Issue of Stock Acquisition Rights as Stock Options for a Stock-Linked Compensation Plan for Corporate Officers

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Issue of Stock Acquisition Rights as Stock Options for a Stock-Linked Compensation Plan for Corporate Officers

June 28, 2007

TDK Corporation's (the "Company") Board of Directors today passed a resolution, as detailed below, regarding the specific terms for the issuance of stock acquisition rights as stock options for a stock-linked compensation plan. The issuance of these stock acquisition rights was approved by the 111th Ordinary Annual General Meeting of Stockholders on June 28, 2007.

Ⅰ  Reason for issuance of stock acquisition rights with specially favorable terms and conditions to individuals other than stockholders

The stock acquisition rights are structured so that these officers also share the risk of a decrease in the Company's share price with stockholders and not just the benefits of a price increase. The issuance of these rights is thus intended to provide the Company's corporate officers with further incentive for improving the Company's operating results and share price.

Ⅱ  Matters pertaining to the issuance of stock acquisition rights

1. Name of stock acquisition rights
   TDK Corporation 2007 Stock-linked Compensation Stock Acquisition Rights (for Corporate Officers, issued free of charge)
2. Total number of stock acquisition rights
   130
3. Class and number of shares to be issued upon the exercise of the stock acquisition rights
   The class of share to be issued upon the exercise of stock acquisition rights shall be the Company's common stock, and the number of shares for each stock acquisition right (hereinafter the "number of shares granted") shall be 100.
   
   However, in the event that the Company conducts a stock split, distributes shares free of charge, or consolidates its common stock, the "number of shares granted" shall be adjusted according to the following method of calculation. This adjustment will apply to the "number of shares granted" for those stock acquisition rights that have not already been exercised prior
   
   to the relevant date. Moreover, fractions of less than one share arising out of the above adjustments shall be discarded.
   
   Post-adjustment "number of shares granted" =
   Pre-adjustment "number of shares granted" × stock split or stock consolidation ratio
   
   Moreover, in other cases where circumstances arise requiring the "number of shares granted" to be adjusted, the "number of shares granted" shall be adjusted appropriately.
4. Method for calculating the amount to be invested when exercising stock acquisition rights
   The amount to be invested when exercising each stock acquisition right shall be the amount to be paid for each share that can be granted due to the exercise of stock acquisition rights, which shall be ¥1, multiplied by the "number of shares granted."
5. Exercise period for stock acquisition rights
   The exercise period shall be the period beginning July 8, 2007 and ending July 7, 2027.
6. Other conditions for exercising of stock acquisition rights

   (1)	Stock acquisition rights holders, excluding (2) below, shall not be able to exercise stock acquisition rights in the period from July 8, 2007 to July 7, 2010 and to be able to exercise stock acquisition rights on or after July 8, 2010.
   (2)	Stock acquisition rights holders shall be permitted to exercise stock acquisition rights until July 7, 2010 in cases specified in a) and b) below, as long as it is within the time frame stipulated. a) In the event that a stock acquisition rights holder loses his or her position as either director or employee of the Company (including full-time advisors and contract employees, but excluding part-time advisors and part-time contract employees. * This definition of employee is applicable throughout this resolution.)       Three years from the day after losing the position b) In the event that a proposal for approval of a merger agreement, under which the Company is to be dissolved, or a proposal for approval of a stock exchange agreement or a proposal for share transfer that makes the Company a wholly owned subsidiary, is approved at a meeting of stockholders of the Company.       A period of 15 days from the day following the approval date
   (3)	On or after July 8, 2010, in the event that a stock acquisition rights holder loses his or her position as either a director or employee of the Company, the individual may exercise his or her rights up to three years from the day after losing the position as long as it is within the exercise period for stock acquisition rights.
   (4)	In the event that a stock acquisition rights holder relinquishes his or her stock acquisition rights, such stock acquisition rights cannot be exercised.

7. Items concerning increases in common stock and additional paid-in capital if shares are issued due to the exercise of stock acquisition rights

   (1)	In the event that shares are issued due to the exercise of stock acquisition rights, common stock shall increase by half the limit for increase in common stock calculated in accordance with Article 40-1 of the Japanese generally accepted accounting principles. Any amount less than one yen arising shall be rounded up to the nearest yen.
   (2)	In the event that shares are issued due to the exercise of stock acquisition rights, additional paid-in capital shall increase by the amount remaining after deducting the increase in the limit for increase in common stock prescribed in (1).

8. Restrictions on the acquisition of stock acquisition rights due to transfers
   Regarding the acquisition of stock acquisition rights due to transfers, approval is required by resolution of the Company's Board of Directors.
9. Provisions for the acquisition of stock acquisition rights
   No provisions for the acquisition of stock acquisition rights are specified.
10. Amount to be paid for stock acquisition rights
    No payment shall be necessary for stock acquisition rights.
11. Allotment date of stock acquisition rights
    July 7, 2007
12. Number of stock acquisition rights allotted and number of eligible persons
    130 stock acquisition rights will be allotted to 9 Corporate Officers

For further information, contact the Corporate Communications Dept.
Tel.: 81-3-6778-1055
E-mail: TDK.PR@tdk.com