Incorporation of physical securities into the bookentry

Transcription

1 Incorporation of physical securities into the bookentry system Decision of Euroclear Finland s CEO To: Issuers Account operators Issuer agents Reference to the Rules: , , and Ratified: 23 January 2015 Entry into force: 2 February 2015 Supersedes: the Decision in force as of 1 January 2014

2 CONTENTS 1. GENERAL PROVISIONS Scope of Application Purpose of the Decision Decisions and applications preceding incorporation and removal Responsibilities of the Issuer in connection with incorporation and removal Approval of the Issuer, the Issue and removal INCORPORATION OF SHARES INTO THE OM SYSTEM Alternative procedures and instructions pertaining to incorporation Use of the Exchange Model in incorporation Simplified incorporation model Notifications to shareholders and notifying of the decision to incorporate the shares into the book-entry system Shareholders known to the Company Announcement in the Official Gazette Deviating from the obligations to notify and disclose Provision for error situations in the exchange of share certificates Granting an exceptional permit Provisional measures Settlement of an error Collection of share certificates Safekeeping of share certificates Cancellation of share certificates Obligation of the company to disclose Obligation of the Issuer Agent to act Incorporation of cancelled share certificates into the book-entry system Nullifying of share certificates Returning of Nullified Share Certificates to Shareholders Returning of Share Certificates incorporated with Exchange Model Returning of Share Certificates incorporated with Simplified Incorporation Model Marking the Share Certificates that will be returned Storing of Copies of Share Certificates INCORPORATION OF PHYSICAL SECURITIES ENTITLING TO SHARES INCORPORATION OF SHARES IN COOPERATIVES IN THE OM SYSTEM Alternative procedures and instructions pertaining to incorporation Use of the Exchange Model in incorporation Simplified incorporation model Notifications to holders of shares in the Cooperative and notifying of the decision to incorporate the shares into the book-entry system Holders of shares known by the Cooperative Announcement in the Official Gazette Deviating from the obligations to notify and disclose Provision for error situations in the exchange of share certificates Provisional measures Settlement of an error (40)

3 4.4. Collection of share certificates Cancellation of share certificates Obligation of the cooperative to disclose Obligation of the issue manager to act Incorporation of cancelled share certificates into the book-entry system Cancellation of share certificates INCORPORATION OF PHYSICAL SECURITIES ENTITLING TO SHARES INCORPORATION OF FUND UNITS INTO THE OM SYSTEM A fund whose unit certificates are not in circulation at the time of transfer A fund which has issued certificates for fund units (Exchange Model) Notifications to unit holders and notifying of the decision to incorporate the units into the book-entry system Unit holders known to the Fund Company Announcement in a newspaper Announcement in the Official Gazette Deviating from the obligations to notify and disclose INCORPORATION OF GUARANTEE SHARES INTO THE OM SYSTEM Alternative procedures pertaining to incorporation Use of the Exchange Model in incorporation Simplified incorporation model Notifications to guarantee shareholders and notification of the decision to incorporate the guarantee shares into the book-entry system Shareholders known to the Company Announcement in the Official Gazette Deviating from the obligations to notify and disclose Provision for error situations in the exchange of share certificates Granting an exceptional permit Provisional measures Settlement of an error Collection of guarantee share certificates Cancellation of share certificates Obligation of the company to disclose Obligation of the Issuer Agent to act Incorporation of cancelled share certificates into the book-entry system Cancellation of share certificates INCORPORATION OF PHYSICAL DEBT SECURITIES INTO THE BOOK- ENTRY SYSTEM Incorporation of physical debt securities Notification of the possibility to incorporate a physical debt security in the form of a certificate into the book-entry system Cancellation of physical debt securities REMOVAL OF A BOOK-ENTRIES FROM THE BOOK-ENTRY SYSTEM ON APPLICATION BY THE ISSUER Alternative procedures applying to the removal of a book-entry from the book-entry system Decisions and applications applying to the removal of a book-entry from the book-entry system (40)

