FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
REPORT OF FOREIGN ISSUER
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of June, 2001
COMMISSION FILE NUMBER: 1-7239
KOMATSU LTD.
...............................................
Translation of registrant's name into English
3-6 Akasaka 2-chome, Minato-ku, Tokyo, Japan
............................................
Address of principal executive offices
2
INFORMATION TO BE INCLUDED IN REPORT
------------------------------------
1. Information Distributed to Security Holders
-------------------------------------------
The registrant, KOMATSU LTD., distributed to its security holders the
following documents, which are attached hereto and constitute a part
hereof:
Notice of Convocation of the 132nd Ordinary General Meeting of
Shareholders attaching Referential Materials and Instruction Card
Concerning the Exercise of Voting Rights (including the 132nd Business
Report (From April 1, 2000 to March 31, 2001), which contained the
financial statements which are prepared in accordance with accounting
principles generally accepted in Japan and are on non-consolidated
basis.)
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
KOMATSU LTD.
----------------------------
(Registrant)
Date: June 6, 2001 By: /S/ Masaru Fukase
----------------------------
Masaru Fukase
Senior Executive Officer
4
(Translation)
May 30, 2001
NOTICE OF CONVOCATION OF THE
----------------------------
ONE HUNDRED AND THIRTY SECOND ORDINARY
--------------------------------------
GENERAL MEETING OF SHAREHOLDERS
-------------------------------
OF KOMATSU LTD.
---------------
TO: THE SHAREHOLDERS
Please be advised that the 132nd Ordinary General Meeting of Shareholders
of the Company will be held in accordance with the particulars indicated in the
attachment hereto. Your attendance at the meeting is cordially requested. If you
are unable to attend the meeting, we would appreciate your reviewing the
attached documents, affixing your seal or signature on the enclosed instruction
card concerning the exercise of voting rights, and returning it to the Company
after indicating thereon your approval or disapproval of the items of business
enumerated in the attached documents.
Sincerely yours,
KOMATSU LTD.
3-6, Akasaka 2-chome
Minato-ku, Tokyo
By: Satoru Anzaki
President and
Representative Director
5
PARTICULARS OF MEETING
----------------------
1. Date and Time: June 27, 2001 (Wed.) at 10:00 a.m.
2. Place: 2nd Floor, Komatsu Building
3-6, Akasaka 2-chome
Minato-ku, Tokyo
3. Purpose of Meeting:
Items to be Reported Matters concerning the Balance Sheet as of March
31, 2001 and the Business Report, Statement of
Income for the 132nd business term (April 1,
2000- March 31, 2001) and redemption of shares
by distribution of net profit.
Items to be Resolved:
1st Item of Business: Matters concerning the approval of the Proposed
Appropriation of Profit for the 132nd business
term (April 1, 2000 - March 31, 2001).
2nd Item of Business: Matters concerning the election of six
Directors.
3rd Item of Business: Matters concerning the election of one Statutory
auditor.
4th Item of Business: Matters concerning the acquisition of Treasury
shares for transfer to the directors and
employees. Details of this item are provided in
the Referential Documents Regarding the Exercise
of Voting Rights (Proxy Statement).
5th Item of Business Matters concerning the payment of retirement
allowance to retiring director and statutory
auditor.
* * *
(If you attend the meeting, please present the enclosed instruction card to the
receptionist.)
6
ATTACHED DOCUMENTS
EXHIBIT I
Business Report
(April 1, 2000 - March 31, 2001)
(Note) As Komatsu's management is basically oriented towards global consolidated
management, this Business Report is prepared in an aim to also cover the
information on a consolidated basis as much as possible.
I. Outline of Business
(1) Development and Results of Business Operations
The very cornerstone of Komatsu's management lies in its commitment to
Quality and Reliability and enhance the corporate value. This policy does not
only concern the supply of safe and innovative products and services from the
viewpoint of customers but also extends to constant improvement of Quality and
Reliability of the Komatsu Group's entire organizations, businesses, employees
and management. In pursuit of this policy, the top management task will continue
to improve this Quality and Reliability year after year. We will devote our best
efforts to realize this goal.
During the fiscal 2000, from April 1, 2000 to March 31, 2001, the
Japanese economy accommodated some signs of moderate autonomous recovery
centering on private-sector corporations in the first half period. In the last
half period, however, signs of slowing capital investment coupled with reduced
exports and industrial production made the Japanese economic mindset less
positive. Overseas, the United States economy, which had maintained the
record-high length of buoyancy, began to slow down. European economies remained
strong in general, albeit with uncertainty of the depreciation of the euro. The
recovery pace of overall Asian economies slowed down, leaving their uncertainty
intact.
Under such an environment, the Company positioned the fiscal 2000 as a
year of further strides under the "G" to the 21st mid-range management strategy
and worked to improve performance.
For its construction and mining equipment business, Komatsu completed
the restructuring program for Japanese production facilities initiated in 1998
with the closings of Tachikawa and Saitama plants of Komatsu Zenoah Co. for
consolidation of production at the
7
Kawagoe Plant (formerly Kawagoe Plant of the Company). The Company also worked
to expand its business domain by adding IT utilization to its competitive
advantages of global sales, service and production networks, "Quality and
Reliability"-backed brand power and in-house production of key components.
Back on a recovery track, Komatsu's electronics business continued to
facilitate differentiation of products and technologies. Komatsu also worked to
promote operations designed to make effective and timely responses to drastic
changes in the business environment.
Furthermore, Komatsu worked to reinforce its businesses where it can
demonstrate its technological superiority, including sale of shares held in
Komatsu Construction Co., Ltd., establishment of a joint venture with USHIO INC.
in the area of Excimer laser business, and acquisition of Hensley Industries,
Inc., a U.S. manufacturer of parts and components for construction and mining
equipment.
As a result, the consolidated sales for this period was JPY 1096.3
billion, up 3.9% from the previous period, and consolidated net income was JPY
6.9 billion, down 48.4% from the previous period. On a non-consolidated basis,
sales resulted in JPY 430.2 billion, down 2.5% from the previous period, and
ordinary profit was JPY 11.2 billion, up 13.5% from the previous period, and net
income for the period JPY 7.2 billion, down 46.9% from the previous period.
The following is an outline of the business result of each division of
Komatsu.
Construction and Mining Equipment
---------------------------------
Consolidated sales of construction and mining equipment totaled JPY718.1
billion, down 3.9% from the previous period, and the non-consolidated sales of
the Company totaled JPY 360.9 billion, down 3.9% from the previous period.
In Japan, consolidated sales totaled JPY 305.5 billion, up 4.7% from the
previous period, and the non-consolidated sales totaled JPY 221.7 billion, up
0.1% from the previous period.
In fiscal 2000, Japanese demand for construction equipment declined
slightly, and Komatsu teamed up with its distributors and affiliated rental
companies across the country and worked to expand earnings by effectively
utilizing information networks for sales, rental and service. The Company
concerted its efforts to step up sales of major products such as minimal
rear-swing radius hydraulic excavators, large machines and equipment for
environmental conservation, such as the mobile crusher/recycler "Galapagos"
series. The Company also
8
focused on delivering value to customers by holding the Komatsu Management
Strategy Seminar and through the E-KOMATSU Net for information and service
provision on the Internet.
In the area of Information Technology (IT) utilization, the Company
continued to introduce the "KOMTRAX," a construction equipment operation
management system designed to improve reducing overall business cost of the
rental business, to affiliated rental companies. The Company also developed new
business models in fiscal 2000. Such initiatives include joint operation of a
new service for construction equipment customers on the Internet with RICOH Co.,
Ltd. and a web site (www.anahori.com) dedicated to sales of mini excavators, the
first one by the Japanese construction equipment manufacturing industry.
Consolidated sales outside of Japan totaled JPY 412.5 billion, down
9.5% from the previous period, and non-consolidated sales of exports totaled JPY
139.1 billion, down 9.5% from the previous period.
In North America, the major market, while new construction investment
expanded in 2000, new housing starts of the private sector declined from 1999.
As a result, demand for construction equipment dropped for the second
consecutive year. Komatsu shortened production lead-time considerably,
restructured its distributor network and reinforced sales capability. However,
North American sales decreased from the previous year.
In Europe, while demand for construction equipment continued to grow,
Komatsu Group carried out aggressive marketing and promoted further
reorganization and reinforcement of their distributors. As a result, major
European companies in the Group registered improved sales on a local currencies
basis. In response to the depreciated euro, Komatsu worked to secure earnings
through further reduction of costs by expanding local procurement of parts and
components and implementing rationalization measures, while expanding the
product range for local production.
In Southeast Asia, while demand for construction and mining equipment
began to recover, centering on the mining and forestry industries, recovery of
overall demand remained delayed. As a result, sales of construction and mining
equipment were about the same level from the previous year. Meanwhile, Komatsu
made steady gains in sales in the infrastructure investment-driven Chinese
market. In February 2001, the Company established Komatsu (China) Ltd. in
Shanghai as regional headquarters to coordinate operations in China. With this
regional headquarters, Komatsu is now better positioned to more effectively
utilize the functions of its production, sales and service foundations built
over the years and respond to the Chinese market with great potential for
growth.
9
Utility equipment, small construction equipment, business continued
to expand sales from steady growth in North American and European demand. Sales
growth was supported by brisk sales of backhoe loaders in North America where
Komatsu launched full-scale sales of backhoe loaders two years ago. Komatsu has
begun construction of a new plant for utility equipment in South Carolina,
U.S.A. With an initial plan to launch production in 2002, Komatsu is well
prepared to accelerate sales in this promising market.
Mining equipment business saw some signs of recovery in demand for
off-highway dump trucks against the backdrop of improved price for copper.
However, this stopped short of full recovery for demand, leaving the difficult
management environment in place.
In the area of parts business for construction and mining equipment,
Komatsu acquired Hensley Industries, Inc., a leading manufacturer of buckets,
teeth and adapters for construction and mining equipment, in December 2000. With
Hensley Industries in the Komatsu Group, Komatsu is positioned to expand a
line-up of parts and supply their competitive products mainly in the North
American market.
Electronics
-----------
Consolidated sales from the electronics business improved 30.3% over
the previous fiscal year, to JPY 117.7 billion. Non-consolidated sales decreased
23.7% from the previous fiscal year to JPY 8.5 billion.
Komatsu Electronic Metals Co., Ltd. experienced a dramatic increase in
demand for 200mm silicon wafers in the first half period of fiscal 2000 and
falling demand in the second half period. Under such an environment, the company
worked to improve quality of and technology development for 200mm silicon wafers
in both Japan and Taiwan, while undertaking aggressive sales in Japan and
overseas. The company also facilitated restructuring including reinforcement of
the discrete wafer business and expanded efforts to reduce total costs and
expand sales in order to improve profits. Formosa Komatsu Silicon Corporation,
the company's joint-venture entity with a local partner, expanded its production
facilities and accelerated sales to major customers, thereby establishing its
solid presence in the Taiwanese market.
