June 27, 2024

• Management/Finance

Notice Concerning Allocation of Stock Acquisition Rights (Stock Compensation Type Stock Options)

1. The number of persons to be assigned stock acquisition rights (hereinafter referred to as target persons) and the number of stock acquisition rights assigned to target persons

2. Total number of stock acquisition rights

577 pieces

3. Type and number of shares for the purpose of stock acquisition rights

The Company's common stock will be 57,700 shares.
The number of shares (hereinafter referred to as the number of shares granted) for the purpose of each stock acquisition right is 100 shares of the Company's common stock. However, after the date the stock acquisition rights are allocated (hereinafter referred to as the day of the allotment), the Company splits shares (including free allocation of common shares). Hereafter, the same as described in the stock split) or when a stock merger is carried out, the number of shares granted is adjusted according to the following formula, and fractions of less than 1 share that occur as a result of the adjustment are rounded down.

Number of shares granted after adjustment = number of shares granted before adjustment × ratio of stock split or stock merger

Also, when the Company undertakes a merger, company split, stock exchange, or stock transfer after the day of the allotment, when allocating shares free of charge, or when an adjustment in the number of granted shares is required, the number of granted shares will be adjusted appropriately to the extent necessary and reasonable.
When the number of shares granted is adjusted, necessary matters are notified or announced to the person holding each stock acquisition right described in the stock acquisition rights register (hereinafter referred to as the stock acquisition rights holder) by the day before the day the adjusted number of shares granted is applied. However, if notification or public announcement cannot be made by the day before the applicable date, notification or publication will be made promptly thereafter.

4. Date of allocation of stock acquisition rights

July 12, 2012

5. Stock Acquisition Rights Payment Amount

The payment amount for each stock acquisition right is the amount obtained by multiplying the number of shares granted by the number of shares granted by the option price per share (fractions less than 1 yen rounded) calculated based on basic values ii to vii below using the Black Scholes model in the following formula.

wherein

• i.
  Option price per share (C)
• ii.
  Stock price (S): Closing price of ordinary trading of the Company's common stock on the Tokyo Stock Exchange on July 12, 2012 (allotment date) (if there is no closing price, the base price for the next trading day)
• iii.
  Exercise price (X): 1 yen
• iv.
  Expected remaining period (T): 9 years
• v.
  Stock price volatility (σ): Fluctuation rate calculated based on the closing price of ordinary transactions of our common stock on the last trading day of each week for 9 years (from 2015/7/12 to 2024/7/11)
• vi.
  Risk-free interest rate (r): Interest rate on government bonds whose remaining years correspond to the expected remaining period
• vii.
  Dividend yield (q): Dividend of 250 yen per share (dividend results for December 2023 and June 2012) ÷ share price as defined in ii above
• viii.
  cumulative distribution function of the standard normal distribution (N (·))
  Note, when allocating stock acquisition rights, compensation of the same amount as the total amount of the payment amount shall be paid to the target person, and payment shall be made by a method of offsetting with the reward claim in place of payment of the payment amount.

6. Payment date for stock acquisition rights

July 12, 2012

7. Period for exercising stock acquisition rights

From 2027/7/13 to 2039/7/12.

8. Value of property invested in the exercise of stock acquisition rights

The value of property invested in the exercise of each stock acquisition right is 1 yen per share that can be issued by exercising each stock acquisition right, and this is the amount multiplied by the number of shares granted.

9. Conditions for exercising stock acquisition rights

• (1)
  The target person shall not be able to exercise the stock acquisition rights when the following events occur.

  • 1)
    When 1 year has passed since the target person no longer holds any position as a director, executive officer, full-time officer, employee or director or employee of the Company's subsidiary during the stock acquisition rights exercise period (hereinafter referred to as the right exercise period) as stipulated in 7. above (including the date the matter occurred). However, if 1 year has passed since the date the event occurred (including the day the event occurred) exceeds the exercise period, the target person shall not be able to exercise the stock acquisition rights with the expiration date of the right exercise period without waiting for 1 year to elapse. Also, if the target person no longer holds any position as a director, executive officer, employee or director or employee of the Company's subsidiary before the start date of the exercise of rights period arrives, the target person shall be able to exercise the stock acquisition rights only for 1 year from the first day of the exercise period, regardless of the provisions of 7. above.
  • 2)
    When the target person falls under any of the following.