4 1. General provisions 1.1. Scope of Application This Decision shall be applied when incorporating shares, shares in cooperatives and other rights outside the book-entry system and physical securities issued in certificate form into the book-entry system as well as, on application by the issuer, the removal of book-entries from the system Purpose of the Decision This Decision describes the decisions and applications preceding transfer to the book-entry system, procedures to be applied to incorporation as well as Euroclear Finland's incorporation requirements and standards. It also describes the procedure applying to the removal of book-entries from the system. The purpose of the Decision is to ensure the incorporation of physical securities into the book-entry system in an appropriate and reliable manner. If, when incorporating or removing physical securities from the book-entry system, an issue arises to be settled which has not been prescribed in Euroclear Finland s Rules, Decisions or agreements, Euroclear Finland shall decide case-specifically the manner in which the matter shall be resolved and give corresponding instructions to the issuer. In this context, an Issuer shall mean an entity, which Euroclear Finland has approved as an issuer and which has signed an issuer agreement with Euroclear Finland Decisions and applications preceding incorporation and removal Responsibilities of the Issuer in connection with incorporation and removal The Issuer shall be responsible for the internal decision-making preceding the incorporation and removal of physical securities into the book-entry system, for the conclusion of the necessary agreements with the different parties, for acquiring the necessary consents as well as for the information the Issuer has submitted to Euroclear Finland. The Issuer and issuer agent shall also be responsible for investigating potential errors or discrepancies and for any costs arising to the parties in the book-entry system as a result of such investigation. 4(40)

5 Since incorporation of physical securities into the book-entry system includes in practice also an issue either on the OM system or Infinity, the provisions on applying for Issuer status and on issuing book-entry securities in the Decision "Issuing and Corporate Actions in the Book- Entry System" by the CEO of Euroclear Finland shall be applied to incorporation. The incorporation and removal of physical securities shall be agreed with Euroclear Finland in good time before the envisaged incorporation or removal. The issuer shall provide Euroclear Finland with required documentation Approval of the Issuer, the Issue and removal An issuer has to appoint an issuer agent as referred to in the Rules of Euroclear Finland, to carry out the incorporation and removal of shares in the book-entry system. Euroclear Finland will provide the issuer or issuer agent with the instructions relating to the book-entry system, incorporation and removal from the book-entry system. The incorporation or removal schedule shall be agreed with Euroclear Finland. With all related decisions, amendments to Articles of Association and registrations, the Issuer shall reserve two months in minimum for the incorporation or removal process. Provisions governing applications for Issuer status and for the Issue of a book-entry security shall be given in the Decision of Euroclear Finland s CEO Issues and Corporate Actions in the Book-Entry System. 2. Incorporation of shares into the OM system In this decision is ordered in accordance with Chapter 4, Section 7 and 8 of the Companies Act about procedure to notify shareholders about decision to incorporate the shares in the book-entry system and to register shareholder s or other holder of right s right to the book-entry account of the shareholder. The General Meeting of an issuing company ( Company ) shall decide upon the incorporation of shares into the book-entry system by implementing such a provision to the articles of association. The General Meeting of the Company shall decide upon the registration period or authorises the Board of Directors to decide upon it. The Company shall agree on the registration period with Euroclear Finland. Amendment to the Articles of Association and the decision on the registration period shall be registered in the Trade Register. 5(40)

6 2.1. Alternative procedures and instructions pertaining to incorporation Use of the Exchange Model in incorporation When incorporating shares into the book-entry system a so-called Exchange Model may be used. The Exchange Model shall be regarded as an incorporation model approved by Euroclear Finland referred to in Chapter 4, Section 8, Subsection 1 of the Companies Act Simplified incorporation model The simplified incorporation model can be used, if the Company knows all of its shareholders. However, it is not possible to use the simplified incorporation model, if a share of the Company is subject to public or multilateral trading, if not all the shares of the Company have been registered or if the Company is unable to take charge of processing the shares. Shares can be incorporated with the simplified incorporation model only if the Company has not issued share certificates or if the share certificates can be collected and cancelled before incorporation into the book-entry system in such a manner that ownership of the shares is evidenced solely on the lists kept by the Company (Companies with no Share Certificates). If Certificates or interim certificates have been issued, the Company shall collect and cancel them before incorporation. The shareholders shall deliver the Share Certificates and the interim certificates to the Company. If a conveyance or other acquisition has not been registered, the Company shall examine the acquisition documentation and decide on registration in the name of the owners in question. When the shares are incorporated with the simplified incorporation model, Euroclear Finland shall receive an affirmation signed by the CEO of the Company stating that, - all the shares in the Company have been registered in the name of the shareholders, - every Share Certificate and interim certificate not subject to a pledge has been collected and cancelled, - all of the Company's shareholders have undertaken not to convey or transfer their ownership in the company before incorporation and that - all the pledgees and relevant execution authorities have undertaken not to convey the Share Certificates and interim certificates subject to a pledge other than to a book-entry register in connection with registration of their right in a bookentry account. The shares shall be registered in the book-entry system on the basis of an application for registration. The issuer agent shall take care of the registration of the shares to the book-entry system. Before 6(40)