Advanced Silicon Materials LLC. expanded sales over the previous year
by focusing on sales of monosilane gas and monosilane gas-based, unique
polycrystalline silicon against the backdrop of market growth. However, the
company continued to face difficult conditions for earnings, including increased
depreciation of the Butte Plant (Montana, USA) as accompanied by its full-scale
production.
10
Meanwhile, Komatsu Electronics, Inc. made a significant gain in sales
over the previous period by taking advantage of expanded demand for micro
modules for use in fiber optic communication networks. To meet further growth in
demand more flexibly, the company expanded production capacity with new
facilities and reached an alliance agreement with Ferrotec Corporation, a
competitive manufacturer of thermoelectric modules. The agreement centers on the
production of micro modules by a Chinese subsidiary of Ferrotec.
In the Excimer laser business, the Company established GIGAPHOTON
INC., a 50-50 joint venture with USHIO INC. The joint venture engages in overall
Excimer laser business, from research and development, production, and sales to
service. Against the backdrop of an improved market supported by aggressive
investment by semiconductor manufacturers, the company delivered the number of
units at a rate higher than market growth and accomplished larger sales than
initially planned.
In the non-consolidated electronics business of the Company, sales for
FA panels and network information terminals grew but due to the transfer of the
excimer laser business, the sales dropped below the previous period.
Others
------
Consolidated sales of the industrial machinery, logistics and other
businesses for fiscal 2000 increased 19.7% to JPY 260.4 billion. Non-
consolidated sales was JPY 60.7 billion, up 10.9% from the previous period.
With respect to the large press business, the Company expanded sales
with good sales of the WS-3TR series, standard-type transfer press for
manufacturers of automotive body components, and sales to overseas automobile
manufacturers for retrofitting their equipment. In the defense equipment
business where the Company integrated development and production for improved
efficiency, sales to the Defense Agency remained strong. In the environmental
business, the Company delivered three full-scale comprehensive recycling plants
for construction wastes and other wastes in Japan, developing a new business
domain.
Komatsu Forklift Co., Ltd., a consolidated subsidiary since this fiscal
year, introduced renewed models of the "LEO Plus" engine-powered forklift and
reach-type forklift trucks "AR" series in Japan. The company also promoted the
"Proposal for Total Logistics" campaign to customers. The company expanded both
sales and market share in the United States where it had reinforced its sales
network. As a result, the company's sales and ordinary profits for the fiscal
year improved over the previous fiscal year. Also during the fiscal year, the
company built a cooperative global relationship with Linde AG of Germany in
production and sales of
11
forklift trucks. Under this arrangement, Komatsu Forklift began sales of
Linde-made forklift trucks in Japan and Linde's subsidiary launched production
of Komatsu Forklift-brand forklift trucks in Europe.
Komatsu Industries Corporation, in charge of sheet metal forming
machinery and small and medium-sized presses, posted profits for fiscal 2000
according to the restructuring plan undertaken since 1999. Also during the
fiscal year, the company further reinforced the sales alliance with TRUMPF GmbH
+ Co. KG of Germany, expanded sales of TRUMPF-made products in Japan and
embarked on supply of its "PAS" series AC servomotor-driven press brake models
to TRUMPF by targeting U.S. and European markets.
(2) Capital Expenditure
In construction and mining business, Komatsu made IT-related
investments and investments for production efficiency aggressively. In
electronics business, it invested to improve production efficiency and to expand
production capacity for silicon wafers and also made to improve production
capacity to accommodate increased demand of micro modules for fiber optic
communication.
As a result, total investments amounted to JPY 79.3 billion on a
consolidated basis, up JPY 21.5 billion from the previous period, and JPY 20.4
billion on a non-consolidated basis, up JPY 2.0 billion from the previous
period.
(3) Fund Raising
Komatsu continues to strengthen its financial position and during the
current period. In this period, it consolidated the bank commitment lines, the
credit line that allows borrowings to a certain amount when necessary, that were
formerly established separately in Japan and USA. The consolidated global
commitment line allows Komatsu to flexibly procure funds either in yen or dollar
from Japanese, US or European banks. And this would enable the Komatsu Group in
Japan and USA to decrease debts and interest expenses. In the meantime, the
Company raised short-term funds through commercial papers during the period.
(4) Future Challenges
Under the "G" to the 21st century mid-range management strategy, we
specified the course of growth as a true global company in the 21st century. By
making the best use of Komatsu's consolidated network and a technological edge
on a global scale, the Company is determined to become a company that can be
trusted as a partner who may provide the best
12
solutions to various problems which the customers may face. The four basic
strategies of "G" to the 21st century are as follows:
(i) Pursuit of new development strategies for construction and
mining equipment business;
(ii) To reduce the stress on the environment and to expand
environment-related business;
(iii) To focus on business areas where we can maintain a technological
edge on a global scale;
(iv) To achieve a strong competitive position by utilizing
IT=e-KOMATSU.
Komatsu will further pursue development of business on a global scale
and with a new view of IT's dramatically fast progress and protection of global
environment, the Company aims to improve its sales and profit, of all others,
centralizing on strategies to develop the construction and mining equipment
business.
In dealing with global environment, the Company worked on the issue of
reducing damage on the environment in the process of production activities. To
provide solutions for environmental problems of the customers through Komatsu's
technology and systems would also lead to large business opportunities. Komatsu
will aggressively expand its environment business in the following three fields
based on the foundation that it has built up.
(i) Environment-friendly products: Development of environment
technology reduction of exhaust emission, noise and vibration,
water emulsion fuel engine system, etc.), remanufacturing
(recycling of parts and components)
(ii) Construction equipment for environmental conservation (On-site
resource recycling machines such as Galapagos)
(iii) Resources recycling plant
Making use of IT would not only improve efficiency of business and allow
sharing of information but this completely changes the fundamentals of business.
Komatsu has an advantage in terms of its organization and network of personnel.
Komatsu will enhance capabilities that are concerned with research and
development, marketing and product support, and improve creative and fast-action
team work of the employees around the world by making use of Komatsu's unique IT
and it will respond to diverse expectations of the customers.
This year, the Company has celebrated its 80th anniversary of its
foundation. The founder, Mr. Meitaro Takeuchi, directed to the then employees
that Komatsu's tasks are to "innovation of industrial technology", cultivation
of human resources who will support this
13
technology innovation and "leading the company out into the world". This
founder's spirit was succeeded by the employees throughout the world and became
the dynamics for Komatsu to develop further in the era of technology innovation
and globalization. Komatsu will continue to cherish this spirit and continue to
self-improve the management and technology and aim for a further development.
(5) Comparison of Financial Data
The financial position for this period and the recent 3 years are as
follows:
(i) Consolidated Results
(Unit: in billion yen)
-------------------------------------------------------------------------------------------------------------------
Fiscal 1997 Fiscal 1998 Fiscal 1999 Fiscal 2000
(April 1997 - (April 1998 - (April 1999 - (April 2000 -
March 1998) March 1999) March 2000) March 2001)
-------------------------------------------------------------------------------------------------------------------
Net Sales 1,104.0 1,061.5 1,055.6 1,096.3
-------------------------------------------------------------------------------------------------------------------
Income (Loss) Before Taxes 40.2 (9.6) 19.3 20.0
-------------------------------------------------------------------------------------------------------------------
Net Income (Loss) 19.2 (12.3) 13.3 6.9
-------------------------------------------------------------------------------------------------------------------
Total Assets 1,561.6 1,524.6 1,375.2 1,403.1
-------------------------------------------------------------------------------------------------------------------
(ii) Non-consolidated Results
(Unit: in billion yen (*except earnings per common share data))
-------------------------------------------------------------------------------------------------------------------
129th Period 130th Period 131st Period 132nd Period
(April 1997 - (April 1998 - (April 1999 - (April 2000 -
March 1998) March 1999) March 2000) March 2001)
-------------------------------------------------------------------------------------------------------------------
Net Sales 533.0 475.7 441.4 430.2
-------------------------------------------------------------------------------------------------------------------
Operating Profit 20.1 11.6 12.9 14.1
-------------------------------------------------------------------------------------------------------------------
Ordinary Profit 19.7 8.5 9.9 11.2
-------------------------------------------------------------------------------------------------------------------
Net Income 11.3 2.1 13.6 7.2
-------------------------------------------------------------------------------------------------------------------
Earnings per Common Share * 11.69 2.24 14.05 7.53
-------------------------------------------------------------------------------------------------------------------
Total Assets 781.3 771.7 746.8 765.4
-------------------------------------------------------------------------------------------------------------------
Net Assets 448.5 450.4 469.1 473.7
(Shareholders' Equity)
-------------------------------------------------------------------------------------------------------------------
(Shareholders' Equity Ratio (%)) (57.4%) (58.4%) (62.8%) (61.9%)
-------------------------------------------------------------------------------------------------------------------
(Note) The earnings per common share for the relevant period are based on the
total number of shares issued and outstanding at the end of such period.
14
The 129th period experienced harsh environment in which the real GDP
became negative growth in Japan. On the other hand, at overseas, the U.S.
economy maintained favorable growth and the European economy showed signs of
modest recovery while the Asian economy fell sharply into a depression and the
discrepancies between regions became ever more apparent. While the Company
focused its efforts on the mining equipment division, utilities division, and in
the electronics division, the reorganization of business and organization
including the sale of the synthetics division and the conversion of the forging
division into a subsidiary were conducted. However, sales and profits decreased
compared to the previous period.
In the 130th period, the domestic economy continued to suffer from the
long depression where the real GDP ended in a negative growth for two
consecutive periods. The Company mobilized the efforts of all Komatsu companies
inside and outside of Japan to provide customers with safe and creative products
and services by closely watching the needs of the customers based on the motto
of "Quality and Reliability", and aimed to improve sales and profit. At the same
time, we wrestled with reorganization of production system for dealing with
decrease of demands in construction equipment in Japan and to strengthen the
competitive ability and to make certain the earning base. However, the effects
in the current term was very limited and both sales and profit resulted in a
decrease from the previous period. On a consolidated basis, the construction and
mining equipment achieved performance above that of the previous period,
however, due to the significant degradation in the results of the electronics
division, the sales declined from the previous period and net income for the
period was regretfully a loss.
