TOKYO, May 13 (Pulse News Wire) – TEAC Corporation (6803.T) announced today that its board of directors has resolved to introduce a performance-based equity compensation plan (phantom stock) linked to its medium-term management plan. The plan will be implemented upon approval at the 78th Ordinary General Meeting of Shareholders scheduled for June 26, 2026.
Under the plan, eligible executives will receive virtual shares equivalent to a certain percentage of their base salary in July of the fiscal year they are appointed. At the end of each fiscal year and the completion of the medium-term management plan period, the executives will receive special bonuses based on the value of the virtual shares and dividends accrued during the period, adjusted according to the achievement of predefined performance metrics. Performance indicators include Return on Equity (ROE), operating profit margin, operating cash flow, and ESG targets.
Executives will earn bonus rates ranging from 0% to 100%, depending on their performance scores. In cases of significant adjustments to financial statements or major misconduct, the Nomination and Remuneration Committee may request the return or suspension of phantom stock grants. Additionally, the company reserves the right to acquire granted virtual shares without payment under certain conditions, such as mergers leading to the company's dissolution or changes in executive status.
Transfer of phantom stock is strictly prohibited, and any misuse could result in penalties imposed by the committee.
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