SRV GROUP PLC NOTICE TO THE ANNUAL GENERAL MEETING 5 MARCH 2020 10.00 EET
Notice to the annual general meeting of SRV Group Plc
Notice is given to the shareholders of SRV Group Plc to the annual general meeting to be held on Thursday 26 March 2020 at 4:00 PM (EET) in SRV Group Plc’s main office, address: Tarvonsalmenkatu 15, 02600 Espoo. The reception of persons who have registered for the meeting and the distribution of voting tickets will commence at 3:00 PM (EET).
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 persons to scrutinize the minutes and 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 & CEO.
7. Adoption of the annual accounts
8. Resolution on the use of the profit shown on the balance sheet and the payment of dividend
The Board of Directors proposes that no dividend is distributed for the financial year ended on 31 December 2019 based on the balance sheet to be adopted.
9. Resolution on the discharge of the members of the board of directors and the President & CEO from liability
10. Adoption of the Excecutive Remuneration Policy
The Board of Directors proposes that the Annual General Meeting adopts the Executive Remuneration Policy.
The Company’s Executive Remuneration Policy is available on SRV Group Plc’s website at www.srv.fi/agm.
11. Resolution on the remuneration of the members of the board of directors
The Board of Directors’ HR & Nomination Committee proposes that the fees for Members of the Board of Directors for the term up to the close of the Annual General Meeting held in 2021 be EUR 5,000 per month for the Chairman, EUR 4,000 per month for the Vice Chairman and EUR 3,000 per month per member as well as a EUR 700 fee per member per meeting for Board and Committee meetings. In addition, travel expenses arising from work for the Board of Directors shall be reimbursed in accordance with the company’s travel policy.
12. Resolution on the number of members of the board of directors
The Board of Directors’ HR & Nomination Committee proposes that six (6) members be elected to the Board of Directors.
13. Election of members and chairman of the board of directors
The Board of Directors’ HR & Nomination Committee proposes that the following current members be elected again to the Board of Directors: Minna Alitalo, Olli-Pekka Kallasvuo, Timo Kokkila and Tomi Yli-Kyyny and that Hannu Leinonen and Heikki Leppänen be elected as new members to the Board of Directors. The nominees have agreed to their membership of the Board. The term of office of members of the Board of Directors will end at the close of the Annual General Meeting held in 2021.
The Board of Directors’ HR & Nomination Committee proposes that Tomi Yli-Kyyny be elected as the Chairman of the Board of Directors.
Information on the individuals proposed for Board membership is available on SRV Group Plc’s website www.srv.fi/agm.
14. Resolution on the remuneration of the auditor
The Audit Committee of the Board of Directors proposes that the Auditor be reimbursed as per an approved invoice by the company.
15. Election of auditor
The Audit Committee of the Board of Directors proposes that PricewaterhouseCoopers Oy, a firm of authorised public accountants, be elected as the company’s Auditor for a term continuing until the close of the Annual General Meeting 2021. PricewaterhouseCoopers Oy has notified the company that APA Samuli Perälä would be the responsible auditor.
16. Amendment of the Articles of Association
The Board of Directors proposes that article 4 of the Articles of Association be amended as follows:
4 § The Board of Directors of the company consists of the minimum of five (5) and the maximum of eight (8) ordinary members. The Board of Directors shall elect a vice chairman from among its members. The term of office of the Board members expires upon the closing of the first Annual General Meeting of Shareholders following the election.
The General Meeting of Shareholders shall elect a chairman for the same term of office.
17. Approval of a planned financing arrangement and related authorisations to issue shares
Description of the financing arrangement
On 6 February 2020, SRV announced that it had resolved on new measures relating to the earlier published recovery programme. The measures include the strengthening of its equity and the subsequently completed disposal of SRV's stake in REDI shopping centre and reduction of SRV's ownership in the Tampere Central Deck and Arena project. Simultaneously, SRV agreed with its principal lenders on the conversion of its EUR 100 million revolving credit facility into two separate revolving credit facilities of EUR 60 million and EUR 40 million.
If implemented, the purpose of these actions is to significantly improve SRV's balance sheet position, liquidity and financial position by the end of the second quarter of 2020.
As a part of the aforementioned actions, the Board of Directors of SRV has on 6 February 2020 decided to pursue two share issues, the aggregate size of which would be up to approximately EUR 142 million (as further specified since EUR 141 million was announced on 6 February 2020). To enable the share issues, the Board of Directors proposes to the Annual General Meeting that the Annual General Meeting authorise the board to resolve on the share issues.
