New Employee Incentive System Not Based on Salary, Bonuses, or Stocks: "Perform+" First Adopter is "Higo Shoji"

1. Overview

Music Securities, Inc. (Headquarters: Chiyoda-ku, Tokyo; President and CEO: Hiroki Nakazono) is pleased to announce that it has provided its new employee incentive service, "Perform+" (Perform Plus), which is a performance-linked incentive service without stock issuance, to Higo Shoji Co., Ltd. (Headquarters: Kumamoto City, Kumamoto Prefecture; President and CEO: Yasuya Iwadate) as its first client.

In recent years, with increasing attention on human capital management, companies are being called upon to improve the engagement of each employee and create mechanisms that connect management goals with the awareness of the front lines.

Traditionally, mechanisms have been used to return corporate growth to employees through bonuses, employee stock ownership plans, and stock options.

However, many companies have found it difficult to implement existing systems due to reasons such as:

・It is difficult for employees to "own" the company (business) through salary and bonuses alone.

・Procedural burdens associated with stock issuance.

・Concerns about changes in capital structure and the burden of shareholder management.

"Perform+" is a new incentive service that takes the form of an investment, utilizing a silent partnership agreement as a new option to address these challenges. It allows companies to share KPIs such as sales with employees and distribute monetary amounts to employees based on performance, without issuing stock.

By sharing corporate growth with employees and supporting increased participation in the business and fostering a sense of unity within the organization, it supports sustainable corporate growth and the promotion of human capital management.

Higo Shoji Co., Ltd., the first adopter of the service, has overcome the challenges of existing systems inherent to unlisted companies with "Perform+". The company decided to adopt the service with the aim of creating an organization where each employee perceives the company's growth as their own and strives towards common goals.

Leveraging the expertise in forming and managing silent partnership funds cultivated to date, Music Securities will continue to support the growth of people and organizations for businesses nationwide through "Perform+".

2. Higo Shoji Co., Ltd. Comment

At our company, we emphasize building an organization where each employee perceives the company's growth as their own and strives towards common goals.

As an unlisted company, building a system to share the growth of the company with our employees has been an important theme, but introducing systems utilizing stocks presented challenges in terms of capital policy and operational aspects.

We see great potential in "Perform+" because it allows employees to perceive the company's growth as their own and enhances their sense of participation in the business without utilizing stocks, leading to improved organizational unity and engagement.

We will continue to grow with our employees and provide value to our regional customers and community.

3. Service Overview

Service Overview: Performance-linked incentive service without stock issuance

Service URL: https://www.musicsecurities.com/perform_plus

4. About the Adopting Company

Company Name: Higo Shoji Co., Ltd.

Location: 1-23 Konyaimachi, Chuo-ku, Kumamoto City, Kumamoto Prefecture

Representative: Yasuya Iwadate, President and CEO

Business Description: Non-life insurance and life insurance agency

End

Contact for this matter

Music Securities

Email: [email protected]

Tel: 03-5948-7301

Music Securities, Inc.

Type II Financial Instruments Business Operator Kanto Local Finance Bureau (Kinsho) No. 1791

Member Association: General Incorporated Association Type II Financial Instruments Firms Association

【Important Notes】

Funds handled by our company are subject to prescribed handling fees (transfer fees to financial institutions may also be required separately) and carry risks such as the principal of the investment being lost.

Handling fees and risks vary depending on the fund, so please refer to the silent partnership agreement explanation for each fund for details.