SOURCE: TDK Corporation

May 09, 2005 11:07 ET

TDK Corporation announces Stock Options - 2

Tokyo, Japan -- (MARKET WIRE) -- May 9, 2005 --


Contacts:
Nobuyuki Koike
TDK Corporation
Corporate Communications Dept.
Tel: (81)-3-5201-7102
E-mail; pr@mb1.tdk.co.jp
http://www.tdk.co.jp/tetop01/index.htm



                              FOR IMMEDIATE RELEASE

             TDK Issues Stock Acquisition Rights for Stock Options

TOKYO JAPAN, May 9, 2005-----TDK Corporation's (the "Company") Board of Directors today passed a resolution to issue stock acquisition rights with specially favorable terms and conditions to individuals other than stockholders for the purpose of distributing stock options pursuant to Articles 280-20 and 280-21 of the Commercial Code of Japan. The resolution is subject to approval at the 109th Ordinary Annual General Meeting of Stockholders scheduled for June 29, 2005.

1. Reason for Issuing Stock Acquisition Rights With Specially Favorable Terms and Conditions to Parties Other Than Stockholders:

  By implementing a stock option program for high-ranking TDK  
  Managers, as well as Directors and high-ranking Managers of group 
  companies, TDK will provide added incentive for these individuals to 
  improve TDK's consolidated operating results.

2. Matters Pertaining to the Issuance of Stock Acquisition Rights: (1)Class and Number of Shares to Be Issued Upon Exercise of Stock Acquisition Rights:

      Up to 119,000 shares of common stock

      In the event that the "number of shares granted" (as defined below) is
      adjusted in accordance with (2) below, the maximum number of shares to be 
      issued for the purpose of granting stock acquisition rights shall be 
      calculated by multiplying the aggregate number of stock acquisition rights 
      to be issued by the "number of shares granted" after adjustment.

   (2)Aggregate Number of Stock Acquisition Rights to Be Issued:
      Up to 1,190

      The number of shares per stock acquisition right (hereinafter the "number 
      of shares granted") shall be 100. Provided, however, that in the event 
      that the Company makes a stock split or stock consolidation for its common 
      stock on and after the date on which stock acquisition rights are issued 
      (hereinafter the "issue date"), the number of shares granted shall be 
      adjusted proportionately based on the stock split or stock consolidation 
      ratio.

      Furthermore, in cases where the "number of shares granted" needs to be
      adjusted, such as in the event that the Company merges with another 
      company or performs a division, the "number of shares granted" shall be 
      adjusted appropriately based on the conditions of the merger or division.
      Fractions less than one share arising out of such adjustment shall be 
      discarded.

   (3)Issue Price of Stock Acquisition Rights:
      Free of charge

   (4)Total Amount Due Upon Exercise of Stock Acquisition Rights:
      The total amount due upon exercise of stock acquisition rights shall be 
      the price to be paid for each share, issued or transferred upon the 
      exercise of rights (hereinafter the "exercise price"), multiplied by the 
      "number of shares granted."

      The exercise price shall be an amount which is the average of the closing 
      price (regular way) of the Company's common stock on the Tokyo Stock 
      Exchange on each day (other than any day on which no sale is reported) of 
      the month immediately preceding the date of the issuance of stock 
      acquisition rights, multiplied by 1.05. Any amount less than one yen 
      arising out of such adjustment shall be rounded upward to the nearest yen.

      Provided, however, that, if such price is less than the closing price as 
      of the date of issue of stock acquisition rights, then such closing price 
      reported on the date of issue of stock acquisition rights shall be the 
      exercise price.