7 incorporation of the shares in the book-entry system, a shareholder shall open a book-entry account with one of the account operators if the shareholder does not already have one Notifications to shareholders and notifying of the decision to incorporate the shares into the book-entry system Shareholders known to the Company The Company shall notify its shareholders no later than three (3) months before the end of the registration period of the decision by the Company to incorporate the shares of the Company into the book-entry system, unless all shareholders have agreed to a deviation from this deadline (see point 2.2.3). In the notification to the shareholders referred to in Chapter 4, Section 7, Subsection 1 of the Companies Act, at least the information presented below shall be provided, unless all shareholders have agreed to a deviation from these requirements on substance (see point 2.2.3). All account operators and their agents acting as recipients of share certificates must be mentioned in the notification. Notification shall include a reminder that the documents indicating title shall be appended to the registration application. After the period of registration, a holder of unexchanged shares may not exercise the rights of a shareholder in the company until he or she has been entered in the company s list of shareholders kept by Euroclear Finland. Notifications and information bulletins shall indicate how shareholders can avoid forfeiting their rights in this respect. Notification shall be delivered by mail, e.g. in a letter, to the shareholders known to the company no later than three (3) months prior to the end of the registration period. If notification is included in other material to be delivered to the shareholder, it shall be distinct from this other material (e.g. a notification in a customer magazine shall be clearly indicated in the cover) Announcement in the Official Gazette Prior to the beginning of the registration period, an announcement on the transfer decision, the beginning and end of the registration period shall be published in the Official Gazette Deviating from the obligations to notify and disclose When shares are incorporated with the simplified incorporation model, the deadlines as well as obligations to notify and disclose prescribed in 7(40)

8 the Companies Act (Chapter 4, Section 7) may be deviated from with the consent of all shareholders. The Company shall collect the consents prior to submitting an application for issue to Euroclear Finland Provision for error situations in the exchange of share certificates This chapter shall be applied in full when the Company has issued share certificates and the share certificates cannot be collected and cancelled before incorporation into the book-entry system in such a manner that ownership of the shares is evidenced solely on the register kept by the Company (Companies with no Share Certificates). These regulations issued on the provision for error situations in the exchange of share certificates shall apply to shares for which share certificates or interim certificates have not been issued by the end of the registration period of the company in question Granting an exceptional permit Euroclear Finland s CEO is entitled to decide on exceptions concerning the obligation to conclude an agreement on the reservation of a share portfolio as well as the obligation to conclude an agreement on the transfer of book-entries. An exceptional permit can be granted in the following situations: the ownership of the company will not diverge prior to incorporation of the physical securities into the book-entry system, there are only a few shareholders, incorporation will be performed in one place of exchange, thereafter, when a company s shares have been accepted for public trading and the company either holds or is authorised to acquire an equivalent number of its own shares at any time as required by the agreement on the reservation of shares below in case of any errors Provisional measures Information on share certificates to be received By no later than three weeks prior to the commencement of the exchange, the Company shall deliver the following information to the Issuer Agent: a) detailed descriptions of and instructions for identification of the physical shares of each category of shares as well as the authenticity criteria on the physical shares, b) a list of cancelled physical shares and c) information in the share register of the 100 major shareholders of the Company Issuer Agent may agree with the company on stricter limits of significance in view of points b-c. Euroclear Finland shall be notified of the limits agreed upon prior to the commencement of the exchange. 8(40)

9 Issuer Agent shall, without delay, deliver the information referred to above to the other places of exchange and Euroclear Finland prior to commencement of the exchange. Inspections on banking days The entries made on each banking day shall, without delay but by no later than the third banking day following the exchange, be inspected in each place of exchange. Monitoring the balance of a joint account The Issuer Agent shall monitor the balance of a joint account. When the balance of a joint account falls below the limit of 5% or some other limit higher than this agreed upon by the company and the Issuer Agent, the Issuer Agent shall notify the Company and the party who, in the manner referred to in section Agreement on the transfer of bookentries below, has undertaken to surrender his book-entries. Agreement on the reservation of a share portfolio The Company shall agree with the Issuer Agent on the reservation of the portfolio of the unchanged shares. Agreement on the transfer of book-entries The Company shall agree with the Issuer Agent and at least one significant shareholder that when the balance of the joint account is insufficient, the necessary amount of book-entries shall be transferred to the shareholder requiring the exchange. The party committed to the delivery of book-entries has to attest in an agreement a dedicated book-entry account, from which the Issuer Agent has the right to transfer the necessary amount of book-entries to a shareholder requesting the exchange, when the balance of the joint account is insufficient. In the agreement the party committed to the delivery of book-entries has to give an authorisation to the Issuer Agent to register a transfer restriction to the book-entry account for the benefit of the Issuer Agent or to apply for a registration of a transfer restriction for the benefit of the Issuer Agent. An agreement for the time following the registration period on the transfer of book-entries may also include an undertaking to acquire book-entries. In this case, transfer shall take place during the seven (7) banking days following notification by the Issuer Agent. Extent of the agreements The balance corrected within the registration period with the agreements pertaining to the share portfolios and with the share 9(40)

