KONICA MINOLTA

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Notice on the Allotment of Subscription Rights to Shares as Stock Options

Company Name: Konica Minolta, Inc.
Representative: Shoei Yamana, President and CEO
Stock Exchange Listings: Tokyo (First Sections)
Local Securities Code Number: 4902
Contact:Mami Iwamoto, General Manager, CSR, Corporate Communications & Branding Division
Tel: (81) 3-6250-2100

Tokyo (August 3, 2015) –Konica Minolta, Inc. (the “Company”) has decided to offer its directors and executive officers (excluding outside directors) subscription rights to shares in the form of compensation-type stock options, in accordance with the provisions of Articles 238 and 240 of the Company Law of Japan, under the terms and conditions set forth hereunder:

1. Reasons for the Issuance of Subscription Rights to Shares in the Form of Stock Options:

The Company issues subscription rights to shares as the shareholders' perspective linked stock price-related compensation, in order to provide further incentives to its directors and executive officers (excluding outside directors), increase their morale, and clarify their responsibilities for improving company performance.

2. Name of Subscription Rights to Shares:

The Konica Minolta, Inc. 11th (FY2015) Subscription Rights to Shares
(Stock Compensation-Type Stock Options)

3. Terms and Conditions for the Issuance of Subscription Rights to Shares:

(1) Persons Eligible for the Allotment of Subscription Rights to Shares, the Number of Persons, and the Number of Subscription Rights to Shares to be Allotted:

A total of 1,101 subscription rights to shares will be allotted to a total of 22 persons, with 221 to three directors, excluding outside directors, and 880 to 19 executive officers. It should be noted that four of the 19 executive officers concurrently serve as directors.

(2) Total Number of Subscription Rights to Shares: 1,101

The above total number represents the number of subscription rights to shares that are planned for allotment. In the event that some of the shares are not subscribed, and in consequence the total number of subscription rights to shares to be offered decreases, the total number to be allotted will be the total number that will be issued.

(3) Type and Number of Shares Underlining Subscription Rights to Shares:

The type of shares underlining the subscription rights to shares shall be the Company's ordinary share, and the number of shares issued upon the exercise of each stock acquisition right (hereinafter referred to as the “number of shares granted”) is 100. (The total number of shares for the 1,101 subscription rights to shares as stated in the (2) above amounts to 110,100 shares.)
However, if the Company splits or consolidates its ordinary share (including allotting shares of the Company's ordinary share free of charge), the number of shares granted shall be adjusted by the following formula, and any fraction less than one share resulting from adjustment will be rounded down to the nearest one whole share.

Post-adjustment number of shares granted
= Pre-adjustment number of shares granted x the stock split or consolidation ratio

In addition to the above, if unavoidable circumstances necessitate an adjustment to the number of shares granted, it shall be adjusted to the extent reasonable.

(4) Amount to be Paid in Exchange for Subscription Rights to Shares and the Method of Calculation:

Undecided (it shall be the amount determined by the Black-Scholes model, as of August 18, 2015)
The amount determined by the said model is the fair price of each stock acquisition right to be offered; therefore, it does not apply to favorable issuance.
Pecuniary compensation equivalent to the total amount payable for subscription rights to shares that will be allotted to the directors and executive officers set forth in (1) above shall be paid to the said directors and executive officers who shall be granted the said subscription rights to shares by offsetting the amount payable for the subscription rights to shares to be offered against their right to claim the said compensation.

(5) Amount of Property to be Provided as Contribution upon the Exercise of Subscription Rights to Shares and the Method of Calculation:

The amount of property to be provided as contribution upon the exercise of subscription rights to shares shall be the amount obtained by multiplying the number of shares granted by one yen, the amount to be paid per share granted upon the exercise of each stock acquisition right.

(6) Period of Time during that Subscription Rights to Shares may be Exercised:

From August 19, 2015 to June 30, 2045

(7) Conditions for the Exercise of Subscription Rights to Shares:

(a) The person receiving allotment of subscription rights to shares offered (hereinafter referred to as the “optionee”) shall be permitted to exercise their subscription rights to shares only during a period of ten years counting from the date one year after the date immediately following the date on which they lose their both positions as the Company's directors and executive officers (hereinafter referred to as the “exercise commencement date”) within the time frame mentioned in (6) above.

(b) Notwithstanding (a) above, in case of the following (i) and (ii), the optionee may exercise their subscription rights to shares only during either of the periods specified in the following (i) and (ii), except, in the case (ii), where the subscription rights to shares of any of the restructured companies are granted to the optionee as specified in (11) below:
(i) In case the exercise commencement date does not arrive on or before June 30, 2044:
-- The period from July 1, 2044 to June 30, 2045; or
(ii)In case the Company's general meeting of shareholders approves a proposal for the approval of a merger agreement that will cause the Company to dissolve; or a proposal for the approval of a share exchange agreement that will make the Company a wholly owned subsidiary; or a proposal for the approval of a share transfer plan (if the resolution by the general meeting of shareholders is unnecessary, then in case such resolution is made at the Company's Board of Directors meeting):
-- The period of 15 days from the date immediately following the approved date

(c) No partial exercise of each subscription rights to shares shall be permitted.

