 |
The following information is true and accurate at the time of publication.
November 30, 2001
Issues of Bonds with Warrants, Bonds with Warrants for Shares of
Subsidiary Tracking Stock Linked to Sony Communication Network
and U.S. Dollar Denominated Convertible Bonds
for the Purpose of the Incentive Plan
Sony Corporation (the "Corporation") resolved at a meeting of its Board
of Directors today to issue three different types of equity-related securities
for the purpose of providing stock incentives to management and key employees
of Sony group companies. Securities to be issued include:
1) Bonds with warrants to subscribe for shares of common stock of the
Corporation for approximately 500 executives and key employees of the
Corporation and its affiliated companies;
2) Bonds with warrants to subscribe for shares of Subsidiary Tracking
Stock linked to Sony Communication Network for its seven key executives;
and
3) U.S. dollar-denominated convertible bonds to replace a part of existing
Stock Appreciation Rights for key executives in Sony's U.S. affiliated
companies.
The terms of the issue are as follows:
1. The Thirteenth Series Unsecured Bonds with Warrants
| 1. Name of
Bonds: |
The Thirteenth Series
Unsecured Bonds with Warrants of Sony Corporation |
| 2. Total
amount of issue: |
7,300,000,000
yen |
| 3. Denomination of
each Bond: |
100,000,000 yen |
| 4. Form of Bonds: |
Bearer Bonds with
Coupons |
| 5. Interest rate: |
The rate to be determined
hereafter by the Representative Director, not exceeding 1.5% per
annum |
| 6. Issue price: |
111.449944% of the
principal amount of the Bonds (Bonds: 100% of the principal amount,
Warrants: 12% of the Denominated Amount as defined below) |
| 7. Redemption price: |
100% of the principal
amount of the Bonds |
| 8. Maturity date: |
December 21, 2007 |
| 9. Offering period: |
December 10, 2001 |
| 10. Payment date: |
December 21, 2001 |
| 11. Method of offering: |
Subscription by Nomura
Securities Co., Ltd. |
| 12. Security or guarantee: |
The Bonds are not
secured by any pledge, mortgage or other charge on any assets or
revenues of the Corporation or of others nor guaranteed. There is
no assets reserved for security for the Bonds. |
| 13. Special covenants: |
The Bonds are subject
to certain covenants relating to negative pledge. |
| 14. Redemption prior
to maturity: |
The Corporation may,
at any time after the issue of the Bonds, purchase the Bonds and
have such purchased Bonds canceled; provided, however, that no such
cancellation shall cause the aggregate principal amount of all Bonds
thereafter remaining outstanding to be less than the amount produced
by multiplying the number of Warrants then remaining outstanding
and unexercised by 603,900 yen. |
| 15. Interest payment
dates: |
June 21 and December
21 of each year |
| 16. Place of payment: |
Payment of principal
and interest in respect of the Bonds will be made at Tokyo Main
Office of Sumitomo Mitsui Banking Corporation. |
| 17. Underwriter: |
Nomura Securities
Co., Ltd. |
| 18. Matters concerning
Warrants: |
|
| (1) Amount of Warrants: |
Aggregate amount
of the Warrants is 95.4162% of the aggregate principal amount of
the Bonds. Each Warrant represents the right to subscribe for the
shares in an aggregate issue price of 603,900 yen. (Such amount
per Warrant is hereinafter referred to as "Denominated Amount".) |
| (2) Aggregate amount
of issue price of the shares to be issued upon exercise of the Warrants:
6,965,382,600 yen |
| (3) Shares to be
issued upon exercise of the Warrants: |
Shares of common
stock ("Shares") of the Corporation |
| (4) Conditions to
exercise the Warrants: |
Issue price per Share
to be issued upon exercise of the Warrants (the "Exercise Price")
is initially 6,039 yen. The number of Shares to be issued upon exercise
of the Warrants shall be obtained by dividing the aggregate Denominated
Amount of the Warrants in respect of which exercise notice has been
given, by the Exercise Price; provided, however, that any fraction
of a share arising upon exercise of the Warrants will be disregarded.
