Press Information
Announcement of Allotment of Share without Contribution
January 30, 2018
Hirose Electric (“the Company”) announced that, at the Board of Directors’
meeting held on January 30, 2018, the Company resolved conduct allotment of sharewithout contribution utilizing the Company‐owned treasury stock based on Article 185of the Companies Act.
1. Purpose of the Allotment of Share without Contribution
The Company recognizes returning profit to shareholders as one of the mostimportant management issue, and the basic policy is to secure necessary internal
reserves to strengthen management foundation as well as continue a stable dividendpayout. Under this policy, in addition to dividend to shareholders, the Company has
been buying back share in the past, with the purpose of enhancing shareholder
returns and improving capital efficiency, as well as enabling flexible capital policy that
corresponds to the changes in management environment.
On the other hand, as of December 31, 2017, the Company owns 5,177,095
treasury stocks, which accounts to 12.9% of the total number of share the Company
issued. Should the Company continue to buy back from general shareholders
through stock market, there is concern that the number of outstanding share will
decrease and impact the share liquidity in the future. Therefore it has beenrecognized as an important management issue to continue returning to shareholder
while maintaining outstanding share in order to ensure liquidity to improve
corporate value.
Due to reasons above, the Company has resolved to conduct allotment of sharewithout contribution in order to utilize the Company‐owned treasury stock efficiently,
and return benefit to shareholders as well as increase the Company share liquidity,
and widen the range of investors.
Allotment of share without contribution is a system based on Article 185 of theCompanies Act, which enables the Company to allot the Company shares toshareholders without additional payment. Unlike share split, the treasury stock
owned by the Company will not be subject to the allotment.

Moreover, the Company share issued on the allotment to shareholders will all
be allotted from the treasury stock owned by the Company.
Furthermore, no special procedures will be needed for shareholders, as all theprocedure will be completed by the Company, each Securities Company, JapanSecurities Depositary Center, and Sumitomo Mitsui Trust Bank Ltd (“SumitomoMitsui Trust”) which is the shareholder registry administrator.
Sumitomo Mitsui Trust will send a notification regarding the allotment by theend of April 2018.
2. Outline of Allotment of Share without Contribution(1) Outline of Allotment without Contribution
March 31, 2018 (Sat) (actually, March 30, 2018 (Fri)) will be the record date. The
Company’s treasury stock will be allotted without contribution with the ratio of0.05 common share per each common share owned by shareholders listed orrecorded in the final shareholder registry of the record date.
(2) The Situation of shares issued by the Allotment without Contribution①②③④

Total number of share issued before the allotment: 40,020,736 shares
Number of treasury stock that does not perform allotment: 5,177,095 shares
Total number of treasury stock issued on the allotment: 1,742,182 share
Total number of share issued after the allotment: 40,020,736 shareNote) The above is based on shares as of December 31, 2017, and there is apossibility of change in Number of treasury stock that does not perform
allotment of shares and Total number of treasury stock issued on theallotment, should there be share buyback or cancellation, or exercising stock
option by the record date.

3. Schedule(1) Public notice day of record date：March 16, 2018 (Fri) (Planned)(2) Record date：March 31, 2018 (Sat) (Planned)(3) Effective date：April 1, 2018 (Sun) (Planned)Note) On the record date, the shareholder registry administrator is closed,
and March 30, 2018 (Fri) would be the actual record date.
4. Others(1) Capital stock
There is no increase in capital stock on this allotment.

(2) Dividend
As the effective date of this allotment of share without contribution is April 1,
2018, the year‐end dividend of fiscal year ended March 2018 will be based on
the number of shares before the allotment. As for the dividend forecast of fiscal
year ended March 2018, there is no change from the previous amount; 240 yen
per share for fiscal year‐end, 480 yen per share for full year.
(3) Fractional shares less than one share caused by the allotment
Based on Article 234, Paragraph 1 of the Companies Act, the fractional sharesless than one share caused by the allotment will be sold all together and theproceeds will be distributed to the relevant shareholders according to fraction.
(4) Shares less than one unit (100 shares) caused by the allotment
With the allotment, there are times share less than one unit (100 shares) occurs.
Those shares cannot be traded in the trading market, but the following system isavailable.
① Purchase system of share less than one unit.
This is a system based on Article 192, Paragraph 1 of Companies Act, thatshareholder who owns shares less than one unit can claim the Company topurchase it.
② Additional purchase system of share less than one unit
This is a system based on the regulation of the Articles of Incorporation inaccordance with the provision of Article 194, Paragraph 1 of the Companies
Act, that shareholder can claim to the Company to sell the Company’s shares
so that the shares less than one unit they own would become one unit (100shares) combined together.

(5) To Adjust the Number of share and Price on exercise of stock option
With this allotment of share without contribution, the objective number of shareper unit and the exercise price per share upon the stock option issued will beadjusted as the following from the effective date of April 1, 2018.
1. The objective number of share per unit
Number before

Number after

adjustment

adjustment

6th Stock option
105 shares
Resolution at Ordinary General Meeting ofShareholders on Jun 27, 2013
(Board of Directors’ meeting on Oct 31, 2013)110 shares

7th Stock option
105 shares
Resolution at Ordinary General Meeting ofShareholders on Jun 27, 2014
(Board of Directors’ meeting on Sep 30, 2014)

110 shares

2. The exercise price per share
Price before

Price after

adjustment

adjustment

6 Stock option
14,309 yen
Resolution at Ordinary General Meeting ofShareholders on Jun 27, 2013
(Board of Directors’ meeting on Oct 31, 2013)

13,627 yen

7th Stock option
12,915 yen
Resolution at Ordinary General Meeting ofShareholders on Jun 27, 2014
(Board of Directors’ meeting on Sep 30, 2014)

12,300 yenth[Additional explanation](Concrete example regarding the announcement)(Example 1) Shareholder with 2000 share
Afer

BeforeNumber of shares owned(Example 2)2000 share+ 100 shares2100 share

Shareholder with 90 share
Afer

BeforeNumber of shares owned

90 share+ 4.5 shares

94 share
0.5 share

0.5 share will be distributed by cashNote) Fractional share of 0.5 share will be sold all together and the proceeds will bedistributed to shareholders along with dividend(Contact / Notification)
The effective date will be April 1, 2018 (planned). Regarding when it will be allotted toyour securities transaction account, please contact your securities company.
Sumitomo Mitsui Trust will send a notification regarding this allotment to all relevant
shareholders by the end of April 2018.