For the 131st period, domestic economy did not realize autonomous
recovery despite the fact that the comprehensive economic measures and emergency
economic package implemented by the government started to present effects. At
overseas, the US economy continued to grow and Europe showed signs of modest
recovery and Asian economy headed for the direction of recovery although not on
a full scale. The top priority of the Company was to recover the performance
above all, and for this purpose, the Company engaged in three major tasks, to
significantly strengthen corporate governance centering around reorganization of
the Board of Directors, to recover the profits for the domestic construction
equipment business, and to effect structural reforms in the group's electronics
business. These efforts respectively presented results and the consolidated
sales for this period was almost the same level for the previous period but the
net income for this period improved significantly. On a non-consolidated basis,
sales decreased slightly from the previous period but the profit for the period
improved considerably.
The outline of business for the current 132nd period is as set forth in
above (1) "Development and Results of Business Operations".
15
II. Outline of the Company (as of March 31, 2001)
(1) Major Lines of Business
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Division Principal Products and Business
-------------------------------------------------------------------------------------------------------------------
Construction Excavating Equipment hydraulic excavators, mini excavators,
& Mining and backhoe loaders*
Equipment -----------------------------------------------------------------------------------------------------
Loading Equipment wheel loaders, mini wheel loaders, and skid - steer loaders
-----------------------------------------------------------------------------------------------------
Grading and Roadbed bulldozers, motor graders, and vibratory rollers
Preparation Equipment
-----------------------------------------------------------------------------------------------------
Hauling Equipment dump trucks, and crawler carriers
-----------------------------------------------------------------------------------------------------
Tunneling machines shield machines, tunnel-boring machines,
and small-diameter pipe jacking machines (Iron Moles)
-----------------------------------------------------------------------------------------------------
Recycling Equipment mobile debris crushers (Galapagos), mobile soil improver
(Literra), and mobile lumber crusher (Refole)
-----------------------------------------------------------------------------------------------------
Other Equipment rough-terrain cranes, reach tower cranes,
and railroad maintenance equipment
-----------------------------------------------------------------------------------------------------
Engine and Equipment diesel engines, diesel generator sets,
and hydraulic equipment
-----------------------------------------------------------------------------------------------------
Castings steel castings, and iron castings*
-------------------------------------------------------------------------------------------------------------------
Electronics Electronic Materials silicon wafers*, and polycrystalline silicon*
-----------------------------------------------------------------------------------------------------
Communication Equipment, network peripheral equipment,
Control and Information LAN peripheral equipment, FA computers,
Equipment and vehicles controller
-----------------------------------------------------------------------------------------------------
Temperature Control Thermoelectric modules*, and temperature control
Equipment equipment for semiconductor wet process*
-------------------------------------------------------------------------------------------------------------------
Others Metal Forging and Large sized presses, middle and small sized presses*, forging
Stamping Presses presses*, and Therbo presses*
-----------------------------------------------------------------------------------------------------
Sheet-metal Machines and press brakes*, shears*, gatling press centers*, laser cutting
Machines Tools machines*, fine plasma cutting machines*, and crankshaft
millers*
-----------------------------------------------------------------------------------------------------
Industrial vehicles, Lift trucks* , packing, and logistics*
Logistics
-----------------------------------------------------------------------------------------------------
Defense Ammunition, and armored personnel carriers
-----------------------------------------------------------------------------------------------------
Others Commercial-use-prefabricated structures for businesses*, and
construction waste recycling plant
-------------------------------------------------------------------------------------------------------------------
(Note : The products and businesses listed above include those of the
subsidiaries. Those with * mark are the principal products and major lines of
businesses of the subsidiaries.)
16
(2) Shares of the Company
(i) Number of Shares and Number of Shareholders
--------------------------------------------------------------------------------
Number of Shares Authorized to be Issued: 3,955,000,000 shares
--------------------------------------------------------------------------------
Total Number of Shares Issued and Outstanding: 958,921,701 shares
--------------------------------------------------------------------------------
Stated capital: JPY70,120,637,607
--------------------------------------------------------------------------------
Number of Shareholders: 61,403
--------------------------------------------------------------------------------
(Note) From the cancellation of treasury shares acquired for profit, the total
number of shares authorized to be issued and the total number of shares issued
and outstanding respectively decreased by 10,000,000 shares compared to the end
of the previous period.
(ii) Major Shareholders (Top 10)
------------------------------------------------------------------------------------------------------------------
Name of Shareholders Status of Investment by the Status of Investment by the
Shareholder in the Company Company in the Shareholder
-------------------------------------------------------------------
Number of Ratio of Number of Ratio of
Shares held Shareholding Shares held Shareholding
(thousand shares) (%) (thousand shares) (%)
------------------------------------------------------------------------------------------------------------------
NATS CUMCO 55,735 5.8 - -
------------------------------------------------------------------------------------------------------------------
The Taiyo Mutual Life Insurance Co. 55,224 5.8 - -
------------------------------------------------------------------------------------------------------------------
Nippon Life Insurance Company 31,863 3.3 - -
------------------------------------------------------------------------------------------------------------------
Komatsu Ltd. Employees 28,695 3.0 - -
Stockholding Association
------------------------------------------------------------------------------------------------------------------
The Chase Manhattan Bank N.A. London 27,794 2.9 - -
------------------------------------------------------------------------------------------------------------------
Japan Trustee Services Co., Ltd. (held by 27,398 2.9 - -
trust units)
------------------------------------------------------------------------------------------------------------------
The Sumitomo Bank, Ltd. 24,144 2.5 15,176 0.5
------------------------------------------------------------------------------------------------------------------
State Street Bank and Trust 22,595 2.4 - -
Company
------------------------------------------------------------------------------------------------------------------
The Mitsubishi Trust and Banking Corporation
(held by Trust units) 21,110 2.2 - -
------------------------------------------------------------------------------------------------------------------
Boston Safe Deposit BSDT Treaty Clients 19,803 2.1 - -
Omniba
------------------------------------------------------------------------------------------------------------------
17
(Notes)
1. NATS CUMCO is the share nominee of CITIBANK, N.A. which is a trustee
of the Company's ADR (American Depository Receipts).
2. The Company's holding of the shares in The Sumitomo Bank, Ltd. is
computed by excluding the non-voting preferred shares issued by the
same bank.
3. The Sumitomo Bank, Ltd. merged with The Sakura Bank, Ltd. effective
April 1, 2001 and they became Sumitomo Mitsui Banking Corporation. As
of March 31, 2001, The Sakura Bank, Ltd. held 1,507,000 shares of the
Company (0.2% holding) but the Company does not hold any shares in
this bank.
(iii) The Status of Acquisition, Disposal, etc. and Holding of the Treasury
Shares
(a) The below is the status of acquisition and cancellation for profit of
the treasury shares of the Company pursuant to the resolution of the
Board of Directors Meeting held on May 2, 2000:
(1) Treasury shares acquired during this period:
Type and Number: Ordinary shares with par value 10,000,000 shares
Acquisition Price: Total: JPY 6,340,500,000
(2) Treasury shares canceled during this period:
Type and Number: Ordinary shares with par value 10,000,000 shares
Disposal Price: Total: JPY 6,340,500,000
(b) The below is the status of acquisition, cancellation and holding of
treasury shares to be transferred to the Company's Directors and
Employees.
(1) Treasury shares acquired during this period:
Type and Number: Ordinary shares with par value 1,200,000 shares
Acquisition Price: Total: JPY 691,544,770
(2) Treasury shares disposed during this period:
Type and Number: Ordinary shares with par value 10,000 shares
Disposal Price: Total: JPY 7,000,000
(3) Treasury shares held at the end of this period:
Type and Number: Ordinary shares with par value 3,370,000 shares
18
(3) Employees
-----------------------------------------------------------------------------------------------------
Number of Increase (Decrease) Average Age Average Service
--------- ------------------- ----------- ---------------
Employees Over Previous Period Years
--------- -------------------- -----
-----------------------------------------------------------------------------------------------------
11,112 (376) 44.4 22.7
-----------------------------------------------------------------------------------------------------
The number of employees on a consolidated base is 32,002.
(4) Affiliates
(i) Results of Consolidation
====================================================================================================================
Fiscal 1999 Fiscal 2000 Increase/Decrease from
(From April 1, 1999 (From April 1, 2000 the Previous Period
to March 31, 2000) to March 31, 2001)
--------------------------------------------------------------------------------------------------------------------
Consolidated Net 1,055.6 1,096.3 Increase of 3.9%
Sales (in billion yen)
--------------------------------------------------------------------------------------------------------------------
Consolidated Net 13.3 6.9 Decrease of
Income (in billion yen)
JPY 6.4 billion
--------------------------------------------------------------------------------------------------------------------
Consolidated ROE 2.7% 1.4%
(Ratio of Net Income to
Shareholders' Equity)
--------------------------------------------------------------------------------------------------------------------
Consolidated ROA 1.3% 1.4%
(Ratio of Pretax Income to
Total Assets)
====================================================================================================================
(Note) The Company's consolidated financial statements are based on the
accounting principles generally accepted in the United States of
America.
19
(ii) Principal Subsidiaries
---------------------------------------------------------------------------------------------------------------------
Name Capital Ownership Main Business
---- ------- --------- -------------
(in JPY million) (%)
---------------- ---
---------------------------------------------------------------------------------------------------------------------
Komatsu Electronic 11,636 59.9 Manufacture and sales of silicon wafers for
Metals Co., Ltd. semiconductors
---------------------------------------------------------------------------------------------------------------------
Komatsu Forklift Co., 11,411 51.5 Manufacture and sales of industrial vehicles,
Ltd. and logistics-related machinery and equipment
---------------------------------------------------------------------------------------------------------------------
Komatsu Zenoah Co. 5,099 54.3 Manufacture and sales of agricultural and
forestry equipment, construction Equipment,
industrial machinerys
---------------------------------------------------------------------------------------------------------------------
Komatsu Castex Ltd. 4,979 100.0 Manufacture and sales of steel castings and
iron castings
---------------------------------------------------------------------------------------------------------------------
Komatsu House Co., 1,436 86.7 Manufacture, sales and lease of
Ltd. commercial-use-prefabricated structures for
businesses
---------------------------------------------------------------------------------------------------------------------
Komatsu Logistics Corp. 1,080 96.1 Packing, baling, Transportation,
Warehousing and port-and-harbor Services
---------------------------------------------------------------------------------------------------------------------
Komatsu Industries 990 100.0 Manufacture and sale of middle and small sized
Corporation presses and forging presses
---------------------------------------------------------------------------------------------------------------------
Komatsu Machinery 600 100.0 Manufacture and sales of machine tools and
Tool Corporation semiconductor material processing equipment
---------------------------------------------------------------------------------------------------------------------
Komatsu Electronics, Inc. 390 100.0 Manufacture and sale of thermoelectric modules
and temperature control equipment for
semiconductor wet process
---------------------------------------------------------------------------------------------------------------------
Komatsu Tokyo Ltd. 287 100.0 Sales of construction Equipment, repair and
service
---------------------------------------------------------------------------------------------------------------------
Komatsu Hokkaido Ltd. 287 100.0 Sales of construction Equipment, repair and
service
---------------------------------------------------------------------------------------------------------------------
Komatsu America Corp. US $635 mil 100.0 Holding company in the U.S.
