Toyota 2015 Annual Report Download - page 118

Japanese Unit Share System
General. Consistent with the requirements of the Companies Act, Toyota’s articles of incorporation provide
that 100 common shares or Model AA Class Shares each constitute one “unit.” Although the number of shares
constituting a unit is included in the articles of incorporation, any amendment to the articles of incorporation
reducing (but not increasing) the number of shares constituting a unit or eliminating the provisions for the unit of
shares may be made by a resolution of the board of directors rather than by a special shareholders resolution,
which is otherwise required for amending the articles of incorporation.
Voting Rights under the Unit Share System. Under the unit share system, shareholders have one voting
right for each unit of shares that they hold. Any number of common shares or Model AA Class Shares less than a
full unit will carry no voting rights.
Purchase by Toyota of Shares Constituting Less Than a Unit. A holder of shares constituting less than a
full unit may require Toyota to purchase those shares at their market value in the case of common shares and at
fair price in the case of Model AA Class Shares in accordance with the provisions of Toyota’s share handling
regulations and the Companies Act.
Surrender of American Depositary Receipts. ADR holders will only be permitted to surrender ADRs and
withdraw underlying common shares constituting an integral number of a whole unit. If a holder surrenders an
ADR including ADRs representing common shares that do not constitute an integral number of whole units, the
Depositary will deliver to that holder only those common shares which constitute a whole unit. The Depositary
will then issue to the holder a new ADR representing the remaining shares. Holders of an ADR that represents
less than a whole unit of underlying shares will be unable to withdraw the underlying shares. As a result, those
holders will be unable to require Toyota to purchase their common shares to the extent those common shares
constitute less than one whole unit.
Voting Rights
Toyota holds its ordinary general shareholders’ meeting each year. In addition, Toyota may hold an
extraordinary general shareholders’ meeting whenever necessary by giving at least two weeks’ advance notice.
Under the Companies Act, notice of any shareholders’ meeting must be given to each shareholder having voting
rights or, in the case of a non-resident shareholder, to his or her resident proxy or mailing address in Japan in
accordance with Toyota’s share handling regulations, at least two weeks prior to the date of the meeting.
Holders of common shares and holders of Model AA Class Shares shall have voting rights exercisable at a
general shareholders’ meeting. A holder of shares constituting one or more whole units is entitled to one vote per
unit of shares subject to the limitations on voting rights set forth in this paragraph. In general, under the
Companies Act, a resolution can be adopted at a general shareholders’ meeting by a majority of the shares having
voting rights represented at the meeting. The Companies Act and Toyota’s articles of incorporation require a
quorum for the election of members of the board of directors and audit & supervisory board members of not less
than one-third of the total number of outstanding shares having voting rights. Toyota’s shareholders are not
entitled to cumulative voting in the election of members of the board of directors. A corporate shareholder, the
management of which is substantially under Toyota’s control as provided by an ordinance of the Ministry of
Justice, either through the holding of voting rights or for any other reason, does not have voting rights.
Shareholders may exercise their voting rights by attending the general shareholders’ meeting or in writing
by mail. Shareholders who choose to exercise their voting rights by mail must fill out and return to Toyota the
voting right exercise form enclosed with the convocation notice of the general shareholders’ meeting by the date
specified in such convocation notice. In addition, from the general shareholders’ meeting for fiscal 2009,
shareholders may exercise their voting rights through the internet. Shareholders electing to exercise their voting
rights through the internet must log on to the “Website to Exercise Voting Rights” using the login ID and
temporary password provided in the voting right exercise form enclosed with the convocation notice and submit
113