Recruit Holdings Announces the Implementation of the Stock Incentive Plan for the Board Directors and Selected Senior Management of the Company and the Subsidiaries
Feb 14, 2020 | Recruit Holdings Co., Ltd.
TOKYO, JAPAN (February 14, 2020) - Recruit Holdings Co., Ltd. (TSE 6098) (the "Company") announced today that its Board of Directors meeting resolved today the details of the stock incentive plan (the "Scheme") for the Board Directors, Corporate Executive Officers and Corporate Professional Officers ("Board Directors and senior management") of the Company and its subsidiaries (the "Subject Companies") which will be implemented in February 2020.
1. Purpose of the Scheme
The Subject Companies implement the Scheme in order to establish a strong relationship between the compensation for Board Directors and senior management and the Company's stock price value, and to motivate maximizing financial performance and enterprise value in mid to long-term.
2. Details of the Scheme
(1) The Scheme is a stock incentive plan, which the Company implemented for its Board Directors and senior management in 2016, and for Board Directors and senior management of the Subject Companies after 2016.
(*) In regard to the stock incentive plan for Board Directors and senior management of the Company, please refer to the "Notification of Introduction of the Performance-based Stock Incentive Plan for Board Directors" released on May 13, 2016 and "Recruit Holdings Co., Ltd. Announces a Partial Revision of the Stock Incentive Plan for its Board Directors, etc." released on May 15, 2018.
(2) The Scheme uses the structure of the Board Incentive Plan Trust (the "BIP Trust"). The BIP Trust is a stock incentive plan in which the Company's shares are acquired through a trust using the capital contribution by the Subject Companies as remuneration for Board Directors and senior management. They receive the payout in form of a grant or payment (the "grant, etc.") of the Company's shares and money equivalent to the converted value of such shares (the "Company's shares, etc.") at time of retirement in principle, mainly based on their responsibility and the achievement of performance targets.
(3) The Subject Companies of the Scheme for the current fiscal year are the Company and its subsidiaries, and the implementation of the Scheme was approved at the appropriate decision-making body.
(4) The Subject Companies intend to continue implementing the Scheme by establishing new trusts, or by making amendments to the existing trusts after the expiry of the trust period and making additional contribution to such existing trusts.
3． Framework of the Scheme
1) The Subject Companies obtained approval for the implementation of the Scheme for the Board Directors and senior management at the annual meeting of shareholders.
2) The Company revised the Share Issuance Rules at the board of directors meeting with respect to the continuous implementation of the Scheme. (The Subsidiaries establish the Share Issuance Rules at the board of directors meeting with respect to the implementation of the Scheme.)
3) The Company entrusts money which the Company contributed as stock compensation and the money contributed by the subsidiaries to the trustee, and establishes or extends the Trust BIP(I) and Trust BIP(II) (hereinafter collectively referred to as the "Trusts"). The Trust BIP(I) is for the Board Directors and senior management of the Company who meet the beneficiary requirements as its beneficiary and the Trust BIP(II) is for the Board Directors and senior management of the subsidiaries who meet the beneficiary requirements as its beneficiary.
The Subject Companies are allowed to contribute money within the limit as approved by the annual meeting of shareholders in 1).
4) The Trusts follow the instruction of the trust administrator and acquire the Company's shares from the stock market using the money contributed in 3).
5) The Company's shares held in the Trusts are entitled to receive dividends in the same manner as other Company's shares.
6) No voting rights shall be exercised on the Company's shares held in the Trusts during the trust period.
7) During the trust period, a certain number of points are granted to the Board Directors and senior management mainly according to their responsibility and the achievement of performance targets. The grant, etc. of the Company's shares, etc. corresponding to the number of points are offered to the Board Directors and senior management who meet certain beneficiary requirements, in principle, at the time of their retirement. (The Board Directors and senior management are, in principle, granted 50% of the Company's shares corresponding to the points (fractional shares are omitted) in accordance with the provisions of the trust agreement, while the remaining Company's shares corresponding to the points are converted to money within the Trusts and paid to the Board Directors and senior management in money.)
8) If there are residual shares at the expiry of the trust period, the Subject Companies will either continuously use the Trusts for the Scheme, or as another incentive plan similar to the Scheme, by amending the trust agreement by the resolution of the Board of Directors and having additionally contribute to the Trusts, or will transfer the residual shares from the Trusts to the Company without compensation, acquire them without compensation, and cancel them by a resolution of the Board of Directors.
9) At the termination of the Trusts, residual assets remaining after the distribution to the beneficiaries will be attributable to the Subject Companies within the amount of the reserve for trust expenses after deducting share acquisition funds from the trust money. Any portion in excess of the reserve for trust expenses will be donated to organizations with no interest in the Subject Companies.
(Note) If the Company's shares are exhausted within the Trusts due to the grant, etc. of the Company's shares, etc. to the Board Directors and senior management, who meet the beneficiary requirements, the Trusts shall be terminated prior to the expiry of the trust period. The Company may entrust money to the Trusts and the subsidiaries may additionally entrust money to the Trusts through the Company as acquisition funds for the Company's shares, thereby causing the Trusts to additionally acquire the Company's shares within the limit of the share acquisition funds as well as within the maximum number of shares to be granted as approved by the resolution of the annual meeting of shareholders.
4． Outline of the trust agreement
|BIP(I) (the Company)||BIP(II) (the subsidiaries)|
|(1)||Type of trust||Monetary trust other than a specified solely-administered monetary trust (third-party benefit trust)|
|(2)||Purpose of trust||Providing incentive to the following subject persons|
|(3)||Subject persons||The Board Directors and senior management of the Company||The Board Directors and senior management of the subsidiaries|
|(5)||Trustee||Mitsubishi UFJ Trust and Banking Corporation
(Joint Trustee: The Master Trust Bank of Japan, Ltd.)
|(6)||Beneficiary||The Board Directors and senior management who meet the beneficiary requirements|
|(7)||Trust administrator||A third party with no interest in the Company|
|(8)||Date of trust agreement||November 11, 2016
(Scheduled to change on February 17, 2020)
|February 17, 2020 (planned)|
|(9)||Trust term||November 11, 2016 to August 31, 2022 (planned)||February 17, 2020 to August 31, 2022 (planned)|
|(10)||Commencement date of the scheme||November 11, 2016||February 17, 2020|
|(11)||Exercise of voting rights||Voting rights will not be exercised.|
|(12)||Class of shares to be acquired||Common stock of the Company|
|(13)||Amount of trust||¥0.8 billion (planned)||¥0.4 billion (planned)|
|(each including trust fees and trust expenses)|
|(14)||Timing for acquiring shares||February 18, 2020 (planned) to March 13, 2020 (planned)|
|(15)||Method of share acquisition||Acquisition from the stock market|
|(16)||Rights holder||The Company|
|(17)||Residual assets||The Company, as the rights holder, may receive residual assets within the scope of reserve for trust expenses after deducting share acquisition fund from trust money.|
(Note) The scheduled dates mentioned above may be changed to appropriate dates in light of applicable laws and regulations.
[Details of administration relating to the trusts and shares]
|(1)||Trust-related administration||Mitsubishi UFJ Trust and Banking Corporation and The Master Trust Bank of Japan, Ltd. are to be the trustees of the Trusts and will conduct trust-related administration.|
|(2)||Share-related administration||Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. will conduct administration related to the delivery of the Company's shares to beneficiaries based on the administration service agreement.|