The Exercise Price will be adjusted in accordance with the market
price formula. |
| (5) Period during
which the Warrants may be exercised: |
From January 6, 2003
to December 20, 2007. Provided, however, that the Warrants cease
to be exercisable when the Bonds become due and payable. |
| (6) Partial exercise
of a Warrant: |
No Warrant may be
exercised in part. |
| (7) Dividend on Shares
issued upon exercise of the Warrants: |
With respect to the
initial payment of dividends and cash distribution as provided in
Article 293-5 of the Commercial Code of Japan ("interim dividends")
on the Shares issued upon exercise of the Warrants, such exercises
shall be deemed to have taken effect on April 1 in case an application
for exercise was made during the period from April 1 to September
30, and on October 1 in case an application for exercise was made
during the period from October 1 to March 31 of the following year.
|
| (8) Transfer of the
Warrants: |
The Warrants may
be transferred separately from the Bonds subject to certain restrictions
on the transfer thereof within the United States or to U.S. persons.
Transfer of the Warrants by persons referred to in item 20 below
including Directors and Corporate Executive Officers is restricted
as a general rule pursuant to their undertaking to the Corporation
or the relevant Affiliated Company. |
| (9) The portion of
the Exercise Price which will not be accounted for as stated capital: |
The portion of the
Exercise Price which will not be accounted for as stated capital
shall be the amount of such Exercise Price (if adjusted, as adjusted)
less the amount which will be accounted for as stated capital; the
amount to be accounted for as stated capital shall be one-half of
such Exercise Price (if adjusted, as adjusted) and any fraction
less than 1 yen resulting from such calculation shall be rounded
up to the nearest yen. |
| (10) Payment Handling
Bank: |
Sumitomo Mitsui Banking
Corporation, Head Office |
| (11) Place where
applications for exercise of the Warrants may be made: |
Nomura Securities
Co., Ltd., Head Office and other branches within Japan |
| 19. Recording Agency: |
Sumitomo Mitsui Banking
Corporation |
| 20. All Warrants
will be repurchased by the Corporation and granted, directly or
through the Corporation's affiliated companies (the "Affiliated
Companies"), to directors of the Corporation or the Affiliated Companies
as part of their remuneration, and sold, directly or through the
Affiliated Companies, to Corporate Executive Officers and key employees
of the Corporation and executive officers and key employees of the
Affiliated Companies. |
(For reference)
Secondary distribution of Warrants
|
| 1. Pieces for offering: |
9,164 pieces |
| 2. Aggregate offering
price: |
664,096,752 yen |
| 3. Offering price: |
72,468 yen |
| 4. Unit of offering: |
1 piece |
| 5. Offering period: |
December 10, 2001 |
| 6. Payment date: |
December 21, 2001 |
| 7. The warrants will
be distributed by the Corporation to Corporate Executive Officers
and key employees of the Corporation, and Affiliated Companies. |
2. The Fourteenth Series Unsecured Bonds with Warrants for Shares
of Subsidiary Tracking Stock Linked to Sony Communication Network Corporation
| 1. Name of Bonds: |
The Fourteenth Series
Unsecured Bonds with Warrants for Shares of Subsidiary Tracking
Stock Linked to Sony Communication Network Corporation |
| 2. Total amount of
issue: |
150,000,000 yen |
| 3. Denomination of
each Bond: |
50,000,000 yen |
| 4. Form of Bonds: |
Bearer Bonds with
Coupons |
| 5. Interest rate: |
The rate to be determined
hereafter by the Representative Director, not exceeding 1.5% per
annum |
| 6. Issue price: |
100.46% of the principal
amount of the Bonds (Bonds: 100% of the principal amount, Warrants:
0.46% of the Denominated Amount as defined below) |
| 7. Redemption price: |
100% of the principal
amount of the Bonds |
| 8. Maturity date: |
December 21, 2007 |
| 9. Offering period: |
December 10, 2001 |