10 portfolios of the joint account shall, in total, correspond to at least 1% of each category of shares. Within the five years following the registration period, the agreements relating to the share portfolios as well as the balance of the joint account, shall, in total, correspond to the following shares of each category of shares: 1st year 1 %; 2nd year 0.8 %; 3rd year 0.6 %; 4th year 0.4 %; 5th year 0.2 %. In addition, when a company s general meeting makes a decision after 1 September 2006 to incorporate the shares into the book-entry system, the agreements and the balance in the joint account shall, in total, correspond to the following shares of each category of share: 6th year 0.2 % 7th year 0.2 % 8th year 0.2 % 9th year 0.2 % and 10th year 0.2 % The company shall notify Euroclear Finland of the conclusion of the agreements at the latest two weeks prior to the beginning of the registration period. Euroclear Finland s CEO may, upon an application by the Issuer Agent, lower the minimum requirements on the agreements pertaining to the transfer of book-entries and the reservation of a share portfolio referred to above. Suspension of exchange The exchange of share certificates for book-entries shall, during the registration period, be suspended in places of exchange and at account operators and their agents implementing the exchange when the balance of the joint account is insufficient and the Issuer Agent no longer has the book-entries belonging to the agreement concerning the transfer of book-entries at his disposal. The places of exchange and account operators shall notify the customers of the suspension in the manner agreed upon by the Issuer Agent and the Company. The Issuer Agent shall notify the Financial Supervision Authority and Euroclear Finland of the suspension without delay. However, material to be exchanged may be accepted if the customer so wishes Settlement of an error The Issuer Agent shall coordinate the search for and rectification of an error. The Issuer Agent shall notify the places of exchange of the settlement procedures as well as report them to Euroclear Finland. 10(40)

11 Procedure prior to submitting the final report The Issuer Agent has to process reconciliation between the received commissions and the entries made in the book-entry system. The Issuer Agent is responsible for making the necessary corrections. The exchange material shall be filed so in the places of exchange and other exchange registers that the possible exchange-specific inspection can be made to find the error. The Issuer Agent shall issue further instructions on the inspection procedure. The Issuer Agent may, for a justified reason, oblige the places of exchange to undertake the inspection. Each place of exchange shall make the inspections within 2 4 weeks of the notification given by the Issuer Agent. The places of exchange shall, without delay, report any errors detected to the Issuer Agent and to Euroclear Finland, where necessary. Upon the end of the inspection, the places of exchange and account operators shall, without delay, furnish the Issuer Agent and Euroclear Finland with written accounts on the inspection and their measures for rectification if any. The places of exchange shall, each for their part, be liable for the costs of the inspection and for those arising from rectifying the errors detected. The Company shall be liable for the costs of measures concerning the agreements on the reservation of a share portfolio and on the transfer of book-entries. If the Issuer Agent and places of exchange together deem that the costs arising from settling an error would be excessive in view of the volume of shares involved in the error in question, they may agree that no inspection is undertaken. In this case, the places of exchange shall share the costs of the acquisition of shares or book-entries corresponding to the error in proportion to the exchange transactions conducted. If unsettled errors still remain after inspection of the exchange material, the issuer and the Issuer Agent shall agree on a further inspection. If this is effected by a party other than the places of exchange, a representative of the competent place of exchange shall be entitled to be present when the exchange material is being inspected. Further inspection shall relate to the volume and categories of shares and to the correctness of the share certificates. The inspection may also, in accordance with the agreement between the company and the Issuer Agent, cover e.g. comparison of the numbers of the share certificates to the list of shares preceding their transfer to book-entries. If further inspection reveals an error which could have been detected with the care required in the transfer already in the inspection of the exchange material - e.g. an incorrectly calculated volume of shares, 11(40)

