-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, G0nb7A3HrEP9mFOg8gDzhVd+gC/UJyj6g/DjL1MxWfNGNHL8F7IhhUk+33CNyPRS z/vyRnEzDGK3d5DHiAhAZA== 0000317891-09-000010.txt : 20090603 0000317891-09-000010.hdr.sgml : 20090603 20090603060752 ACCESSION NUMBER: 0000317891-09-000010 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20090603 FILED AS OF DATE: 20090603 DATE AS OF CHANGE: 20090603 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RICOH CO LTD CENTRAL INDEX KEY: 0000317891 STANDARD INDUSTRIAL CLASSIFICATION: PHOTOGRAPHIC EQUIPMENT & SUPPLIES [3861] IRS NUMBER: 000000000 STATE OF INCORPORATION: M0 FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 002-68279 FILM NUMBER: 09869825 BUSINESS ADDRESS: STREET 1: 13-1, GINZA 8-CHOME STREET 2: CHUO-KU CITY: TOKYO 104-8222 JAPAN STATE: M0 ZIP: 00000 BUSINESS PHONE: 81-3-6278-5241 MAIL ADDRESS: STREET 1: 13-1, GINZA 8-CHOME STREET 2: CHUO-KU CITY: TOKYO 104-8222 JAPAN STATE: M0 ZIP: 00000 6-K 1 r6k090603.txt NOTICE OF 109TH ORDINARY GENERAL MEETING OF SHAREHOLDERS ================================================================================ FORM 6-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13A-16 OR 15D-16 OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE MONTH OF JUNE, 2009 COMMISSION FILE NUMBER 2 - 68279 RICOH COMPANY, LTD. (TRANSLATION OF REGISTRANT'S NAME INTO ENGLISH) 13-1, GINZA 8-CHOME, CHUO-KU, TOKYO 104-8222, JAPAN (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.) Form 20-F [X] Form 40-F [_] (Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): [_]) (Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): [_]) (Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.) Yes [_] No [X] (If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- ) ------- ================================================================================ SIGNATURE 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. Ricoh Company, Ltd. -------------------------------------- (Registrant) Date: June 3, 2009 By: /s/ Takashi Nakamura ---------------------------------- Name: Takashi Nakamura Title: Director Corporate Executive Vice President CHO(Chief Human Resource Officer) General Manager of Personnel Division (TRANSLATION) (Securities Code: 7752) June 3, 2009 NOTICE OF 109TH ORDINARY GENERAL MEETING OF SHAREHOLDERS Dear Shareholder, The Company would hereby like to inform you that the 109th Ordinary General Meeting of Shareholders will be held as follows, and would be grateful if you could attend the meeting. Those who will not be able to attend the meeting on the day are kindly requested to consider appended "Reference Material for Ordinary General Meeting of Shareholders" and exercise your voting right in writing or via the Internet no later than 5:30 p.m., Wednesday, June 24, 2009. [Exercise of voting rights in writing] Please indicate your "approval or disapproval" for each of the proposals on the voting form enclosed herewith and return the form by the above-mentioned deadline. [Exercise of voting rights via the Internet] Please access the website designated by the Company for the Exercise of Voting Rights (http://www.web54.net), use "Voting right exercise code" and "Password," both shown in the voting form and enter your approval or disapproval for each of the proposals following the instructions displayed on the screen. When exercising your voting right through the Internet website, please read "Exercise of Voting Rights via the Internet" on page 53. Yours faithfully, Shiro Kondo, Representative Director, President and Chief Executive Officer Ricoh Company, Ltd. 1-3-6 Nakamagome, Ohta-ku, Tokyo 1. DATE AND TIME: Thursday, June 25, 2009, from 10:00 a.m. 2. VENUE: Ricoh's registered head office: 1-3-6 Nakamagome, Ohta-ku, Tokyo 3. PURPOSE: ITEMS TO BE REPORTED: 1. The Business Report, Consolidated Financial Statements and the results of auditing consolidated financial statements by Accounting Auditors and the Board of Corporate Auditors for the fiscal year ended March 31, 2009 (from April 1, 2008 to March 31, 2009) 2. The Non-Consolidated Financial Statements for the fiscal year ended March 31, 2009 (from April 1, 2008 to March 31, 2009) -1- ITEMS TO BE RESOLVED: Agenda 1: Appropriation of retained earnings Agenda 2: Partial amendments to the Articles of Incorporation Agenda 3: Election of one (1) Corporate Auditor Agenda 4: Election of one (1) Substitute Corporate Auditor Agenda 5: Payment of bonuses to Directors 4. TREATMENT OF VOTING RIGHTS (1) When voting rights were exercised both in writing and via the Internet, the vote arrived later shall be deemed effective. However, if votes arrive on the same day, the vote registered via the Internet shall be deemed effective. (2) When voting rights are exercised via the Internet more than once, the last vote shall be deemed effective. - ---------- Notes: 1. Shareholders are requested to fill out and submit the appended voting form at the reception desk when attending. 2. If there is any revision to Reference Material for Ordinary General Meeting of Shareholders, Business Report, Consolidated and Non-consolidated Financial Statements, such revision will be notified on the Company's website (http://www.ricoh.co.jp/IR/). This English translation is an abridged version of the original notice in Japanese. In the event of any discrepancy, the Japanese version shall prevail. -2- TO OUR SHAREHOLDERS I would like to take this opportunity to express our sincere appreciation for our shareholders' continuous support to us in delivering our business report for 109th business term, from April 1, 2008 to March 31, 2009. Consolidated net sales of Ricoh Group for the fiscal year under review amounted to Yen 2,091.6 billion, a decrease of 5.8% from the previous year, significantly affected by the decrease in sales from all categories, including the Imaging & Solutions, Industrial Products, and Other segments due to the economic slowdown and the appreciation of the yen. Net income was Yen 6.5 billion, a decrease of 93.9% from the previous year, due to a foreign exchange loss in addition to decreased income caused by the severe business environment. With regard to dividends, we would like to propose a year-end dividend of Yen 15 per share at the 109th Ordinary General Meeting of Shareholders. In addition to the interim dividend of Yen 18 per share already disbursed, the total dividend for the fiscal year under review would amount to Yen 33 per share, the same amount as the previous fiscal year. It is true that there are various uncertain factors such as economic trends and foreign exchange fluctuations, but the Ricoh Group is determined to do the utmost efforts to achieve consolidated net sales of Yen 2,160 billion and net income of Yen 30 billion in the fiscal year ending March 31, 2010. Under the 16th Mid-Term Management Plan in which we announce our vision of the three years from the fiscal year ended March 2009, the Ricoh Group strove to achieve further growth and development through customer value creation and highly efficient management. By implementing these initiatives, we aim to meet the expectations of our shareholders. We look forward to your support and encouragement to the Company from now on. Sincerely, June 2009 Masamitsu Sakurai, Chairman of the Board and Representative Director, Chairman Shiro Kondo, Representative Director, President and Chief Executive Officer -3- Reference Documents Attached to Notice of 109th Ordinary General Meeting of Shareholders BUSINESS REPORT FOR 109TH BUSINESS TERM (April 1, 2008 to March 31, 2009) (The following is an unofficial English translation of the Reports for the 109th Fiscal Year of the Company. The Company provides this translation for your reference and convenience only and without any warranty as to its accuracy or otherwise.) 1. STATUS OF THE RICOH GROUP (1) OPERATING CONDITIONS FOR THE FISCAL YEAR UNDER REVIEW (I) Operating progress and results - - Overview .. Business Environment In the fiscal year under review, the U.S.-originated financial crisis spread globally. From the Autumn onwards in particular it impacted massively on the real economy. In addition to the U.S., economic conditions turned down in the comparatively steady European economy also. Even the Asian economies such continually-expanding China dived sharply. The Japanese economy also fell into extremely severe circumstances with corporate earnings dropping considerably under the effect of a sharply appreciating yen, falling stock markets, weakening capital investment and flagging individual consumption. .. Ricoh Group Vision Ricoh Group announced a group vision "Winner in the 21st Century" (Build a strong global RICOH brand), and aims to gain the strong trust of customers by continually contributing to greater customer productivity and knowledge creation, thereby continuing to grow and develop. To these ends, Ricoh is promoting business activities in order to provide innovative products and services for all customers who handle information at work and in their lives, based on the Ricoh values of "Harmonize with the environment", "Simplify your life and work", and "Support knowledge management".) .. Medium and Long Term Management Strategy In its 16th Mid-Term Management Plan for the period April 2008 to March 2011, Ricoh shall put even more emphasis on customer viewpoints, and continue providing products and services which exceed customer expectations, thereby earning even greater trust of customers. Especially in the imaging and solutions area, Ricoh Group plans to utilize its strengths such as customer contact capabilities, excellent product line, ability to propose solutions, global business development abilities, and image processing technologies, to respond to increasingly diverse needs of more customers, and strengthen its business foundations. Specifically, "Work flow", "Security", "TCO (Total Cost of Ownership)", "Compliance", and "Environment" are important issues for customers. Ricoh will focus on these to provide greater customer value. Ricoh helps customers to improve their business productivity -4- improvement and promote the creation of knowledge in their businesses through its IT services. In addition to providing document solutions by constructing and implementing systems with centralized storage, search, and output by file servers, its other IT services includes support for the introduction and utilization of IT and the provision of security and business continuity solutions. Ricoh is providing better color laser printer and GELJET printer products to boost growth of its low-end business and rapidly establish the production printing business, thus expanding its business areas in the printing market. In the industrial market, allocation of business resources is focused on businesses where large growth is expected. Ricoh will put efforts into strengthening cooperation between technical fields and business areas in order to combine diverse fields and create new businesses. Ricoh is also making further advances in business development in emerging markets, in both the Imaging & solutions and the industrial products. In order to increase or create customer value and boost earning power in each business, it is important to secure competitive superiority through technology. Ricoh will continue to actively work to strengthen its technical abilities. .. New Products from Imaging & Solutions In the Imaging & solutions market, Ricoh continually creates new color multifunction machines and color laser printers, further enhancing the product line. In digital color printers targeted for the business office, Ricoh introduced the Imagio MP C5000, which, at 50 Pages per minute, is the fastest in its class. In printers which can be used for personal offices or for distributed printing in a large office, we introduced the Imagio MP C2200. In addition, as the Reconditioning (RC) machine, which uses our brand-new recycling technology, we introduced the Imagio Neo 300RC/250RC series. By achieving excellent environmental performance, higher image quality, and advanced security functions in these new product launches, Ricoh's stronger product line has led it to attain large market shares in color copier/multifunction equipment markets in Japan and overseas. As a color laser printer, we introduced the IPSiO SP C310, a high productivity, compact, stylish A4 color laser printer. Since it fits in a limited space, it is well-suited for a variety of uses, including personal offices, small businesses, medical offices, university laboratories, etc. As a production class multifunctional color system, we introduced the RICOH Pro C900 in answer to the needs of the high-speed printing and production market for a color/monochrome 90-page-per-minute A4 landscape printer with high picture quality, high stability and high reliability. In the corporate and commercial professional printing market, where there are needs for very low-cost color POD (Print On Demand), we strengthened our line-up. .. Acquisition of IKON Office Solutions, Inc. To further growth our imaging and solutions business, we acquired IKON Office Solutions, Inc. headquartered in United States, the world's largest independent channel for document management systems and services. IKON has a sales and support network, long-standing customer relationships with major -5- businesses in the U.S., Canada and the Western European market as well as advanced capabilities on professional services. Combining those strengths with Ricoh's innovative technology and imaging solutions, we create opportunities to expand our global business. .. Further improvement of customer satisfaction According to J.D. Powers Asia-Pacific "2008 Japan Copier/Multifunction Product Customer Satisfaction Study", for the 2nd year, we received the number 1 ranking. According to Ascii