| 10. Payment date: |
December 21, 2001 |
| 11. Method of offering: |
Subscription by Nomura
Securities Co., Ltd. |
| 12. Security or guarantee: |
The Bonds are not
secured by any pledge, mortgage or other charge on any assets or
revenues of the Corporation or of others nor guaranteed. There is
no assets reserved for security for the Bonds. |
| 13. Special covenants: |
The Bonds are subject
to certain covenants relating to negative pledge. |
| 14. Redemption prior
to maturity: |
The Corporation may,
at any time after the issue of the Bonds, purchase the Bonds and
have such purchased Bonds canceled; provided, however, that no such
cancellation shall cause the aggregate principal amount of all Bonds
thereafter remaining outstanding to be less than the amount produced
by multiplying the number of Warrants then remaining outstanding
and unexercised by 250,000 yen. |
| 15. Interest payment
dates: |
June 21 and December
21 of each year |
| 16. Place of payment: |
Payment of principal
and interest in respect of the Bonds will be made at Tokyo Main
Office of Sumitomo Mitsui Banking Corporation. |
| 17. Underwriter: |
Nomura Securities
Co., Ltd. |
| 18.Matters concerning
Warrants: |
|
| (1) Amount of Warrants: |
Aggregate amount
of the Warrants is 100% of the aggregate principal amount of the
Bonds. Each Warrant represents the right to subscribe for the shares
in an aggregate issue price of 250,000 yen. (Such amount per Warrant
is hereinafter referred to as "Denominated Amount".) |
| (2) Aggregate amount
of issue price of the shares to be issued upon exercise of the Warrants: |
|
150,000,000 yen
|
| (3) Shares to be
issued upon exercise of the Warrants: |
a) Shares of Subsidiary
Tracking Stock Linked to Sony Communication Network Corporation
("Tracking Stock") of the Corporation
b) Provided that in case the Corporation causes the compulsory conversion
("Compulsory Conversion") of each Tracking Stock into shares of
common stock ("Shares") of the Corporation, shares to be issued
upon exercise of the Warrants on and after the compulsory conversion
date shall be the Shares of the Corporation. |
| (4) Conditions to
exercise the Warrants: |
a) Issue price per
shares of Tracking Stock or Shares of the Corporation to be issued
upon exercise of the Warrants (the "Exercise Price") is initially
3,300 yen.
b) The number of Shares to be issued upon exercise of the Warrants
shall be obtained by dividing the aggregate Denominated Amount of
the Warrants in respect of which exercise notice has been given,
by the Exercise Price; provided, however, that any fraction of a
share arising upon exercise of the Warrants will be disregarded.
The Exercise Price will be adjusted in accordance with the market
price formula.
c) If the Compulsory Conversion is made, the Exercise Price will
be adjusted appropriately in proportion to the conversion ratio
applicable to the Compulsory Conversion. |
| (5) Period during
which the Warrants may be exercised: |
From June 20, 2002
to June 20, 2007. Provided, however, that the Warrants cease to
be exercisable when the Bonds become due and payable or all the
Tracking Stock are compulsory retired. (Provided that in case of
all the Tracking Stock are compulsory retired, the Corporation may
restrict the exercise of Warrants during a certain period.) |
| (6) Partial exercise
of a Warrant: |
No Warrant may be
exercised in part. |
| (7) Dividend on shares
of Tracking Stock or Shares issued upon exercise of the Warrants: |
|
a) With respect to
the initial payment of dividends and cash distribution as provided
in Article 293-5 of the Commercial Code of Japan ("interim dividends")
on the Shares issued upon exercise of the Warrants, such exercises
shall be deemed to have taken effect on April 1 in case an application
for exercise was made during the period from April 1 to September
30, and on October 1 in case an application for exercise was made
during the period from October 1 to March 31 of the following year.