12 wrong category or manifest forgery - the place of exchange responsible for the error shall be liable for the costs arising from the further inspection in proportion to the total share of errors caused. Rectification costs include compensation to the company for acquiring the corresponding book-entries if the book-entries referred to in the error cannot be returned to the joint account due to the fact that they have been transferred further. The costs of further inspection to be compensated shall be calculated on the basis of the inspection hours and the hourly compensation agreed upon in advance. If no error that could have been detected by a place of exchange is detected in further inspection, the Company shall be liable to compensate the costs referred to above. Similarly, the Company shall be liable to compensate if the error is detected in the inspection of the numbers of the share certificates, when it is caused by the Issuer himself - e.g. by the fact that more shares were issued than should have been according to the trade register entry. The Company may also, prior to further inspection, order that no inspection is made, in which case it shall be liable for the costs arising from the compensation of the necessary book-entries to the transferor of the book-entries. Procedure after submitting the final report After the commencement of the post-exchange, the places of exchange shall submit the Issuer Agent final reports on the exchanges they have made at the point of time separately agreed upon by the company and the Issuer Agent. After submitting the final report, a place of exchange shall, upon detecting an error, be entitled to inspect its own exchange material at its own expense within 2-4 weeks of the notification about the matter of the Issuer Agent. If the exchange material no longer is in the possession of the places of exchange when the error is detected, the Company shall deliver it to the places designated by them for the period of inspection. The Company shall be responsible for the costs of the agreements on the reservation of a share portfolio and on the transfer of book-entries. In other respects, the inspection shall proceed in the manner referred to in the sections concerning the inspection of the exchange material and further inspection, if less than ten (10) years has lapsed since the end of the registration period in question. After a lapse of ten (10) years from the end of the registration period in question, the Company shall be responsible for the inspection measures and liable for any compensation Collection of share certificates A share certificate, in which the shares referred to have been incorporated into the book-entry system, is the document referred to in point of the Rules of Euroclear Finland pertaining depositing 12(40)

13 other documents. A company may deposit share certificates on behalf of the place of exchange. In this case, the place of exchange shall submit to Euroclear Finland an account of the agreement pertaining to the matter and the undertaking of the company to deposit the share certificates in accordance with Rules of Euroclear Finland prior to collection of the share certificates at the places of exchange Safekeeping of share certificates The company shall agree with its issued agent on the safekeeping of share certificates and related acquisition documentation. The issuer agent shall see to the conclusion of corresponding agreements with the places of exchange. Share certificates and related acquisition documentation shall be stored like accounting material Cancellation of share certificates Share certificates of a company transferring to the book-entry system may be cancelled either during the registration period or thereafter Obligation of the company to disclose The applicant of a cancellation shall notify the company of the cancellation application pertaining to share certificates issued by the Company. Since the Company transferring to the book-entry system is under an obligation to provide a list of cancelled shares to the Issuer Agent, the company shall, correspondingly, immediately notify the Issuer Agent of the share certificates whose cancellation has been applied for Obligation of the Issuer Agent to act If the Company, during the registration period, notifies of the share certificates whose cancellation has been applied for, the Issuer Agent shall immediately notify the places of exchange thereof. If the volume of the share certificates whose cancellation has been applied for exceeds the balance of the joint account, the Issuer Agent shall undertake the measures referred to in point If the volume or value of the share certificates whose cancellation has been applied for is significant, the Issuer Agent shall consider whether it undertakes to inspect the exchange material, taking into account at least the history of the share certificates of the Company and the 13(40)

14 number of the transcriptions to be cancelled in proportion to the total amount of transcriptions involved Incorporation of cancelled share certificates into the book-entry system When incorporating cancelled share certificates into the book-entry system, it is recommended to use a court record endorsed with a notification of service upon the Company or a separate certificate of service as the basis of registration. Since it is not possible to obtain the original decision from the court and since an unlimited number of copies may, in principle, be obtained, the decision of copying cannot as such be used as the basis of registration in the book-entry system. The decision of copying may, however, be changed to a solitary one by serving notice thereof upon the company that has issued the cancelled shares, which is able completely to keep a record of the cancellation decisions made pertaining to the shares of the Company Nullifying of share certificates Endorsement of the incorporation of shares in the book-entry system referred to in the last sentence of Chapter 4, Section 8, Subsection 1 of the Companies Act shall be made by punching. Endorsements can also be made by stamping the share certificate with the stamp nullified so that it is not possible to remove the stamp. Endorsement shall be made in the place of exchange where the share certificate has been accepted. During the period of after-market exchange, endorsement shall be made by the Issuer Agent Returning of Nullified Share Certificates to Shareholders Returning of Share Certificates incorporated with Exchange Model General Conditions Before the company makes a decision on the returning of the nullified share certificates to the shareholders, it is responsible for contacting the manager referred to in the Rules of Euroclear Finland. The company and the manager must discuss about the practical feasibility of the returning. The returning of the nullified share certificates requires the consent of the manager and an agreement on the returning between the company and the manager. Moreover, the company s Board of Directors must make a decision on the returning of the nullified share certificates to the shareholders. The company is responsible for submitting to Euroclear Finland 1. the decision of the company s Board of Directors, 2. the company s and the manager s assurance that the company and the manager have made an agreement on the returning of the nullified share certificates and 14(40)

