Introduction of a Performance-Linked Share Compensation Plan

「In connection with its 50th anniversary, the company granted restricted stock to eligible employees, including hourly employees, through the Joyful Honda Group Employee Shareholding Association as part of its employee welfare initiatives.」

「In connection with its 50th anniversary, the company decided to dispose of treasury shares with the employee shareholding association as the intended allottee, in order to grant restricted stock to eligible employees through the association. The initiative is intended to promote employee welfare and help eligible employees build personal assets, encourage greater sharing of value with the company's shareholders, and strengthen human capital by providing an incentive to sustainably increase corporate value.」

「Because the conditions for benefits under the company's share-based compensation plan for directors and other officers, the Share-Based Benefit Trust (BBT (Board Benefit Trust)), had been met, the company delivered 38,000 company shares on 25 October 2023.」

「Based on a resolution of the Board of Directors meeting held on 5 October 2023, the company disposed of 8,000 treasury shares as restricted stock compensation on 2 November 2023.」

「Based on a resolution of the Board of Directors meeting held on 5 October 2022, the company disposed of 36,000 treasury shares as restricted stock compensation on 4 November 2022.」

「At the 47th Annual General Meeting of Shareholders held on 16 September 2022, shareholders approved a policy of providing restricted stock compensation to give directors an incentive to sustainably increase corporate value and promote greater sharing of value with shareholders.」

「For each three-fiscal-year period commencing after the initial covered period (each, a “covered period”), the company will make additional cash contributions to the trust of up to ¥230 million for directors, including up to ¥30 million for outside directors, and ¥100 million for executive officers, for a total of ¥330 million.」

「Under the trust agreements for the Share-Based Benefit Trust (BBT and J-ESOP), shares of the company held by Custody Bank of Japan, Ltd. (Trust Account E) are accounted for as treasury shares.」

「At the 44th Annual General Meeting of Shareholders held on 19 September 2019, shareholders also approved including outside directors in the performance-linked share-based compensation plan (6 directors).」

「The company has introduced the Share-Based Benefit Trust (BBT) and Share-Based Benefit Trust (J-ESOP). Asset Management Service Trust Bank Corporation (Trust Account E) has acquired 433,300 company shares, which are not included in treasury shares.」

「In connection with the introduction of the Share-Based Benefit Trust (J-ESOP), the company disposed of 117,000 treasury shares through a third-party allotment on 20 February 2018, with Asset Management Service Trust Bank Corporation (Trust Account E) as the allottee, based on a resolution of the Board of Directors meeting held on 2 February 2018. Capital surplus and treasury shares each increased by ¥17 million.」

「Pursuant to a resolution of the Board of Directors meeting held on 15 September 2017, 600 treasury shares were delivered from the Board Benefit Trust (BBT) to an executive officer whose retirement had been approved under the share-based benefit trust plan, reducing the balance by ¥1 million.」

「Under the trust agreement for the Board Benefit Trust (BBT), Asset Management Service Trust Bank Corporation (Trust Account E) acquired 100,500 shares for ¥299 million in November 2016.」

「The company is introducing this plan to clarify the linkage between the compensation of directors and other officers and the company's share value, and to increase their awareness of contributing to improved medium- to long-term performance and increased corporate value.」