(Translated)
June 25, 2019
To whom it may concern
Itoham Yonekyu Holdings Inc.
President and Representative Director: Isao Miyashita(Tokyo Stock Exchange Securities Code: 2296)
Inquiries: Ryoji Matsubara
Executive Officer
General Manager, Corporate Strategy Planning Dept. and Manager, Investor Relations Section
Tel: +81-3-5723-6885

Notice Regarding the Disposal of Treasury Stockas Restricted Stock Compensation
Itoham Yonekyu Holdings Inc. ("the Company") hereby announces that its Board of Directors
resolved at a meeting held today to implement the disposal of treasury stock as restricted stockcompensation ("the Disposal of Treasury Stock"), as outlined below.
1.

2.

Outline of the Disposal(1)
Date of disposal

July 12, 2019(2)

Class and number ofshares to be disposed

163,751 shares of common stock(3)

Disposal value¥734 per share(4)

Total disposal value(5)

Planned allottees

(6)

Other

¥120,193,234
Directors(*): 6 persons, 66,482 shares
Executive officers: 19 persons, 97,269 shares* Excludes outside directors.
The Disposal of Treasury Stock is subject to thesecurities registration statement taking effect inaccordance with the Financial Instruments and ExchangeAct.

Purpose and Reasons for the Disposal
At a meeting of the Company’s Board of Directors held on May 22, 2018, the Company
passed a resolution to introduce a stock compensation plan (the “Plan”) to grant restricted
shares to the Company’s directors (excluding outside directors) and executive officers, forthe purpose of providing further incentive to the Company’s directors (excluding outsidedirectors) and executive officers to increase the stock price and the corporate value of theCompany by further sharing the benefits and risks of stock price fluctuations withshareholders. Moreover, at the Second Ordinary General Meeting of Shareholders held onJune 26, 2018, approval was given for the total amount of monetary compensation claims
to be paid as remuneration in connection with the restricted shares to the Company’sdirectors (excluding outside directors) based on the Plan to be set at no more than 80
million yen per year, and for the maximum amount of the total number of restricted shares
to be allocated to the Company’s directors (excluding outside directors) in each fiscal year
to be set at 100,000 shares. Approval was also given for setting the restricted period for therestricted shares at a period between 20 to 30 years, with the exact period to bedetermined by the Company’s Board of Directors.
At a meeting of the Company’s Board of Directors held today, the Company passed aresolution to pay monetary compensation claims of 120,193,234 yen as remuneration to
the planned allottees, specifically the Company’s six directors (excluding outside directors)
and 19 executive officers (the “Allottees”), and to allocate 163,751 shares of the Company'scommon stock as specified restricted shares to be paid for by the Allottees using all themonetary compensation claims as contributed assets. The shares are provided as
restricted share compensation to the Company’s directors (excluding outside directors) forthe period from the Third Ordinary General Meeting of Shareholders to the Fourth Ordinary
General Meeting of Shareholders scheduled to be held in June 2020 and as restricted
share compensation to the Company’s executive officers for the Company’s fourth fiscal
year (April 1, 2019 to March 31, 2020). The amount of monetary compensation claims
granted to each Allottee is determined by comprehensively taking into consideration a widerange of factors, such as the extent of the contribution of each Allottee to the Company.
The monetary compensation claims will be granted provided that each Allottee enters into a
Restricted Stock Compensation Agreement (the “Stock Compensation Agreement”) with
the Company, as summarized below.
The purpose of introducing the Plan is to provide further incentive to the Allottees toincrease the stock price and the corporate value of the Company by further sharing thebenefits and risks of stock price fluctuations with shareholders. In order to realize thispurpose of the Plan over the longest period possible, the restricted period has been set asa period of 30 years.
3.