15 3. the certificate of the manager s consent to the returning of the nullified share certificate to the shareholders. A nullified share certificate may be returned to a shareholder at the earliest after the end of the registration period. The company and the manager can agree that the returning of the nullified share certificates to the shareholders will be initiated later than the above-mentioned moment. Returning of Share Certificates exchanged for book-entry on 15 September 2013 or earlier The manager gives the nullified share certificates that are exchanged for book-entries on 15 September 2013 or earlier and can reasonably be found to the company. Thereafter, the company may return the nullified share certificates to the shareholders. Returning of Share Certificates exchanged for book-entry on 16 September 2013 or later If a shareholder has exchanged a share certificate for a book-entry on 16 September 2013 or later, the shareholder, on whose book-entry account the book-entries have been registered when the share certificates have been exchanged for book-entries, must request for the retuning of the nullified share certificate from the manager. The request for returning shall be presented within one (1) year after the decision of the company s Board of Directors, if the share certificates have been exchanged for book-entries before the company s Board of Directors have made an decision on the returning, or, if the share certificates have been exchanged for book-entries after the decision of the company s Board of Directors, within one (1) year after the exchange of the share certificates for book-entries. If the shareholder has requested for returning in time, the manager returns the nullified share certificates to the shareholder, on whose book-entry account the book-entries have been registered when the share certificates have been exchanged for book-entries. All the share certificates related to a single exchange that can reasonably be found shall be returned, unless the shareholder accepts that all the nullified share certificates are not returned Returning of Share Certificates incorporated with Simplified Incorporation Model Returning of the share certificates incorporated with simplified incorporation model requires that the company s Board of Directors makes a decision on the returning of the nullified share certificates to the shareholders and this decision of the Board of Directors is submitted to the Euroclear Finland. 15(40)

16 The company returns the nullified share certificates to the shareholder from whom the share certificates have been collected before incorporation into the book-entry system. All the collected share certificates that can reasonably be found shall be returned, unless the shareholder accepts that all the nullified share certificates are not returned Marking the Share Certificates that will be returned A nullified share certificate that will be returned to a shareholder must contain the following markings: 1. The stamp nullified next to the serial number, 2. The stamp nullified after the latest endorsement and 3. Perforation. All these markings shall be done in such way that it not possible to remove the markings. The one, who returns the nullified share certificate to the shareholder, is responsible for ensuring that all the required markings are in the nullified share certificate and adding the missing markings Storing of Copies of Share Certificates The copies of the nullified share certificates returned to the shareholders shall be taken and the copies shall be stored in the corresponding way as the original share certificates in accordance with the Points of the Rules of Euroclear Finland and Sections 2.4 and 2.5 of this Decision of Euroclear Finland s CEO. However, storing of the returned share certificates as copies does not require the authorization of Euroclear Finland s CEO or the approval of the account operator s authorized public accountant in accordance with the Point of the Rules of Euroclear Finland. 3. Incorporation of physical securities entitling to shares In this context, security entitling to shares shall mean securities issued by the Company entitling to shares in that company, including warrants, bonds with warrants and convertible loans. Simplified incorporation model will always be used when incorporating physical securities entitling to shares. The provisions on the incorporation of share certificates in section of this Decision shall apply to the incorporation of physical securities. If the Terms and Conditions of the security to be incorporated provide the subsequent incorporation in the book-entry system, the Board of Directors of the Company or another body stated in the Terms and Conditions shall decide upon incorporation. 16(40)

17 If there are no provisions on incorporation or if the Company does not otherwise have the right to transfer the physical security in the bookentry system under its own decision, the Company shall receive written approval from all the holders of the physical securities before incorporation and making an application for issuance. In order to ensure the reliable and secure operations of the book-entry system, Euroclear Finland shall decide upon the schedule to incorporate the securities into the book-entry system. The shares that are the object of subscription or conversion shall be incorporated in the bookentry system prior to the beginning of the share subscription or conversion period for the securities entitling to shares. The Company shall notify the holders of the securities of the incorporation of the security into the book-entry system and of the time schedule and procedure for incorporation in accordance with section of the Rules of Euroclear Finland. The provisions on share certificates shall apply to the cancellation and annulment of the securities when applicable. 4. Incorporation of shares in cooperatives in the OM system This decision shall be applied in accordance with Chapter 15, Section 7, 8, and 10 of the Cooperatives Act about procedure to notify holders of shares in the cooperative about decision to incorporate the shares in the cooperative in the book-entry system and to register holders of the shares in cooperatives or other holder of right s right to the book-entry account of the holder of shares in the cooperative. The cooperative s or representatives meeting shall decide on the incorporation of shares in the OM System. The meeting can authorise the Board of Directors to decide the registration period, the length of which the cooperative agrees with Euroclear Finland. The provisions for incorporating the shares in the cooperative to the book-entry system and the provision of the right to become a member of the cooperative under Chapter 1, Section 4, are to be added to the rules of the cooperative. The amendment to the cooperative s rules and the cooperative s decision to incorporate the shares in the book-entry system must be notified for registration of the Trade Register. Before making issuer and issue applications, the cooperative must sign an agreement with one Issuer Agent in accordance with the Rules of Euroclear Finland to act as the cooperative s issue manager. A model template for the agreement between the cooperative and its issue manager can be obtained from Euroclear Finland. 17(40)