    • (1)
      When the target person dies.
    • (2)
      When our trade secrets are illegally used or leaked, causing damage to our company.
    • (3)
      When you take office as an officer or employee of another company (excluding cases where written consent from our company is obtained in advance).
  • 3)
    When the target person falls under Article 4 (1) (4) (4) (injunctive retirement) and (5) (disciplinary dismissal) of the Company's disciplinary regulations, and when the Company determines that it has carried out an act equivalent to this, and it is reasonably recognized that it is inappropriate for the target person to exercise the stock acquisition rights.
  • 4)
    When the target person is sentenced to more than a prison sentence.
  • 5)
    When the target person requests to relinquish all or part of the stock acquisition rights in writing prescribed by the Company.
• (2)
  The target person cannot transfer stock acquisition rights, establish security rights such as gifts, pledges, etc., or perform other disposal against a third party.
• (3)
  Stock acquisition rights assigned to the target person belong exclusively to the target person, and inheritance is not permitted.
• (4)
  The target person can exercise the stock acquisition rights in installments. However, it is not possible to exercise one stock acquisition right in installments.
• (5)
  Other conditions for exercising rights are stipulated in the stock acquisition rights allotment agreement concluded between the Company and the target person.

10. Amount of capital and capital reserves that increase when issuing shares due to the exercise of stock acquisition rights

The amount of capital that increases when issuing shares due to the exercise of stock acquisition rights is an amount equal to one-half of the capital increase limit calculated in accordance with section 17 (1) of the company calculation rules, and when a fraction of less than 1 yen occurs as a result of the calculation, that fraction is rounded up. The remaining amount shall be incorporated into the capital reserve.

11. Fractional rounding resulting from the exercise of stock acquisition rights

If there is a fraction of less than 1 share in the number of shares to be issued to the Stock Acquisition Authority, this shall be rounded down.

12. Restrictions on acquisition of stock acquisition rights due to transfer

Approval by resolution of the Board of Directors is required for the acquisition of stock acquisition rights through transfer.

13. Reasons and conditions for the acquisition of stock acquisition rights

• (1)
  The Company can obtain stock acquisition rights free of charge on a date separately determined by the Board of Directors of the Company when it is approved by the Company's general meeting of shareholders regarding a bill to approve a merger agreement or a newly established split plan in which the Company becomes a split company, or a bill to approve a stock exchange agreement or stock transfer plan in which the Company is a wholly owned subsidiary (when a resolution of the General Meeting of Shareholders is unnecessary) is approved by the Company's general meeting of shareholders.
• (2)
  If it becomes impossible to exercise the stock acquisition rights due to the provisions stipulated in 9. above before the target person exercises the rights, the Company can obtain the stock acquisition rights free of charge.

14. Handling of Stock Acquisition Rights in the Event of Organizational Reorganization

In the case where the Company undertakes a merger (limited to when the Company disappears due to merger), absorption division, new establishment split, stock exchange, or stock transfer (the above are collectively referred to as an act of organizational restructuring), new stock reservation rights (hereinafter referred to as “remaining stock acquisition rights) that remain at the time the organizational restructuring act takes effect, in each case, a new stock reservation for a corporation (hereinafter referred to as a company subject to restructuring) (hereinafter referred to as a company subject to restructuring) Each right shall be issued based on the following conditions.

• (1)
  Number of stock acquisition rights for companies subject to restructuring to be issued
  A number equal to the number of stock acquisition rights held by the stock acquisition rights holder of the remaining stock acquisition rights is issued.
• (2)
  Types of shares of companies subject to restructuring that are the purpose of stock acquisition rights
  It is common stock of the company subject to restructuring.
• (3)
  Number of shares of companies subject to restructuring that are the purpose of stock acquisition rights
  The Board of Directors of the Company makes a decision after taking into account the conditions etc. of the organizational restructuring act.
• (4)
  The value of property to be invested in the exercise of stock acquisition rights
  The payment amount stipulated in paragraph 5 above is the amount obtained by multiplying the amount of shares of the company subject to restructuring that is the purpose of the stock acquisition right determined in accordance with (3) by the amount of shares of the restructured company that is the purpose of the stock acquisition right determined in accordance with (3) above.
• (5)
  Period for exercising stock acquisition rights
  It is from the start date of the right exercise period for the remaining stock acquisition rights stipulated in 7 above or the effective date of the organizational restructuring act, whichever is later, until the expiration date of the right exercise period for the remaining stock acquisition rights stipulated in 7.
• (6)
  The amount of capital and capital reserves that will increase when issuing shares due to the exercise of stock acquisition rights
  Determined in accordance with section 10. above.
• (7)
  Restrictions on acquisition of stock acquisition rights due to transfer
  Approval of the company subject to restructuring is required for the acquisition of stock acquisition rights through transfer.
• (8)
  Reasons and conditions for obtaining stock acquisition rights
  Determined in accordance with section 13 above.
• (9)
  Other conditions for exercising stock acquisition rights
  Determined in accordance with 9. above.

15. Banks that handle payments when exercising stock acquisition rights

Sumitomo Mitsui Banking Corporation Osaka Head Office Sales Department

16. Shareholder Registry Administrator's Name, Address, and Business Office

(name)

Mitsubishi UFJ Trust and Banking Co., Ltd.

(address)

1-4-5 Marunouchi, Chiyoda-ku, Tokyo

(sales office)

3-6-3 Fushimi-cho, Chuo-ku, Osaka-shi
Mitsubishi UFJ Trust and Banking Co., Ltd. Osaka Securities Agency Department

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