the Rights Issue Shares, 12 pence or EUR 0.1372 per Placing Share.
·; The Board shall have the right to cancel the Placing at any time prior to allotment of the Placing Shares in the event of material change in market conditions or financial condition of the Company or the Company's business.
·; The subscription price for the Placing Shares will be credited to the Company's reserve for invested non-restricted equity.
The Placing Shares will not carry any right to participate in the Rights Issue. The Placing Shares will, when issued and fully paid, rank pari passu in all respects with the Existing Shares, including the right to receive all dividends made, paid or declared after the registration of the Placing Shares with the Trade Register, which is expected to occur on or about 23 November 2010. Each Placing Share will entitle the holder to one vote at General Meetings.
Applications will be made for the Placing Shares to be admitted to trading on AIM and First North. It is expected that Admission of the Placing Shares will become effective and dealings in the Placing Shares will commence on 24 November 2010.
The Placing is conditional upon, inter alia, the Resolutions taken by the Extraordinary General Meeting to be held on 22 October 2010, the Placing and Underwriting Agreement becoming unconditional in all respects and not being terminated by Collins Stewart in accordance with its terms and the Rights Issue having completed. Collins Stewart has the right to terminate the Placing and Underwriting Agreement (in respect of the Placing) at any time prior to commencement of the Interim Share Trading Period if certain events occur, including, inter alia, any material breach of any warranty given by the Company in the Placing and Underwriting Agreement, upon the occurrence of a force majeure event or if there arises material adverse change in the financial position or prospects of the Company. The Placing is conditional upon completion of the Rights Issue.
No commission is payable to Placees in respect of the Placing.
The terms and conditions of the Placing as set out in the Prospectus and any non-contractual obligation related thereto shall be governed by, and construed in accordance with, Finnish law. The courts of Finland are to have exclusive jurisdiction to settle any dispute which may arise out of or in connection with the Placing. By subscribing to the Placing Shares the Placees irrevocably submit to the jurisdiction of the courts of Finland and waive any objection to proceedings in any such court on the ground of venue or on the ground that proceedings have been brought in an inconvenient forum.
The contractual obligations with Placees related to the Placing shall, however, be governed by and shall be construed in accordance with English law and Placees irrevocably agree that the Courts of England are to have non-exclusive jurisdiction to settle any disputes which may arise out of or in connection with the same.