18 The provisions on share certificates shall apply to the stocks issued by cooperation when applicable Alternative procedures and instructions pertaining to incorporation Use of the Exchange Model in incorporation When incorporating shares in a cooperative into the book-entry system a so-called Exchange Model may be used. The Exchange Model shall be regarded as an incorporation model approved by Euroclear Finland referred to in Chapter 15, Section 8 of the Cooperatives Act Simplified incorporation model Simplified incorporation model can be used if the Cooperative knows all of the holders of shares in it. However, it is not possible to use the simplified incorporation model, if a share of the Cooperative is subject to public or multilateral trading, if not all the shares of the Cooperative have been registered or if the Cooperative is unable to take charge of processing the shares. In this case, the Exchange Model shall be used. Shares can be incorporated with the simplified incorporation model if the Cooperative has not issued share certificates or interim certificates or if they can be collected and cancelled before incorporation into the book-entry system in such a manner that ownership of the shares is evidenced solely on the lists kept by the Cooperative (Cooperatives with no Share Certificates). If certificates or interim certificates have been issued for shares, the Cooperative shall collect and cancel them before incorporation. Shareholders shall deliver the share certificates and the interim certificates to the Cooperative. If conveyance or other acquisition of a share has not been registered, the Cooperative shall examine the acquisition documentation and decide on registration in the name of the owners in question. When the shares are incorporated with the simplified incorporation model, Euroclear Finland shall receive an affirmation signed by the Board of Directors or CEO of the Cooperative stating that - all the shares in the Cooperative have been registered in the name of the shareholders, - every share certificate and interim certificate not subject to a pledge has been collected and cancelled, - all the Cooperative's shareholders have undertaken not to convey or transfer their ownership in the Cooperative before incorporation and the Cooperative has undertaken not to accept changes on members and not to mark changes in the list of members and - all the pledgees and relevant execution authorities have undertaken not to convey the share certificates and interim 18(40)

19 certificates subject to a pledge other than to a book-entry register in connection with registration of their right in a bookentry account. Euroclear Finland may, upon cooperative s application accept that cooperative accepts changes on its members and mark changes in the list of members. The shares in the Cooperative shall be registered in the book-entry system on the basis of an application for registration. The shares in the cooperative shall be incorporated into the book-entry system on the basis of application by the Cooperative. The Cooperative shall agree with Euroclear Finland on the processing of the applications for registration and the method to be complied with. Before incorporation of the shares in the Cooperative in the book-entry system, a shareholder shall open a book-entry account with one of the account operators if the shareholder does not already have one Notifications to holders of shares in the Cooperative and notifying of the decision to incorporate the shares into the book-entry system Holders of shares known by the Cooperative The Cooperative shall notify its shareholders no later than three (3) months before the end of the registration period of the decision by the Cooperative to incorporate the shares of the Cooperative into the bookentry system, unless all shareholders have agreed to a deviation from this deadline (see point 4.2.3). Similar instructions must also be issued when other rights to the share can be registered. In the notification to the shareholders referred to the incorporation of the shares into the book-entry system, at least the information presented below shall be provided, unless all shareholders have agreed to a deviation from these requirements on substance (see point 4.2.3). - All places of exchange acting as recipients of share certificates must be mentioned in the notification. - The notification shall furthermore include reminder that documents indicating title shall be appended when leaving the share certificates to be registered as book-entries. After the registration period, the holder of unexchanged share certificate cannot use the rights of the holders of shares in cooperation before the holder has been registered on the member register kept by Euroclear Finland. Notifications and information bulletins shall indicate how shareholders can avoid forfeiting rights in this respect. Notification must be sent by mail, for example as a letter, no later than three (3) months before the end of the registration period. If 19(40)