---------------------------------------------------------------------------------------------------------------------
Komatsu America -- 100.0 Manufacture and sales of Construction
International Company equipment
---------------------------------------------------------------------------------------------------------------------
Komatsu Mining US $65 mil 100.0 Manufacture and sales of Mining equipment
Systems, Inc.
---------------------------------------------------------------------------------------------------------------------
Komatsu do Brasil Ltda. CR $55 mil 100.0 Manufacture and sales of Construction
equipment, and steel and iron castings
---------------------------------------------------------------------------------------------------------------------
Advanced Silicon -- 100.0 Manufacture and sales of
Materials LLC. Polycrystalline silicon and silane gas
---------------------------------------------------------------------------------------------------------------------
20
---------------------------------------------------------------------------------------------------------------------
Komatsu Europe EUR 45mil 100.0 Supervision of European subsidiaries'
International N.V. operations and sales of construction equipment
---------------------------------------------------------------------------------------------------------------------
Komatsu UK Ltd. Stg.(pound)23 mil 100.0 Manufacture and sales of Construction equipment
---------------------------------------------------------------------------------------------------------------------
Komatsu Hanomag AG DM 37 mil 98.4 Manufacture and sales of Construction equipment
---------------------------------------------------------------------------------------------------------------------
Komatsu Mining DM 10 mil 100.0 Manufacture and sales of Mining equipment
Germany GmbH
---------------------------------------------------------------------------------------------------------------------
Komatsu Utility Europe S.p.A. 12,000 mil lira 100.0 Manufacture and sale of construction equipment
---------------------------------------------------------------------------------------------------------------------
Komatsu Asia & Pacific Pte. 12 mil 100.0 Supervision of Asian Pacific subsidiaries'
Ltd. Singapore $ operations, sales of construction equipment
and industrial machines
---------------------------------------------------------------------------------------------------------------------
P T Komatsu Indonesia Tbk 192,780 mil 55.1 Manufacture and sales of
Rupiahs Construction equipment and steel and iron
castings
---------------------------------------------------------------------------------------------------------------------
Bangkok Komatsu Co., 620 mil 74.8 Manufacture and sales of construction equipment
Ltd. Bahts
---------------------------------------------------------------------------------------------------------------------
Komatsu (China) Ltd. US$ 30 mil 100.0 Supervision of business in China
---------------------------------------------------------------------------------------------------------------------
Komatsu (Changzhou) US$ 21 mil 85.0 Manufacture and sales of Construction equipment
Construction Machinery Corp.
---------------------------------------------------------------------------------------------------------------------
(Note)
1. Komatsu America International Company is a general partnership
established under the laws of Delaware, U.S.A. The Company holds
an equity interest in this company indirectly through its
subsidiary. The Company's accrued investment in this company
amount to US$3 million (after deducting the profit dividend from
this company from the paid-in capital).
2. Komatsu Mining Systems, Inc. and Komatsu do Brasil Ltda. are
indirectly owned by the Company through subsidiaries.
3. Advanced Silicon Materials, Inc. is a limited liability company
established under the laws of Delaware, U.S.A. The Company holds
an equity interest in this company indirectly through its
subsidiary. This company's net asset which is equivalent to its
capital is US$147 million.
4. The shareholding percentages in Komatsu U.K. Ltd., Komatsu
Hanomag AG, Komatsu Utility Europe S.p.A. and Bangkok Komatsu
Co., Ltd. and the equity holdings in Komatsu (Changzhou)
Construction Machinery Corp. include the shares and the equity
holdings held by the Company's subsidiaries.
21
(iii) Principal Affiliated Companies
---------------------------------------------------------------------------------------------------------------------
Capital Ownership (%) Main Business
Name (in JPY million)
---- ----------------
---------------------------------------------------------------------------------------------------------------------
GIGAPHOTON INC. 2,000 50.0 Manufacture and sale of excimer lasers
for semiconductor exposures
---------------------------------------------------------------------------------------------------------------------
Komatsu Cummins Engine Co., Ltd. 1,400 50.0 Manufacture of diesel engines
---------------------------------------------------------------------------------------------------------------------
Cummins Komatsu Engine Company - 50.0 Manufacture of diesel engines
---------------------------------------------------------------------------------------------------------------------
Komatsu Soft Ltd. 1,234 35.0 Subcontracts for computer software
development and sales
---------------------------------------------------------------------------------------------------------------------
Komatsu Shantui Construction US$ 21 mil 40.0 Manufacture and sales of construction
Machinery Co., Ltd. equipment
---------------------------------------------------------------------------------------------------------------------
(Notes)
1. Cummins Komatsu Engine Company is a general partnership established
under the laws of Indiana, U.S.A. The Company holds an equity interest
in this company indirectly through its subsidiary, which investments
amount to US$2 million.
2. The ownership in Komatsu Shantui Construction Machinery Co., Ltd.
includes the ownership held by the subsidiaries.
(iv) Report on Business Consolidation
1) In April, 2000, the Company sold 65.0% of the issued and outstanding
shares of Komatsu Soft Ltd. to Toyo Information Systems Co., Ltd.
(currently TIS Co., Ltd.) As a result, Komatsu Soft Ltd. became a
subsidiary of Toyo Information Systems Co., Ltd. and became an
affiliate of the Company pursuant to the equity method under the
Securities and Exchange Law.
2) In June 2000, the Company acquired the majority of the issued and
outstanding shares of Komatsu Forklift Co., Ltd. and this company
became a subsidiary of the Company.
3) In August 2000, the Company incorporated GIGAPHOTON INC. through joint
investment with Ushio Inc. (50-50 joint venture).
4) In October 2000, the Company, the subsidiaries and affiliated of the
Company sold an equivalent of 69.2% of the issued and outstanding
shares of Komatsu Construction Ltd. to Takamatsu Corp. As a result,
Komatsu Construction Ltd. became a subsidiary of Takamatsu Corp.
22
(5) Major Borrowing
------------------------------------------------------------------------------------------------------------------
Name of Lenders Balance of Loans Number of Shares of the Company held
--------------- ---------------- by such Lenders
(in JPY billions) (Ratio of Shareholding)
-----------------------
(in thousand shares)
------------------------------------------------------------------------------------------------------------------
The Taiyo Mutual Life Insurance Co. 3.8 55,224 (5.8%)
------------------------------------------------------------------------------------------------------------------
Daihyaku Mutual Life Insurance Company 2.7 1 (0.0%)
------------------------------------------------------------------------------------------------------------------
Japan Bank for International 1.9 - (-)
Cooperation
------------------------------------------------------------------------------------------------------------------
Hokkoku Bank, Ltd. 1.4 9,486 (1.0%)
------------------------------------------------------------------------------------------------------------------
Nippon Life Insurance Company 1.2 31,863 (3.3%)
------------------------------------------------------------------------------------------------------------------
(Note) Daihyaku Mutual Life Insurance Company assigned its loan claims towards
the Company to Manulife Century Life Insurance Co., Ltd. on April 2, 2001.
The major lenders on a consolidated basis are The Fuji Bank. Ltd. (JPY 26.6
billion), The Bank of Tokyo-Mitsubishi, Ltd. (JPY 20.9 billion), and The
Sumitomo Bank, Limited (JPY 17.8 billion). (The amounts are the balance of
borrowing)
23
(6) Principal Business Offices
------------------------------------------------------------------------------------------------------------------
Name Location
---- --------
------------------------------------------------------------------------------------------------------------------
Head Office Head Office Minato-ku, Tokyo
------------------------------------------------------------------------------------------------------------------
Research Division Research Center Hiratsuka-shi, Kanagawa Pref.
------------------------------------------------------------------------------------------------------------------
Plants The Company Awazu Plant Komatsu-shi, Ishikawa Pref.
------------------------------------------------------------------------------ -----------------------------------
Osaka Plant Hirakata-shi, Osaka Pref.
------------------------------------------------------------------------------------------------------------------
Mohka Plant Mohka-shi, Tochigi Pref.
------------------------------------------------------------------------------------------------------------------
Oyama Plant Oyama-shi, Tochigi Pref.
------------------------------------------------------------------------------------------------------------------
Subsidiaries Komatsu Electronic Metals Co., Ltd. Ohmura-shi, Nagasaki Pref.,
Kiyotake-cho, Miyazaki Pref.
------------------------------------------------------------------------------------------------------------------
Komatsu Forklift Co., Ltd. Oyama-shi, Tochigi Pref.
------------------------------------------------------------------------------------------------------------------
Komatsu Zenoah Co. Kawagoe-shi, Saitama Pref.
------------------------------------------------------------------------------------------------------------------
Komatsu Castex Ltd. Himi-shi, Toyama Pref.
------------------------------------------------------------------------------------------------------------------
Komatsu Electronics, Inc. Hiratsuka-shi, Kanagawa Pref.
------------------------------------------------------------------------------------------------------------------
Komatsu America International Company Chatanooga, Tennessee, USA
------------------------------------------------------------------------------------------------------------------
Komatsu Mining Systems, Inc. Peorea, Illinois, USA
------------------------------------------------------------------------------------------------------------------
Advanced Silicon Materials, Inc. MosesLake, ashington, USA
------------------------------------------------------------------------------------------------------------------
Komatsu do Brasil Ltda. Suzano, San Paulo, Brazil
------------------------------------------------------------------------------------------------------------------
Komatsu UK Ltd. Birtley, UK
------------------------------------------------------------------------------------------------------------------
Komatsu Hanomag AG Hannover, Germany
------------------------------------------------------------------------------------------------------------------
Komatsu Mining Germany GmbH Dusseldorf, Germany
------------------------------------------------------------------------------------------------------------------
Komatsu Utility Europe S.p.A. Este, Italy
-----------------------------------------------------------------------------------------------------------------
P T Komatsu Indonesia Tbk Jakarta, Indonesia
------------------------------------------------------------------------------------------------------------------
Bangkok Komatsu Co., Ltd. Chonburi, Thai
------------------------------------------------------------------------------------------------------------------
Komatsu (Changzhou) Construction Machinery City of Chagzhou, Jiangsu
Corp. Province, China
------------------------------------------------------------------------------------------------------------------
(Notes) 1. The above also includes the major plants of the subsidiaries.