b) Provided that in case the Cumulative Unpaid Dividends (as defined
in the Tracking Stock) for the Tracking Stock exist with respect
to the already issued shares of Tracking Stock, the amount equivalent
to the Cumulative Unpaid Dividends per already issued share of Tracking
Stock at the time of such issuance of new shares shall be deemed
to be the Cumulative Unpaid Dividends per share of such newly issued
Tracking Stock; provided, however, that if the Corporation newly
issues the Tracking Stock during the period from the day immediately
following the last day of an accounting period of the Corporation
through the day of the ordinary general meeting of shareholders
of the Corporation for such accounting period, the appropriation
of retained earnings for such accounting period adopted at such
meeting shall be taken into account in calculating the deemed Cumulative
Unpaid Dividends of the newly issued shares of the Tracking Stock.
|
| (8) Transfer of the
Warrants: |
The Warrants may
be transferred separately from the Bonds subject to certain restrictions
on the transfer thereof within the United States or to U.S. persons.
Transfer of the Warrants by persons referred to in item 20 below
including Directors and Corporate Executive Officers of Sony Communication
Network Corporation is restricted as a general rule pursuant to
their undertaking to the Corporation and Sony Communication Network
Corporation. |
| (9) The portion of
the Exercise Price which will not be accounted for as stated capital: |
|
The portion of the
Exercise Price which will not be accounted for as stated capital
shall be the amount of such Exercise Price (if adjusted, as adjusted)
less the amount which will be accounted for as stated capital; the
amount to be accounted for as stated capital shall be one-half of
such Exercise Price (if adjusted, as adjusted) and any fraction
less than 1 yen resulting from such calculation shall be rounded
up to the nearest yen. |
| (10) Payment Handling
Bank: |
Sumitomo Mitsui Banking
Corporation, Head Office |
| (11)
Place where applications for exercise of the Warrants may be made: |
|
Nomura Securities
Co., Ltd., Head Office and other branches within Japan |
| 19. Recording Agency:
|
Sumitomo Mitsui Banking Corporation |
| 20. All Warrants
will be repurchased by the Corporation and sold to Sony Communication
Network Corporation and granted from Sony Communication Network
Corporation to Directors of Sony Communication Network Corporation
as part of their remuneration, and sold to Corporate Executive Officers
of Sony Communication Network Corporation. |
3. U.S. Dollar Denominated Convertible Bonds Due 2006
| 1. Name of Bonds: |
Sony Corporation U.S. Dollar Denominated Convertible Bonds Due 2006 |
| 2. Total amount of issue: |
U.S.$57,307,476 plus an amount equal to the principal amount of the replacement Bond certificates that may be issued upon obtaining appropriate evidence and indemnity in case of loss, theft or destruction of Bond certificates |
| 3. Denomination of each Bond: |
U.S.$4,794 only |
| 4. Form of Bonds: |
Registered Bonds |
| 5. Issue price: |
100% of the principal amount of the Bonds |
| 6. Interest rate: |
The Bonds bear no interest. |
| 7. Redemption price: |
100% of the principal amount of the Bonds |
| 8. Maturity date: |
October 6, 2006 |
| 9. Payment date: |
December 17, 2001 |
| 10. Method of offering: |
Upon the registration of the Bonds with the U.S. Securities and Exchange Commission under the U.S. Securities Act, Sony Corporation of America will purchase the aggregate principal amount of the Bonds. |
| 11. Matters concerning
conversion: |
| (1) Terms of conversion: |
The price at which each share of Common
Stock of the Corporation to be issued upon conversion of the Bonds
(the "Conversion Price") shall be initially 5,952.23 yen, and the
number of shares of Common Stock of the Corporation to be issued
upon conversion shall be determined by the following formula. No
request for the conversion of the Bonds may be made in respect of
part only of the principal amount of a Bond or a Bond already called
for redemption. |
|
|
Amount obtained
by translating the aggregate of the principal amount of the
Bonds surrendered for conversion by the holder thereof into
yen at the rate of exchange of U.S.$ 1 = 124.16 yen |
| Number of shares |
= |
|
|
|
Conversion
Price |
Provided, however, that any fraction of a full share arising upon
conversion will be disregarded and no cash adjustment will be made
therefor.