      In case the Company issues new shares or disposes of its own shares at a 
      price less than the current market price on or after the issue date 
      (except in the case of the conversion of convertible stock or stock with 
      mandatory conversion terms, or in the case of a request by a stockholder 
      for the sale of shares constituting less than one unit or the exercise of 
      stock acquisition rights), the exercise price shall be adjusted in 
      accordance with the following formula and any amount less than one yen 
      arising out of such adjustment shall be rounded upward to the nearest yen:

                                                   Number of shares    Amount paid
                                                   newly issued     x  per share
                                  Number of      + _______________________________                        
                                  shares issued           Current market price                 
Exercise      Exercise price                        
price after = before adjustment x ________________________________________________
adjustment    
                                  Number of               Number of new shares
                                  shares issued   +       increased after stock
                                                          split or new issuance

      In the above formula, the "number of shares issued" shall be defined as 
      the number of shares of common stock issued and outstanding less the 
      number of treasury stock. In the event that the Company disposes of 
      treasury stock, the "number of shares newly issued" shall be read as 
      "number of treasury stock disposed of." Provided, however, that in the 
      event that the Company makes a stock split or stock consolidation for its 
      common stock on or after the issue date, the exercise price shall be 
      adjusted proportionately based on the stock split or stock consolidation 
      ratio.

      Furthermore, in cases where the "exercise price" needs to be adjusted, 
      such as in the event that the Company merges with another company or 
      performs a division, the "exercise price" shall be adjusted appropriately 
      based on the conditions of the merger or division. And any amount less 
      than one yen arising out of such adjustment shall be rounded upward to the 
      nearest yen.

   (5)Exercise Period for Stock Acquisition Rights:
      From August 1, 2007 to July 31, 2011

   (6)Conditions for Exercising of Stock Acquisition Rights:
      Partial exercise of stock acquisition rights is not permitted.

   (7)Reasons and Conditions for the Cancellation of Stock Acquisition Rights:
      1. The Company may cancel these stock acquisition rights without 
         compensation, if a proposal for approval of a merger agreement, under 
         which the Company is to be dissolved, is approved at a meeting of 
         stockholders of the Company, or if a proposal for approval of a stock 
         exchange agreement or a proposal for share transfer that makes the 
         Company a wholly owned subsidiary, is approved at a meeting of 
         stockholders of the Company.
      2. In the event that the Company acquires unexercised stock acquisition
         rights, it may cancel these stock acquisition rights without 
         compensation at any time.

   (8)Transfer Restrictions of Stock Acquisition Rights:
      The transfer of stock acquisition rights requires the approval of the 
      Board of Directors of the Company.

3. Matters Pertaining to the Allotment of Stock Acquisition Rights:
   When granting stock acquisition rights, the Company shall execute an 
   "Agreement of Allotment of Stock Acquisition Rights" with each eligible 
   person. This Agreement sets forth the conditions that the Company's Board of 
   Directors has deemed reasonable based on the purpose of issuing the of stock 
   acquisition rights.
Note: Subject to approval of the issue and granting of stock acquisition rights at the 109th Ordinary Annual General Meeting of Stockholders scheduled for June 29, 2005, the specific details will be determined at a meeting of the Board of Directors to be held subsequent to the closing of this Ordinary Annual General Meeting of Stockholders.

# # #

Contacts:
Nobuyuki Koike
TDK Corporation
Corporate Communications Dept.
Tel: (81)-3-5201-7102
E-mail; pr@mb1.tdk.co.jp
http://www.tdk.co.jp/tetop01/index.htm


                              FOR IMMEDIATE RELEASE


 Grant of Stock Acquisition Rights as the means of a stock option scheme for a
                         stock-linked compensation plan

TOKYO JAPAN, May 9, 2005-----TDK Corporation's (the "Company") Board of Directors today passed a resolution regarding the issuance to individuals other than stockholders of stock acquisition rights with specially favorable terms and conditions as a stock-linked compensation plan for Company directors and corporate officers, pursuant to Articles 280-20 and 280-21 of the Commercial Code of Japan. This resolution is subject to approval at the 109th Ordinary Annual General Meeting of Stockholders scheduled for June 29, 2005.

1. Reason for Issuing Stock Acquisition Rights With Specially Favorable Terms and Conditions to Individuals Other Than Stockholders: Part of the remuneration of directors and corporate officers of TDK is structured so that they also share the risk of a decrease in the Company's share price with stockholders and not just the benefits of a price increase. The stock option program is thus designed to provide TDK's directors and corporate officers with further incentive for improving the Company's operating results and share price.

