Trust Recovery Growth Vitalization - Marubeni

12 Preferred Stock
The Company is authorized to issue 100 million shares of Class I
Preferred Stock and 100 million shares of Class II Preferred Stock.
Both classes of preferred stock are non-voting and have equal
preference with the Company’s common stock for the payment of
dividends and the distribution of assets in the event of a liquidation
or dissolution of the Company. However, during a period that no
preferred dividends are paid preferred shareholders have a voting
right per share until preferred dividends are declared. Preferred
dividends are non-cumulative and non-participating. Preferred
shareholders are entitled to a liquidation distribution at ¥1,000 ($9.35)
per share and do not have the right to participate in any further
liquidation distributions. The Company may repurchase and hold any
classes of preferred stocks, and retire them out of earnings available
for distribution to the shareholders.
Class I Preferred Stock
Class I Preferred Stock is convertible into common stock at the
option of preferred shareholders during a conversion period. Class I
Preferred Stock will be mandatorily converted into common stock on
the date immediately following the closing date of the conversion
period. At the time of issuance, the Board of Directors will determine
the issue price, annual dividend (not exceed ¥100 per share), and
conversion terms, including a conversion period.
On December 16, 2003, the Company issued 75.5 million shares
of Class I Preferred Stock at ¥1,000 per share or ¥75,500 million in
aggregate. The Company allocated ¥37,750 million to preferred stock
with the remainder, net of issuance costs, recognized as capital
13 Other Comprehensive Income (Loss)
Marubeni Corporation 2005 88 / 89
surplus based on the JCC and the decision of the Board of Directors
of the Company. The annual dividend is ¥20 ($0.19) per share. At the
option of the shareholders, Class I Preferred Stock is convertible into
common stock during the period from September 1, 2006 to
December 12, 2013 at the conversion price, which is initially the
average market closing price of the common stock of the Company
traded on the Tokyo Stock Exchange (the “TSE”) for the 30 business
days starting from the 45th business day prior to the starting day of
the conversion period, but not less than ¥50 ($0.47). The conversion
price will then be reset annually on September 1 of each year from
2007 to 2013 if there is a decline in the market price of the
Company’s common stock, but not less than 70% of the initial
conversion price or ¥50 ($0.47), whichever higher. Class I Preferred
Stock shares which are not converted at the option of the shareholders
will be mandatorily converted into common stock on December
13, 2013, at the conversion price determined based on the average
market closing price of the common stock traded on the TSE for the
30 business days starting from the 45th business day prior to the
date of mandatory conversion.
Class II Preferred Stock
Class II Preferred Stock is redeemable at the option of the Company.
At the time of issuance, the Board of Directors will determine the
issue price, annual dividend (not exceed ¥100 per share), and
redemption terms, including a redemption price.
No shares of the Class II Preferred Stock were issued and
outstanding at March 31, 2005.
The amount of income tax expense or benefit allocated to each component of other comprehensive income (loss) for the years ended March 31,
2005, 2004 and 2003 was as follows:
Millions of yen
Before-tax Tax (expense) Net-of-tax
amount or benefit amount
2005
Unrealized gains on investment securities arising during period .............................. ¥ 42,562 ¥(14,247) ¥ 28,315
Less: reclassification adjustments for gains included in net income ........................ (28,082) 11,501 (16,581)
Net unrealized gains .................................................................................................. 14,480 (2,746) 11,734
Currency translation adjustments arising during period ............................................ (2,531) (1,764) (4,295)
Less: reclassification adjustments for losses included in net income ...................... 2,993 (357) 2,636
Net currency translation adjustments ....................................................................... 462 (2,121) (1,659)
Unrealized gains on derivatives arising during the period ......................................... 10,512 (4,081) 6,431
Less: reclassification adjustments for gains included in net income ........................ (4,330) 1,758 (2,572)
Net unrealized gains on derivatives .......................................................................... 6,182 (2,323) 3,859
Minimum pension liability adjustment ...................................................................... (55) 20 (35)
Other comprehensive income .................................................................................. ¥ 21,069 ¥ (7,170) ¥ 13,899