Laboratories "Compact Digital Camera Customer satisfaction survey", we received a similarly high evaluation for digital cameras. By continuing to emphasize our customers' needs, we will increase our efforts to create products which receive such high grades. .. Performance in the fiscal year under review Net sales amounted to Yen 2,091.6 billion, down 5.8% from the previous year. Operating income was down 58.9% year on year to Yen 74.5 billion. With respect to non-operating income (loss), income from continuing operations before income taxes, equity income and minority interests was down 82.3% from the previous year to Yen 30.9 billion, due to foreign exchange loss caused by the stronger yen in the latter half of the fiscal year, as well as loss on evaluation of marketable securities. Net income decreased by 93.9% from the previous year to Yen 6.5 billion. CONSOLIDATED SALES BY CATEGORY (CONSOLIDATED BASIS) Category Sales (billions of yen) Percentage of total Change (%) - -------------------------------------------------------------------------------- Imaging Solutions 1,598.6 76.4 -6.5 Network System Solutions 234.4 11.2 17.2 Imaging & Solutions 1,833.0 87.6 -4.0 Industrial Products 115.5 5.5 -19.9 Other 143.0 6.9 -13.9 Total 2,091.6 100.0 -5.8 - -------------------------------------------------------------------------------- Japan 938.3 44.9 -7.6 Overseas 1,153.3 55.1 -4.2 The Americas 502.8 24.0 15.7 Europe 523.4 25.0 -13.2 Other 127.0 6.1 -23.4 - -------------------------------------------------------------------------------- IMAGING & SOLUTIONS (down 4.0% year on year to Yen 1,833 billion) In the Imaging & Solutions segment, which consists of Imaging Solutions and Network System Solutions, various efforts were made, including strengthening the sales system and expanding business areas but economic setback and the appreciating yen significantly affected the performance of this segment. As a result, net sales decreased by 4.0% from the previous corresponding period to Yen 1,833.0 billion. Net sales excluding the impact of foreign exchange fluctuations increased by 3.7% from the previous corresponding period. -6- Imaging Solutions (down 6.5% year on year to Yen 1,598.6 billion) Trends in consolidated net sales (billions of yen) FY 2008 1,709.4 FY 2009 1,598.6 FY 2010(E) 1,645.7 Imaging Solution: Digital copiers, color copiers, analog copiers, digital duplicators, facsimile machines, diazo copiers, scanners, multi-functional printers (MFP), printers and software Sales of color MFPs increased steadily while those of black-and-white MFPs substantially decreased from the previous corresponding period. Sales of printers increased steadily due to the reinforced sales system and expanded business areas. Overall sales in the Imaging & Solutions segment, however, decreased by 6.5% from the previous corresponding period to Yen 1,598.6 billion, significantly affected by the economic recession and the appreciation of the yen. Network System Solutions (up 17.2% year on year to Yen 234.4 billion) Trends in consolidated net sales (billions of yen) FY 2008 200.0 FY 2009 234.4 FY 2010(E) 270.2 Network System Solutions: Personal computers, PC servers, network systems and network related software Due to the expansion of IT services and the solutions business, sales of Network System Solutions increased by 17.2% from the previous corresponding period, to Yen 234.4 billion. Overseas IT service business was changed from Imaging Solutions to Network System Solutions from this fiscal year. The effect of the change was Yen 17.7 billion. INDUSTRIAL PRODUCTS (down 19.9% year on year to Yen 115.5 billion) Trends in consolidated net sales (billions of yen) FY 2008 144.3 FY 2009 115.5 FY 2010(E) 104.1 Industrial Products: Thermal media, optical equipments, semiconductors, electronic component and measuring equipments Net sales in the Industrial Products segment decreased by 19.9% from the previous corresponding period, to Yen 115.5 billion. Sales of each business, including semiconductors, thermal media, and electric components decreased due to the economic recession. -7- OTHER (down 13.9% year on year to Yen 143.0 billion) Trends in consolidated net sales (billions of yen) FY 2008 166.0 FY 2009 143.0 FY 2010(E) 140.0 Other: Digital cameras, etc. Net sales in this segment decreased by 13.9% from the previous corresponding period, to Yen 143.0 billion. Sales of digital cameras and of each business decreased due to the economic recession. (II) PLANT AND EQUIPMENT INVESTMENT In the fiscal period under review, the Ricoh Group invested a total of Yen 96.9 billion (including an investment of Yen 41.8 billion by the Company) in plant and equipment, mainly comprising the following. (a) Major equipment and facility expansions completed during the fiscal year: Equipment-related supplies plant (Numazu Plant) (b) Major equipment and facility expansions in progress in the fiscal year: Construction of a new building in the Ricoh Technology Center Equipment-related supplies plant (Tohoku Ricoh) Establishment of a plant to manufacture multi-functional printers (MFPs) and laser printers (Thailand) (III) FUND PROCUREMENT In March 2009, the Company procured Yen 85.0 billion and Yen 167.1 billion through unsecured straight bonds and bank loans, respectively, in order to allocate them as funds for acquiring IKON Office Solutions, Inc. and for redeeming corporate bonds. (IV) STATUS OF ACQUISITION OF OTHER COMPANIES' STOCKS AND OTHER EQUITIES Ricoh Group acquired IKON Office Solutions, Inc. on October 31, 2008. Details are described in the "Overview" in the section "(i) Operating progress and results." -8- (2) STATUS OF ASSETS AND PROFIT/LOSS IN THREE BUSINESS YEARS Transition of assets and profit/loss of the Ricoh Group
- ------------------------------------------------------------------------------------------------------- Fiscal year Fiscal year Fiscal year Fiscal year ended ended ended ended Items March 2006 March 2007 March 2008 March 2009 - ------------------------------------------------------------------------------------------------------- Net sales (billions of yen) 1,909.2 2,068.9 2,219.9 2,091.6 Income from continuing operations before income tax (billions of yen) 152.7 174.5 174.6 30.9 Net income (billions of yen) 97.0 111.7 106.4 6.5 Net income per share (yen) 132.33 153.10 146.04 9.02 Total assets (billions of yen) 2,041.1 2,243.4 2,214.3 2,513.4 Net assets (billions of yen) 960.2 1,070.9 1,080.1 975.3 - -------------------------------------------------------------------------------------------------------
Notes: 1. The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the U.S. 2. As a result of the sale of a business in the fiscal year ended March 2007, the operating results from the discontinued operations have been reclassified in the figure before fiscal year ended March 2006 in accordance with Statement of Financial Accounting Standards No. 144 "Accounting for the Impairment or Disposal of Long-Lived Assets." 3. Net income per share is calculated based on the average number of shares outstanding during the fiscal year, from which the number of shares of treasury stock is deducted. Transition of assets and profit/loss of the Company
- ----------------------------------------------------------------------------------- Fiscal year Fiscal year Fiscal year Fiscal year ended ended ended ended Items March 2006 March 2007 March 2008 March 2009 - ----------------------------------------------------------------------------------- Net sales (billions of yen) 934.3 1,033.3 1,036.2 948.3 Ordinary income (billions of yen) 82.4 105.2 79.5 39.7 Net income (billions of yen) 55.0 71.9 54.6 23.0 Net income per share (yen) 74.81 98.48 74.99 31.90 Total assets (billions of yen) 982.5 1,076.2 1,067.8 1,260.6 Net assets (billions of yen) 694.7 744.8 761.2 764.7 - -----------------------------------------------------------------------------------
Notes: 1. Net income per share is calculated based on the average number of shares outstanding during the fiscal year, from which the number of shares of treasury stock is deducted. 2. Beginning in the fiscal year ended March 2007, the Company adopted ASBJ Statement No. 5 "Accounting Standards for Presentation of Net Assets in the Balance Sheets" and its Implementation Guidance-ASBJ Guidance No. 8, "Guidelines on Accounting Standards for Presentation of Net Assets in Balance Sheet." -9- (3) STATUS OF MAJOR SUBSIDIARIES Status of major subsidiaries (as of March 31, 2009)
Investment Name Paid-in capital ratio (%) Principle business - -------------------------------------------------------------------------------------------------------------- Tohoku Ricoh Co., Ltd. 2,272 million JPY 100.0 Manufacturing of office equipment Ricoh Printing Systems, Ltd. (Note 4) 5,000 million JPY 100.0 Manufacturing and sale of office equipment Ricoh Elemex Corporation (Note 5) 3,456 million JPY 100.0 Manufacturing of office equipment Ricoh Sales Co., Ltd. 622 million JPY 100.0 Sale of office equipment Ricoh Kansai Co., Ltd. 700 million JPY 100.0 Sale of office equipment Ricoh Technosystems Co., Ltd. 2,128 million JPY 100.0 Maintenance service and sale of office equipment Ricoh Leasing Company, Ltd. (Note 1) 7,896 million JPY 51.1 General leasing RICOH ELECTRONICS, INC. (Note 1) 27 million USD 100.0 Manufacturing of office equipment and related supplies RICOH AMERICAS CORPORATION 1,286 million USD 100.0 Sale of office equipment InfoPrint Solutions Company, LLC (Note 1) (Note 2) 79.6 Sale of office equipment IKON Office Solutions, Inc. (Note 1) 945 million USD 100.0 Sale of office equipment RICOH EUROPE HOLDINGS PLC (Note 3) 1.9 million GBP 100.0 Holding company of sales in the European region RICOH ASIA INDUSTRY LTD. 180 million HKD 100.0 Sale of office equipment
Notes: 1. The respective percentage of total investment ratio for Ricoh Leasing Company, Ltd., RICOH ELECTRONICS, INC., InfoPrint Solutions Company, LLC, IKON Office Solutions, Inc. include voting rights of those shares held by subsidiaries. 2. No description was made since the company is a limited liability company in the U.S. laws, and there are no accounting items which completely correspond to the paid-in capital. 3. RICOH EUROPE HOLDINGS PLC is a holding company established for the purpose of business restructuring in the European region. 4. In October 2008, the Company executed an absorption-type split of its consolidated subsidiary, Ricoh Printing Systems (hereinafter "RPS"), thereby succeeding the business operations of RPS, on October 1, 2008. As part of the absorption-type split, the Company succeeded the operations related to following departments of RPS: Information Technology Promotion Division, Business Strategy Division, Sales & Marketing Division, Research & Development Center, Design & Development Division 1, Design & Development Division 2, Customer Satisfaction Promotion Center, CLP Engineering Department, and Intellectual Property Department. 5. Ricoh Elemex Corporation became a wholly-owned subsidiary of the Company following an exchange of shares on August 2008. -10- (4) ISSUES THE RICOH GROUP FACES The economic environment surrounding the Ricoh Group deteriorated on a far greater scale than predicted. As already mentioned, the spreading of the financial crisis has made a massive impact on the real economy and the global economy has fallen into a serious recession. Operating in such an sharply changing environment, we continued our efforts to achieve our performance targets, but operations were extremely difficult. Amidst the various uncertainties with respect to the Global economy's outlook, the Ricoh Group strove to further execute "high efficiency management," one of its ongoing challenges. It is rapidly switching to a management structure under which revenues can be surely maintained and preserved even in circumstances of weak demand. By thoroughly carrying out a range of measures as part of our various structural innovations in development, production, sales, etc., and by rigorously selecting businesses for complete focus, Ricoh will boost earnings power of the overall group and individual businesses. We also aim to expand our field of business so as to participate in new growth enterprises. We recognize that another vital issue is ensuring that our achievements from investments, accumulated up until now, lead to earnings. Lastly, in addition to broadening our practice of "Customer Satisfaction Management", through which we have actively uncovered new value, Ricoh is pursuing "Harmonize with the environment", "Simplify your life & work", and "Support knowledge management" as customer values, which emphasize the Ricoh's unique abilities. Ricoh will strive further to provide products and services which help customers contribute to global environmental conservation, pursue ease of use which enables customers to thoroughly utilize products and services, support knowledge creation activities by customers, and create environments for knowledge creation. (5) MAIN BUSINESS (AS OF MARCH 31, 2009) Imaging & Solutions Imaging Solutions Digital copiers, color copiers, analog copiers, digital duplicators, facsimile machines, diazo copiers, scanners, multi-functional printers (MFP), printers and software, etc. Network System Solutions Personal computers, PC servers, network systems and network related software, etc. Industrial Products Thermal media, optical equipments, semiconductors, electronic component and measuring equipments, etc. Other Digital camera, etc. -11- (6) PRINCIPAL OFFICES AND PLANTS (as of March 31, 2009) Major domestic offices and plants The Company (location) Subsidiaries (location) - -------------------------------------------------------------------------------- Head Office (Tokyo) Ricoh Optical Industries Co., Ltd. (Iwate Pref.) Omori Office (Tokyo) Tohoku Ricoh Co., Ltd. (Miyagi Pref.) Shin-Yokohama Office (Kanagawa Pref.) Ricoh Printing Systems, Ltd. (Tokyo) Ricoh Technology Center Ricoh Elemex Corporation (Aichi Pref.) (Kanagawa Pref.) Research and Development Center Ricoh Hokkaido Co., Ltd. (Hokkaido (Kanagawa Pref.) Pref.) Atsugi Plant (Kanagawa Pref.) Ricoh Tohoku Co., Ltd. (Miyagi Pref.) Hadano Plant (Kanagawa Pref.) Ricoh Sales Co., Ltd. (Tokyo) Gotemba Plant (Shizuoka Pref.) Ricoh Chubu Co., Ltd. (Aichi Pref.) Numazu Plant (Shizuoka Pref.) Ricoh Kansai Co., Ltd. (Osaka Pref.) Fukui Plant (Fukui Pref.) Ricoh Chugoku Co., Ltd. (Hiroshima Pref.) Ikeda Plant (Osaka Pref.) Ricoh Kyushu Co., Ltd. (Fukuoka Pref.) Yashiro Plant (Hyogo Pref.) Ricoh Technosystems Co., Ltd. (Tokyo) Ricoh Leasing Company, Ltd. (Tokyo) Major overseas offices SUBSIDIARIES (LOCATION) SUBSIDIARIES (LOCATION) - -------------------------------------------------------------------------------- RICOH AMERICAS CORPORATION (U.S.A.) RICOH ELECTROICS, INC. (U.S.A.) InfoPrint Solutions Company, LLC RICOH UK PRODUCTS LTD. (U.K.) (U.S.A.) IKON Office Solutions, Inc. (U.S.A.) RICOH INDUSTRIE FRANCE S.A.S. (France) RICOH EUROPE PLC (U.K.) RICOH ASIA INDUSTRY (SHENZHEN) LTD. (China) RICOH CHINA CO., LTD. (China) SHANGHAI RICOH DIGITAL EQUIPMENT CO., RICOH ASIA PACIFIC PTE LTD (Singapore) LTD. (China) (7) STATUS OF EMPLOYEES (as of March 31, 2009) (I) EMPLOYEES OF THE RICOH GROUP Imaging and Industrial Common Solutions products Other businesses in the Classification business business businesses group Total - -------------------------------------------------------------------------- Number of employees 100,302 3,150 3,911 1,114 108,477 Note: The number of employees increased by 25,021 during the fiscal year under review, mainly because IKON Office Solutions, Inc. and other 33 companies newly became the consolidated subsidiaries of the Company. (II) EMPLOYEES OF THE COMPANY Change from previous Number of employees fiscal year Average age Average length of service - ------------------------------------------------------------------------------ 11,907 612 (Increase) 41.2 17.2 years -12- (8) MAIN CREDITORS (as of March 31, 2009) Creditors Amounts borrowed (million yen) - -------------------------------------------------------------------------------- The Bank of Tokyo-Mitsubishi UFJ, Ltd. 127,118 Syndicated loans 82,100 Mizuho Corporate Bank, Ltd. 60,048 Note: Syndicated loans are financed by the managing banks of the Bank of Tokyo-Mitsubishi UFJ, Ltd. and Mizuho Corporate Bank, Ltd.. -13- 2. SHAREHOLDERS' EQUITY (as of March 31, 2009) (1) TOTAL NUMBER OF SHARES AUTHORIZED TO BE ISSUED: 1,500,000,000 (2) TOTAL NUMBER OF SHARES ISSUED: 744,912,078 (3) NUMBER OF SHAREHOLDERS: 43,526 (4) MAJOR SHAREHOLDERS:
Name The shareholders' stake in the Company - ------------------------------------------------------------------------------------------------------------ Thousands of shares Investment ratio (%) The Master Trust Bank of Japan, Ltd. (Trust Account) 70,093 9.41 Japan Trustee Services Bank, Ltd. (Trust Account) 57,235 7.68 Japan Trustee Services Bank, Ltd. (Trust Account 4G) 45,130 6.06 Nippon Life Insurance Company 36,801 4.94 The Bank of Tokyo-Mitsubishi UFJ, Ltd. 35,943 4.83 NIPPONKOA Insurance Co., Ltd. 18,198 2.44 THE NEW TECHNOLOGY DEVELOPMENT FOUNDATION 15,839 2.13 National Mutual Insurance Federation of Agricultural Cooperatives 13,259 1.78 Tokio Marine & Nichido Fire Insurance Co., Ltd. 10,147 1.36 The Chase Manhattan Bank, N. A. London Secs Lending Omnibus Account 9,508 1.28
Notes: 1. The number of treasury stocks (19,232 thousands of shares) is not included in the chart above. 2. In addition to the above, stakes in the Company include 1,000 thousands of shares (0.13%) that NIPPONKOA Insurance Co., Ltd. owns and has entrusted with The Master Trust Bank of Japan, Ltd. These shares are registered in the name of The Masters Trust Bank of Japan, Ltd. as the owner, but NIPPONKOA Insurance Co., Ltd. reserves the right to instruct on exercising voting rights on these shares. Breakdown of shareholders
Category Thousands of shares held Number of shareholders Investment ratio (%) - --------------------------------------------------------------------------------------------------------- Financial institutions 384,119 210 51.56 Foreign companies 238,825 684 32.06 Individual investors and others 58,562 41,799 7.86 Other domestic companies 34,268 772 4.60 Treasury stock 19,232 1 2.58 Securities companies 9,900 59 1.32 Government and Local public entities 5,000 1 0.00
-14- 3. STATUS OF STOCK ACQUISITION RIGHTS The status of "Euro Yen Zero Coupon Convertible Bonds due 2011 (bonds with stock acquisition rights)" which the Company issued on December 7, 2006 was as follows. Issue: Euro Yen Zero Coupon Convertible Bonds due 2011 (bonds with stock acquisition rights) Number of new stock acquisition rights: 55,000 Applicable type of shares: Common stock Applicable number of shares: 19,741,071 shares Conversion period: On or after December 21, 2006 Up to and including November 23, 2011 Conversion price: Yen 2,800 (Note 1) Conditions of new stock acquisition (Note 2) rights: Notes: 1. The Conversion Price shall be adjusted by the following formula in case Ricoh issues or disposes of treasury shares at a price below the then market price of its common stock after the issuance of the Convertible Bonds. "Number of Outstanding Shares" in the following formula means the total outstanding number of the shares of common stock of Ricoh (excluding the number of treasury shares). Conversion Price After Adjustment = Conversion Price Before Adjustment x (Number of outstanding Shares + [Number of Shares to be issued or disposed] x [Amount to be paid per Share / Market price per Share]) / (Number of outstanding Shares + Number of Shares to be issued or disposed) Appropriate and necessary adjustments to the Conversion Price will also be made in certain cases including in case of stock splits or consolidation of the common stock of Ricoh, the issuance of stock acquisition rights (including stock acquisition rights attached to bonds with stock acquisition rights) exercisable into the common stock of Ricoh at less than market price. 2: No Stock Acquisition Right may be exercised in part. Prior to (but not including) December 8, 2010, a Convertible Bond holder may exercise the Stock Acquisition Rights only if, as of the last Trading Day (as defined below) of any calendar quarter, the Closing Price of the common stock of Ricoh for any 20 Trading Days during a period of 30 consecutive Trading Days ending on the last Trading Day of such quarter is more than 120% of the Conversion Price in effect on such Trading Day. However, such calculation shall not be made for the calendar quarter commencing on October 1, 2010. On and after December 8, 2010, a Convertible Bond holder may exercise the Stock Acquisition Rights at any time after the Closing Price of the common stock of Ricoh on at least one Trading Day falling on and after December 8, 2010 is more than 120% of the Conversion Price in effect on such Trading Day. -15- 4. STATUS OF CORPORATE OFFICERS (1) DIRECTORS AND CORPORATE AUDITORS (as of March 31, 2009)
Principal duty, representative Position Name status at other companies - -------------------------------------------------------------------------------- Chairman of the Board and Masamitsu Sakurai Chairman of Japan Association of Representative Director: Corporate Executives President and Shiro Kondo CEO Representative Director: Director: Koichi Endo Management Strategy, Business Process Innovation Director: Katsumi Yoshida Overseas Marketing Director: Masayuki Matsumoto Domestic Marketing, Corporate Social Responsibility Director: Takashi Nakamura Personnel, General Manager of Personnel Division Director: Kazunori Azuma General Manger of Marketing Group Director: Zenji Miura Finance, Information, IR, Corporate Communication, Management of Group Companies, Internal Management and Control; General Manager of Corporate Planning Division, General Manager of Accounting Director: Kiyoshi Sakai Technology, Corporate Environment, Legal and Intellectual Property Director: Takaaki Wakasugi Professor, Faculty of Business Administration, Tokyo Keizai University Co-director of Mitsui Life Financial Research Center, University of Michigan Ross School of Business Director and General Manager of Japan Corporate Governance Research Institute, Inc. Director: Takuya Goto Advisor of Kao Corporation Chairman of Japan Marketing Association Corporate Auditor: Kohji Tomizawa Full-time Corporate Auditor: Shigekazu Iijima Full-time Corporate Auditor: Kenji Matsuishi General Manager of Matsuishi Legal Services Corporate Auditor: Takao Yuhara Managing Executive Director of ZENSHO CO., LTD.
Notes: 1. Directors Takaaki Wakasugi and Takuya Goto are Outside Directors stipulated in Article 2-15 of the Corporate Law. 2. Corporate Auditors Kenji Matsuishi and Takao Yuhara are Outside Corporate Auditors stipulated in Article 2-16 of the Corporate Law. 3. Serving at the Company's accounting and finance sector for many years, Corporate Auditor Shigekazu Iijima has considerable knowledge about finance and accounting. 4. "Principal duty, representative status at other companies" of Directors Koichi Endo, Katsumi Yoshida, Kazunori Azuma and Zenji Miura were revised as of April 1, 2009, as follows: Koichi Endo: Business Process Innovation Katsumi Yoshida: Business Process Innovation Kazunori Azuma: General Manager of Marketing Group, General Manager of Global Marketing Taskforce Zenji Miura: Management Strategy, Finance, Information, Internal Management and Control; General Manager of CRGP Office, Deputy General Manager of Global Marketing Taskforce -16- (2) TOTAL REMUNERATION, ETC. PAID TO DIRECTORS AND CORPORATE AUDITORS
Amount of remuneration paid Category Number of recipients (million yen) - ----------------------------------------------------------------------------- Directors 11 433 (Outside Directors) (2) (19) Corporate Auditors 5 61 (Outside Corporate Auditors) (3) (12) - ----------------------------------------------------------------------------- Total 16 494 - -----------------------------------------------------------------------------
Notes: 1. The remuneration, etc. paid to Directors excludes employee wages for Directors who are also employees. 2. The remuneration, etc. paid to Directors include amount of allowance for Directors' bonuses based on the proposal, "Payment of bonuses to Directors" to be submitted to the 109th Ordinary General Meeting of Shareholders to be held on June 25, 2009, amounting to Yen 84 million. 3. The above includes one Corporate Auditor who resigned at the conclusion of the 108th Ordinary General Meeting of Shareholders held on June 26, 2008. 4. In addition to the above remuneration, the Company plans to pay retirement allowance, amounting to Yen 10 million, to one Corporate Auditor who will resign at the conclusion of 109th Ordinary General Meeting of Shareholders held on June 25, 2009. This payment is based on the resolution "Payment of retirement allowances for Directors and Corporate Auditors following the abolishment of the retirement allowance system" of the 107th Ordinary General Meeting of Shareholders held on June 27, 2007. (3) OUTSIDE DIRECTORS AND CORPORATE AUDITORS (i) Significant concurrent jobs Outside Directors and Corporate Auditors are engaged in at other companies
Concurrent positions as Director in charge of execution of Position Name operations or outside Director, at other companies - ----------------------------------------------------------------------------------------------------- Outside Director Takaaki Wakasugi Emeritus Professor, the University of Tokyo Professor, Faculty of Business Administration, Tokyo Keizai University Co-director of Mitsui Life Financial Research Center, University of Michigan Ross School of Business Director and General Manager of Japan Corporate Governance Research Institute, Inc. Outside Corporate Auditor, JFE Holdings, Inc. Outside Corporate Auditor, NTT DoCoMo, Inc. Outside Director Takuya Goto Advisor, Kao Corporation Outside Director, Nagase & Co., Ltd. Chairman of Japan Marketing Association Outside Corporate Auditor Kenji Matsuishi General Manager of Matsuishi Legal Services Outside Corporate Auditor Takao Yuhara Managing Executive Director of ZENSHO CO., LTD. Outside director of COCO'S JAPAN CO., LTD.
Note: There is no special conflict of interests between the Company and ZENSHO CO., LTD. -17- (ii) Major activities by outside Directors and Corporate Auditors
Position Name Main activities - ------------------------------------------------------------------------------------------------------ Outside Director Takaaki Wakasugi Participated in 12 of the 13 Board of Directors meetings held during the fiscal year under review, and proactively made statements, mainly from his expert perspective as a scholar of finance and a governance specialist. Outside Director Takuya Goto Participated in all 13 Board of Directors meetings held during the fiscal year under review, and proactively made statements, mainly from the perspective of a highly-experienced manager. Outside Corporate Auditor Kenji Matsuishi Participated in 12 of the 13 Board of Directors meetings and all of 9 Board of Corporate Auditors meetings, held during the fiscal year under review, and made statements, whenever necessary, mainly from his various perspectives based on the insight he has cultivated as a lawyer. Outside Corporate Auditor Takao Yuhara Participated in 10 of the 11 Board of Directors meetings and all of 7 Board of Corporate Auditors meetings, held after his assumption during the fiscal year under review, and made statements, whenever necessary, mainly from his experiences of managing business.