(d) Articles on circumstances that will make the optionee unable to exercise the subscription rights to shares they hold and articles related to succeeding the subscription rights to shares in the event of the optionee's death shall be separately prescribed by a stock acquisition right allotment agreement to be made and entered into by and between the Company and the optionee.

(8) Amount of Capital or Capital Reserve to be Increased when Shares are Issued upon the Exercise of Subscription Rights to Shares:

(a) The amount of capital to be increased when shares are issued upon the exercise of the subscription rights to shares shall be the amount equivalent to half of the allowable capital increase limit calculated pursuant to Article 17, Paragraph 1, of the Company Calculation Rules, and fractions less than one yen resulting from calculation shall be rounded up to the nearest whole yen.

(b) The amount of capital reserve to be increased when shares are issued upon the exercise of the subscription rights to shares shall be the above-mentioned allowable capital increase limit minus the above-mentioned amount of capital increase.

(9) Conditions for the Acquisition of Subscription Rights to Shares:

When the Company's general meeting of shareholders approves a proposal for the approval of a merger agreement that will cause the Company to dissolve; or a proposal for the approval of a company split agreement or plan that will make the Company a split company ; or a proposal for the approval of a share exchange agreement or a share transfer plan that will make the Company a wholly owned subsidiary, and if the Company deems it necessary, the Company may acquire the subscription rights to shares free of charge on a date separately designated by the Board of Directors or executive officers.

(10) Restrictions on the Transfer of Subscription Rights to Shares:

Transfer of the subscription rights to shares shall be subject to an approval of the Company's Board of Directors.

(11) Handling of Subscription Rights to Shares upon Organizational Restructuring:

In the case where the Company conducts any merger (limited to cases where the Company is the dissolving company), demerger by transfer to an existing company (kyusyu-bunkatsu), demerger by transfer to a newly established company (shinsetsu-bunkatsu), statutory share exchange (kabushiki kokan) or statutory share transfer (kabushiki iten), (collectively, hereinafter referred to as the “organizational restructuring”), each optionee that holds the subscription rights to shares that are outstanding immediately prior to the time at which the relevant organizational restructuring becomes effective (hereinafter referred to as the “outstanding subscription rights to shares”) shall be granted the subscription rights to shares to acquire shares in the respective “kabushiki kaisha” as set forth in Article 236, Paragraph 1, Item 8(a) to 8(e) of the Company Law (hereinafter referred to as the “successor company”), in which case, the outstanding subscription rights to shares shall be cancelled, and new subscription rights to shares shall be issued by the successor company; provided, however, that this shall be on condition that the issuance of the subscription rights to shares by the successor company in accordance with the following terms and conditions is set forth in the relevant merger agreement, demerger agreement or demerger plan, statutory share exchange agreement or statutory share transfer plan:

(a) Number of subscription rights to shares to be issued by the successor company:
This shall be the same number as the outstanding subscription rights to shares held by the optionee

(b) Type of the shares of the successor company to be issued upon the exercise of subscription rights to shares:
-- Ordinary share of the successor company

(c) Number of the shares of the successor company to be issued upon the exercise of subscription rights to shares:
This shall be determined in accordance with (3) above upon considering the terms and conditions of the relevant organizational restructuring activities.

(d) Amount of property to be provided as contribution upon the exercise of subscription rights to shares:
This shall be the amount obtained by multiplying the post-reorganization exercise price by the number of shares underlying each stock acquisition right as set forth in (c) above. The post-reorganization exercise price shall be one yen per share of the successor company to be granted upon the exercise of subscription rights to shares to be issued.

(e) Period of time during that subscription rights to shares may be exercised:
The period shall commence on the later of (i) the first day of the period during which the subscription rights to shares may be exercised as specified in (6) above or (ii) the day when any of the organizational restructuring activities become effective, and end on the last day of the period during which the subscription rights to shares may be exercised as specified in (6) above.

(f) Matters related to the amount of capital or capital reserve to be increased when shares are issued upon the exercise of subscription rights to shares:
These matters shall be determined as set forth in (8) above.

(g) The acquisition of subscription rights to shares:
This shall be determined as set forth in (9) above.

(h) Restrictions on the transfer of subscription rights to shares:
The acquisition of subscription rights to shares by transfer shall be subject to the approval of the Board of Directors meeting of the successor company.

(i) Other conditions for the exercise of subscription rights to shares:
Other conditions shall be determined as set forth in (7) above.

Allotment Date of Subscription Rights to Shares:

August 18, 2015

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