FOR IMMEDIATE RELEASE
May 26, 2006
ADVANTEST CORPORATION
(Toshio Maruyama, President and CEO)
(Stock Code Number: 6857, TSE first section)
(Ticker Symbol: ATE, NYSE)
CONTACT:
Yuri Morita
(Managing Executive Officer and
Senior Vice President, Corporate Affairs Group)
Phone: +81-(0)3-3214-7500
Advantest Adopts Stock Option Plan (in the Form of Stock Acquisition Rights)
Tokyo - May 26, 2006 - Advantest Corporation (the "Company") resolved at a
meeting of its Board of Directors today, pursuant to Articles 236, 238 and 239
of the Company Law of Japan to submit to its shareholders, a proposal to
authorize the issuance of stock acquisition rights described hereunder in
connection with stock option grants. The proposal will be made at its 64th
ordinary general meeting of shareholders (the "Shareholders' Meeting") to be
held on June 27, 2006.
1. Reason for the issuance of stock acquisition rights on especially favorable
terms
The Company will issue stock acquisition rights as stock options on
especially favorable terms to executive officers and employees of the
Company and directors, corporate auditors and employees of its domestic and
overseas subsidiaries to improve performance and morale of executive
officers and employees of the Company and directors and employees of its
domestic and overseas subsidiaries, and corporate auditor's awareness of
proper auditing at the Company's domestic and foreign subsidiaries. In this
manner, the Company aims to promote a management style conscious of
increasing shareholder value and to attract and retain outstanding
personnel.
2. Details of the stock acquisition rights
(1) Persons to whom the stock acquisition rights will be allocated
Executive officers and employees of the Company and directors, corporate
auditors and employees of its domestic and overseas subsidiaries of the
Company.
(2) Class and number of shares to be issued upon exercise of the stock
acquisition rights
Not exceeding 700,000 shares of common stock of the Company.
The number of shares to be issued upon exercise of each stock acquisition
right shall be 100 shares, provided that if the subscription price per
share has been adjusted in accordance with sub-paragraph (5) below, the
number of such shares shall be adjusted according to the following formula.
This adjustment has been made only with respect to stock acquisition rights
that have not yet been exercised as of the time of adjustment. Any
fractional share that arises as a result of an adjustment will be rounded
down to the nearest whole number of shares.
Number of shares to be issued or Total subscription price
delivered upon exercise of each stock = ----------------------------
acquisition right Subscription price per share
When the number of shares to be issued or delivered upon exercise of each
stock acquisition right has been adjusted, the total number of shares to be
issued or delivered upon exercise of the stock acquisition rights shall be
adjusted to the number obtained by multiplying (i) the number of shares to
be issued or delivered upon exercise of each stock acquisition right after
adjustment by (ii) the number of the stock acquisition rights that have not
yet been exercised as of such adjustment, then adding the number of shares
that have been issued or delivered upon exercise of the stock acquisition
rights. After the adjustment, the total number of shares to be issued or
delivered upon exercise of the stock acquisition rights may exceed 700,000
shares.
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(3) Total number of the stock acquisition rights to be issued
Not exceeding 7,000.
(4) Issue price of the stock acquisition rights
No consideration.
(5) Subscription price to be paid upon exercise of each stock acquisition right
The subscription price to be paid upon exercise of each stock acquisition
right shall be determined by multiplying (i) the subscription price per
share as determined in the following paragraph, by (ii) the number of
shares to be issued or delivered upon exercise of each stock acquisition
right as specified in sub-paragraph (2) above (initially, 100 shares).
The subscription price per share shall be 1.05 times the average closing
price, rounded up to the nearest yen, of the common stock of the Company in
regular trading on the Tokyo Stock Exchange on each day of the month
preceding to the month in which any stock acquisition rights are allocated
(excluding any such day on which there was no trade); provided, however,
that if such amount is less than the closing price of the common stock of
the Company on such day of allocation (or, if there was no trade on such
day of allocation, the closing price on the immediately preceding day on
which there was any trade), the subscription price per share shall be equal
to the closing price on such day of allocation. The Company may determine
the subscription price per share to be the same as that for the first stock
acquisition rights issued based upon this Shareholders' Meeting (if the
subscription price per share for the first stock acquisition right is
adjusted by the method described below, such adjusted subscription price
per share) for any subsequent stock acquisition rights issued.