(iii) Outline of liability limitation contracts The Company amended its Articles of Incorporation at the 106th Ordinary General Meeting of Shareholders on June 28, 2006, establishing the provision of contracts to limit liabilities of Outside Directors and Corporate Auditors. The outline of liability limitation contracts, which the Company concluded with Outside Directors and Corporate Auditors in accordance with the revised Articles of Incorporation, is as follows. (a) Liability limitation contracts with Outside Directors Under such contracts, the maximum liability of Outside Directors shall be the higher of either of Yen 10.0 million or a minimum liability amount stipulated in Article 425, Item 1 of the Corporate Law. (b) Liability limitation contracts with Outside Corporate Auditors Under such contracts, the maximum liability of Outside Corporate Auditors shall be the higher of either of Yen 5.0 million or a minimum liability amount stipulated in Article 425, Item 1 of the Corporate Law. -18- 5. ACCOUNTING AUDITORS (1) NAME: KPMG AZSA & CO. (2) REMUNERATION, ETC.:
Amount to be paid - ------------------------------------------------------------------------------ Remuneration, etc. to be paid to the accounting auditor by the Company Yen 193 million Total sum of remuneration, etc. to be paid to the accounting auditor by the Company and its subsidiaries Yen 376 million
Notes: 1. In the audit contract signed between the Company and the accounting auditor, there is no classification between remuneration for audit services pursuant to the Corporate Law and that in accordance with the Financial Instruments and Exchange Law. Accordingly, the above "Remuneration, etc. to be paid to the accounting auditor by the Company" above represent the sum of these remunerations. 2. Other than operations stipulated in Article 2, Paragraph 1 of the Certified Public Accountants Law, the Company entrusts the accounting auditor with operations relating to compiling comfort letters at the time of bonds issuance, and such remuneration thereof is included in the above amount. 3. Among the Company's major subsidiaries, Ricoh Americas Corporation and other 6 subsidiaries are audited by KPMG. (3) POLICY REGARDING DECISION TO DISMISS OR NOT REAPPOINT THE ACCOUNTING AUDITOR The Board of Corporate Auditors, by unanimous agreement, will dismiss the accounting auditor when confirmed that the accounting auditor falls under any item of Article 340, Paragraph 1 of the Corporate Law. In this case, the dismissal and its reasons will be reported at the first general meeting of shareholders to be held after the dismissal. In addition to the above, the Company will propose at a general meeting of shareholders to dismiss or not reappoint the accounting auditor when confirmed that it is difficult for the accounting auditor to properly perform audit duties with the agreement of the Board of Corporate Auditors or as requested by the Board of Corporate Auditors. -19- 6. SYSTEMS TO SECURE APPROPRIATENESS OF OPERATIONS Resolutions adopted by the Board of Directors for systems to secure the appropriateness of the Company's operations are as follows: (1) SYSTEM TO ENSURE THE EFFICIENT IMPLEMENTATION OF DIRECTORS' DUTIES AND COMPLIANCE WITH LAWS AND ARTICLES OF INCORPORATION The Company promotes a sense of alertness in execution of management and execution of business, and in addition uses the following management structures in order to further improve its quality and speediness. (i) Management transparency and fairness of decision-making are strengthened by the presence of Outside Directors. (ii) As part of the strengthening of management oversight functions by the Board of Directors, the "Nomination and Compensation Committee," a permanent organization composed of Outside Directors and designated internal Directors, makes propositions and resolutions concerning the regulation of the nomination, dismissal and compensation of Directors and executive officers, etc. (iii) The executive officer system, its division of duties clarified, is speeding up the decision-making process through the attribution of authority to each business division. (iv) The "Group Management Committee" (GMC) is a decision-making organization delegated by the Board of Directors, and composed of executive officers who meet certain qualifications. The GMC operates so as to accelerate deliberation and decision-making from the perspective of the optimum management of the entire Group, concerning proposals on the most appropriate strategies for direction of each business division and the entire Group, within the limits granted to it. (v) The "Disclosure Committee" is an independent organization that assures the accuracy, timeliness and comprehensiveness of disclosure of corporate information, and it performs checks on the process for the production of disclosed information. (2) SYSTEMS RELATED TO THE RETENTION AND MANAGEMENT OF INFORMATION RELATED TO THE IMPLEMENTATION OF DIRECTORS' DUTIES Records and proposals related to decisions by Directors in the course of their duties are collated, retained and managed in compliance with applicable laws, regulations and internal rules. Documents are kept so that they can be retrieved and produced in response to a request from Directors and Corporate Auditors. (3) REGULATIONS AND OTHER STRUCTURES REGARDING RISK MANAGEMENT FOR LOSSES (i) The occurrence of losses shall be proactively prevented based on regulations for risk management. (ii) Should losses nevertheless arise, efforts shall be made to minimize damage (loss) based on standards for initial reaction. -20- (iii) In order to manage losses as a Group, comprehensively and in a unified fashion, a division responsible for integrated management will be created that will thoroughly cover all aspects globally. (4) SYSTEMS TO ENSURE APPROPRIATE COMPLIANCE WITH LAWS, AND ARTICLES OF INCORPORATION CONCERNING THE PERFORMANCE OF EMPLOYEE'S DUTIES (i) In order to thoroughly implement the "Ricoh Group Corporate Social Responsibility (CSR) Charter" which sets forth the principles of corporate behavior with regard to CSR including compliance, and the "Ricoh Group Code of Conduct" which shows the general rules of conduct for Ricoh Group employees, the Specialty Committee and a "Hot Line" for reporting incidents and seeking advice have been established. Also various training programs are set up with an aim to enhance compliance domestically and overseas. (ii) Efforts are being made to improve business processes and construct a framework for standardized internal control throughout the entire Ricoh Group, with the goal of "complying with laws, norms and internal rules," "improvement of business effectiveness and efficiency," "maintaining high reliability of financial reporting" and "securing of assets," including compliance to the Sarbanes-Oxley Act of 2002, the Financial Products Exchange Law and other relevant laws and regulations. (iii) To ensure appropriate internal auditing, an internal auditing department shall perform fair and objective examination and evaluation of how each division is executing its business based on legal compliance and rational criteria, and provide advice or recommendation for improvement. (iv) The Company shall establish a department specializing in enhancing and promoting the functions of (i), (ii) and (iii) above on an integrated basis. In an aim to establish and improve an internal control system of the Ricoh Group, the Company shall institute an "Internal Control Committee" within the Group Management Committee, which is expected to be held regularly to deliberate and decide on relevant matters. (5) SYSTEMS TO ENSURE CORRECT BUSINESS STANDARDS IN THE RICOH GROUP COMPOSED OF THE COMPANY AND ITS AFFILIATES Ricoh and each affiliate in the Ricoh Group shall devise a system that will ensure the adherence to correct business standards to improve business performance and enhance the prosperity of each Group company, while keeping mutual respect for their independence, as follows: (i) The Company's Board of Directors and the "Group Management Committee" (GMC) make decisions and perform management oversight for the Ricoh Group as a whole. To ensure the efficacy of such efforts, they establish management regulations concerning affiliate companies, and set up relevant administrative organizations in order to manage the Group. (ii) The "Ricoh Group Standard" (RGS) represents a set of common rules to be followed by the entire Group. -21- (6) MATTERS REGARDING EMPLOYEES WHOM AUDITORS REQUEST TO ASSIST THEM IN THE PERFORMANCE OF THEIR DUTIES In order to clarify the independency of staff for Corporate Auditors, the Company shall establish a Corporate Auditor office, where exclusively assigned employees assist Corporate Auditors in auditing through directives from Corporate Auditors. (7) MATTERS RELATED TO THE INDEPENDENCE OF CORPORATE AUDITORS' STAFF FROM DIRECTORS DESCRIBED IN (6) ABOVE When an employee (as in (6) above) assists Corporate Auditors in their work, he or she shall not be subject to orders given by Directors. In addition, decisions concerning personnel assessments or personnel changes regarding said employees shall be made only after hearing the opinions of the Corporate Auditors. (8) SYSTEMS TO ENABLE DIRECTORS OR EMPLOYEES TO REPORT TO CORPORATE AUDITORS, AND OTHER SYSTEMS RELATED TO REPORTING TO AUDITORS Directors or employees shall report to Corporate Auditors matters concerning laws and regulations, as well as "important matters decided by Directors which affect the entire company," "the results of internal audits," "the status of reporting via the internal reporting system," and "matters which auditors have sought reports about." (9) SYSTEMS ESTABLISHED TO ENSURE THE EFFICACIOUS PERFORMANCE OF AUDITING RESPONSIBILITIES BY CORPORATE AUDITORS Corporate Auditors shall perform audits thoroughly by attending the board of Directors meetings and management meetings, receiving reports on exercise of function from the Directors and executive officers, reviewing important resolution documents, and investigating the status of operations of divisions and group companies. -22- CONSOLIDATED BALANCE SHEETS (as of March 31, 2009) Millions of yen - ------------------------------------------------------------------------------ As of March 31, - ------------------------------------------------------------------------------ 2009 2008 - ------------------------------------------------------------------------------ ASSETS Current Assets: Cash and cash equivalents 258,484 170,607 Time deposits 2,043 1,531 Trade receivables: Notes 45,781 57,068 Accounts 460,519 463,999 Less-Allowance for doubtful receivables (21,533) (16,666) Total trade receivables 484,767 504,401 Current maturities of long-term finance receivables, net 195,617 194,642 Inventories: Finished goods 123,798 117,658 Work in process and raw materials 67,772 74,365 Total inventories 191,570 192,023 Other current assets 79,385 60,936 Total Current Assets 1,211,866 1,124,140 Fixed Assets: Tangible fixed assets: Land 45,693 46,681 Buildings and structures 235,905 235,106 Machinery and equipment 613,879 587,956 Construction in progress 23,459 12,884 Less-Accumulated depreciation (649,600) (627,994) Total Tangible fixed assets 269,336 254,633 Investment and other assets: Long-term finance receivables, net 465,262 445,436 Investment securities 47,815 71,244 Investment in and advances to affiliates 1,248 1,977 Goodwill 250,330 112,538 Other intangible assets 165,126 114,402 Lease deposits and other 102,512 89,998 Total investment and other assets 1,032,293 835,595 Total Fixed Assets: 1,301,629 1,090,228 - ------------------------------------------------------------------------------ Total Assets 2,513,495 2,214,368 ============================================================================== -23- CONSOLIDATED BALANCE SHEETS (as of March 31, 2009) Millions of yen - ------------------------------------------------------------------------ As of March 31, - ------------------------------------------------------------------------ 2009 2008 - ------------------------------------------------------------------------ LIABILITIES AND SHAREHOLDERS' INVESTMENT Current Liabilities: Short-term borrowings 184,210 75,784 Current maturities of long-term indebtedness 85,582 82,658 Trade payables- Notes 12,914 18,942 Accounts 272,499 341,627 Total trade payables 285,413 360,569 Accrued income taxes and other 10,317 28,909 Accrued expenses and other 207,969 165,836 Total Current Liabilities 773,491 713,756 Fixed Liabilities: Long-term indebtedness 509,403 225,930 Accrued pension and severance costs 156,625 99,830 Deferred income taxes and other 49,626 36,373 Total Fixed Liabilities: 715,654 362,133 Total Liabilities 1,489,145 1,075,889 Minority Interests 48,977 58,283 Shareholders' Investment Common stock 135,364 135,364 Additional paid-in capital 186,083 186,448 Retained earnings 815,725 835,238 Accumulated other comprehensive income (loss) (125,121) (31,005) Treasury stock (36,678) (45,849) Total shareholders' investment 975,373 1,080,196 - ------------------------------------------------------------------------ Total Liabilities, Minority Interests and Shareholders' Investment 2,513,495 2,214,368 ======================================================================== -24- CONSOLIDATED STATEMENTS OF INCOME (for the year ended March 31, 2009) Millions of yen - ------------------------------------------------------------------------------ For the year ended March 31, - ------------------------------------------------------------------------------ 2009 2008 - ------------------------------------------------------------------------------ Net sales 2,091,696 2,219,989 Cost of sales 1,237,310 1,292,262 Gross profit 854,386 927,727 Selling, general and administrative expenses 779,850 746,221 Operating income 74,536 181,506 Other (income) expenses (43,597) (6,837) Interest and dividend income 5,227 6,341 Interest expense (5,863) (4,835) Loss on valuation of securities (26,837) (142) Foreign exchange gain and loss, net (15,575) (10,901) Others, net (549) 2,700 Income from continuing operations before income taxes, equity income and minority interests 30,939 174,669 Provision for income taxes: Current 27,321 58,426 Deferred (5,163) 4,970 Total income taxes 22,158 63,396 Minority interests in earnings of subsidiaries (2,322) (6,057) Equity in earnings of affiliates 71 1,247 - ------------------------------------------------------------------------------ Net income 6,530 106,463 ============================================================================== -25- CONSOLIDATED STATEMENT OF SHAREHOLDERS' INVESTMENT (for the year ended March 31, 2009)
(Unit: millions of yen) - ------------------------------------------------------------------------------------------------------- Accumulated Additional other Total Common paid-in Retained comprehensive Treasury Shareholders' stock capital earnings income (loss) stock Investment - ------------------------------------------------------------------------------------------------------- Beginning balance 135,364 186,448 835,238 (31,005) (45,849) 1,080,196 - ------------------------------------------------------------------------------------------------------- Cumulative effect of adjustment resulted from applying FAS No. 158 (Note) -- -- (643) (6) -- (649) - ------------------------------------------------------------------------------------------------------- Beginning balance (after adjustment) 135,364 186,448 834,595 (31,011) (45,849) 1,079,547 Gain (Loss) on disposal of treasury stock (365) (80) (445) Dividends declared and approved (25,320) (25,320) Comprehensive income (loss) Net income 6,530 6,530 Net unrealized holding gains (losses) on available-for-sale securities 532 532 Pension liability adjustments (33,507) (33,507) Net unrealized gains (losses) on derivative instruments 35 35 Cumulative translation adjustments (61,170) (61,170) - ------------------------------------------------------------------------------------------------------- Total comprehensive income (loss) (87,580) Net changes in treasury stock 9,171 9,171 - ------------------------------------------------------------------------------------------------------- Ending balance 135,364 186,083 815,725 (125,121) (36,678) 975,373 - -------------------------------------------------------------------------------------------------------