SRV contemplates that in the first share issue, new shares would be offered in a directed share issue to the holders of SRV's hybrid notes in order to convert the hybrid notes into shares. In the directed share issue, the subscription price would be paid by setting off hybrid notes. The size of the pursued share issue would correspond to the total nominal amount of the hybrid notes and accrued interest, and would be approximately EUR 92 million (as further specified since EUR 91 million was announced on 6 February 2020). Ilmarinen Mutual Pension Insurance Company, Pohjola Insurance Ltd and OP Life Assurance Company Ltd as well as Pontos Ltd (a company controlled by the chairman of the Board of Directors of SRV, Ilpo Kokkila) have committed to SRV to subscribe for new shares in SRV with the hybrid notes in the directed share issue for an aggregate amount of approximately EUR 51 million in principal amount of the hybrid notes, and together with the accrued interest, for an aggregate amount of approximately EUR 57 million. The aforementioned commitments have been issued with the subscription price of EUR 1.05 per share.
SRV contemplates that the subsequent second share issue would be a rights issue of up to EUR 50 million. SRV has received commitments for an aggregate amount of EUR 40 million from Ilmarinen Mutual Pension Insurance Company, Pohjola Insurance Ltd, OP Life Assurance Company Ltd, Varma Mutual Pension Insurance Company, Tiiviste-Group Oy and Pontos Ltd to subscribe for new shares in SRV in the rights issue. The subscription price would be paid in cash.
SRV has received commitments from shareholders whose shares represent more than two-thirds of issued and outstanding shares in SRV to vote in favour of the board's proposals at the Annual General Meeting. If the Annual General Meeting grants the board the requisite share issue authorisations, both share issues are intended to be carried out by 30 June 2020.
As a part of the aforementioned subscription and voting commitments, SRV has received commitments from Pontos Ltd and Kolpi Investments Oy (both of which are companies controlled by Ilpo Kokkila, the chairman of the Board of Directors of SRV) effective where the aggregate proportion of voting rights of Pontos Ltd, Kolpi Investments Oy and parties acting in concert with them (including Ilpo Kokkila, the chairman of the Board of Directors of SRV) exceeds the mandatory takeover offer threshold of 30 percent in connection with the share issues pursuant to "Authorisation for directed share issues" and "Authorisation for rights issue" below. Pursuant to the commitments, Pontos Ltd and Kolpi Investments Oy undertake within one month to dispose of such number of shares by which the aggregate voting rights of Pontos Ltd and Kolpi Investments Oy and the parties acting in concert with them exceeds 30 percent. If the committed parties carry out such disposal and the other requirements pursuant to Chapter 11, Section 21(5) of the Securities Markets Act (in Finnish: arvopaperimarkkinalaki) are complied with, there shall no longer be an obligation to make a mandatory public tender offer.
The revolving credit facilities of EUR 60 million and EUR 40 million contain a term pursuant to which SRV's General Meeting shall authorise the share issues pursuant to "Authorisation of directed share issue" and "Authorisation for rights issue" below by 30 April 2020. If the General Meeting does not approve them, SRV must present an alternative solution achieving an equivalent financial outcome and acceptable to all the creditor banks. If neither of the alternative conditions is met by 30 April 2020, the creditors of the revolving credit facility will have the right to accelerate the facility.
In addition, if the General Meeting does not authorise the said share issues, SRV will no longer have the right to make drawdowns under its EUR 40 million revolving credit facility unless all the creditor banks provide consent to such drawdowns and approve the aforementioned alternative solution achieving a financial outcome equivalent to the share issues.
Authorisation for directed share issue
The Board of Directors proposes that the Annual General Meeting authorise the Board of Directors to resolve on a directed share issue as follows:
The shares to be issued under the authorisation are new shares. Under the authorisation, a maximum of 100,000,000 shares can be issued.
Under the authorisation, new shares would be issued in a directed share issue, i.e. in deviation from the shareholders' pre-emptive rights, to the holders of the hybrid notes issued by the company on 22 March 2016 (ISIN code FI4000198114) and holders of the hybrid notes issued by the company on 23 May 2019 (ISIN code FI4000384185). Subscriptions would be paid by setting off hybrid bonds against their nominal value and accrued interest. A directed share issue always requires a weighty financial reason for the company.
The Board of Directors is authorised to resolve on all other terms and conditions of the share issue.
The authorisation is valid until 30 September 2020.
The authorisation revokes prior unused authorisations granted by the General Meeting to the Board of Directors to resolve on share issues, transfers of shares held by the company and/or to grant special rights entitling to shares as referred to in the Chapter 10, Section 1 of the Finnish Companies Act (in Finnish: osakeyhtiölaki). The authorisation shall not, however, revoke any other share issue authorisations to be passed at the same General Meeting.