Overview of the Stock Compensation Agreement(1) Restricted Period
July 12, 2019 to July 11, 2049
During the restricted period specified above (the “Restricted Period”), the Allottees may
not dispose of the restricted shares allocated to each Allottee (the “Allocated Shares”)
in any way including through transfers, pledges, mortgages, advancements or
bequests to third parties (the “Restrictions”).
(2) Free of Charge Acquisition of the Restricted SharesIf, prior to the day before the date of the first Ordinary General Meeting of Shareholdersof the Company following the beginning of the Restricted Period (if the Allottee is an
executive officer of the Company, the day before the date of the Company’s first fiscal
year-end following the beginning of the Restricted Period), an Allottee loses his or her
position as a director or executive officer of the Company, with the exception of cases
recognized as legitimate by the Board of Directors such as the expiration of his or her
term of office, the Company shall, as a matter of course, acquire all of the allocatedshares free of charge upon the loss of position.
In addition, any Allocated Shares that did not have their restrictions lifted based on
the grounds for the lifting of restrictions set forth in (3) below when the Restricted
Period expires (the “Expiry of the Restricted Period”). The Company shall, as a matterof course, acquire such Allocated Shares free of charge immediately after the Expiry ofthe Restricted Period.
(3) Lifting of Restrictions
Upon the Expiry of the Restricted Period, the Company shall lift the restrictions on all
Allocated Shares held by an Allottee at that time provided that the Allottee has retained
the position of director or executive officer of the Company from the beginning of theRestricted Period through to the date of the first Ordinary General Meeting of theShareholders of the Company following the beginning of the Restricted Period (if theAllottee is an executive officer of the Company, the Company’s first fiscal year-end
following the beginning of the Restricted Period). However, if an Allottee loses theposition of either director or executive officer of the Company prior to the expiry of theRestricted Period for reasons recognized as legitimate by the Board of Directors, suchas the expiration of his or her term of office, then the Company shall lift the restrictions
immediately after the loss of the position for a number of Allocated Shares computedby multiplying the number of Allocated Shares by a factor determined by dividing thenumber of months counted from July 2019 (if the Allottee is an executive officer of theCompany, from April 2019) to the month that includes the date on which the Allottee
loses the position of either director or executive officer, by 12 (however, if thecomputed factor is greater than 1, then the factor shall be 1 and any figures less than
one share arising from the calculation shall be rounded down).
(4) Provisions Concerning the Administration of Shares
The Allottees shall complete the process of opening accounts with SMBC Nikko
Securities Inc. to register and record the Allocated Shares through the methods
designated by the Company, and hold and maintain the Allocated Shares in theseaccounts until the restrictions are lifted.
(5) Treatment of Allocated Shares Upon Reorganization of the Company
If, during the Restricted Period, a merger agreement in which the Company becomes anon-surviving company, a share exchange agreement or a share transfer plan underwhich the Company becomes a wholly-owned subsidiary of another company or any
other matters related to reorganization, etc. are resolved at a General Meeting ofShareholders of the Company (or by the Board of Directors of the Company, if theapproval of the General Meeting of Shareholders of the Company is not required)(however, only when the effective date of the reorganization, etc. falls before theExpiry of the Restricted Period, hereinafter, “when the Reorganization, etc. isapproved”), and if the Allottees will lose the positions of either director or executive
officer in connection with the reorganization, etc., the Company shall lift the restrictions
for a number of Allocated Shares computed by multiplying the number of AllocatedShares held by the Allottee on the approval date by a factor determined by dividing thenumber of months counted from July 2019 (if the Allottee is an executive officer of theCompany, from April 2019) to the month that includes the approval date, by 12(however, if the computed factor is greater than 1, then the factor shall be 1, and any
figures less than one share arising from the calculation shall be rounded down), withthe restrictions to be lifted on the business day before the effective date of thereorganization, etc.
In addition, when the reorganization, etc. is approved, on the business day before
the effective date of the reorganization, etc., the Company shall, as a matter of course,
acquire free of charge all of the Allocated Shares for which restrictions have not been
lifted on the aforementioned business day.
4.

Basis for the Calculation of the Amount Paid in Per Share and Related Specific Details
The disposal value for the Disposal of Treasury Stock has been set at 734 yen per share,
the closing price of the common stock of the Company on the Tokyo Stock Exchange on
the business day (June 24, 2019) immediately preceding the date of resolution of the Boardof Directors of the Company. The disposal value has been set in this manner to remove any
arbitrariness from the valuation. This disposal value represents the fair stock priceimmediately preceding the resolution of the Board of Directors of the Company. Therefore,
the Company believes that the disposal value is reasonable and has not been set at aparticularly advantageous amount.