Note: FAS No. 158: Financial Accounting Standards Board ("FASB") Statement No. 158: Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans - an Amendment to FASB Statements No. 87, 88, 106, 132 (R) -26- NOTES TO CONSOLIDATED FINANCIAL STATEMENTS * All figures are rounded off to nearest million yen. Accounting Policies Regarding the Preparation of Consolidated Financial Statements SCOPE OF CONSOLIDATION 1. ITEMS RELATED TO SCOPE OF CONSOLIDATION (1) NUMBER OF CONSOLIDATED SUBSIDIARIES: 275 COMPANIES The name of major consolidated subsidiaries can be found in 1. Status of the Ricoh Group, (3) Status of major subsidiaries. (2) CHANGES IN SCOPE OF CONSOLIDATION In the fiscal year under review, the Company added 34 companies in scope of consolidation, and excluded 38 companies from scope of consolidation. IKON Office Solutions, Inc. is included in the companies added to the scope. 2. APPLICATION OF THE EQUITY METHOD (1) NUMBER OF COMPANIES TO WHICH THE EQUITY METHOD IS APPLIED: 36 Name of major companies to which the equity method is applied: Edisys Co., Ltd., others (2) CHANGES OF APPLICATION OF EQUITY METHOD In the fiscal year under review, the Company added 1 company for application of equity method, and excluded 3 companies from application of equity method. SIGNIFICANT ACCOUNTING POLICIES 1. BASIS FOR PREPARING CONSOLIDATED FINANCIAL STATEMENTS The consolidated financial statements including consolidated balance sheets and consolidated statements of income has been prepared on the basis of accounting principles generally accepted in the United States of America ("U.S. GAAP"), in compliance with Article 120, Section 1 of the Corporate Calculation Regulations. However, in compliance with the article, certain disclosure that is required on the basis of U.S. GAAP is omitted. -27- 2. ACCOUNTING POLICY FOR SECURITIES The Company and Consolidated Subsidiaries ("Ricoh") apply Statement of Financial Accounting Standards ("SFAS") No.115, "Accounting for Certain Investments in Debt and Equity Securities". All of Ricoh's Securities in debt and marketable equity securities are mainly classified as available-for-sale securities. Those available-for-sale securities are reported at fair value with unrealized gains and losses, net of related taxes, excluded from earnings and reported in accumulated other comprehensive income (loss). 3. ACCOUNTING POLICY FOR INVENTORIES: Inventories are mainly stated principally at the lower of average cost or net realizable values. 4. TANGIBLE FIXED ASSETS: For the Company and its domestic subsidiaries, depreciation of tangible fixed assets is computed principally by using the declining-balance method over the estimated useful lives. Most of the foreign subsidiaries have adopted the straight-line method for computing depreciation. Certain leased buildings, machinery and equipment are accounted for as capital leases in conformity with SFAS No. 13 "Accounting for Leases." which is classified as a capital lease, is treated as acquisition of tangible fixed assets. 5. SOFTWARE FOR INTERNAL USE: Costs incurred for computer software developed or obtained for internal use are capitalized and amortized on a straight line basis over their estimated useful lives in accordance with Statement of Position (SOP) 98-1, "Accounting for the Costs of Computer Software Developed or Obtained for Internal Use." 6. GOODWILL AND OTHER INTANGIBLE FIXED ASSETS: Goodwill and intangible assets that have indefinite useful lives are not amortized but tested at least annually for impairment, in accordance with the SFAS No. 142, "Goodwill and Other Intangible Assets." Other intangible fixed assets that have definite useful lives are depreciated by using the straight-line method. 7. BASIS FOR PROVISION OF RESERVES (1) ALLOWANCE FOR DOUBTFUL RECEIVABLES: Ricoh records allowances for doubtful receivables that are based upon historical experience and specific customer collection issues. The estimated amount of probable credit losses in its existing receivables is determined from write-off history adjusted to reflect current economic conditions and specific allowances for receivables including nonperforming leases, impaired loans or other accounts for which Ricoh has concluded it will be unable to collect all amounts due according to original terms of the lease or loan agreement. -28- (2) RESERVE FOR RETIREMENT ALLOWANCES: The measurement of pension costs and liabilities is determined in accordance with SFAS No. 87, "Employers' Accounting for Pensions" and SFAS No. 158, "Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans." Changes in the amount of either the projected benefit obligation or plan assets resulting from actual results different from that assumed and from changes in assumptions can result in gains and losses in the consolidated financial statements. Amortization of net gain or loss is included as a component of the net periodic benefit plan cost for a year if, as of the beginning of the year, that net gain or loss exceeds 10 percent of the greater of (1) the projected benefit obligation or (2) the fair value of that plan's assets. In such case, the amount of amortization recognized is the resulting excess divided by the average remaining service period of active employees expected to receive benefits under the plan. 8. The consumption tax and the local consumption tax are excluded from profits and losses. CHANGE IN SIGNIFICANT ACCOUNTING POLICIES 1. In September 2006, the FASB issued SFAS No.157, "Fair Value Measurements". The Company adopted SFAS 157 from April 1, 2008. The effect of this adoption on the Company's consolidated results of operations and financial condition was not material. 2. In September 2006, the FASB issued SFAS No.158, "Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans" (an amendment of FASB Statements No. 87, 88, 106, and 132(R)). SFAS 158 requires the measurement date for plan assets and benefit obligations to coincide with the sponsor's year-end from fiscal years ending after December 15, 2008. Accordingly, Ricoh adopted in the fiscal year beginning April 1, 2008, and recorded a reduction of retained earnings of Yen 643 million and increase of accumulated other comprehensive loss of Yen 6 million as of April 1, 2008. NOTES TO CONSOLIDATED BALANCE SHEETS 1. Allowance for doubtful receivables related to long-term finance receivables: Yen 11,526 million 2. Accumulated other comprehensive income (loss) includes accumulated foreign currency translation adjustments, unrealized holding gains (losses) on available-for-sale securities, unrealized gain (loss) on derivative instruments, and pension liability adjustment. 3. Pledged assets and liabilities: (1) Pledged assets: Tangible fixed assets: Yen 111 million Leasing receivables: Yen 14,553 million (2) Pledged liabilities Yen 13,167 million 4. Guarantee obligation including employees' housing loans: Yen 318 million NOTES TO CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' INVESTMENT 1. Details and total number of shares outstanding as of the end of the fiscal year Common stock: 744,912,078 shares -29- 2. Dividend, effective date of which belongs to the next fiscal year though base date belongs to the current fiscal year The Company intends to propose an agenda on dividends (dividend per share: Yen 15.00; total amount of dividend: Yen 10,885 million; base date: March 31, 2009) for the 109th Ordinary General Meeting of Shareholders to be held on June 25, 2009. 3. Details and number of shares to be object of stock acquisition rights at the end of the current fiscal year In case "Euro Yen Zero Coupon Convertible Bonds due 2011 (bonds with stock acquisition rights)" issued on December 7, 2006 is converted at the price of Yen 2,800: Common stock: 19,741,071 shares NOTES TO PER-SHARE INFORMATION 1. Net assets per share: Yen 1,344.08 2. Basic net income per share: Yen 9.02 Diluted net income per share: Yen 8.75 NOTES REGARDING SIGNIFICANT SUBSEQUENT EVENTS Subsidiary of the Company, Ricoh Leasing Company, Ltd. issued unsecured straight bonds on April 22, 2009 based on the resolution passed at its Board of Directors' meeting held on March 27, 2009 to issue corporate bonds. Unsecured Bonds No. 11 (with Limited Inter-Bond Pari Passu Clause) (i) Issue amount: Yen 35.0 billion (ii) Issue price: Full price: Yen 100 per Yen 100 bond (iii) Payment date: April 22, 2009 (iv) Redemption date: April 22, 2014 (v) Interest rate: 1.473% per annum (vi) Appropriation of proceeds: To redeem CP (commercial paper) ADDITIONAL INFORMATION (Notes regarding business combinations etc) To further strengthen the sales and service businesses in Europe and North America, the Company, through its subsidiary Ricoh Americas Corporation, which manages sales in the U.S., acquired 100% of issued shares of IKON Office Solutions, Inc. for Yen 170.0 billion, including transaction-related expenses. The funds for this acquisition were entirely procured from borrowings from banks. IKON Office Solutions, Inc. operates a sales and service network across Europe, North America and elsewhere. It operates sales and service businesses for copiers, printers, faxes and other office imaging equipment. Since the date of acquisition, the operating results of IKON Office Solutions, Inc. will be included in the consolidated financial statements. -30- [English Translation of the Auditors' Report Originally Issued in the Japanese Language] INDEPENDENT AUDITORS' REPORT ---------------------------- May 19, 2009 The Board of Directors Ricoh Company, Ltd. KPMG AZSA & Co. Teruo Suzuki (Seal) Designated and Engagement Partner Certified Public Accountant Ryoji Fujii (Seal) Designated and Engagement Partner Certified Public Accountant Junichi Adachi (Seal) Designated and Engagement Partner Certified Public Accountant We have audited the consolidated statutory report, that is the consolidated balance sheet, the consolidated statement of income, the consolidated statement of shareholders' investment and the notes to consolidated financial statement of Ricoh Company, Ltd. for the year from April 1, 2008 to March 31, 2009 in accordance with Article 444(4) of the Corporate Law. The consolidated statutory report is the responsibility of the Company's management. Our responsibility is to express an opinion on the consolidated statutory report based on our audit as independent auditors. We conducted our audit in accordance with auditing standards generally accepted in Japan. Those auditing standards require that we obtain reasonable assurance about whether the consolidated statutory report is free of material misstatement. An audit is performed on a test basis, and includes assessing the accounting principles used, the method of their application and estimates made by management, as well as evaluating the overall presentation of the consolidated statutory report. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the consolidated statutory report referred to above presents fairly, in all material respects, the consolidated financial position of Ricoh Company, Ltd. and consolidated subsidiaries as of March 31, 2009 and the consolidated results of their operations for the year then ended, in conformity with the Article 120(1) of the regulation on the Corporate Law and the recognition and measurement criteria of accounting principles generally accepted in the United States of America (Refer to Note 1, Significant Accounting Policies, Accounting Policies Regarding the Preparation of Consolidated Financial Statements, Notes to Consolidated Financial Statements). Our firm and engagement partners have no interest in the Company which should be disclosed pursuant to the provisions of the Certified Public Accountants Law of Japan. Note: The details of audit report on consolidated financial statements by the Board of Auditors are included in Transcript of Corporate Auditor's Report on Consolidated Financial Statements (page 44). -31- NON-CONSOLIDATED BALANCE SHEETS (as of March 31, 2009) Millions of yen - -------------------------------------------------------------------------------- As of March 31, - -------------------------------------------------------------------------------- 2009 2008 - -------------------------------------------------------------------------------- ASSETS Current Assets: Cash on hand and in banks 18,440 15,563 Notes receivable - trade 3,075 7,353 Accounts receivable - trade 198,447 234,545 Marketable securities 107,079 23,396 Finished goods 23,641 23,633 Raw materials 3,843 3,422 Work in process 7,267 8,822 Supplies 7,910 7,993 Deferred tax assets 9,600 12,097 Accounts receivable - other 24,572 14,817 Short-term loans receivable 26,092 124,117 Other current assets 5,604 5,788 Allowance for doubtful accounts (48) (112) Total Current Assets 435,529 481,437 Fixed Assets: Tangible fixed assets: Buildings 50,894 50,313 Structures 2,649 2,536 Machinery and equipment 28,206 23,786 Vehicles 25 16 Tools 14,407 18,745 Land 29,028 29,030 Leased assets 177 -- Construction in progress 15,689 9,596 Total tangible fixed assets 141,078 134,024 Intangible fixed assets: Goodwill 19,295 -- Leasehold right and others 26,740 21,377 Software 24,047 22,028 Leased assets 16 -- Total Intangible fixed assets 70,100 43,405 Investments and Other Assets: Investment securities 16,673 26,356 Affiliates' securities 349,131 251,990 Investment in affiliates 19,293 19,293 Long-term loans receivable 214,482 96,878 Deferred tax assets -- 623 Lease deposit 6,763 6,674 Other investments 8,105 7,718 Allowance for doubtful accounts (557) (526) Total investments and other assets 613,891 409,008 Total Fixed Assets 825,071 586,438 - -------------------------------------------------------------------------------- Total Assets 1,260,601 1,067,876 =============================================================================== -32- NON-CONSOLIDATED BALANCE SHEETS (as of March 31, 2009) Millions of yen - -------------------------------------------------------------------------------- As of March 31, - -------------------------------------------------------------------------------- 2009 2008 - -------------------------------------------------------------------------------- LIABILITIES Current Liabilities: Notes payable - trade 2,310 3,837 Accounts payable - trade 117,286 142,479 Bonds maturing within one year -- 25,000 Leased obligations 281 -- Accounts payable - other 14,787 15,939 Accrued expenses 29,830 35,375 Accrued corporate tax 336 8,556 Accrued bonuses 9,354 13,129 Accrued Directors' bonuses 84 173 Warranty reserve 1,418 774 Other current liabilities 7,046 4,416 Total Current Liabilities 182,736 249,682 Fixed Liabilities: Bonds 85,000 -- Convertible Bond 55,146 55,201 Long-term borrowings 167,100 -- Leased obligations 541 -- Deferred tax liabilities 1,648 -- Long accounts payable-other 497 498 Retirement benefit obligation 2,671 710 Other fixed liabilities 477 568 Total Fixed Liabilities 313,081 56,978 Total Liabilities 495,818 306,660 (Net Assets) Stockholders' Equity: Common Stock 135,364 135,364 Additional paid-in-capital: Legal capital reserve 180,804 180,804 Total additional paid-in-capital 180,804 180,804 Retained