Tokyo, Japan – October 25, 2001 – Trend Micro Inc. (TSE: 4704; Nasdaq: TMIC), a worldwide leader in antivirus and Internet content security solutions, today adopted the following resolutions regarding the issuance of the bonds with subscription warrants at the meeting of the Board of Directors of the Company held on October 25, 2001.
Pursuant to the Company's "Incentive Plan for the Year 2001," the purpose of the issuance of bonds with subscription warrants is to grant subscription warrants to certain directors and employees of the Company as well as to certain directors and employees of the Company's subsidiaries.
- Name of the bonds
Trend Micro Incorporated Eighth Series of Unsecured Bonds with Subscription Warrants
- Total amount of bonds to be issued
6 billion yen
- Price of each bond
100 million yen
- Type of bond
Only bearer type
- Price of bond at issue
Undecided (It will be decided at the meeting of the Board of Directors to be held on November 1, 2001).
- Interest rate
- Redemption price
100 yen par value of 100 yen
- Term of redemption
November 19, 2004
- Application period
From November 5, 2001 until November 15, 2001
- Date of payment
November 19, 2001
- Subscription method
Daiwa Securities SMBC Co., Ltd. shall purchase the total amount.
- Security, guarantee
There is no collateral or guarantee, and there is no asset serving as a back up for the bonds.
- Special agreements
"Negative Pledge," "Net profit maintenance," and "Switching bond type from unsecured to secured."
- Cancellation of the purchase
From the day after the date of the issuance, as long as the total value of the shares that can be obtained by then unexercised subscription warrants does not exceed the total value of the outstanding bonds, cancellation of the purchase of the bonds is allowed.
- Method and period of interest payment
(1) From the day after the date of the issuance until the redemption date, the interests will be paid first on May 19, 2002 for all the interest payments due by then, and from thereafter, six-months worth of interest will be paid on every May 19 and November 19.
(2) If the banks are closed on the day when interests are to be paid, then, the date of interest payment shall be moved to the prior bank business day.
(3) When paying less-than-six-months worth of interests, interests should be calculated according to the calendar.
(4) No interest will be paid after the redemption date.
- Place where principal and interest shall be paid
The Toyo Trust and Banking Co., Ltd.., Head Office
Daiwa Securities SMBC Co., Ltd., Head Office and Osaka Branch
- Underwriting company
Daiwa Securities SMBC Co., Ltd.
- Regarding subscription warrants
(1) Ratio of the bond to the share obtained by the subscription warrant
For every 1 million yen par value bond price, total issue price of par value shares of common stock issuable upon exercise of the subscription warrant shall be granted 100%. Each subscription warrant certificate represents the right to obtain 1 million yen worth of new shares.
(2) Total amount of the issue price of shares issuable upon exercise of the subscription warrants
6 billion yen
(3) Type of shares issuable upon exercise of the subscription warrant
Common stock of the Company
(4) Conditions of exercise of the subscription warrants
Issue price per share ("exercise price") of shares issuable upon exercise of the subscription warrants is undecided. It will be decided at the meeting of the Board of Directors to be held on November 1, 2001).
Number of shares issuable upon exercise of the subscription warrant is as follows:
The total value of subscription warrant certificates submitted by the warrantholder for the exercise of the warrant
Number of shares = ------------------------------------------------------------------
Any fraction less than one share shall be disregarded. The adjustment of the exercise price will take the market-price format.
(5) Exercise period of the subscription warrants:
From November 2, 2002 through November 12, 2004. If bond acceleration occurs, no subscription warrant may be exercised thereafter.
(6) Partial exercise of the subscription warrant
No subscription warrant may be partially exercised.
(7) Transfer of the subscription warrants
Subscription warrant detachable from the bond can be transferred. However, pursuant to the Company's and/or its subsidiary's memorandum, the Company's directors and employees as well as the subsidiary's directors and employees cannot transfer the subscription warrants.
(8) The portion of the issue price of the shares to be issued upon exercise of the subscription warrant which will not be transferred to stated capital
The balance of the exercise price (if adjusted pursuant to 18(4) above, the adjusted exercise price) remaining after deduction of the amount to be transferred to stated capital. The amount to be transferred to stated capital shall mean an amount obtained by multiplying the exercise price (if adjusted pursuant to 18(4) above, the adjusted exercise price) by 0.5, with any fraction of one yen occurring as a result of such calculation to be rounded up to a full yen.
(9) Payment in kind
(10) Effectiveness of exercise of the subscription warrants
The exercise of the subscription warrants shall become effective if the certificate evidencing the relevant subscription warrant, documents required for exercise of the subscription warrant and cash payment reach the place for handling payments.
(11) Dividends payable on shares to be issued upon exercise of the subscription warrants
Any annual dividend or interim dividend payable on shares issuable upon exercise of the subscription warrants with respect to the Dividend Accrual Period (as defined below), during which the relevant date of exercise falls, shall be paid for the full Dividend Accrual Period as if the exercise had taken effect at the beginning of such Dividend Accrual Period. The "Dividend Accrual Period" means each six-month period ending on June 30 and December 31 in each year.
(12) Place for accepting the request for exercise of the subscription warrant
The registered head office of the Company
(13) Place for handling payments resulting from exercise of the subscription warrant
The registered head office of The Toyo Trust and Banking Co., Ltd.
(14) Method of delivery of share certificates
Share certificates will be delivered by the corporate agency department of The Toyo Trust and Banking Co., Ltd. as soon as after the relevant subscription warrant is exercised. No certificates will be issued for any fractional shares.
The Toyo Trust and Banking Co., Ltd.
Any other matters required for the issuance of the Bonds of Subscription Warrants will be decided at a meeting of the Company's board of directors to be held hereafter and entrusted to the representative director of the Company.
The subscription warrants to be issued by the Company will be fully repurchased by the Company from Daiwa Securities SMBC Co., Ltd. Then, they will be partly granted to certain directors of the Company as part of director compensations and partly offered to certain employees of the Company and to the Company's subsidiaries.