|
(2) Adjustment of
the Conversion Price:
The Conversion Price will be adjusted by the following formula in
case the Corporation issues new shares of the Corporation after
the issue of the Bonds at a consideration per share less than the
current market price per share of common stock of the Corporation:
|
|
|
|
|
| Number
of shares already issued |
|
Number
of new shares to be issued |
x |
Amount
to be paid per share |
| + |
|
|
Current
market price per s |
|
Number
of shares
already issued |
+
|
Number
of newshares to be issued |
|
| Conversion Price
after adjustment |
=
|
Conversion Price
before adjustment |
x |
|
|
|
|
The Conversion Price will also be appropriately adjusted in cases
of stock split or consolidation of shares, issuance of convertible
bonds or bonds with warrants convertible into or exercisable at
an initial conversion or exercise price less than the current market
price per share of the Corporation, and in certain other cases as
provided for in the terms and conditions of the Bonds. |
(3) The portion of
the issue price of the shares issued upon conversion which will
not be accounted for as stated capital:
The portion of the issue price of the shares issued upon conversion
of the Bonds which will not be accounted for as stated capital shall
be the amount of such issue price less the amount which will be
accounted for as stated capital; the amount to be accounted for
as stated capital shall be one-half of such issue price and any
fraction less than 1 yen resulting from such calculation shall be
rounded up to the nearest yen. |
(4) Class of shares
to be issued upon conversion:
Shares of Common Stock of the Corporation |
(5) Period during
which applications for conversion may be made:
From December 18, 2001 to September 30, 2006 |
(6) Place at which
applications for conversion may be accepted:
Sony Corporation of America |
(7) Effectiveness
of the conversion:
The conversion will become effective on the Conversion Date (Japan time) specified as such in the Conversion Notice.
|
(8) Dividends on
shares issued upon conversion:
The first dividends or interim dividends on shares issued upon conversion
of the Bonds will be paid on the assumption that such conversion
took place on April 1 in case the conversion of the Bonds becomes
effective during the period from April 1 to September 30 or on October
1 in case the conversion of the Bonds becomes effective during the
period from October 1 to March 31 of the following year. |
(9) Payment for shares
less than one unit of shares arising from conversion:
In case any shares less than one unit of shares arise as a result
of conversion and the Corporation does not issue the shares in accordance
with the Commercial Code of Japan or the Articles of Incorporation
of the Corporation, the payment therefor shall be made in cash equivalent
to current market price for the shares less than one unit arising
as a results of conversion calculated based upon (1) above. |
(10) Method of delivery
of share certificates:
Share certificates will be delivered at the Corporate Agency Department
of the Head Office of The Toyo Trust and Banking Company, Limited
promptly after all procedures for conversion of the Bonds are completed.
No share certificate shall be issued in respect of shares less than
one unit pursuant to (9) above.
|
12. Method of redemption
(1) The aggregate principal amount of the Bonds shall be redeemed
on October 6, 2006.
(2) The Corporation may, at any time on or after the date immediately
following the issue date of the Bonds, purchase the Bonds and have
such purchased Bonds canceled. |
13. Security or guarantee:
The Bonds are not secured by any mortgage, pledge or other security
interest nor by any assets reserved for security for the Bonds and
are not guaranteed. |
| 14. The Bonds purchased by Sony Corporation of America will be sold to officers and employees of Sony Corporation of America and its affiliated companies under the Sony Corporation of America Stock Incentive Plan as a substitution for the Stock Incentive Plan utilizing SAR (Stock Appreciation Rights) already introduced and implemented. |
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