Note : This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail.
To whom it may concern:
May 13, 2026
Company name: SEIKO GROUP CORPORATION Name of representative: Shuji Takahashi, President
(Securities code: 8050; the Prime Market of the Tokyo Stock Exchange)
Inquiries: Haruhiko Igarashi, General Manager, General Affairs Department
(Telephone: +81-3-3563-2111)
Notice Concerning Partial Revision of the Board Benefit Trust (BBT)
SEIKO GROUP CORPORATION (the "Company") hereby announces that it has resolved, at the Board of Directors meeting held today, to partially revise the Board Benefit Trust (BBT), as described below.
The Company received approval for a BBT (Board Benefit Trust), a stock compensation plan (the "Plan") for the Company's Executive Directors (excluding Non-Executive Directors and Outside Directors), at the 155th Ordinary General Meeting of Shareholders held on June 29, 2016. Subsequently, following the introduction of the system of executive officer (senior vice president) on June 29, 2022, Executive Officers were added to the persons eligible for the Plan (Executive Directors and Executive Officers eligible for the Plan are hereinafter referred to as "Directors, Etc."). In July 2022, the Company revised its Directors, Etc. compensation plan and increased the ratio of stock compensation in the total amount of compensation paid to Directors, Etc. Accordingly, at the 162nd Ordinary General Meeting of Shareholders held on June 29, 2023, the Company received approval to revise the upper limit of funds to be contributed by the Company for every three fiscal years (the "Target Period") and the maximum number of points to be awarded to Directors, Etc. for each fiscal year, and has since operated the Plan.
At the Board of Directors meeting held today, the Company resolved to make a partial revision of the Plan (the "Revision") and to submit a proposal regarding the Revision to the 165th Ordinary General Meeting of Shareholders to be held on June 25, 2026 (the "General Meeting of Shareholders").
The Company implemented a 2-for-1 stock split of its common shares, effective April 1, 2026. Accordingly, the above maximum number of points awarded for each fiscal year has been adjusted to reflect this stock split.
For an outline of the Plan, please refer to the Company's announcements dated May 10, 2016, "Notice Concerning Introduction of Performance-Linked Stock Compensation System," and August 9, 2016, "Notice Concerning Introduction of the Board Benefit Trust (BBT) (Details Determined)."
Background and purpose of the Revision
The Plan aims to enhance the awareness of the Directors, Etc. to contribute to improve business performance and increase corporate value of the Company in the medium- to long-term, by further clarifying the link between their compensation and medium- to long-term business performance and stock value, and by the Directors, Etc. sharing interest with our shareholders. The Company has decided to revise the Plan to provide an appropriate incentive for improving medium- to longterm business performance and increasing corporate value, and to further promote the sharing of interests between Directors, Etc. and shareholders. Specifically, in light of the objectives of this revision to the Plan and subject to approval and resolution of the related proposal at the General
Meeting of Shareholders, the Company has decided, taking into consideration the impact of share price fluctuations on the number of shares acquired by the trust, to remove the upper limit on the cash the Company contributes to the trust and to establish a specific method for calculating the amount of compensation, etc. under the Plan.
Details of revisions
The Company acquires through a trust (the trust created under the Plan hereinafter being referred to as the "Trust") the Company's shares reasonably expected to be required in order to provide the shares for each Target Period. The upper limit of the amount of contribution by the Company will be removed.
Outline of the revised Plan (The main changes are underlined.)
Outline of the Plan
The Plan is a performance-linked stock compensation plan where the Company's shares are acquired through the Trust with funds contributed by the Company, and the Company's shares and cash equivalent to the market value of the Company's shares (the "Company Shares, Etc.") are provided to the Directors, Etc. through the Trust in accordance with the "Rules for Delivery of Shares to Officers" stipulated by the Company. The time at which a Director, Etc. receives the Company Shares, Etc. shall, in principle, be when he or she retires from office.
Persons eligible for the Plan
The persons eligible for the Plan shall be Executive Directors (excluding Non-Executive Directors and Outside Directors) and Executive Officers of the Company.
