23rd Jun 2006 11:14
Toyota Motor Corporation23 June 2006 (Translation) To Whom It May Concern: June 23, 2006 Toyota Motor Corporation (Toyota Jidosha Kabushiki Kaisha) 1, Toyota-cho, Toyota City, Aichi Prefecture Notice Concerning Granting Stock Options (Stock Acquisition Rights) At a meeting held on June 23, 2006, the Board of Directors of Toyota MotorCorporation ("TMC") determined the details of the terms and conditions of theissuance of rights to subscribe for or purchase shares of TMC ("StockAcquisition Rights"), without consideration, for the purpose of granting stockoptions, pursuant to Article 236, Article 238 and Article 239 of the CorporationAct, and a resolution at the 102nd Ordinary General Shareholders' Meeting ofTMC, and we hereby inform you as follows. The amount to be paid upon the exercise of Stock Acquisition Rights and otherundetermined matters are to be determined by the date on which the StockAcquisition Rights are allotted (which is currently scheduled on August 1,2006). 1. Reason for Issue of Stock Acquisition Rights without Consideration In order to enhance enthusiasm and raise morale of Directors, ManagingOfficers and employees, etc. of TMC and its affiliates, thereby improvingbusiness performance and contribute to the strengthening of TMC's internationalcompetitiveness. 2. Type and Number of Shares to be Issued or Transferred upon Exercise of StockAcquisition Rights 3,176,000 shares of common stock of TMC. Provided, however, that if the number of shares to be issued or transferred uponexercise of each Stock Acquisition Right is adjusted in accordance with 3 below,such number of shares to be issued or transferred shall be adjusted to thenumber obtained by multiplying the number of shares after adjustment by thetotal number of Stock Acquisition Rights to be issued. 3. Total Number of Stock Acquisition Rights 31,760 The number of shares to be issued or transferred upon exercise of one (1)Stock Acquisition Right (the "Number of Shares Granted") shall be 100; provided,however, that if TMC splits its shares (including the allotment of common stockto shareholders without consideration; hereinafter the same shall apply) orconsolidates its shares after the allotment date of the Stock AcquisitionRights, the Number of Shares Granted shall be adjusted according to thefollowing formula. Number of shares = Number of shares x Ratio of splitafter adjustment before adjustment (or consolidation) The adjustment above shall be made only to the unexercised rights remainingat the relevant time. If any fraction less than one (1) share arises as aresult of such adjustment, such fraction shall be discarded. 4. Number of Stock Acquisition Rights to be Granted and Number of GranteesThereof Number of Grantees Number of Stock Acquisition Rights to be Total Number of Stock (persons) Granted per Grantee Acquisition Rights to be Granted Directors/Managing Officers/ Representative Directors, etc.: 400 19,300Executive Advisory Senior Managing Directors: 300Engineers of TMC Managing Officers: 200(79 persons) Executive Advisory Engineers: 100 Employees of TMC Senior General Managers and (453 persons) General Managers: 50 9,900 Senior Grade 1: 20 Directors and employees, 20-100 2,560etc. of TMC's affiliates(74 persons) Total (606 persons) - 31,760 The number of Stock Acquisition Rights to be allotted to each grantee (the"Number of Stock Acquisition Rights to be Allotted") shall be determined on thecondition that the relevant grantee has submitted an application forsubscription of Stock Acquisition Rights in a number equal to or exceeding theNumber of Stock Acquisition Rights to be Allotted pursuant to Article 242,Paragraph 2 of the Corporation Act, and if the number of Stock AcquisitionRights the relevant grantee applies for subscription of is less than the Numberof Stock Acquisition Rights to be Allotted, the allotted number shall be thenumber applied for by such grantee. 5. Amount Paid for Issuance of Stock Acquisition Rights No payment of money shall be required for the Stock Acquisition Rightsissued in accordance with the resolution of the meeting of the Board ofDirectors. 6. Amount of Assets to be Paid upon Exercise of Stock Acquisition Rights The amount of assets to be paid upon exercise of each Stock Acquisition Rightshall be the amount obtained by multiplying the amount to be paid per shareissued or transferred upon exercise of Stock Acquisition Rights (the "ExercisePrice") by the Number of Shares Granted. The Exercise Price shall be asfollows. The amount obtained by multiplying the closing price of TMC's common stock inregular trading on the Tokyo Stock Exchange on the allotment date of the StockAcquisition Rights (if there is no transaction made on that day, then theclosing price of the latest date prior to the allotment date of the StockAcquisition Rights on which a transaction was made) by 1.025, and any fractionless than one (1) yen arising therefrom shall be rounded up to the nearest one(1) yen. In addition, the Exercise Price shall be adjusted as follows: (i) If TMC splits or consolidates its shares after the allotment date of theStock Acquisition Rights, the Exercise Price shall be adjusted according to thefollowing formula, and any fraction less than one (1) yen arising therefromshall be rounded up to the nearest