2. In October 2000, the Company abolished the branch office system.
24
(7) Directors and Auditors
---------------------------------------------------------------------------------------------------------------
Position Name Responsibility in the Company,
-------- ---- ------------------------------
Or Principal Occupation
-----------------------
---------------------------------------------------------------------------------------------------------------
Chairman and Director Tetsuya Katada
---------------------------------------------------------------------------------------------------------------
President and Representative Director *Satoru Anzaki
---------------------------------------------------------------------------------------------------------------
Executive Vice President and *Masahiro Sakane General Manager of Corporate Planning
Representative Director Division
---------------------------------------------------------------------------------------------------------------
Executive Vice President and *Toshitaka Hagiwara Supervision of Corporate Administration and
Representative Director External Corporate Affaires
---------------------------------------------------------------------------------------------------------------
Executive Managing Director *Koji Ogaki General Manager of Research Division
---------------------------------------------------------------------------------------------------------------
Executive Managing Director *Norimichi Kitagawa General Manager of e-Komatsu Promotion
Division
---------------------------------------------------------------------------------------------------------------
Director Arlie G. Tucker
---------------------------------------------------------------------------------------------------------------
Director Toshio Morikawa Counsel of The Sumitomo Bank, Ltd.
---------------------------------------------------------------------------------------------------------------
Standing Statutory Auditor Toshiro Nakaya
---------------------------------------------------------------------------------------------------------------
Standing Statutory Auditor Hiroyuki Watanabe
---------------------------------------------------------------------------------------------------------------
Statutory Auditor Masahiro Yoshiike President and Representative Director of The
Taiyo Mutual Life Insurance Co.
---------------------------------------------------------------------------------------------------------------
Statutory Auditor Takaharu Dohi Lawyer
---------------------------------------------------------------------------------------------------------------
(Notes)
1. Messrs. Hiroyuki Watanabe, Masahiro Yoshiike and Takaharu Dohi, each
of them being a Statutory Auditor, satisfy the requirements for
outside auditors provided in Article 18, Paragraph 1 of the "Law for
Special Exceptions to the Commercial Code Concerning Audit, etc. of
Kabushiki-Kaisha"
2. Each Director with the mark * concurrently holds the post of an
Executive Officer.
3. The Sumitomo Bank, Ltd. merged with The Sakura Bank, Ltd. effective
April 1, 2001 and they became Sumitomo Mitsui Banking Corporation. Mr.
Toshio Morikawa became counsel to Sumitomo Mitsui Banking Corporation
effective on the same date.
There were no Directors or Statutory Auditors who resigned from their positions
during this term.
25
(Reference)
In June 1999, the Company introduced the "Executive Officer" system and the
"Global Officer" system in which the latter is comprised of the management class
personnel of the major foreign local subsidiaries. The below is the list of the
Executive Officers and the Global Officers as of March 31st, 2001.
The five persons with * mark holds both of the post as a Director and an
Executive Officer.
----------------------------------------------------------------------------------------------------------------
Position Name Responsibility in the Company,
-------- ---- ------------------------------
or Principal Occupation
-----------------------
----------------------------------------------------------------------------------------------------------------
President and Representative *Satoru Anzaki
Director (Executive Officer)
----------------------------------------------------------------------------------------------------------------
Executive Vice President and *Masahiro Sakane General Manager of Corporate Planning Dept.
Representative Director
(Executive Officer)
----------------------------------------------------------------------------------------------------------------
Executive Vice President and *Toshitaka Hagiwara Supervision of Corporate Administration and
Representative Director External Corporate Affaires
(Executive Officer)
----------------------------------------------------------------------------------------------------------------
Executive Managing Director *Koji Ogaki General Manager of Research Division
(Executive Officer)
----------------------------------------------------------------------------------------------------------------
Executive Managing Director *Norimichi Kitagawa General Manager of
(Executive Officer) e-KOMATSU Promotion Division
----------------------------------------------------------------------------------------------------------------
Senior Executive Officer Kazuhiro Aoyagi General Manager of International Division
----------------------------------------------------------------------------------------------------------------
Senior Executive Officer Naomi Anesaki Deputy General Manager of Corporate Planning
Dept.
----------------------------------------------------------------------------------------------------------------
Senior Executive Officer Kunihiko Komiyama General Manager of Engines and Hydraulics
Division
----------------------------------------------------------------------------------------------------------------
Senior Executive Officer Hisashi Wada General Manager of Domestic Sales Division
----------------------------------------------------------------------------------------------------------------
Senior Executive Officer Masaru Fukase Accounting, Finance and Audit
----------------------------------------------------------------------------------------------------------------
Senior Executive Officer Teruo Nakahara General Manager of Development Division
---------------------------------------------------------------------------------------------------------------
Senior Executive Officer Kunio Noji General Manager of Production Division
----------------------------------------------------------------------------------------------------------------
Executive Officer Kiyokazu Baba General Manager of Industrial Machinery Division
----------------------------------------------------------------------------------------------------------------
26
Executive Officer Shuji Sugi Deputy General Manager of Development Division
----------------------------------------------------------------------------------------------------------------
Executive Officer Susumu Isoda General Manager of Osaka Plant,
Production Division
----------------------------------------------------------------------------------------------------------------
Executive Officer Yoshitaka Ohmura Deputy General Manager of Corporate Planning
Dept.
----------------------------------------------------------------------------------------------------------------
Executive Officer Teruo Nagayasu General Manager of Mohka Plant,
Production Division
----------------------------------------------------------------------------------------------------------------
Executive Officer Kanetake Nakatani General Manager of Awazu Plant,
Production Division
----------------------------------------------------------------------------------------------------------------
Executive Officer Yuzo Tsumura Deputy General Manager of Production Division
and General Manager of Purchasing Dept.
----------------------------------------------------------------------------------------------------------------
Executive Officer Masahiro Yoneyama Manager of Human Resources Dept.
----------------------------------------------------------------------------------------------------------------
Executive Officer Shigeki Fujimori General Manager of Defense system Division
----------------------------------------------------------------------------------------------------------------
Executive Officer Munenori Nakao General Manager of Environmental Control and
System Development Business Division
----------------------------------------------------------------------------------------------------------------
Executive Officer Yuji Watanabe General Manager of Electronics Division
----------------------------------------------------------------------------------------------------------------
Executive Officer Kenji Kinoshita General Manager of Finance Department
----------------------------------------------------------------------------------------------------------------
Global Officer James E. Boyle Chairman and CEO of Komatsu America
International Company
----------------------------------------------------------------------------------------------------------------
Global Officer Dave W. Grzelak Director, Chairman and CEO of Komatsu Mining
Systems, Inc.
----------------------------------------------------------------------------------------------------------------
Global Officer Kota Hoshino Director, President and COO of Komatsu Mining
Systems, Inc.
----------------------------------------------------------------------------------------------------------------
Global Officer Junro Kawanabe Director and President of Komatsu do Brasil
Ltda.
----------------------------------------------------------------------------------------------------------------
Global Officer Michael W. Kerschen President and COO of Advanced Silicon
Materials, Inc.
----------------------------------------------------------------------------------------------------------------
Global Officer Yoichi Kobayashi Director and President of Komatsu Latin America
Corp.
----------------------------------------------------------------------------------------------------------------
Global Officer Yoshinori Komamura Director and President of Komatsu Europe
International N.V.
----------------------------------------------------------------------------------------------------------------
27
----------------------------------------------------------------------------------------------------------------
Global Officer Gerhard Lehnen Director and President of Komatsu Hanomag AG
----------------------------------------------------------------------------------------------------------------
Global Officer John H. Matlock Director, President and CEO of Komatsu Silicon
America, Inc.
----------------------------------------------------------------------------------------------------------------
Global Officer Edson R. McCord General Manager, USA Research & Development
Center, Komatsu America Corp.
----------------------------------------------------------------------------------------------------------------
Global Officer Kenichi Nakamura President and COO of Komatsu America
International Company
----------------------------------------------------------------------------------------------------------------
Global Officer Ian Olivieri Director and President of NS Komatsu Pty., Ltd.
----------------------------------------------------------------------------------------------------------------
Global Officer Toshiji Onuma Director and President of Komatsu Mexicana S.A.
de C.V.
----------------------------------------------------------------------------------------------------------------
Global Officer Yuzo Suzuki Director and President of Komatsu Asia &
Pacific Pte. Ltd.
----------------------------------------------------------------------------------------------------------------
Global Officer Keith Tipping Director and President of Komatsu UK Ltd.
----------------------------------------------------------------------------------------------------------------
Global Officer Enrico Tonetti Director and President of Komatsu Utility
Europe S.p.A
----------------------------------------------------------------------------------------------------------------
Global Officer Hideo Ueda Chairman and CEO of Advanced Silicone Materials
LLC
----------------------------------------------------------------------------------------------------------------
Global Officer Norbert H.H. Walther Director and President of Komatsu Mining
Germany GmbH
----------------------------------------------------------------------------------------------------------------
28
III. Acquisition and Disposition of the Company's Share by Appropriation to
Profit
(1) Pursuant to the provisions of Article 7-2 of the Articles of Incorporation
of the Company, it was resolved at the Board of Directors Meeting of the Company
held on May 2, 2000 to acquire and cancel by appropriating to profit treasury
shares with a maximum of 10 million ordinary shares with par value at a total
acquisition price of JPY7.0 billion by the closing of the Ordinary General
Meeting of shareholders to be held in June 2000 because this was determined to
be especially necessary in light of the economic conditions, the Company's
performance and its condition of assets and other factors.
(2) In accordance with this resolution, the Company acquired 10 million
ordinary shares with par value at a total acquisition price of JPY 6,340,500,000
and completed procedures for cancellation of these shares on May 17, 2000.
(Note) Article 7-2 of the Articles of Incorporation of the Company provides that
"The Company may acquire and cancel for profit a maximum of 90,000,000 ordinary
shares of the Company by resolution of the Board of Directors" which provision
was newly added to the Articles of Incorporation by resolution of the
shareholders at the 128th Ordinary General Meeting of Shareholders held on June
27, 1997. When aggregating the past and the current purchases and cancellations,
25,000,000 treasury shares of the Company were acquired and canceled pursuant to
this provision.