Authorisation for rights issue
The Board of Directors proposes that the Annual General Meeting authorise the Board of Directors to resolve on a share issue as follows:
The shares to be issued under the authorisation are new shares. Under the authorisation, a maximum of 500,000,000 shares can be issued.
The shareholders have a pre-emptive right to the new shares in the same proportion as they already hold shares in the company. However, shares not subscribed by shareholders may be offered on a secondary basis for subscription by other shareholders or by other persons. The Board of Directors is entitled to decide to whom the shares that remain unsubscribed will be offered. Subscriptions would be paid in cash.
The Board of Directors is authorised to resolve on all other terms and conditions of the share issue.
The authorisation is valid until 30 September 2020.
The authorisation revokes prior unused authorisations granted by the General Meeting to the Board of Directors to resolve on share issues, transfers of shares held by the Company and/or to grant special rights entitling to shares as referred to in the Chapter 10, Section 1 of the Finnish Companies Act. The authorisation shall not, however, revoke any other share issue authorisations to be passed at the same General Meeting.
Order of decision-making
The proposals of the Board of Directors concerning the authorisation for the directed share issue and the authorisation for the rights issue form a single entirety, the approval of which must be passed by a joint resolution.
18. Authorising the board of directors to resolve on acquiring the company's own shares
The Board of Directors proposes that the Annual General Meeting authorise the Board of Directors to resolve on the acquisition of the company’s own shares using the company’s unrestricted equity as follows:
The Board of Directors is authorised to acquire a maximum of 5,000,000 shares in the company so that the number of shares acquired on the basis of the authorisation, when combined with the shares already owned by the company and its subsidiaries, does not at any given time exceed a total of 10 percent of all shares in the company.
Shares may be acquired in public trading arranged by Nasdaq Helsinki Ltd at the market price at the moment of acquisition. Own shares may be acquired otherwise than in proportion to the existing holdings of the shareholders. Shares may be acquired in one or several instalments.
The company's own shares may be acquired inter alia for use as payment in corporate acquisitions, when the company acquires assets relating to its business, as part of the company's incentive programmes, as a part of the management's incentive scheme or to be otherwise conveyed, held or cancelled.
The Board of Directors is authorised to resolve on all other terms and conditions of the acquisition of the shares.
The authorisation is valid for 18 months from the date of the decision of the General Meeting. It revokes the authorisation granted to the Board of Directors at the Annual General Meeting on 19 March 2019 to decide on the repurchase of the company's own shares.
19. Authorising the board of directors to resolve on share issues and granting of special rights
The Board of Directors proposes that the Annual General Meeting authorise the Board of Directors to resolve on a share issue and granting of special rights as follows:
The Board of Directors may decide on the issuance of new shares or the reissuance of shares held by the company and/or granting of other special rights entitling to shares as referred to in Chapter 10, Section 1 of the Finnish Companies Act either for consideration or free of consideration in one or several instalments.
Under the authorisation, the number of shares to be issued or the number of reissued shares held by the company, including the shares issued on the basis of the special rights, shall not exceed 12,000,000 shares. Any shares issued on the basis of special rights entitling to shares are included in the aforementioned aggregate amount.
New shares may be issued, the company's own shares held by the company reissued and/or other special rights entitling to shares pursuant to Chapter 10, Section 1 of the Finnish Companies Act may be granted in deviation from the pre-emption rights of shareholders only if there exists a weighty financial reason for the company. A directed share issue may be free of consideration only if there exists, for the company and taking into account the interests of all its shareholders, a particularly weighty financial reason.
The authorisation may be used inter alia when issuing new shares or conveying shares as consideration in corporate acquisitions, when the company acquires assets relating to its business, in order to strengthen the company's capital structure and for implementing incentive schemes. However, the authorisation may not be used in connection with the financing arrangement pursuant to Section 17 of the notice to the Annual General Meeting ("Approval of a planned financing arrangement and related authorisations to issue shares").
The Board of Directors is authorised to resolve on all other terms and conditions of the share issue.
The authorisation shall be in force for 18 months from the decision of General Meeting. The authorisation revokes prior unused authorisations granted by the General Meeting to the Board of Directors to resolve on share issues, transfers of shares held by the Company and/or to grant special rights entitling to shares as referred to in the Chapter 10, Section 1 of the Finnish Companies Act. The authorisation shall not, however, revoke any other share issue authorisations to be passed at the same General Meeting.
20. Establishment of a Shareholders’ Nomination Board
The Board of Directors proposes that the Annual General Meeting establishes a Shareholders’ Nomination Board whose task is to prepare proposals concerning the composition and remuneration of the Board of Directors to the General Meeting.