Upper limit of the amount of contribution by the Company to the Trust
To date, the Company has contributed cash to the Trust up to a limit of 540 million yen (including 390 million yen for the Company's Executive Directors' portion) as the funds required for the Target Period, and has contributed 240 million yen at the time of establishment of the Trust and 533 million yen in November 2023 (including 385 million yen for the Company's Directors' portion). Subject to the approval of this proposal, the Company will make an additional contribution to the Trust in the amount deemed necessary for the Trust to acquire in advance the number of the Company's shares reasonably expected to be required to make deliveries to Directors, Etc. under the Plan for the Target Period from the fiscal year ended March 31, 2026 to the fiscal year ending March 31, 2028 and in each subsequent Target Period. However, in making such additional contribution, if there are any shares of the Company (excluding the Company's shares corresponding to the number of points awarded to the Directors, Etc. pursuant to (5) below, which have not been delivered to them) and cash remaining in the trust assets on the day immediately preceding the commencement of the Target Period for which such additional contribution is to be made (the "Remaining Shares, Etc."), the Remaining Shares, Etc. shall be allocated to the source of delivery to be made under the Plan for the subsequent Target Period, and the amount of the additional contribution shall be calculated after taking into account the Remaining Shares, Etc. If the Company decides to make an additional contribution, it will disclose such decision in a timely and appropriate manner.
(Note) The total amount the Company actually contributes to the Trust will consist of the above funds for acquiring shares plus an estimated amount of necessary expenses such as trust fees.
Method of acquisition of the Company's shares
The Trust will acquire the Company's shares through stock markets or by subscribing to treasury
shares of the Company.
Specific details of the Company Shares, Etc. to be delivered to Directors, Etc.
In each fiscal year, the Company will award points to each Director, Etc. in such number to be determined based on his or her position, the degree of achievement of the medium- and long-term performance targets, and other factors in accordance with the "Rules for Delivery of Shares to Officers."
The total number of points awarded to the Directors, Etc. in each fiscal year will be a maximum of 124,000 points (including 90,000 points for the Company's Executive Directors' portion) (Note: Prior to the stock split implemented on April 1, 2026, the maximum was 62,000 points (including 45,000 points for the Company's Executive Directors' portion)).
Upon the delivery of Company Shares, Etc. under (6) below, one point awarded to a Director, Etc. will be converted to one common share of the Company (however, if a stock split, allotment of shares without contribution, or reverse stock split is conducted with respect to the Company's shares, the maximum number of points and the number of points already awarded or the conversion ratio will be adjusted in a reasonable manner depending on the ratio or other factors of such conduct).
Timing of delivery to the Directors, Etc. and specific method for calculating the amount of compensation, etc.
If a Director, Etc. who has retired from office meets the beneficiary requirements stipulated in the "Rules for Delivery of Shares to Officers," he or she will be able to receive the Company's shares from the Trust, in principle, after his or her retirement in proportion to the accumulated number of points awarded until his or her retirement from office, by taking the prescribed procedures to determine the beneficiary. However, if a Director, Etc. meets the requirements stipulated in the "Rules for Delivery of Shares to Officers," the Company may pay him or her cash equivalent to the market value of a certain percentage of such shares, instead of delivering the Company's shares. Please note that the Trust may sell the Company's shares to carry out a cash delivery. If a Director, Etc. who has been awarded points is dismissed or commits an act that causes material damage to the Company or other similar misconduct, the Company may reduce all or part of the shares and cash to be paid to him or her.
The amount of compensation, etc. a Director, Etc. receives will be based on the amount obtained by multiplying, at the time of awarding points, the total number of points awarded to the Director, Etc. by the book value per share of the Company's shares held in the Trust (however, if an allotment of shares without contribution, reverse stock split, or similar action is conducted with respect to the Company's shares, a reasonable adjustment will be made based on the relevant ratio and other factors). If cash is exceptionally delivered in accordance with the "Rules for Delivery of Shares to Officers" and such delivery is deemed appropriate, that amount will be added.
Treatment of dividends
Dividends on the Company's shares held in the Trust account are received by the Trust and used to cover the acquisition cost of the Company's shares, trustee fees, and other Trust-related expenses. If the Trust is terminated, any remaining dividends and other funds in the Trust will be distributed to Directors, Etc. then in office on a pro rata basis according to the number of points each holds, in accordance with the "Rules for Delivery of Shares to Officers."