29
EXHIBIT II
BALANCE SHEET
-------------
(As of March 31, 2001)
(JPY million)
--------------------------------------------------------------------------------
ASSETS
------
--------------------------------------------------------------------------------
CURRENT ASSETS: 336,159
--------------------------------------------------------------------------------
Cash on hand and in banks 20,085
--------------------------------------------------------------------------------
Notes receivable-trade 12,573
--------------------------------------------------------------------------------
Accounts receivable-trade 174,362
--------------------------------------------------------------------------------
Finished products 27,237
--------------------------------------------------------------------------------
Materials and supplies 2,167
--------------------------------------------------------------------------------
Work in process 21,630
--------------------------------------------------------------------------------
Prepaid expenses 1,144
--------------------------------------------------------------------------------
Deferred taxes asset-current 11,150
--------------------------------------------------------------------------------
Short-term loans receivable 57,968
--------------------------------------------------------------------------------
Other current assets 12,833
--------------------------------------------------------------------------------
Allowance for doubtful receivables (4,996)
--------------------------------------------------------------------------------
FIXED ASSETS: 429,287
--------------------------------------------------------------------------------
TANGIBLE FIXED ASSETS: 146,202
--------------------------------------------------------------------------------
Buildings 48,208
--------------------------------------------------------------------------------
Structures 8,905
--------------------------------------------------------------------------------
Machinery and equipment 31,522
--------------------------------------------------------------------------------
Vehicles and delivery equipment 252
--------------------------------------------------------------------------------
Tools, furniture and fixtures 9,416
--------------------------------------------------------------------------------
Land 46,982
--------------------------------------------------------------------------------
Construction in progress 914
--------------------------------------------------------------------------------
INTANGIBLE FIXED ASSETS: 10,279
--------------------------------------------------------------------------------
Utility rights 185
--------------------------------------------------------------------------------
Software 10,023
--------------------------------------------------------------------------------
Other intangible fixed assets 69
--------------------------------------------------------------------------------
30
--------------------------------------------------------------------------------
INVESTMENTS AND MISCELLANEOUS 272,806
ASSETS:
--------------------------------------------------------------------------------
Investment securities 63,943
--------------------------------------------------------------------------------
Capital stock of subsidiaries, Contributions 215,647
--------------------------------------------------------------------------------
Long-term loans receivable 4,443
--------------------------------------------------------------------------------
Non-current prepaid expenses 621
--------------------------------------------------------------------------------
Deferred taxes asset-current 4,632
--------------------------------------------------------------------------------
Treasury stock 1,751
--------------------------------------------------------------------------------
Other investments 4,906
--------------------------------------------------------------------------------
Allowance for doubtful receivables (444)
--------------------------------------------------------------------------------
Allowance for investments valuation (22,697)
--------------------------------------------------------------------------------
TOTAL ASSETS 765,446
------------
--------------------------------------------------------------------------------
LIABILITIES
--------------------------------------------------------------------------------
CURRENT LIABILITIES: 178,279
--------------------------------------------------------------------------------
Notes payable trade 3,980
--------------------------------------------------------------------------------
Accounts payable trade 81,338
--------------------------------------------------------------------------------
Short-term loans payable 6,136
--------------------------------------------------------------------------------
Commercial paper 20,000
--------------------------------------------------------------------------------
Accounts payable 33,758
--------------------------------------------------------------------------------
Accrued corporation taxes, etc. 8,180
--------------------------------------------------------------------------------
Advances received 942
--------------------------------------------------------------------------------
Deferred profit on installment sales 9,771
--------------------------------------------------------------------------------
Accrued bonuses 4,701
--------------------------------------------------------------------------------
Warranty reserve 3,696
--------------------------------------------------------------------------------
Other current liabilities 5,772
--------------------------------------------------------------------------------
LONG-TERM LIABILITIES: 113,372
--------------------------------------------------------------------------------
Bonds 62,447
--------------------------------------------------------------------------------
Long-term loans payable 12,867
--------------------------------------------------------------------------------
Liabilities for retirement benefits 36,191
--------------------------------------------------------------------------------
Liabilities for retirement allowance for directors 1,079
statutory auditors
--------------------------------------------------------------------------------
Other long-term liabilities 786
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
TOTAL LIABILITIES 291,652
-----------------
--------------------------------------------------------------------------------
31
--------------------------------------------------------------------------------
SHAREHOLDERS' EQUITY
--------------------
--------------------------------------------------------------------------------
CAPITAL: 70,120
--------------------------------------------------------------------------------
Common stock 70,120
--------------------------------------------------------------------------------
LEGAL RESERVES: 127,366
--------------------------------------------------------------------------------
Capital surplus 109,337
--------------------------------------------------------------------------------
Legal earned surplus 18,029
--------------------------------------------------------------------------------
RETAINED EARNINGS: 266,722
--------------------------------------------------------------------------------
Reserve for special depreciation 192
--------------------------------------------------------------------------------
Reserve for losses on overseas investment 1
--------------------------------------------------------------------------------
Reserve for advanced depreciation deduction 11,977
--------------------------------------------------------------------------------
Reserve for special advanced depreciation account 10,745
--------------------------------------------------------------------------------
General reserve 205,359
--------------------------------------------------------------------------------
Unappropriated retained earnings for this period 38,445
--------------------------------------------------------------------------------
(including net income for this period) (7,222)
--------------------------------------------------------------------------------
Valuation differences 9,585
--------------------------------------------------------------------------------
Valuation differences 9,585
--------------------------------------------------------------------------------
TOTAL SHAREHOLDERS' EQUITY 473,794
--------------------------
--------------------------------------------------------------------------------
TOTAL LIABILITIES & 765,446
-------------------
SHAREHOLDERS' EQUITY
--------------------
--------------------------------------------------------------------------------
32
EXHIBIT III
STATEMENT OF INCOME
-------------------
(From April 1, 2000 to March 31, 2001)
(JPY million)
-----------------------------------------------------------------------------------------------
ORDINARY PROFITS AND LOSSES
---------------------------
Operating Profits and Losses:
Operating income:
Net sales 430,270
Operating expenses:
Cost of sales 314,534
Adjustment to deferred profit on installment sales (526)
Selling, general and
Administrative expenses 102,080 416,088
------- -------------
Operating profit: 14,181
Non-operating Profits and Losses:
Non-operating income:
Interest and dividend Income 5,337
Other non-operating income 3,336 8,673
-------
Non-operating expenses:
Interest expenses 1,826
Other non-operating Expenses 9,746 11,573
------- -------------
Ordinary Profit: 11,281
SPECIAL PROFITS AND LOSSES
--------------------------
Special Income:
Profits from sale of investment securities 12,778
Gains from sale of shares of subsidiaries 3,426
33
Gains from sale of money invested 186
Gains from placing the retirement allowance 1,955
payments in trust
Variance changing to retirement benefits 953 19,299
accounting -------
Special Losses:
Valuation loss from sale of 439
Investment securities
Deferred allowance of securities investment 6,264
valuation
Valuation loss of the shares of the subsidiaries 1,430
Loss from reorganization of subsidiaries 12,812 20,946
------- -------------
Income before income taxes 9,635
Corporation, resident and Enterprise taxes 11,398
Adjustments to corporation tax, etc. (8,984)
----------------------------------------------------------------------------------------------
Net income for the period 7,222
Unappropriated retained earnings 40,433
Brought forward
Cancellation of treasury shares 6,340
Interim cash dividend paid 2,869
Unappropriated retained earnings at the end of the
period 38,445
-----------------------------------------------------------------------------------------------
34
(Notes)
1. Accounting Principles
(1) Method and basis of valuation of securities
Bonds held until maturity: At cost of amortization
Shares of subsidiaries and affiliates: At cost by moving average method
Other securities:
With market value: At market value of the market price as of the date of
settlement (The valuation differences are all disposed
by direct investment method and cost of sales are
computed by moving average method.)
Without market value: At cost by moving average method
With respect to financial products, the Accounting Principles for Financial
Products (("Opinion Concerning the Establishment of Accounting Principles
for Financial Products" of January 22, 1999 of the Corporate Accounting
Examination Committee) has been applied from this period. The effects of
this change are minor.
Also, the purposes for holdings in the securities that are held as of the
beginning of the period are reviewed and bonds held until maturity and
other securities are indicated as investment securities. As a result of
this accounting, the Securities declined by JPY 25,574 million and
Investment Securities increased by JPY 25,574 million.
(2) Method and basis of valuation of inventories
Finished products (excluding spare parts and real estate held for sale) and
work in process: Lower of cost (specific identification basis) or market
Spare parts: Lower of cost (last-in, first-out) or market
Real estate held for sale: Cost (specific identification basis)
Materials and supplies: Lower of cost (periodic average) or market
(3) Depreciation of tangible fixed assets and intangible fixed assets is
computed according to the declining-balance method and the straight-line
method respectively.
(4) As for the provision of retirement benefits, in order to appropriate the
necessary amount for employees, the amount accrued as of the end of this
period is accounted pursuant to the retirement benefits payment obligations
and pension assets accrued as of the end of this period.
The Accounting Principles Concerning Retirement Allowance ("Opinion
Concerning the Establishment of Accounting Principles for Severance
Payments" of June 16, 1998 by the Corporate Accounting Examination
Committee) was applied from this period.
Due to this change, when compared to the figures computed pursuant to the
same accounting principles applied last period, the retirement allowance
payment expenses increased by JPY 554 million, ordinary profit decreased by
JPY 545 million, and income before income taxes increased by JPY 2,669
million.
In addition, the variance changing in accounting was temporarily disposed
as special income.
35
(5) For long-term installment sales in which the installment period is in
excess of two years, the profits to be collected after the next period are
deferred.
(6) Accounting method of lease transactions
General accounting methods employed for ordinary lease transactions are
used for accounting finance lease transactions, excluding such transactions
in which it is recognized that the ownership of the leased article is being
transferred to the borrower.
(7) Accounting for consumption tax
Accounting procedures in regard to consumption taxes follow the tax-exempt
method.
(8) Application of the Accounting Principles for Transactions Denominated in
Foreign Currency
The Amended Accounting Principles for Transactions Denominated in Foreign
Currency ("Opinion Concerning the Amendment of the Accounting Principles
for Transactions Denominated in Foreign Currency of October 22, 1999 by the
Corporate Accounting Examination Committee) was applied from this period.
The effects on the profit and loss due to this change are minor.
2. Matters concerning the Balance Sheet
(1) Fractions of one million yen have been discarded.
(2) Short-term receivables from subsidiaries: JPY 167,620 million
Short-term debts payable to subsidiaries: JPY 30,813 million
Long-term receivables from subsidiaries: JPY 924 million
(3) Other amounts under the Current Assets include JPY 1 million for the
treasury shares.
(4) Accumulated depreciation of tangible fixed assets: JPY296,357 million
(5) In addition to the fixed assets shown in the balance sheet, there are
computers and peripherals leased and used as important fixed assets.
(6) Important assets and liabilities denominated in foreign currencies
Accounts receivable denominated in foreign currencies: JPY 16,808 million
Denominated in:
US dollars: US$ 110 million
Euro: EUR 24 million
Deutsche Mark: DM 9 million
The above does not include accounts subject to forward foreign exchange
contracts.