20 notification is included in other material to be delivered to the shareholder, it shall be distinct from this other material Announcement in the Official Gazette Prior to the beginning of the registration period, an announcement on the transfer decision, the beginning and end of the registration period shall be published in the Official Gazette Deviating from the obligations to notify and disclose The deadlines as well as obligations to notify and disclose prescribed in the Cooperatives Act (Chapter 15, Section 7) may be deviated from with the consent of all shareholders. The Cooperative shall collect the consents prior to submitting an application for issue to Euroclear Finland at the risk of Euroclear Finland otherwise deciding an incorporation period with all relating procedures in accordance with the Cooperatives Act Provision for error situations in the exchange of share certificates This chapter shall be applied in full when the Cooperative has issued share certificates,, and the share certificates cannot be collected and cancelled before incorporation into the book-entry system in such a manner that ownership of the shares is evidenced solely on the register kept by the Cooperative (Cooperative with no Share Certificates). These regulations issued on the provision for error situations in the exchange of share certificates shall apply to shares for which share certificates or interim certificates have not been issued by the end of the registration period of the Cooperative in question. Euroclear Finland s CEO may decide on exceptions on provision for error situations Provisional measures Information on share certificates to be received By no later than three (3) weeks prior to the commencement of the exchange, the Cooperative shall deliver the following information to the issue manager: a) detailed descriptions of and instructions for identification of the physical shares of each category of shares as well as the authenticity criteria on the physical shares; b) a list of cancelled physical shares. Monitoring the balance of a joint account The Issuer Agent shall monitor the balance of the joint account. 20(40)

21 When the balance of a joint account falls below the limit of 5% or some other limit higher than this agreed upon by the Cooperative and the issue manager, the issue manager provides information to the Cooperative. The Cooperative shall, if required issue new shares and designate an account from which the issue manager, upon the authorisation of the Cooperative, may, when the balance of the joint account is insufficient, transfer the necessary book-entries to the shareholder requiring the exchange. A transfer restriction for the benefit of the issue manager shall be registered in the account. Suspension of exchange During the registration period, the exchange of share certificates for book-entries shall be suspended when the balance of the joint account is insufficient and the Issuer has, on the basis of exchange, issued a number of new shares that correspond to at least 1% of the cooperative capital at the time of incorporation into the book-entry system or additional shares in respect of additional cooperative capital or investment capital in respect of investment shares and the Cooperative no longer wishes to issue new shares on the basis of exchange. The issue manager and account operators shall notify the customers of the suspension in the manner agreed upon by the account operator acting as the issuer and the Cooperative. The issue manager shall notify the Financial Supervisory Authority and Euroclear Finland of the suspension without delay. However, material to be exchanged may be accepted if the customer so wishes Settlement of an error The issue manager shall coordinate the search for and rectification of an error. The issue manager shall notify Euroclear Finland of the settlement procedures. Procedure prior to submitting the final report The Issuer Agent has to process reconciliation between the received commissions and the entries made in the book-entry system. The Issuer Agent is responsible for making the necessary corrections. The share certificate exchange material shall be filed so in the issue manager and other exchange registers that the possible exchangespecific inspection referred to above can be made. The Issuer Agent shall issue more detailed instructions about the inspection procedure. The responsibility for costs between the Issuer and issue manager is determined on the basis of the agreement between them. 21(40)

22 The issue manager shall furnish the Cooperative with a final report on exchanges carried out at a date agreed by the issue manager and the Cooperative. Procedure after submitting the final report After submitting the final report, the issue manager has, upon detecting an error, the right, at its own expense, to inspect its own exchange material within 2-4 weeks of the issue of the final report. If the exchange material no longer is in the possession of the account operator acting as the issue manager, the Cooperative shall deliver it to the place designated by the issue manager for the period of inspection. In other respects, the inspection shall proceed in the manner referred to in the section concerning the inspection of the exchange material if less than ten (10) years has lapsed since the end of the registration period in question. After a lapse of ten (10) years from the end of the registration period in question, the Cooperative shall be responsible for the inspection measures and liable for any compensation Collection of share certificates A share certificate, in which the shares referred to have been incorporated into the book-entry system, is the document referred to in point of the Rules of Euroclear Finland pertaining depositing other documents. A cooperative may deposit share certificates on behalf of an account operator acting as the issue manager or its agent. In this case, the account operator or its agent in question shall submit to Euroclear Finland an account of the agreement pertaining to the matter and the undertaking of the cooperative to deposit the share certificates in accordance with point of the Rules of Euroclear Finland prior to collection of the share certificates in accordance to the so-called Exchange Model. Alternatively, the account operator or its agent shall copy the share certificates prior to collection in the manner referred to in point of the Rules of Euroclear Finland. The account operator or its agent shall submit to Euroclear Finland an account to the effect that the account operator s auditor, authorised by the Central Chamber of Commerce, has accepted the copying method Cancellation of share certificates Share certificates of a cooperative being incorporated into the bookentry system may be cancelled either during the registration period or thereafter. 22(40)