2. Matters Pertaining to the Issuance of Stock Acquisition Rights:

   (1)Class and Number of Shares to Be Issued Upon the Exercise of the    
      Stock Acquisition Rights:

      Up to 41,000 shares of common stock

      In the event that the "number of shares granted" (as defined below)
      is adjusted in accordance with (2) below, the number of shares to 
      be issued shall be adjusted by multiplying the "number of shares 
      granted" after said adjustment by the total number of stock 
      acquisition rights.

   (2)Aggregate Number of Stock Acquisition Rights to Be Issued:
      Up to 410

      The number of shares per stock acquisition right (hereinafter
      the "number of shares granted") shall be 100.

      However, in the event that the Company splits or consolidates its 
      common stock on or after the date of issuance of stock acquisition 
      rights (hereinafter the "issue date"), the "number of shares 
      granted" shall be adjusted proportionately based on the particular 
      stock split or stock consolidation ratio.

      Furthermore, in cases where the "number of shares granted" needs to 
      be adjusted, such as in the event that the Company merges with 
      another company or performs a division, the "number of shares 
      granted" shall be adjusted appropriately based on the conditions of 
      the merger or division.

      Fractions of less than one share arising out of the above 
      adjustments shall be discarded.


   (3)Issue Price of Stock Acquisition Rights:
      Free of charge

   (4)Total Amount Due Upon Exercise of Each Stock Acquisition Right:
      The total amount due upon exercise of each stock acquisition right 
      shall be the price to be paid for each share issued or transferred 
      upon the exercise of each right, which shall be Y1, multiplied by 
      the "number of shares granted."

   (5)Exercise Period for Stock Acquisition Rights:
      The exercise period shall be determined by TDK's Board of Directors 
      and be within the period beginning on July 1, 2005 and ending on 
      June 30, 2025.

   (6)Conditions for Exercising of Stock Acquisition Rights:


      1. Stock acquisition rights holders, excluding 2. below, shall not be able 
         to exercise stock acquisition rights in the period from July 1, 2005 to
         June 30, 2008 and to be able to exercise stock acquisition rights after 
         July 1, 2008.

      2. Stock acquisition rights holders shall be permitted to exercise stock 
         acquisition rights until June 30, 2008 in cases specified in a) and b)
         below, as long as it is within the time frame stipulated.
            In the event that a stock acquisition rights holder loses his or her 
            position as either director or employee of the Company (including 
            full-time consultants and contract employees, but excluding 
            part-time consultants and part-time contract employees. * This 
            definition is same in this resolution.)
               Three years from the day after losing the position

            a) In the event that a proposal for approval of a merger agreement, 
               under which the Company is to be dissolved, or a proposal for 
               approval of a stock exchange agreement or a proposal for share 
               transfer that makes the Company a wholly owned subsidiary, is 
               approved at a meeting of stockholders of the Company.
                 A period of 15 days from the day following the approval date


      3. After July 1, 2008, in the event that a stock acquisition rights holder 
         loses his or her position as either a director or employee of the
         Company, the individual may exercise his or her rights up to three 
         years from the day after losing the position as long as it is within 
         the exercise period for stock acquisition rights.
      4. Partial exercise of each stock acquisition right is not permitted.


   (7)Reasons and Conditions for the Cancellation of Stock Acquisition Rights:
      In the event that a stock acquisition rights holder becomes unable to 
      exercise stock acquisition rights, the Company can cancel those rights 
      without compensation.

   (8)Transfer Restrictions of Stock Acquisition Rights:
      The transfer of stock acquisition rights requires the approval of the 
      Board of Directors of the Company.


3. Matters Pertaining to the Allotment of Stock Acquisition Rights:
   When granting stock acquisition rights, the Company shall execute an 
   "Agreement of Allotment of Stock Acquisition Rights" with each eligible 
   person. This Agreement sets forth conditions that the Company's Board of 
   Directors has deemed reasonable based on the purpose of issuing the stock 
   acquisition rights.

Note: Subject to approval of the issue and granting of stock acquisition rights at the 109th Ordinary Annual General Meeting of Stockholders scheduled for June 29, 2005, the specific details will be determined at a meeting of the Board of Directors to be held subsequent to the closing of this Ordinary Annual General Meeting of Stockholders.

# # #


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