Earnings: Legal reserve 14,955 14,955 Other retained earnings 467,006 469,754 Reserve for deferral of capital gain on property 467 486 Reserve for special depreciation 357 691 Reserve for warranty on computer programs 58 89 Reserve for social contribution 88 103 General reserve 441,350 411,350 Retained earnings brought forward 24,683 57,034 Total Retained Earnings 481,961 484,709 Treasury stock (36,516) (45,687) Total Stockholders' Equity 761,614 755,191 Difference of appreciation and conversion Net unrealized holding gains on securities 3,168 6,024 Total difference of appreciation and conversion 3,168 6,024 Total Net Assets 764,782 761,216 - -------------------------------------------------------------------------------- Total Liabilities and Net Assets 1,260,601 1,067,876 =============================================================================== -33- NON-CONSOLIDATED STATEMENTS OF INCOME (for the year ended March 31, 2009) Millions of yen - -------------------------------------------------------------------------------- For the year ended March 31, - -------------------------------------------------------------------------------- 2009 2008 - -------------------------------------------------------------------------------- Net sales 948,325 1,036,228 Cost of sales 680,229 722,865 Gross profit 268,096 313,362 Selling, general and administrative expenses 242,905 242,862 Total operating income 25,190 70,500 Non-operating income: Interest and dividend income 30,968 20,607 Other revenue 2,681 5,447 Total non-operating revenue 33,650 26,054 Non-operating expenses: Interest expense 1,020 496 Exchange loss 15,947 14,649 Other expenses 2,128 1,823 Total non-operating expenses 19,096 16,969 Ordinary income 39,744 79,585 Extraordinary income: Gain on restructuring 273 -- Total extraordinary income 273 -- Extraordinary loss: Loss on investment securities 6,251 -- Total extraordinary loss 6,251 -- Income before income taxes 33,766 79,585 Corporate, inhabitant and enterprise taxes 2,152 19,600 Prior year's income taxes 4,048 -- Corporate and other tax adjustments 4,475 5,316 Net income 23,091 54,669 ================================================================================ -34- STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (for the year ended March 31, 2009) (Unit: millions of yen) - ---------------------------------------------------------------------------------------------------------------- Stockholders' equity - ---------------------------------------------------------------------------------------------------------------- Difference of appreciation Additional and paid-in-capital Retained earnings conversion - ---------------------------------------------------------------------------------------------------------------- Net Other Other Total unrealized Legal additional retained stock- holding Common capital paid-in- Legal earnings Treasury holders' gains on Total net stock reserve capital reserve (Note) stock equity securities assets - ---------------------------------------------------------------------------------------------------------------- Balance of March 31, 2008 135,364 180,804 -- 14,955 469,754 (45,687) 755,191 6,024 761,216 Changes in the term Dividends from surplus (25,320) (25,320) (25,320) Net income 23,091 23,091 23,091 Purchase of treasury stock (644) (644) (644) Disposal of treasury stock (519) 9,815 9,296 9,296 Net changes of items other than stockholders' equity (2,856) (2,856) Total changes in the term -- -- -- -- (2,748) 9,171 6,422 (2,856) 3,566 Balance of March 31, 2009 135,364 180,804 -- 14,955 467,006 (36,516) 761,614 3,168 764,782 - ----------------------------------------------------------------------------------------------------------------
Note: Breakdown of other retained earnings (Unit: millions of yen)
- ------------------------------------------------------------------------------------------------------------------------------------ Reserve for Reserve for warranty Retained deferral of Reserve for on Reserve for earnings Total other capital gain special computer social General brought retained on property depreciation programs contributions reserve forward earnings - ------------------------------------------------------------------------------------------------------------------------------------ Balance of March 31, 2008 486 691 89 103 411,350 57,034 469,754 Changes in the term Dividends from surplus (25,320) (25,320) Reversal of reserve for deferral of capital gain on property 1 (1) -- Reversal of reserve for deferral of capital gain on property (19) 19 -- Transfer to reserve for special depreciation 20 (20) -- Reversal of reserve for special depreciation (354) 354 -- Reversal of reserve for warranty on computer programs (30) 30 -- Transfer of reserve for social contribution 96 (96) -- Reversal of reserve for social contribution (111) 111 -- Transfer to general reserve 30,000 (30,000) -- Disposal of treasury stock (519) (519) Net income 23,091 23,091 Total changes in the term (18) (333) (30) (14) 30,000 (32,351) (2,748) Balance of March 31, 2009 467 357 58 88 441,350 24,683 467,006 - ------------------------------------------------------------------------------------------------------------------------------------
-35- NOTES TO NON-CONSOLIDATED FINANCIAL STATEMENTS * All figures are rounded down to nearest million yen. NOTES REGARDING SIGNIFICANT ACCOUNTING POLICIES 1. ACCOUNTING POLICY FOR SECURITIES (1) SECURITIES OF SUBSIDIARIES AND AFFILIATES Securities of subsidiaries and affiliates are stated at cost based on the moving average method. (2) OTHER SECURITIES Marketable securities: Marked to market based on the market price at the end of the term and other factors (accounting for all valuation differences with the full net-assets injection method; the cost of securities sold is valued at moving average cost). Non-marketable securities: Stated at cost based on the moving average method. 2. ACCOUNTING POLICY FOR DERIVATIVES Derivatives are stated at market value. 3. ACCOUNTING POLICY FOR INVENTORIES Inventories are stated principally at cost using the gross average method (the amounts on the balance-sheets are stated based on the method of devaluing book values by lowered profitability). 4. DEPRECIATION AND AMORTIZATION (1) TANGIBLE FIXED ASSETS: Depreciated by using the declining-balance method. Buildings (excluding fixtures) acquired after April 1, 1998 are depreciated using the straight-line method. Major useful life is as follows: Buildings: 5-50 years Machinery and equipment: 4-12 years (2) INTANGIBLE FIXED ASSETS (EXCLUDING LEASED ASSETS): Depreciated by using the straight-line method. With software for sale in the market, however, the Company records the larger of an amortization based on projected sales profits or a uniform amortization based on a projected effective sales period for the balance. The initially projected effective sales term is 3 years. With software for internal use, the Company uses the straight-line method based on a usable period of 5 years. Goodwill is amortized using the straight-line method over the period of investment effect (16 years or 3 years). -36- (3) LEASED ASSETS Finance leases for which ownership does not transfer to lessees; Ricoh uses straight-line depreciation for Leased assets regarding Lease-term as useful life. In addition, with regards to Lease contracts on or before March 31, 2008, Ricoh uses accounting similar to the accounting treatment for ordinary sale and purchase transactions. 5. BASIS FOR PROVISION OF RESERVES (1) ALLOWANCE FOR DOUBTFUL ACCOUNTS: The allowance for doubtful accounts is provided to cover possible losses from bad debts and represents possible individual doubtful accounts based on historical default rates and the potential for irrecoverableness. (2) RESERVE FOR BONUSES: The reserve for accrued bonuses is provided by estimating the amount of bonuses payable to employees for the current financial year under our corporate rules for calculating such bonus payment. (3) RESERVE FOR BONUSES TO DIRECTORS The reserve for accrued bonuses is provided by estimating the amount of bonuses payable to Directors for the current of financial year. (4) WARRANTY RESERVE: To cover product after-sales service expenses, the Company calculates the product warranty reserve based on projected service costs. (5) RESERVE FOR RETIREMENT ALLOWANCES: To cover projected employee benefits, the Company records the estimated obligations at the end of current fiscal year based on projected year-end benefit obligations and plan assets. For actuarial gains or losses and for prior service costs, the Company uses straight-line amortization over a certain period of time (15 years) within averaged remaining employment term as incurred in each business year starting from the year following the year of occurrence. For past service liability (PSL) the Company uses straight-line amortization over a certain period of time (15 years) within averaged remaining employment term as incurred in each business year. 6. CONSUMPTION TAXES The consumption tax and the local consumption tax are excluded from profits and losses. 7. HEDGE ACCOUNTING (1) HEDGE ACCOUNTING METHODS: With interest-rate swaps, the Company hedges by assigning transactions that meet assignment requirements. -37- (2) HEDGE INSTRUMENTS AND TARGETS: Hedging Instruments: Interest swaps Hedged items: Interests of long-term borrowings (3) HEDGING POLICIES: In keeping with its internal Market Risk Management Rules, Ricoh uses derivatives to manage the exposure of its assets and liabilities to market fluctuations. (4) HEDGE EFFECTIVENESS: The Company assesses the effectiveness of hedges by analyzing the ratios of the total market fluctuations of hedged targets and instruments. Interest rate swaps, which the Company hedges by assigning transactions that meet assignment requirements, are exempt. 8. REVISION ON ACCOUNTING SETTLEMENT Accounting Standard for Measurement of Inventories Effective as of April 1, 2008, Ricoh adopted the new accounting standard, "Accounting Standard for Measurement of Inventories" Statement No. 9 issued by the Accounting Standard Board of Japan on July 5, 2006). As a result of adopting this accounting standard, there was no significant impact on operating income, ordinary income and income before income taxes for the fiscal year ended March 31, 2009. Accounting Standards for Lease Contracts Effective as of April 1, 2008, Ricoh adopted the new accounting standard, "Accounting Standards for Lease Contracts"(Statement No. 13, issued by the Accounting Standard Board of Japan on June 17, 1993 and revised on March 30, 2007), and "Application Guidelines for Accounting Standards for Lease Contracts" (Corporate Accounting Standards Application Guidelines No. 16, issued by the Accounting Committee of the Japanese Institute of Certified Public Accountants on January 18, 1994 and revised on March 30, 2007). Therefore, Finance leases for which ownership does not transfer to lessees are accounted for in a similar manner with ordinary sale and purchase transactions. As a result of adopting this accounting standard, there was no significant impact on operating income, ordinary income and income before income taxes for the fiscal year ended March 31, 2009. 9. ADDITIONAL INFORMATION Change of remaining useful life for fixed assets Effective as of April 1, 2008, Ricoh changed the primary useful life for the machinery and equipment from 4 to 14 years to 4 to 12 years. Ricoh reviewed the useful life of Machinery and equipment following the revision of the Japanese Corporate Tax Law in 2008 (Cabinet Order to Amend Part of the Corporation Tax Law (Cabinet Order No. 23, April 30, 2008). As a result of revising the new useful life for the machinery and equipment, the increasing in depreciation expense was no significant impact for the fiscal year ended March 31, 2009. -38- NOTES RELATED TO BUSINESS COMBINATIONS ETC. As part of the Company's strategy to accelerate business expansion in the high-end printing market and the low-end printing market, the Company executed an absorption-type split of its consolidated subsidiary, Ricoh Printing Systems (hereinafter "RPS"), thereby succeeding the business operations of RPS, on October 1, 2008. As part of the absorption-type split, the Company succeeded the operations related to following departments of RPS: Information Technology Promotion Division , Business Strategy Division , Sales & Marketing Division , Research & Development Center, Design & Development Division 1, Design & Development Division 2, Customer Satisfaction Promotion Center, CLP Engineering Department, and Intellectual Property Department. The absorption-type split was pursuant to "Accounting Standards for Business Combinations (Business Accounting Council October 31, 2003) and "Guidance on Accounting Standard for Business Combinations and Accounting Standard for Business Divestitures" (ASBJ Guidance No. 10, Nov. 15, 2007; amended Dec. 26, 2008) and it was accounted for as a transaction under common control. The difference after subtracting the net asset equivalent relating to the transferred operations from the RPS's book value (deemed value equivalent to the total assets succeeded and total liabilities succeeded of the appropriate book price of the tie-in shares) was Yen 273 million (gain on restructuring), which was recorded as an extraordinary gain. NOTES TO NON-CONSOLIDATED BALANCE SHEETS 1. Accumulated depreciation on tangible fixed assets: Yen 402,542 million 2. Guarantee obligation: Bank borrowings for employees' housing funds, etc: Yen 280 million 3. Monetary debts and credits for affiliates: Short-term receivable due from affiliates: Yen 220,496 million Long-term receivable due from affiliates: Yen 214,525 million Short-term payable due to affiliates: Yen 84,446 million NOTES TO NON-CONSOLIDATED STATEMENTS OF INCOME Transaction with affiliates: Sales: Yen 836,951 million Purchase: Yen 351,851 million Non-operating transactions: Yen 42,518 million NOTES TO STATEMENTS OF CHANGES IN NET ASSETS 1. Number of outstanding shares as of the end of the fiscal year under review Common stock: 744,912,078 shares 2. Number of treasury stocks as of the end of the fiscal year under review Common stock: 19,232,352 shares 3. Dividends of retained earnings -39- (1) Payment of dividends - -------------------------------------------------------------------------------- Total amount of Dividends Resolution dividends per share Record date - -------------------------------------------------------------------------------- Ordinary General Meeting of Yen 12,256 million Yen 17.00 March 31, 2008 Shareholders (June 26, 2008) Board of Directors meeting Yen 13,064 million Yen 18.00 September 30, 2008 (October 28, 2008) - -------------------------------------------------------------------------------- (2) Among the dividends for which the record date falls within the fiscal year under review, the portion of the dividends for which the effective date falls in the next fiscal year - -------------------------------------------------------------------------------- Total amount of Dividends Resolution (scheduled) dividends per share Record date - -------------------------------------------------------------------------------- Ordinary General Meeting of Yen 10,885 million Yen 15.00 March 31, 2009 Shareholders (June 25, 2009) - -------------------------------------------------------------------------------- NOTES TO DEFERRED TAX ACCOUNTING Major factors giving rise to deferred tax assets include denial of reserve for retirement benefits and denial of reserve for bonuses, while major factors giving rise to deferred tax liabilities are gains on establishment of retirement benefit trust, intangible fixed assets succeeded due to the absorption-type merger* and unrealized holding gains/losses on other securities. * Deferred tax liability for the non-deductible intangible asset succeeded from Ricoh Printing Systems, Ltd. NOTES TO LEASED FIXED ASSETS The Company uses fixed assets in the balance sheets and certain office equipment and production facilities, etc. under finance lease contracts without ownership transfer. -40- NOTES TO RELATED PARTY TRANSACTIONS (Unit: millions of yen)