(7) The details of the reserve for retirement allowance payments and the
pension assets under the trust of the retirement allowance payments offset
by the same amount of the reserve for retirement allowance payments
(excluding the unrecognized calculation differences) are as follows:
36
----------------------------------------------------------------------------------------------------------------
Temporary Retirement Qualified Retirement Total
Amount Pension
----------------------------------------------------------------------------------------------------------------
Reserve for retirement allowance
payments (before deduction of the
pension assets under the trust
of the severance payments) JPY 47,295 million JPY 145 million JPY 47,441 million
----------------------------------------------------------------------------------------------------------------
Pension assets under the trust of
the retirement allowance payments
(excluding the unrecognized
calculation differences) JPY 11,249 million - JPY 11,249 million
----------------------------------------------------------------------------------------------------------------
Reserve for retirement allowance
payments (after deduction of the
pension assets under the trust of
the retirement allowance payments) JPY 36,045 million JPY 145 million JPY 36,191 million
----------------------------------------------------------------------------------------------------------------
(8) The reserve for the retirement allowance for the officers are the reserves
pursuant to Article 287-2 of the Commercial Code.
(9) Guarantee liability: JPY 52,593 million
Balance under letters of awareness, etc.: JPY 128,358 million
(10) The notes maturing as of the end of the period are settled and disposed on
the date of the exchanging of the notes. As the day of the end of the
period was a holiday for the financial institutions, the notes maturing as
of the end of the period are included in the balance as of the end of the
period as follows:
Notes receivable: JPY 2,224 million
Notes payable: JPY 1,312 million
(11) Total amount of treasury shares pursuant to Article 290, Paragraph 1, Item
5 of the Commercial Code: JPY 1,751 million
Net assets pursuant to Article 290, Paragraph 1, Item 6 of the Commercial
Code: JPY 9,585 million
(12) Earnings per common share (calculated based on the number of outstanding
shares as of March 31, 2001): JPY 7.53
3. Matters concerning the Statement of Income
(1) Fractions of one million yen have been discarded.
(2) Tradings with subsidiaries
Sales: JPY228,303 million
Purchases: JPY113,478 million
Trading other than operating transactions: JPY14,240 million
37
EXHIBIT IV
PROPOSAL FOR APPROPRIATION OF PROFIT
------------------------------------
(For the period ending in March 2001)
(Japanese Yen)
Unappropriated retained earnings at the end of the period 38,445,192,145
Reversal of reserve for special Depreciation 45,761,979
Reversal of reserve for loss on overseas investments 325,600
Reversal of reserve for advanced depreciation deduction 1,145,962,987
Reversal of reserve for special advanced depreciation account 10,745,373,574
TOTAL 50,382,616,285
The foregoing amount is proposed to be appropriated as follows:
Cash dividends 2,866,648,413
(Per share) (JPY 3.00)
Bonus to directors 63,000,000
(including JPY8,000,000 for statutory auditors)
Reserve for special depreciation 21,108,923
Reserve for advanced depreciation deduction 4,236,772,626
General reserve 25,000,000,000
Unappropriated retained earnings carried forward to the next period 18,195,086,323
Notes: 1. The total dividends applicable to this fiscal period would amount
to JPY 5,736,170,121 (including the interim dividends of JPY 3.00
per share, totaling JPY 2,869,521,708 paid on December 8, 2000).
2. The amounts entered respectively for reversals of "Reserve for
loss on overseas investments" and "Reserve for special advanced
depreciation account" and reversals and provisions of "Reserve
for special depreciation" and "Reserve for advanced depreciation
deduction" are recorded in accordance with the Special Taxation
Measures Law.
38
EXHIBIT V
AUDIT REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
--------------------------------------------------------
AUDIT REPORT
------------
May 1, 2001
To: KOMATSU LTD.
Mr. Satoru Anzaki
President and Representative Director
We have made an examination, under the provision of Article 2 of "The Law
for Special Exceptions to the Commercial Code Concerning Audit, etc. of
Kabushiki-Kaisha", of the Balance Sheet, Statement of Income, Business Report
(as to accounting information only), Proposal for Appropriation of Profit, and
Supplemental Schedules (as to accounting information only) of Komatsu Ltd. (the
"Company"), with respect to its 132nd fiscal period beginning on April 1, 2000
and ending on March 31, 2001. Our examination with respect to the Business
Report and Supplemental Schedules was limited to the information therein derived
from the Company's books of account.
In performing the above examination, we have followed the auditing
standards generally recognized as fair and appropriate and applied such auditing
procedures as are normally required. This auditing procedures also include the
audits conducted on the subsidiaries which we considered as necessary.
Our opinions, based on such examination, are as follows:
(1) The above-mentioned Balance Sheet and Statement of Income properly
present the conditions concerning assets of the Company and its profit and
loss in compliance with applicable laws and regulations and the Company's
Articles of Incorporation.
(2) The above-mentioned Business Report (as to the accounting information
only) properly presents the conditions of the Company in compliance with
applicable laws and regulations and the Company's Articles of
Incorporation.
39
(3) The above-mentioned Proposal for Appropriation of Profit is in
conformity with applicable laws and regulations and the Company's Articles
of Incorporation.
(4) There are no matters that the auditors are required to mention with
respect to the above-mentioned Supplemental Schedules (as to accounting
information only) in accordance with applicable provisions of the
Commercial Code.
We do not have any interest in or relationship with the Company as to which
disclosure is required under the applicable provision of the Certified Public
Accountants Law.
Auditing Corporation, Asahi & Co.
Partner & Accountant:
Kozo Uno (seal)
Certified Public Accountant
Partner & Accountant
Tadao Kuwano (seal)
Certified Public Accountant
Partner & Accountant:
Teruo Suzuki (seal)
Certified Public Accountant
Accountant:
Fumio Koike (seal)
Certified Public Accountant
40
EXHIBIT VI
BOARD OF STATUTORY AUDITORS' REPORT
-----------------------------------
AUDIT REPORT
------------
May 7, 2001
To: KOMATSU LTD.
Mr. Satoru Anzaki
President and Representative Director
Having been reported by each Statutory Auditor on the method and
results of the audit in regard to the performance of duties by the directors of
KOMATSU LTD. (the "Company") for the 132nd fiscal year (beginning on April 1,
2000 and ending on March 31, 2001), the Board of Statutory Auditors of the
Company prepares this Audit Report on deliberation and reports as follows:
1. Outline of Method of Examination
In accordance with the policy of audit and the assignment prescribed by
the Board of Statutory Auditors, each Statutory Auditor participated in meetings
of the Board of Directors and other important meetings of the Company, received
reports from the directors, etc. on matters relating to the business operations
of the Company, read important approval documents, etc., investigated at the
head office and the major places of business of the Company into matters
relating to the management of business and the status of property thereof, and
requested subsidiaries to report on business as considered necessary. We also
received reports and explanations from the independent certified public
accountants and examined the contents of the Company's financial documents and
supplemental schedules.
We requested reports from directors, etc. as necessary, in addition to
the above method of audit, for matters such as those concerning the directors'
involvement in transactions competitive with the Company's business and in
transactions which may conflict with the Company's interests, the Company's
bestowing benefits, the Company's unusual transactions with subsidiaries and
shareholders and the Company's acquisition or disposal of its own stocks, and
investigated such transactions in detail.
2. Results of Examination
We are of the view:
(1) that the method and results of the audit conducted by Asahi & Co., the
Company's independent certified public accountants, are appropriate;
41
(2) that the contents of the Business Report (other than accounting
information) present fairly the conditions of the Company as required by
related laws and regulations and the Articles of Incorporation of the
Company;
(3) that there are no matters which we are required to mention in the
Proposal for Appropriation of Profit in the light of the financial
conditions of the Company and other circumstances;
(4) that the Supplemental Schedules (other than accounting information)
properly contain information required to be contained therein and that
there are no matters which we are required to mention; and
(5) that in connection with performance of duties by the directors
including their duties relating to subsidiaries, we did not find any
unlawful act or any material fact which constitutes violation of laws and
regulations or the Articles of Incorporation of the Company. Further, with
respect to matters such as the directors' involvement in transactions
competitive with the Company's business and in transactions which may
conflict with the Company's interests, the Company's bestowing of benefits
and the Company's unusual transactions with subsidiaries and shareholders,
and the Company's acquisition or disposal of its own stocks, we are of the
opinion that there was no breach of obligation of directors.
Toshiro Nakaya (seal)
Standing Statutory Auditor
Hiroyuki Watanabe (seal)
Standing Statutory Auditor
Masahiro Yoshiike (seal)
Statutory Auditor
Takaharu Dohi (seal)
Statutory Auditor
Note: Mr. Hiroyuki Watanabe of Standing Statutory Auditor and Messrs.
Masahiro Yoshiike and Takaharu Dohi of Statutory Auditors are outside
auditors provided in Article 18, Paragraph 1 of the "Law for Special
Exceptions to the Commercial Code Concerning Audit, etc. of
Kabushiki-Kaisha".
42
REFERENTIAL DOCUMENTS REGARDING
-------------------------------
THE EXERCISE OF VOTING RIGHTS
-----------------------------
(PROXY STATEMENT)
-----------------
1. Total Number of shares held by shareholders with voting rights:
945,365,000 shares
2. Explanations of items of business:
1st Item of Business: Matters concerning the approval of the proposed
Appropriation of Profit for the 132nd business
term (April 1, 2000 - March 31, 2001)
The proposal for appropriation of profit is as described in EXHIBIT IV (see
page 34).
Based on our comprehensive consideration of our current fiscal year's
performance and dividend pay out ratio, we decided for the amount of cash
dividend per share as of the end of this period be JPY3.00 per share which is
the same amount as the interim dividend for the current fiscal year and the
dividend of the previous fiscal year.
2nd Item of Business: Matters concerning the election of six directors
The terms of office of six directors, Messrs. Tetsuya Katada, Masahiro
Sakane, Koji Ogaki, Norimichi Kitagawa, Arlie G. Tucker, and Toshio Morikawa
will terminate as of the close of this General Shareholders' Meeting
(hereinafter, the "Meeting"). In 1999, we effected reforms to the board by
decreasing the number of directors and inviting outside directors, and we also
introduced the "Executive Officer" system and the "Global Officer" system. We
hope to achieve a further strengthened corporate governance with the board of
directors comprised of small number of members.
Thus, an election of six directors is requested and the following
candidates are nominated for the positions.
43
DIRECTOR CANDIDATES
-------------------
------------------------------------------------------------------------------------------------------------
Number of
---------
Name Brief Personal History Shares of the
---- ---------------------- -------------
(Date of Birth) (Representative position in other companies) Company Held
--------------- -------------------------------------------- ------------
------------------------------------------------------------------------------------------------------------
Tetsuya Katada 4/1953 Joined the Company 77,115
(October 15, 1931) 3/1978 Director
3/1983 Managing Director
3/ 1987 Executive Managing Director
6/1988 Executive Vice President and
Representative Director
6/1989 President and
Representative Director
6/1995 Chairman and
Representative Director
6/1999 Chairman and Director
(current position)
(Representative position in other companies)
President and Representative Director of Komatsu
Building Co., Ltd.