one (1) yen. Exercise Price after = Exercise Price before x 1 adjustment adjustment ------------------------- Ratio of split (or consolidation) (ii) If TMC issues common stock or sells treasury stock of the common stock ata price below the market price after the allotment date of the Stock AcquisitionRights, the Exercise Price shall be adjusted according to the following formula,and any fraction less than one (1) yen arising therefrom shall be rounded up tothe nearest one (1) yen. However, no adjustment shall be made in the event thatStock Acquisition Rights are exercised. Exercise Price Exercise Price Number of + Number of shares X Amount to be after adjustment = before adjustment X outstanding newly issued paid per share shares -------------------------------------- Market price ---------------------------------------------------------- Number of + Number of shares outstanding shares newly issued "Number of outstanding shares" provided for in the above formula does notinclude the number of shares held by TMC as treasury stock, and in the casewhere the treasury stock is to be sold, "Number of shares newly issued" shall beread as "Number of shares of treasury stock to be sold." (iii) In the event that other classified stock is allotted withoutconsideration to the common shareholders, shares of other company are deliveredto the common shareholders as dividends, or in any other case similar theretowhere an adjustment of the Exercise Price shall be required, in each case afterthe allotment date of the Stock Acquisition Rights, an appropriate adjustmentshall be made to the extent reasonable. 7. Allotment Date of the Stock Acquisition Rights August 1, 2006 8. Exercise Period of the Stock Acquisition Rights From August 1, 2008 to July 31, 2014 9. Conditions of Exercise of Stock Acquisition Rights (i) Each Stock Acquisition Right may not be partially exercised. (ii) The grantee of the Stock Acquisition Rights must, at the time of theclosing of the Ordinary General Shareholder's Meeting to be held for the lastfiscal year ending within two (2) years after the closing of the 102nd OrdinaryGeneral Shareholders' Meeting of TMC, be a Director, Managing Officer or anemployee, etc. of TMC or its affiliate to which he/she belongs at the time suchright is granted. (iii) The grantee of the Stock Acquisition Rights may exercise his or her StockAcquisition Rights for up to two (2) years after the grantee loses his or herposition as a Director, Managing Officer or an employee, etc. of TMC or itsaffiliate to which the grantee belongs at the time such right is granted.However, if the grantee loses such position due to retirement or resignation forhis or her own reasons, or removal from office or dismissal, the StockAcquisition Rights will expire immediately. (iv) Stock Acquisition Rights may not be inherited. (v) Other exercise conditions shall be provided for in the contracts to beexecuted by and between TMC and the grantees of the Stock Acquisition Rightspursuant to the resolution of the 102nd Ordinary General Shareholders' Meetingand the resolution of a meeting of the Board of Directors. 10. Events and Conditions of Acquisition of Stock Acquisition Rights by TMC Stock Acquisition Rights may be acquired by TMC without consideration onthe day otherwise provided by the Board of Directors if a General Shareholders'Meeting approves an agendum on a merger agreement in which TMC is to bedissolved, or an agendum on a share exchange agreement or a share transfer bywhich TMC will become a wholly-owned subsidiary of another company. 11. Restriction on Transfer of Stock Acquisition Rights Transfer of Stock Acquisition Rights shall be subject to an approval of theBoard of Directors. 12. Matters concerning the Capital and Capital Reserve to be Increased due tothe Issuance of Shares upon Exercise of Stock Acquisition Rights (i) Amount of capital to be increased due to the issuance of shares uponexercise of the Stock Acquisition Rights shall be half of the maximum amount ofcapital increase etc. which is calculated in accordance with Article 40,Paragraph 1 of the Corporation Accounting Regulations, and any fraction lessthan one (1) yen arising therefrom shall be rounded up to the nearest one (1)yen. (ii) Amount of capital reserve to be increased due to the issuance of sharesupon exercise of the Stock Acquisition Rights shall be an amount determined bysubtracting the capital amount to be increased provided for in the immediatelypreceding paragraph (i) from the maximum amount of capital increase set forth inthe immediately preceding paragraph (i). 13. Handling of Fraction In the case where the number of shares to be issued or transferred to thegrantee includes any fraction less than one (1) share, such fraction shall berounded down. (Reference) (1) Date on which the Board of Directors resolved to propose the issuance ofStock Acquisition Rights to the Ordinary General Shareholders' Meeting May 10, 2006 (2) Date on which the issuance of Stock Acquisition Rights was adopted by theOrdinary General Shareholders' Meeting June 23, 2006 # # # Contact: TMC, Public Affairs at 03-3817-91116 (Tokyo Head Office) 0565-23-15204 (Head Office) 052-952-34613 (Nagoya) This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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