According to the proposal, the Shareholders’ Nomination Board comprises of four (4) members appointed by the three largest shareholders of the company. The Chairman of the Board of Directors shall act as the fourth member of the Board.
The right to appoint a member lies with those three shareholders whose share of the votes of all shares in the company is largest, based on the company’s shareholders’ register held by Euroclear Finland Ltd as of August 31 of the preceding calendar year of the Annual General Meeting.
In the event that a shareholder who has an obligation in accordance with Securities Market Act to take such ownership into account when making notifications regarding changes in ownership (shareholder subject to flagging notification) notifies the Chairman of the Board of Directors thereof in writing at the latest on August 30 of the preceding calendar year of the Annual General Meeting, the shareholding of such shareholder divided between several funds or registers shall be counted as one. In the event that a shareholder does not wish to use his/her right to appoint a member the right to appoint shall be transferred to the next largest shareholder.
The Board of Directors proposes that the Annual General Meeting adopts the Charter for the Shareholders’ Nomination Board.
The Company’s Charter for the Shareholders’ Nomination Board is available on SRV Group Plc’s website at www.srv.fi/amg.
21. Closing of the meeting
A. Documents of the general meeting
The proposals for the decisions on the matters on the agenda of the general meeting as well as this notice are available on SRV Group Plc’s website at www.srv.fi/amg. The annual accounts, the report of the board of directors and the auditor’s report of SRV Group Plc, are available on the above-mentioned website on 2 March 2020. The proposals for decisions and the other above-mentioned documents are also available at the meeting. The minutes of the meeting will be available on the above-mentioned website at latest from 9 April 2020.
B. Instructions for the participants in the general meeting
1. Shareholder registered in the shareholders’ register
Each shareholder, who is registered on 16 March 2020 in the shareholders’ register of the company held by Euroclear Finland Ltd., 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.
A shareholder, who is registered in the shareholders’ register of the company and who wants to participate in the general meeting, shall register for the meeting no later than 4:00 PM (EET) on Monday 23 March 2020 by giving a prior notice of participation, which shall be received by the company no later than on the above-mentioned date and time. Such notice can be given:
a) on the SRV website www.srv.fi/agm;
b) by telephone +358 405 003 610 on weekdays between 10:00 AM and 3:00 PM (EET); or
c) by post to the following address SRV Group Plc, Legal Affairs/AGM, P.O. Box 555, FI-02601 Espoo, Finland.
When registering to attend the general meeting, individuals are required to provide the following information: the shareholder’s name, date of birth/business ID, address and phone number, and the information on a representative or proxy.
The personal data given to SRV Group Plc 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. 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/she on the record date of the general meeting, i.e. on 16 March 2020 would be entitled to be registered in the shareholders’ register of the company 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 registered into the temporary shareholders’ register held by Euroclear Finland Ltd. at the latest by 23 March 2020 by 10:00 AM (EET). As regards nominee registered shares this constitutes due registration for the general meeting.
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 register a holder of nominee registered shares, who wants to participate in the general meeting, into the temporary shareholders’ register of the company at the latest by the time stated above.
3. Proxy representative and powers of attorney
A shareholder may participate in the general meeting and exercise his/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/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 at 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.
Possible proxy documents should be delivered before the last date for registration by 4:00 PM (EET) on 23 March 2020, to the address SRV Group Plc, Legal Affairs/AGM, P.O. Box 555, FI-02601 Espoo, Finland or by email to ilmoittautuminen@srv.fi.
4. Other instructions and information
Pursuant to chapter 5, section 25 of the 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 meeting.
On the date of this notice to the general meeting 5 March 2020 the total number of shares in SRV Group Plc was 60,499,575 shares, representing an equal number of votes.
In Espoo, on 5 March 2020
SRV GROUP PLC
Board of Directors
For further information, please contact:
Johanna Metsä-Tokila, SVP, General Counsel, tel. +358 40 562 0408, johanna.metsa-tokila@srv.fi
Maija Karhusaari, SVP, Communications and Marketing, tel. +358 45 218 3772, maija.karhusaari@srv.fi
Distribution:
Nasdaq Helsinki
Main media
www.srv.fi
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SRV in brief
SRV is a developer and innovator in the construction industry. We want to offer the best customer experience as a constructor of urban city centres, while also being the most attractive employer in the industry. Our genuine cooperation and enthusiasm for our work comes across in every encounter. Sustainability is reflected in all our activities.
Established in 1987, we are a publicly listed company since 2007 in Helsinki Nasdaq stock exchange that operates in selected growth centres in Finland and Russia. Our revenue in 2019 was EUR 1,061 million. Over 1,000 people work for us and we employ a network of almost 4,000 subcontractors in our projects.
SRV - Building for life