------------------------------------------------------------------------------------------------------------
Masahiro Sakane 4/1963 Joined the Company 36,100
(January 7, 1941) 6/1989 Director
6/1994 Managing Director
6/1997 General Manager of Corporate Planning
Division
(current position)
6/1997 Executive Managing Director
6/1999 Executive Vice President and
Representative Director
(current position)
------------------------------------------------------------------------------------------------------------
Koji Ogaki 4/1964 Joined the Company 31,250
(March 24, 1942) 6/1991 Director
6/1995 General Manager of Research Division
(current position)
6/1996 Managing Director
6/1999 Executive Managing Director
(current position)
------------------------------------------------------------------------------------------------------------
44
------------------------------------------------------------------------------------------------------------
Toshio Morikawa 4/1955 Joined The Sumitomo Bank, Ltd 0
(March 3, 1933) 6/1980 Director of the above Bank
2/1984 Managing Director of the above Bank
10/1985 Executive Managing Director and
Representative Director of the above Bank
10/1990 Executive Vice President and
Representative Director of the above Bank
6/1993 President and Representative Director of
the above Bank
6/1997 Chairman and Representative Director of
the above Bank
6/1999 Director of the Company
(current position)
3/2001 Counsel of The Sumitomo Bank, Ltd.
4/2001 Counsel of Sumitomo Mitsui Banking
Corporation
(current position)
------------------------------------------------------------------------------------------------------------
Kazuhiro Aoyagi 4/1967 Joined the Company 28,000
(April 14, 1943) 6/1993 Director
1/1995 President and Director of Komatsu Europe
Co., Ltd. (currently Komatsu Europe
International N.V.)
6/1998 Managing Director of the Company
6/1999 General Manager of International Business
Division
(current position)
6/1999 Senior Executive Officer
(current position)
(Representative position in other companies)
Chairman of the Board of Komatsu (China) Ltd.
------------------------------------------------------------------------------------------------------------
45
------------------------------------------------------------------------------------------------------------
Kunio Noji 4/1969 Joined the Company
(November 17, 2/1995 General Manager of the Chatanooga Plant
1946) of Komatsu Dresser Company (currently
Komatsu America International Company)
3/1997 General Manager of the Information System 22,000
Division of the Company
6/1997 Director of the Company
6/1999 Executive Officer
4/2000 General Manager of the Production
Division
(current position)
6/2000 Senior Executive Officer
(current position)
------------------------------------------------------------------------------------------------------------
3rd Item of Business: Matters concerning the election of one
statutory auditor
A Statutory Auditor, Mr. Toshiro Nakaya, will resign at the close of this
Meeting. Accordingly, it is proposed that one statutory auditor be elected. The
following candidate is nominated for the position.
STATUTORY AUDITOR CANDIDATE
---------------------------
------------------------------------------------------------------------------------------------------------
Name Brief Personal History Number of shares
---- ---------------------- -----------------
(Date of Birth) (Representative positions held in other companies) of the Company held
--------------- -------------------------------------------------- -------------------
------------------------------------------------------------------------------------------------------------
Norimichi Kitagawa 4/1965 Joined the Company
(July 22, 1940) 6/1993 Director
6/1997 Managing Director
6/1998 General Manager of Construction Equipment
Division and General Manager of
Development Division 25,000
6/1999 Executive Managing Director
(current position)
4/2000 General Manager of e-KOMATSU Promotion
Division
(current position)
------------------------------------------------------------------------------------------------------------
46
4th item of Business: Matters concerning the acquisition of treasury
shares for transfer to the directors and employees
The resolution of the shareholders is requested for the Company to acquire
1.1 million ordinary shares of the Company's treasury shares with par value at a
maximum total acquisition price of JPY1 billion during the period from the
closing of this Meeting until the end of the next Ordinary Meeting of
shareholders, for transfer to the Company's directors and employees in the
following manner in accordance with the provisions set forth in Article 210-2 of
the Commercial Code for the purpose of providing an incentive to and lifting the
morale of the directors and employees towards the improvement of the Company's
business performance.
If the total number of the above shares cannot be acquired at the maximum
acquisition price stipulated above, the above total number of shares to be
acquired and the number of shares to be transferred to the grantees of the
rights will be decreased accordingly by a resolution of the Board of Directors.
(Outline of the Transfer)
(1) Manner of Transfer of the Shares
To be conducted as provided in Article 210-2, Paragraph 2, Item 3 of the
Commercial Code, "Agreement to grant rights to acquire the shares of the Company
from the Company at the price set forth in advance" (hereinafter referred to as
the "Agreement"). Such Agreement shall be concluded between the Company and each
of the persons who are granted with such rights in accordance with the
resolutions to be passed at this Meeting and the future Board of Directors
Meeting.
(2) Type of Shares Subject to Transfer
The Company's ordinary shares with par value
(3) Persons to be Granted the Rights, and the Number of Shares to be Granted
47
(a) The following directors remaining in office as of the closing of this
Meeting (7 persons)
Name Number of shares Name Number of shares
---- ---------------- ---- ----------------
Satoru Anzaki 80,000 Masahiro Sakane 80,000
Toshitaka Hagiwara 70,000 Koji Ogaki 60,000
Kazuhiro Aoyagi 60,000 Kunio Noji 40,000
Tetsuya Katada 20,000
(b) The following executive officers pursuant to the Company's Executive
Officer system, global financial officers, the counsels (riji), chief
technician, chief technical supervisors, and global officers who are
employees (40 persons)
Name Number of shares Name Number of shares
---- ---------------- ---- ----------------
Naomi Anesaki 60,000 Kunihiko Komiyama 40,000
Hisashi Wada 40,000 Teruo Nakahara 40,000
Shuji Sugi 20,000 Susumu Isoda 20,000
Teruo Nagayasu 20,000 Kanetake Nakatani 20,000
Yuzo Tsumura 20,000 Masahiro Yoneyama 20,000
Shigeki Fujimori 20,000 Munenori Nakao 20,000
Yuji Watanabe 20,000 Kenji Kinoshita 20,000
Makoto Nakamura 20,000 Hiroshi Suzuki 20,000
Mamoru Hironaka 20,000 Masaaki Fuchigami 20,000
Keith Sheldon 20,000 Junro Kawanabe 10,000
Yoshinori Komamura 10,000 Kenichi Nakamura 10,000
Teruaki Noda 10,000 Yoshitaka Ohmura 10,000
Toshiji Onuma 10,000 Yoshio Funabiki 10,000
Kanichi Kadotani 10,000 Akifumi Katsushima 10,000
Toshiyuki Kawaguchi 10,000 Yasuo Kimura 10,000
Yoshito Maeyama 10,000 Masatsugu Nagatomo 10,000
Tetsuya Nakayama 10,000 Takeyuki Sakata 10,000
Masayuki Sato 10,000 Yasuo Suzuki 10,000
Yuzo Suzuki 10,000 Tashiro Takeda 10,000
Tetsuo Takiguchi 10,000 Kanenobu Yoshida 10,000
48
(4) Purchase Price
The purchase price of the subject shares shall be in the amount of the
average of the closing price of the Company's ordinary shares with par value
(ordinary trades) of each day (excluding days on which there are no trades of
the shares) of the month immediately preceding the month in which the date of
the grant falls, at the Tokyo Stock Exchange, multiplied by 1.05, with fractions
less than one yen being rounded up to a whole yen. However, the purchase price
shall not be less than the closing price of such shares on the date of the
grant.
If the shares are subject to a stock split or if the new shares are issued
at a price below the market value (excluding those issuable upon conversion of
convertible bonds or exercise of warrants), the purchase price shall be adjusted
in accordance with the formula below, with fractions less than one yen being
rounded up to a whole yen.
Number of newly Amount paid per
Number of currently + issued shares x Share
Issued shares ------------------------------------------------
Purchase price Purchase Stock price before stock split
After adjustment = Price X or new issuance
--------------------------------------------------------------------
Number of currently issued shares + Increased number of shares
Before due to stock split or issuance of new shares
Adjustment
(5) Period for Exercising the Rights
From August 1, 2002 to July 31, 2007. Notwithstanding the foregoing, if any
of the persons who are granted the above rights dies before the end of the
exercising period, his or her heir may exercise the rights within 24 months of
the dated of the death of the person.
(6) Conditions for Exercising the Rights
(a) Any of the persons who have been granted the above rights may exercise his
or her rights pursuant to the Agreement even after the person is no longer
a director or an employee of the Company. If any of the persons granted the
rights dies, his or her heir may exercise the rights pursuant to the
Agreement.
(b) The granted rights may not be transferred or pledged.
(c) The other conditions to the exercise of rights shall be provided in the
Agreement.
49
5th item of Business: Matters concerning the payment of retirement
allowance to retiring director and statutory auditor
As of the close of this meeting, Mr. Norimichi Kitagawa will retire from
the office of the director and Mr. Toshiro Nakaya from the office of the
statutory auditor. To reward them for the services they have rendered, the Board
of Directors proposes to pay retirement allowance in reasonable amounts in
accordance with the rules prescribed by the Company. It is also proposed that
the details of the allowance for the retiring director and the retiring auditor
in terms of individual amount, time and method of payment, be determined by the
Board of Directors for the director and by consultation between the auditors for
the auditor, respectively. Their brief personal histories are as follows:
--------------------------------------------------------------------------------
Name Brief Personal History
---- ----------------------
--------------------------------------------------------------------------------
Norimichi Kitagawa 6/1993 Director
6/1997 Managing Director
6/1999 Executive Managing Director
(current position)
--------------------------------------------------------------------------------
Toshiro Nakaya 6/1996 Standing Statutory Auditor
(current position)
--------------------------------------------------------------------------------
END
50
(Translation)
INSTRUCTION CARD
----------------
CONCERNING THE EXERCISE OF VOTING RIGHTS
----------------------------------------
To: KOMATSU LTD.
Number of Voting Shares: ____________ shares
The undersigned hereby exercises its voting rights as indicated below in
respect of the items of business proposed in the 132nd Ordinary General Meeting
of Shareholders of KOMATSU LTD. to be held on June 27, 2001.
This Instruction Card will also be effective in the event of an adjournment
or continuation of the meeting.
Re: 1st Item of Business:
Matters as proposed are ................ approved
disapproved
2nd Item of Business:
Matters as proposed are ................ approved
(excluding ________)
disapproved
3rd Item of Business:
Matters as proposed are ................ approved
disapproved
4th Item of Business:
Matters as proposed are ................ approved
disapproved
5th Item of Business:
Matters as proposed are ................ approved
disapproved
___ ___, 2001
Name of Shareholder (Seal)
--------------------------
* * *
(Note) Please be advised that if no instruction is indicated for any item of
business above, the voting rights attached to your shares shall be
voted in favor of the approval of such item.
Komatsu Ltd.