Relation with company ---------------------------- Balance as of the fiscal Voting rights year held by Transaction under Name of company, Company Concurrent Description of amount Account review Attribute etc. (%) Directors Business relation transactions (Note 3) item (Note 3) - ---------------------------------------------------------------------------------------------------------------------- Subsidiary Tohoku Ricoh (Possessed) Yes Manufacturing Purchase Accounts Co., Ltd. Directly: of the of payable - 100% Company's products trade office (Note 1) equipment 47,381 14,654 Subsidiary Ricoh (Possessed) Yes Manufacturing Business -- Printing Directly of the absorption Systems, Ltd. 100% Company's (Note 2) office equipment Total -- assets succeeded 29,302 Total liabilities succeeded 5,037 Gain on restructuring 273 Subsidiary Ricoh Sales (Possessed) Yes Sale of the Sales of Accounts Co., Ltd. Directly: Company's products receivable 100% office (Note 1) - trade equipment 183,782 40,434 Subsidiary Ricoh Chubu (Possessed) Yes Sale of the Sales of Accounts Co., Ltd. Directly: Company's products receivable 100% office (Note 1) - trade equipment 44,383 9,770 Subsidiary Ricoh Kansai (Possessed) Yes Sale of the Sales of Accounts Co., Ltd. Directly: Company's products receivable 100% office (Note 1) - trade equipment 74,003 14,892 Subsidiary Ricoh (Possessed) Yes Leasing of Factoring Accounts Leasing Directly: the 71,199 payable - Company, Ltd. 46.9% Company's other -- Indirectly: products Lending Short-term 4.2% of funds loans Lending of (Note 3) Long-term 24,147 funds 831,965 loans 70,000 Subsidiary RICOH (Possessed) Yes Manufacturing Sales of Accounts INDUSTRIE Directly: of the components receivable FRANCE S.A.S. 100% Company's (Note 1) - trade office equipment 51,846 13,682 Subsidiary RICOH (Possessed) Yes Sale of the Sales of Accounts AMERICAS Directly: Company's products receivable CORPORATION 100% office (Note 1) - trade equipment 78,114 24,928 Lending Long-term of funds loans (Note 3) 87,479 91,701 Subsidiary RICOH (Possessed) No Lending of Lending Long-term PRINTING Directly: funds of funds loans SYSTEMS 95.6% (Note 3) AMERICA, INC. Indirectly: 4.4% 13,854 46,647 Subsidiary RICOH EUROPE (Possessed) Yes Sale of the Sales of Accounts SCM B.V. Directly: Company's products receivable 100% office (Note 1) - trade equipment 98,686 20,464 Subsidiary RICOH ASIA (Possessed) Yes Sale of the Purchase Accounts INDUSTRY LTD. Directly: Company's of payable - 100% office products trade equipment (Note 1) 89,776 6,002 Subsidiary Ricoh Hong (Possessed) Yes Manufacturing Receipt -- Kong Ltd. Directly of the of 100% Company's dividend office equipment 6,713 --
Notes: Transaction conditions and policy in determining transaction conditions 1. Prices and other transaction conditions are determined through price negotiations, taking into account the market situation. -41- 2. Because it is treated as a transaction under common control, the succeeded assets and liabilities of Ricoh Printing Systems, Ltd. (RPS) were transferred to the Company as part of RPS's book value based on the accounting standards for business combinations. 3. Lending is determined each time through negotiations based on market prices. 4. The transaction amount does not include the consumption tax, while the ending balance includes the consumption tax, etc. NOTES TO PER-SHARE INFORMATION 1. Net assets per share: Yen 1,053.88 2. Basic net income per share: Yen 31.90 Diluted net income per share: Yen 31.01 -42- [English Translation of the Auditors' Report Originally Issued in the Japanese Language] INDEPENDENT AUDITORS' REPORT ------------------------------- May 19, 2009 The Board of Directors Ricoh Company, Ltd. KPMG AZSA & Co. Teruo Suzuki (Seal) Designated and Engagement Partner Certified Public Accountant Ryoji Fujii (Seal) Designated and Engagement Partner Certified Public Accountant Junichi Adachi (Seal) Designated and Engagement Partner Certified Public Accountant We have audited the statutory report, comprising the non-consolidated balance sheet, the non-consolidated statement of income, the statement of changes in net assets and the notes to non-consolidated financial statement, and its supporting schedules of Ricoh Company, Ltd. as of March 31, 2009 and for the 109th business year from Arpil 1, 2008 to March 31, 2009 in accordance with Article 436(2)(1) of the Corporate Law. The statutory report and supporting schedules are the responsibility of the Company's management. Our responsibility is to express an opinion on the statutory report and supporting schedules based on our audit as independent auditors. We conducted our audit in accordance with auditing standards generally accepted in Japan. Those auditing standards require us to obtain reasonable assurance about whether the statutory report and supporting schedules are free of material misstatement. An audit is performed on a test basis, and includes assessing the accounting principles used, the method of their application and estimates made by management, as well as evaluating the overall presentation of the statutory report and supporting schedules. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the statutory report and supporting schedules referred to above present fairly, in all material respects, the financial position and the results of operations of Ricoh Company, Ltd. for the period, for which the statutory report and supporting schedules were prepared, in conformity with accounting principles generally accepted in Japan. Our firm and engagement partners have no interest in the Company which should be disclosed pursuant to the provisions of the Certified Public Accountants Law of Japan. -43- Transcript of the Corporate Auditor's Report (originally issued in Japanese) CORPORATE AUDITOR'S REPORT The Board of Corporate Auditors has prepared this Audit Report upon discussion based on the audit reports prepared by each Corporate Auditor concerning the execution of duties by Directors for the fiscal year from April 1, 2008 to March 31, 2009, and hereby reports as follows: 1. AUDITING METHODS EMPLOYED BY CORPORATE AUDITORS AND THE BOARD OF CORPORATE AUDITORS The Board of Corporate Auditors prescribed audit policies, work shares and other relevant matters, received reports from each Corporate Auditor on their implementation of audits and results thereof, as well as reports from Directors, etc. and the Accounting Auditor on the performance of their duties, and requested explanations from them whenever necessary. Each Corporate Auditor complied with the auditing standards of Corporate Auditors established by the Board of Corporate Auditors, followed the audit policies, work shares, etc., communicated with Directors, staff of the internal audit sector, other employees, etc., strove to establish the environment for collecting information and auditing, attended Board of Directors and other important meetings, received reports from Directors, employees, etc. on the execution of their duties, requested explanations from them whenever necessary, inspected important written approvals, etc., examined the status of operations and assets at the head office and principal offices. We also monitored and verified the system for ensuring that the execution of duties by Directors conforms to the related laws and regulations and the Articles of Incorporation, the resolution of the Board of Directors concerning the establishment of the system stipulated in Article 100, Paragraph 1 and Paragraph 3 of the Enforcement Regulations of the Corporate Law aiming to secure the appropriateness of joint-stock companies' operations; and the status of an internal control system established in accordance with the said resolution. Meanwhile, we communicated and exchanged information with Directors, Corporate Auditors, etc. of subsidiaries, received reports from subsidiaries on operations whenever necessary, as well as visited and examined some subsidiaries. Based on the above methods, we examined the business report and the supporting schedules for the fiscal year under review. Besides, we monitored and verified whether the Accounting Auditor implemented appropriate audits while maintaining independence, received reports from the Accounting Auditor on the execution of their duties, and sought explanations whenever necessary. Furthermore, we received notice from the Accounting Auditor that "System for ensuring that duties are performed properly" (matters set forth in each item of Article 131 of the Company Accounting Regulations) is organized in accordance with the "Quality Management Standards Regarding Audits" (Business Accounting Council; October 28, 2005), etc., and sought explanations whenever necessary. Based on the above methods, we examined non-consolidated financial statements (balance sheets, statements of income, statement of changes in stockholders' equity, and notes to financial statements) and the supporting schedules for the fiscal year under review, as well as consolidated financial statements (balance sheets, statements of income, statement of shareholders' investment, and notes to financial statements). 2. AUDIT RESULTS (1) RESULTS OF AUDIT OF BUSINESS REPORT, ETC. (i) We hereby state that the business report and the supporting schedules fairly represent the Company's conditions in accordance with the related laws and regulations and the Articles of Incorporation. (ii) With regard to the performance of duties by Directors, we find no significant evidence of wrongful act or violation of related laws and regulations, nor the Articles of Incorporation. (iii) We hereby state that the content of the resolution by the Board of Directors concerning the internal control system is proper. In addition, we find no matters on which to remark in regard to the execution of duties by the Directors regarding the internal control system. (2) RESULTS OF AUDIT OF NON-CONSOLIDATED FINANCIAL STATEMENTS AND THE SUPPORTING SCHEDULES We hereby state that the audit methods of the Accounting Auditor, KPMG AZSA & Co., and the results are appropriate. (3) RESULTS OF AUDIT OF CONSOLIDATED FINANCIAL STATEMENTS We hereby state that the audit methods of the Accounting Auditor, KPMG AZSA & Co., and the results are appropriate. May 20, 2009 The Board of Corporate Auditors, Ricoh Company, Limited Corporate Auditor Kohji Tomizawa (seal) Corporate Auditor Shigekazu Iijima (seal) Corporate Auditor Kenji Matsuishi (seal) Corporate Auditor Takao Yuhara (seal) Note: Corporate auditors Kenji Matsuishi and Takao Yuhara are outside corporate auditors in accordance with Article 2, Item 16 and Article 335, Paragraph 3 of the Corporate Law. -44- CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED) Millions of yen - ------------------------------------------------------------------------------- For the year ended March 31, - ------------------------------------------------------------------------------- 2009 2008 - ------------------------------------------------------------------------------- 1. Cash flows from operating activities Net income 6,530 106,463 Adjustments to reconcile net income to net cash provided by operating activities Depreciation and amortization of tangible and intangible fixed assets 101,817 95,788 Changes in assets and liabilities (73,767) (35,896) Other, net 52,908 28,008 Net cash provided by operating activities 87,488 194,363 2. Cash flows from investing activities Expenditures for tangible fixed assets (96,491) (84,011) Process from sales of available-for-sale securities, net (1,538) 2,067 Acquisition of businesses (after deducting cash and cash equivalents received at the time of acquisition) (157,404) (96,796) Other, net (27,739) (19,610) Net cash used in investing activities (283,172) (198,350) 3. Cash flows from financing activities Change in borrowings, indebtedness and debt securities, net 322,288 (33,148) Dividend payments (25,320) (22,628) Payment for purchase of treasury stock (644) (15,770) Other, net (410) (639) Net cash provided (used in) financing activities 295,914 (72,185) 4. Effect of exchange rate changes on cash and cash equivalents (12,353) (8,958) 5. Net increase (decrease) in cash and cash equivalents 87,877 (85,130) 6. Cash and cash equivalents at beginning of year 170,607 255,737 7. Cash and cash equivalents at end of year 258,484 170,607 -45- REFERENCE MATERIAL FOR ORDINARY GENERAL MEETING OF SHAREHOLDERS AGENDA 1: APPROPRIATION OF RETAINED EARNINGS After considering the earnings results for the business term, the strengthening of our corporate structure as well as our outlook for future development of operations, we propose the appropriation of retained earnings to be as follows: 1. YEAR-END DIVIDENDS Year-end dividends for the current term will be paid as follows: (1) Type of dividend assets Cash (2) Matters concerning allocation of dividend assets and the total amount We propose a year-end dividend of Yen 15 per common share of the Company, down Yen 2 per share from previous fiscal year-end. The total amount of dividends will be Yen 10,885,195,890. Accordingly, an annual dividend for the business term, a total of interim and year-end dividends, amounts to Yen 33 per share, the same payment amount as the previous year. (3) Effective date for the commencement of dividend payment from retained earnings We propose the effective date for commencement of dividend payment to be June 26, 2009. 2. APPROPRIATION OF OTHER RETAINED EARNINGS (1) Items of retained earnings to increase and the amount (i) Retained earnings carried forward: Yen 10,976,600,000 (ii) Reserve for social contributions: Yen 23,400,000 (2) Items of retained earnings to decrease and the amount (i) General reserve Yen 11,000,000,000 -46- AGENDA 2: PARTIAL AMENDMENT TO THE ARTICLES OF INCORPORATION 1. REASONS FOR AMENDMENT Since the Law for Partial Amendments to the Law Concerning Book-Entry Transfer of Corporate Bonds and other Securities for the Purpose of Streamlining the Settlement for Trade of Stocks and Other Securities (Act No. 88 of 2004: hereinafter, the "Streamlining Settlement Law") was promulgated on June 9, 2004 and enforced on January 5, 2009, all shares of listed companies are digitalized in accordance with the new book-entry transfer system for stocks (the "electronic share certificate system"). Accordingly, necessary amendments including deletion of the provisions regarding share certificates, beneficial shareholders, and the register of beneficial shareholders, which are no longer required to be stipulated in the Articles of Incorporation, are to be made to the current Articles of Incorporation. The register of lost stock certificates of the Company must be created and maintained until the day one year after the day immediately following the enforcement date of the Streamlining Settlement Law, and thus, necessary provisions will be set up in the Supplementary Provisions. In accordance with Article 6, Paragraph 1 of the Supplementary Provisions of the Streamlining Settlement Law, Article 7 (Issuance of Share Certificates) of the current Articles of Incorporation has been deemed to be repealed by resolution effective January 5, 2009, and this repeal shall be reflected in the Articles of Incorporation. 2. CONTENTS OF AMENDMENT Proposed amendments are as follows: (The parts underlined are those amended.)
