Notice regarding issuance of new shares as restricted stock compensation

The Company hereby announces that the Board of Directors meeting held today has resolved to issue new shares (hereinafter referred to as the "Issuance of New Shares") as follows.

Record

1.Overview of the new stock issue

2.Purpose and reason for issuance

The Company shall provide the Company with directors of the Company (excluding outside directors; directors who receive restricted stock are hereinafter referred to as “Directors Eligible for Restricted Transfer”) and employees of the Company (hereinafter, together with Directors Eligible for Restricted Transfer, May 15, 2019, with the aim of providing incentives to the "Eligible Directors, etc." to continuously improve the company's corporate value and promoting further sharing of value with shareholders. At the Board of Directors meeting held on June 17, 2019 and the 31st Ordinary General Meeting of Shareholders held on June 17, 2019, we resolved to introduce a "Restricted Stock Compensation Plan" (hereinafter referred to as the "Plan").
In addition, at the 31st Ordinary General Meeting of Shareholders held on June 17, 2019, based on this system, monetary compensation (hereinafter referred to as "Restricted Stock Compensation") will be provided as investment property for the acquisition of restricted stock. ), to provide eligible directors with restricted stock remuneration of up to 80 million yen per year (however, this does not include the employee salary of directors who also serve as employees), and with restricted stock. A resolution has been passed to approve the transfer restriction period of 3 to 5 years as determined by the Company's Board of Directors.
In issuing new shares, we will take into consideration the purpose of this system, the Company's performance, the scope of duties of each eligible director, etc., and various circumstances. A total of 107,564,800 yen in monetary remuneration claims and monetary receivables will be paid to directors eligible for grant as restricted stock remuneration (as of March 31st), and each director, etc. We have decided to issue a total of 44,800 shares of our common stock by distributing the shares in accordance with this method (hereinafter, the common shares of our company issued through this issuance of new shares are referred to as the "Shares"). The monetary remuneration claims and monetary claims are between each eligible director, etc. and the Company and are summarized in 3. below. The payment will be made subject to the conclusion of a restricted stock allocation agreement (hereinafter referred to as the "Allotment Agreement") that includes the contents described in .
Based on this system, the transfer restriction period for the shares has been set as three years.
Please note that these shares will be issued only to the seven employees of the Company, who are the planned allottees, and will only be issued to those who wish to subscribe to them. Since the Company will provide monetary claims for making in-kind contributions to the Company, employees' wages will not be reduced as a result of this issuance of new shares.

3.Summary of allocation contract

(1) Transfer restriction period
July 18, 2019 - July 17, 2022
Eligible Directors, etc. shall not transfer, create a security interest in, or otherwise dispose of the Shares during the period specified above (hereinafter referred to as the "Transfer Restriction Period") (hereinafter referred to as the "Transfer Restriction Period"). It's called.).

(2) Conditions for cancellation of transfer restrictions
During the transfer restriction period, the Eligible Directors, etc. will continue to be directors, auditors, executive officers, and employees of the Company or its subsidiaries (hereinafter, the Company and its subsidiaries are collectively referred to as the "Company Group"). Transfer restrictions will be lifted for all of the shares granted to such eligible directors (including executive officers) at the expiration of the transfer restriction period, provided that they held a similar position.

(3) Before the expiration of the transfer restriction period, the eligible director, etc. resigns or retires from the position listed in (2) above due to expiration of term of office, retirement, death, retirement due to company circumstances, or other justifiable reason. ”).

• ① Timing of lifting of transfer restrictions
  Eligible Directors, etc., are retiring from any of the positions of Directors, Audit & Supervisory Board Members, Executive Officers, Employees (including Executive Officers), and other similar positions of the Group (However, if the Director, etc. (Excluding the case of appointment or reappointment), retirement, death, retirement due to company reasons, or other justifiable reasons, the transfer restriction period is the period from the payment date to the retirement, etc. As of the time immediately after the resignation, etc. (the time immediately after the retirement, etc. and, in this case, the free acquisition described in (4) below; the same applies hereinafter), the transfer restriction will be lifted.
• ②Number of shares subject to cancellation of transfer restrictions
  Transfer restrictions will be lifted for all of the Shares held by the Eligible Director, etc. (however, if the Eligible Director, etc. retires due to death, the heir of the Eligible Director, etc.) as of the time immediately after the relevant retirement, etc. specified in ①. To do.

(4) Free acquisition by our company
Of the Shares granted to Eligible Directors, etc., the Company will naturally acquire all of the Shares for which the transfer restriction is not lifted at the expiration of the transfer restriction period, free of charge, immediately after the expiration of the transfer restriction period. In addition, if certain reasons apply, such as when a director eligible for grant, etc. retires for personal reasons during the transfer restriction period, the director, etc. eligible for grant, etc. falls under the said reason, and the director, etc. eligible for grant, Naturally, all of the shares granted to the Company will be acquired free of charge. In addition, if a Director, etc. eligible for grant, retires, etc. for the valid reason stated in (3) above before the expiry of the transfer restriction period, the payment date will be calculated from the number of Shares granted to the Director, etc., eligible for grant. The number obtained by dividing the number of months from the month including the month including the date on which the director, etc. eligible for grant, etc. retires, etc. for legitimate reasons by 37, multiplied by the number of Shares granted to the director, etc. eligible for grant, etc. (However, , if the calculation results in a fraction less than one share, it shall be rounded down.) The number of shares obtained by subtracting the number of shares (if the calculation results in a fraction less than one share shall be rounded down) will be granted as a matter of course at the time the director, etc. to whom the grant is granted retires, etc. for a justifiable reason. Get it for free.

(5) Stock management
During the transfer restriction period, the shares will be managed in a dedicated account opened by the eligible director, etc. at a securities company designated by the Company, so that they cannot be transferred, set up a security interest, or otherwise disposed of during the transfer restriction period. . In order to ensure the effectiveness of transfer restrictions, etc. related to the Shares, the Company has entered into an agreement with the designated securities company of the Company in connection with the management of the account of the Shares held by each Eligible Director, etc. Masu. In addition, the eligible Directors, etc. shall agree to the details of the management of the relevant account.

(6) Handling in organizational restructuring, etc.
During the transfer restriction period, matters related to a merger agreement in which the Company becomes an extinguished company, a stock exchange contract in which the Company becomes a wholly owned subsidiary, a stock transfer plan, and other organizational restructuring, etc. In cases where approval is not required by the general meeting of shareholders, the number of months from the month including the payment date to the month including the date of approval of the reorganization, etc., as determined by the company, if approved by the company's board of directors) divided by 37, multiplied by the number of Shares held by Directors, etc. eligible for grant as of the date of approval of the reorganization, etc. (However, if the calculation results in a fraction of less than 1 share, ) transfer restrictions will be lifted immediately before the business day preceding the effective date of the reorganization, etc.

4. Basis for calculating the payment amount and its specific details

The issuance of new shares to eligible directors, etc. will be based on monetary remuneration claims or monetary compensation paid as restricted stock compensation for the Company's 32nd fiscal year (April 1, 2019 to March 31, 2020) under this system. Monetary claims are used as invested assets. The issue price is 2,401 yen, which is the closing price of the Company's common stock on the First Section of Tokyo Stock Exchange on July 2, 2019 (the business day before the date of the board of directors' resolution), in order to eliminate arbitrariness. That's what I mean. Since this is the market share price immediately before the date of the board of directors' resolution, we believe that this is a reasonable and not particularly advantageous price.

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