If, subsequent to the issuance of the stock acquisition rights, the Company
splits or consolidates its common stock, or issues new shares or disposes
of its treasury shares below market price (subject to certain other
exceptions including the issuance or delivery of shares upon exercise of
stock acquisition rights), the subscription price per share shall be
adjusted according to the formula set forth below, rounded up to the
nearest yen. Furthermore, the subscription price per share may, to the
extent necessary and reasonable, be adjusted in a way deemed appropriate by
the Company, in the case of merger or split of the Company, stock-for-stock
exchange or certain other events. The Company may determine the
subscription price per share for each stock acquisition right issued
pursuant to the resolution of this Shareholders' Meeting after such
adjustment to be the same as the adjusted subscription price per share.
(a) Formula for adjustment in the case of share split or consolidation
Subscription price per share = Subscription price per 1
after adjustment share before adjustment x ----------------------------------
Ratio of split / consolidation
(b) Formula for adjustment in the case of issue of new shares or
disposition of treasury stock below market price
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Number of new Subscription
Outstanding shares to be X price per share
Subscription Subscription number of + issued to be issued
price per price per x shares ----------------------------------------
share after = share before Market price per share
adjustment adjustment --------------------------------------------------------------
Outstanding number of + Number of new shares
shares to be issued
In the above formula, "outstanding number of shares" shall mean the total
number of outstanding shares of the Company after deduction of shares held
by the Company as treasury stock. In the case of disposition of treasury
stock, "number of new shares to be issued" in the above formula shall be
read as "number of treasury shares to be disposed of".
(6) Exercise period of the stock acquisition rights
Between April 1, 2007 and March 31, 2011 (4 years).
(7) Conditions for exercise of the stock acquisition rights
(a) A person to whom the stock acquisition rights has been allocated must
be a director, corporate auditor, executive officer or employee of the
Company or its domestic or overseas subsidiary at the time of
exercise, expect where there are any reasons the Company deems
justifiable.
(b) The stock acquisition rights may not be inherited.
(c) No stock acquisition right may be exercised in part.
(d) Other terms and conditions will be determined at a meeting of the
Board of Directors to be held subsequent to the Shareholders' Meeting.
(8) The Company's acquisition of the stock acquisition rights
The Company shall automatically acquire the stock acquisition rights, for
no consideration, if:
(a) the general meeting of shareholders approves (if approval by the
shareholders' meeting is not legally required, then the Board of
Directors may approve) (i) any merger agreement pursuant to which the
Company shall dissolve, (ii) any agreement or a plan pursuant to which
the Company shall split all or part of its business or (iii) any
stock-for-stock exchange agreement or stock-transfer plan pursuant to
which the Company shall become a wholly-owned subsidiary of another
company;
(b) a person to whom the stock acquisition rights has been allocated does
not hold the position of a director, corporate auditor, executive
officer, employee or any other similar position of the Company or its
domestic and overseas subsidiaries, expect where there are any reasons
the Company deems justifiable;
(c) a person to whom the stock acquisition rights has been allocated dies;
(d) a person to whom the stock acquisition rights has been allocated
waives all or part of his stock acquisition rights to the Company;
(e) a person to whom the stock acquisition rights has been allocated
becomes a director, corporate auditor, executive officer or employee
of a company that competes with the Company, except where such change
of position has been approved by the Company;
(f) a person to whom the stock acquisition rights has been allocated is in
violation of laws and regulations, internal rules or other regulations
of the Company, except where there are any reasons the Company deems
justifiable; and
(g) other events as determined by resolution at a meeting of the Board of
Directors to be held subsequent to the Shareholders' Meeting occur.
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(9) Matters concerning the amount of capital and the additional paid-in capital
increased by the issuance of shares upon exercise of the stock acquisition
rights
(a) The amount of capital increased by the issue of the shares upon
exercise of the stock acquisition rights shall be the amount equal to
one-half of the maximum limit of capital increase, as calculated in
accordance with Article 40, Paragraph 1 of the Company Accounting
Regulation (kaisha keisan kisoku), and any fraction less than one (1)
yen arising as a result of such calculation shall be rounded up to the
nearest one (1) yen.
(b) The amount of additional paid-in capital increased by the issue of the
shares upon exercise of the stock acquisition rights shall be the
amount obtained by subtracting the capital to be increased, as
provided in the sub-paragraph (a) above, from the maximum limit of
capital increase, as also provided in the sub-paragraph (a) above.
(10) Restriction on the transfer of the stock acquisition rights
Approval by the Board of Directors is required upon a transfer of the stock
acquisition rights, except where the Company is the transferee with respect
to such transfer.
(11) Other details in respect of the stock acquisition rights will be determined
by resolution at a meeting of the Board of Directors to be held subsequent
to the Shareholders' Meeting.
(Note) The above terms are subject to approval at the Shareholders' Meeting
of the proposal entitled "Issuance of stock acquisition rights as
stock options".
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