June 26, 2020
MINEBEA MITSUMI Inc.
Notice Regarding Disposition of Treasury Stock through Third Party Allotment in Connection with Introduction of Performance-Linked Stock Remuneration Plan
MINEBEA MITSUMI Inc. (the "Company") hereby announces that a resolution was made at a meeting of the Board of Directors held today to dispose of treasury stock (hereinafter called the "disposal of treasury stock") in connection with a performance-linked stock remuneration plan. The details are as follows:
1. Outline of Disposition
|(1) Date of disposition||July 13, 2020|
|(2) Number of shares to be disposed||122,800 common shares|
|(3) Price of disposition||1,954yen per share|
|(4) Amount of Proceeds||239,951,200yen|
|(5) Subscriber||Sumitomo Mitsui Trust Bank, Limited
(Trust Account (Re-trustee : Japan Trustee Services Bank, Ltd. (Trust Account))
|(6) Other||This disposal of treasury stock shall be conditional upon the coming into force of the notification in accordance with the stipulations of the Financial Instruments and Exchange Act.|
2. Objective of and Reason for Disposition
The Company passed a resolution to introduce a performance-linked stock remuneration plan (hereinafter the "Plan") for directors (excluding outside directors, hereinafter the same) using a trust at the meeting of Board of Directors on May 8, 2020 and the Plan which applies to Directors was approved at the 74th General Shareholders Meeting, held on June 26, 2020.
The Plan is designed to motivate Directors to contribute more to enhancing the medium to long term business performance of the Company and its corporate value, through further clarifying linkage between remuneration for Directors and the Company's business performance as well as to share the profits and risks of stock price fluctuations with shareholders.
Please refer to "Notice Regarding Introduction of Performance-Linked Stock Remuneration Plan for Directors" announced on May 8, 2020, for the details of the Plan.
The disposition of treasury stock will be conducted to the Trust Account of Sumitomo Mitsui Trust Bank, Limited, (Re trustee: Trust Account of Japan Trustee Services Bank, Ltd.) which is the trustee for the trust established for the introduction of the Plan.
The total number of shares of treasury stock to be disposed of is equal to the number of shares expected to be delivered to the Company's Directors during the period of the Trust based on the Share Delivery Regulations that the Company will establish on the introduction of the plan. The level of share dilution as against the total number of shares issued and outstanding as of March 31, 2020 of 427,080,606 will be 0.03 %, the ratio as against the total number of voting rights as of March 31, 2020 of 4,078,596 will be 0.03 % (rounded to the second decimal place, respectively).
The Company considers that the Plan will clarify the link between the remuneration of the Company's Directors and the Company's stock price, resulting in an enhancement of the Company's corporate value in the medium to long term. Thus, the Company believes that the number of shares to be disposed of and the level of share dilution due to the disposition of treasury stock is reasonable. The Company believes the impact on the trading market is not material through this disposition.
|Trustee||Sumitomo Mitsui Trust Bank, Limited (Re-trustee : Japan Trustee Services Bank, Ltd.)|
|Beneficiaries||Directors who meet the requirements|
|Trust administrator||To be selected from third parties having no conflict of interests with the Company and its Directors|
|Exercise of voting rights||No voting rights will be exercised for the shares in the Trust during the Trust period|
|Type of trust||Money trust other than cash trusts (third-party-benefit trust)|
|Date of conclusion of the Trust Agreement||July 13, 2020|
|Trust Period||July 13, 2020 – July 31, 2023|
|Objective of the trust||To deliver the Company shares to Beneficiaries based on the Share Delivery Regulations|
3. Basis of calculation of the price of disposition and the specific details
The price of disposition has been fixed at 1,954 yen per share, which is the closing price of the Company's shares on the Tokyo Stock Exchange on June 25, 2020, the business day immediately prior to the date of the meeting of the Board of Directors in order to set a price that eliminates any arbitrary elements in view of the recent trends in the price of the Company's shares.
The average closing price of the Company's common shares for the immediately preceding one month (May 26, 2020 - June 25, 2029) was 1,999 yen (rounded down to the nearest whole yen) representing a divergence ratio of -2.25%. Likewise, the average closing price of the Company's common shares for the immediately preceding three months (March 26, 2020 - June 25, 2020) was 1,799 yen (rounded down to the nearest whole yen), representing a divergence ratio of 8.68%. In addition, the average closing price of the Company's common shares for the immediately preceding six months (December 26, 2020 - June 25, 2020) was 1,927 yen (rounded down to the nearest whole yen), representing a divergence ratio of 1.40%.
Therefore, the Company believes that the calculation of the price of disposition is reasonable and not especially favorable to the subscriber.
In addition, all of the Audit & Supervisory Board Members (three out of the total of four are Outside Audit & Supervisory Board Members) who attended the meeting of the Board of Directors, have expressed the opinion that the price of disposition is not especially favorable to the subscriber for the above-stated reasons.
4. Procedures under the Code of Corporate Conduct
This disposition of treasury stock does not require the acquisition of an opinion from an independent third party or require procedures for confirming the intent of shareholders, which are provided for under Article 432 of the Securities Listing Regulations of the Tokyo Stock Exchange, because (1) the dilution ratio is less than 25% and (2) the disposition does not involve a change in controlling shareholders.
|Company Name:||MINEBEA MITSUMI Inc.|
Representative Director, CEO & COO
(Code No. 6479, TSE Div. No. 1)
Officer in charge of Personnel & General Affairs Div.
Product information, contact and other context are subject to change without prior notice.