CURRENT ARTICLES OF INCORPORATION PROPOSED AMENDMENTS - ---------------------------------------------------------- ---------------------------------------------------------- CHAPTER II. SHARES CHAPTER II. SHARES (Total Number of Issuable Shares) (Total Number of Issuable Shares) Article 6. The total number of issuable shares by the Article 6. The Company shall issue shares and the total Company is one billion and five ---------------------------------- hundred million (1,500,000,000) shares. number of issuable shares by the Company is one billion and five hundred million (1,500,000,000). (Issuance of Share Certificates) (Deleted) - -------------------------------- Article 7. The Company shall issue share certificates for - ---------- ---------------------------------------------- the shares. ----------- (Purchase of Treasury Stocks) (Purchase of Treasury Stocks) Article 8. The Company may acquire the shares of its own Article 7. (Same as left/no change) - stocks by a resolution of the Board of - Directors pursuant to Paragraph 2, Article 165 of the Corporation Law. (Number of Shares Constituting One Unit and Non-Issuance (Number of Shares Constituting One Unit) ---------------- Article 8. (Same as left/no change) of Certificates for Less-Than-One-Unit Shares) - - --------------------------------------------- Article 9. The number of shares constituting one unit of shares of the Company shall be one thousand (1,000) shares.
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CURRENT ARTICLES OF INCORPORATION PROPOSED AMENDMENTS - ---------------------------------------------------------- ---------------------------------------------------------- 2. Notwithstanding the provisions of Article 2. (Deleted) ----------------------------------------- 7, the Company shall not ------------------------ issue any certificates for -------------------------- less-than-one-unit shares, unless --------------------------------- otherwise provided for in the Share ----------------------------------- Handling Regulations. --------------------- (Rights Concerning Less-Than-One-Unit Shares) (Rights Concerning Less-Than-One-Unit Shares) Article 10. A shareholder (including the beneficial Article 9. A shareholder of the Company shall not -- ------------------------- - exercise any rights other than those described shareholder; the same applies hereinafter) of below with respect to the less-than-one-unit ------------------------------------------ shares held by it. the Company shall not exercise any rights other than those described below with respect to the less-than-one-unit shares held by it. i) Right described in each Item of Paragraph i) 2, Article 189 of the Corporation Law. to (Same as left/no change) ii) Right to make a request under the iv) provision of Paragraph 1, Article 166 of the Corporation Law. iii) Right to receive allocation of offered shares and allocation of offered stock purchase warrants in accordance with the number of shares held by the shareholder. (iv) Right to make a request provided for in the following Article. (Sale of Shares Constituting Less-Than-One-Unit Shares to (Sale of Shares Constituting Less-Than-One-Unit Shares to Constitute One Unit) Constitute One Unit) Article 11. A shareholder of the Company may request that Article 10. (Same as left/no change) -- the Company sell such number of shares as may, -- together with the number of less-than-one-unit shares held by the shareholder, constitute one unit of shares, in accordance with the Share Handling Regulations. (Administrator of Register of Shareholders) Administrator of Register of Shareholders) Article 12. Article 11. -- -- 1. The Company shall have an administrator of 1. (Same as left/no change) the register of shareholders. 2. The administrator of the register of 2. (Same as left/no change) shareholders and its handling office shall be determined by resolution of the Board of Directors and public notice shall be given thereof.
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CURRENT ARTICLES OF INCORPORATION PROPOSED AMENDMENTS - ----------------------------------------------------------------------------------------------------------------------- 3. The register of shareholders (including 3. The register of shareholders and the ----------- --- the register of beneficial shareholders; register of stock purchase warrants of ---------------------------------------- the Company shall be prepared and kept, and the same applies hereinafter), the all other business pertaining to the ------------------------------ register of shareholders and the register --- register of stock purchase warrants and of stock purchase warrants shall be handled --- by the administrator of the register of the register of the lost share shareholders and not by the Company. ------------------------------ certificates of the Company shall be ------------ prepared and kept, and all other business pertaining to the register of shareholders, the register of stock purchase warrants and the register of the lost share ---------------------------------- certificates shall be handled by the ------------ administrator of the register of shareholders and not by the Company. (Share Handling Regulations) (Share Handling Regulations) Article 13. The business and the service charges Article 12. (Same as left/no change) -- pertaining to the shares of the Company shall -- be subject to laws, ordinances or these Articles of Incorporation and the Share Handling Regulations established by the Board of Directors. CHAPTER III. GENERAL MEETING OF SHAREHOLDERS CHAPTER III. GENERAL MEETING OF SHAREHOLDERS Article 14. Article 13. -- -- to (Omitted) to (Same as left/no change) Article 43. Article 42. -- -- (Newly added) SUPPLEMENTARY PROVISION (Newly added) Article 1. The Company's register of lost share ------------------------------------------------ certificates shall be kept in the place of ------------------------------------------ business of the administrator of register of -------------------------------------------- shareholders. The services related to entry ------------------------------------------- and recording in register of lost share --------------------------------------- certificates shall be entrusted to the -------------------------------------- administrator of register of shareholders and --------------------------------------------- shall not be performed by the Company. ------------------------------------- (Newly added) Article 2. Recording in the Company's register of lost ------------------------------------------------------- share certificates shall be governed by laws -------------------------------------------- and ordinances, Articles of Incorporation, or --------------------------------------------- the Share Handling Regulations established by --------------------------------------------- the Board of Directors. ---------------------- (Newly added) Article 3. The provisions of Articles 1 through 3 of ----------------------------------------------------- these Supplementary Provisions shall be deleted ----------------------------------------------- effective January 6, 2010. -------------------------
-49- AGENDA 3: ELECTION OF ONE (1) CORPORATE AUDITOR As Corporate Auditor Mr. Kohji Tomizawa will resign from his position at the conclusion of this Ordinary General Meeting of Shareholders, the Company proposes the appointment of one (1) Corporate Auditor at this meeting. The Board of Corporate Auditors has given its consent to this agenda. The candidate for the Corporate Auditor is as follows: Brief personal profile, position and responsibility at the Company Number of the Name (* Status of representation at other Company's shares (Date of birth) company, with asterisk) held - ------------------------------------------------------------------------------------------------------------------- Yuji Inoue Apr. 1971 Joined the Company 10,000 (April 4, 1948) Jan. 1997 Deputy General Manager of Finance and Accounting Division Apr. 1998 General Manager of Finance and Accounting Division Oct. 1998 General Manager of Business Department of Ricoh Leasing Co., Ltd. June 1999 Managing Director of Ricoh Leasing Co., Ltd. Apr. 2000 President of Ricoh Leasing Co., Ltd. June 2000 Senior Vice President(Current) June 2004 Managing Director June 2005 * President and Chief Executive Officer of Ricoh Leasing Co., Ltd. (Current) June 2009 Scheduled to retire as President and Chief Executive Officer of Ricoh Leasing Co., Ltd. Scheduled to retire as Senior Vice President
Notes: There is no conflict of interests between the candidate and the Company. -50- AGENDA 4: ELECTION OF ONE (1) SUBSTITUTE CORPORATE AUDITOR The Company proposes to appoint in advance one Outside Corporate Auditor as a Substitute for Outside Corporate Auditors Mr. Kenji Matsuishi and Mr. Takao Yuhara, so that audit operations can be carried out continuously even in a case where the number of Corporate Auditors falls below the number required by law. The above appointment shall be effective only before the candidate assumes as Outside Corporate Auditors, and may be nullified by resolution of the Board of Directors with consent of the Board of Corporate Auditors. The Board of Corporate Auditors has given its consent to this agenda. The candidate for the Substitute Outside Corporate Auditor is as follows: Brief personal profile, position and responsibility at the Company Number of the Name (* Status of representation at other Company's shares (Date of birth) company, with asterisk) held - ------------------------------------------------------------------------------------------------------------------- Kiyohisa Horie Apr. 1970 Joined Horie Morita Audit Office (now : Meiji Audit Corporation) 0 (March 7, 1948) Joined Showa Accounting Office Aug. 1980 Registered as Certified Public Accountant Mar. 1988 Registered as Tax Accountant Apr. 1988 Senior Partner of Meiji Audit Corporation (Current) May 1988 * Representative Director of Showa Accounting Office (Current) May 1988 Managing Partner of Meiji Audit Corporation (Current) May 1998 Vice-Chairman & Managing Partner of Meiji Audit Corporation (Current)
Notes: 1. There is no conflict of interests between the candidate and the Company. 2. Mr. Kiyohisa Horie is a candidate for Substitute Corporate Auditor for Outside Corporate Auditors. 3. With his insight and longstanding experience as a certified tax accountant and certified public accountant, we have judged that the candidate Mr. Kiyohisa Horie is the appropriate person as a Corporate Auditor of the Company. Hence, we propose him as a Substitute Corporate Auditor. 4. If Mr. Kiyohisa Horie is approved to be appointed as a Corporate Auditor of the Company, the Company will conclude a liability limitation contract with him to limit liabilities for damages at higher of either, Yen 5,000,000 or minimum liability limit amount stipulated in Article 425, Paragraph 1 of the Corporate Law. -51- AGENDA 5: PAYMENT OF BONUSES TO DIRECTORS The Company proposes that bonuses amounting to Yen 84.8 million be paid to the incumbent nine (9) Directors (excluding Outside Directors) as of the end of the fiscal year under review, considering the Company's earnings results and other factors. The Company requests that the details such as specific amounts, timing and manner of payment be left to the decision of the Board of Directors. -52- EXERCISE OF VOTING RIGHTS VIA THE INTERNET 1. Website the Company Designated for Exercising Voting Rights via the Internet Please access http://www.web54.net. -------------------- Please note that you would not be able to use cellular phones as terminal for exercising voting rights via the Internet. 2. You will need "Voting right exercise code" and "Password," both shown in the voting form. 3. When you access the designated website, you are requested to decide a new eight-digit password. Please prepare the eight-digit password in advance. 4. Expenses incurred when accessing the website designated for exercising voting rights (ISP access charges, communication charges (call charges) by a carrier, etc.) shall be borne by shareholders. PASSWORD: 1. Please keep secret the new password you chose because it is necessary to identify you as the eligible shareholder. If you forget or lose the password, you will not be able to exercise your voting right and to change approval or disapproval for the agenda you voted via the Internet. (We are sorry we will not be able to answer questions you may ask regarding new password.) 2. The voting right exercise code and password that we present this time are valid only for this Ordinary General Meeting of Shareholders. (We will issue a new password for the next meeting.) Please direct your inquiries regarding personal computer operations to exercise your voting right via the Internet to: Exclusive Information Site for Ricoh: http://www.ricoh.com/IR/contact.html ------------------------------------- FOR INSTITUTIONAL INVESTORS: If shareholders apply in advance for the use of the platform operated by ICJ, Inc. a joint venture set up by the Tokyo Stock Exchange, Inc. and other companies, for exercising voting rights, they may be able to utilize said platform as a method for exercising voting rights in electronic medium, in addition to the exercise of voting rights via the Internet specified above. -53- -----END PRIVACY-ENHANCED MESSAGE-----