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CSK HOLDINGS |
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CSK |
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2004 08 02
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CSK takes legal action against Bellsystem24 Inc.
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TOKYO, August 2, 2004 - CSK CORPORATION ("CSK") today filed legal actions with the Tokyo District Court in regard to a third party allocation of new shares by Bellsystem24 Inc.
Details of these actions are as follows:
- Filing for a provisional injunction to halt actions that contravene articles of incorporation
1) Petitionee party
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Name |
Bellsystem24 Inc. |
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Yukio Sonoyama, President |
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Address |
Tokyu Building East No.3,
2-16-8 Minami-Ikebukuro,
Toshima-ku, Tokyo |
2) Details of petition
The filing for a provisional injunction is to halt the following actions that Bellsystem24 Inc. will undertake vis-à-vis Softbank BB Corp. on August 9, 2004 without making any changes to its articles of incorporation:
- The acquisition of all the outstanding shares of BB Call Corp.
- The assignment from Softbank BB Corp. of Softbank BB's loan to BB Call Corp. (face value = ¥18.8 billion, including interest)
- The lending of ¥29.6 billion to BB Call Corp.
3) Basis for the filing
Along with the payment of ¥50 billion to acquire all the outstanding shares of BB Call Corp. on August 9, 2004, the payment of ¥18.8 billion for the assignment from Softbank BB Corp. of a loan owed by BB Call Corp. amounting to ¥18.8 billion, and the lending of ¥29.6 billion to BB Call Corp., Bellsystem24 Inc. will, by making BB Call Corp. a wholly-owned subsidiary, become involved in leasing*, on the basis of that certain comprehensive business affiliation agreement between Bellsystem24 Inc. and BB Call Corp. Such leasing business is outside the scope of the corporate objectives as stipulated in Bellsystem24's articles of incorporation.
* Under the current commercial registration practice, the corporate objectives of a wholly-owned subsidiary must be embraced in the corporate objectives set forth in the articles of incorporation of the parent company.
- Filing for provisional injunctions to prohibit the exercise of voting rights
1) Petitionee parties
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Name |
Bellsystem24 Inc. |
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Yukio Sonoyama, President |
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Address |
Tokyu Building East No.3,
2-16-8 Minami-Ikebukuro,
Toshima-ku, Tokyo |
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Name |
NPI Holdings |
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Hirofumi Hirano, President |
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Address |
1-2-2 Uchisaiwaicho,
Chiyoda-ku, Tokyo |
2) Details of petitions
- The filing for a provisional injunction is to prohibit Bellsystem24 Inc. from permitting the exercise of voting rights on 5,200,000 ordinary shares of Bellsystem24 Inc. held by NPI Holdings at the ordinary general meeting of shareholders scheduled for a date by the end of August 2004. These new ordinary shares are to be issued, effective as of August 6, 2004, as resolved by the board of directors of Bellsystem24 Inc. on July 20, 2004.
- The filing for a provisional injunction is also to prohibit NPI Holdings from exercising its voting rights on 5,200,000 ordinary shares of Bellsystem24 Inc. at the abovementioned ordinary general meeting of shareholders. As noted above, these new ordinary shares are to be issued, effective as of August 6, 2004, as resolved by the board of directors of Bellsystem24 Inc. on July 20, 2004.
3) Basis for the filing
The record date adopted and publicly notified by Bellsystem24 Inc. effectively permits only NPI Holdings to exercise its voting rights among all the new shareholders of Bellsystem24 Inc. subsequent to the record date already stipulated in its articles of incorporation. Enabling NPI Holdings to exercise its voting rights through this illegal publication of a record date will lower the percentage of CSK's equity holdings in Bellsystem24 Inc. from 39.17% to 19.00%, significantly reducing the ratio of CSK's voting rights, and denying CSK of a fair opportunity to exercise its voting rights.
- Filing for appointment of an inspector of corporate operations and assets
1) Petitionee party
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Name |
Bellsystem24 Inc. |
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Yukio Sonoyama, President |
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Address |
Tokyu Building East No.3,
2-16-8 Minami-Ikebukuro,
Toshima-ku, Tokyo |
2) Details of petition
The filing requests the appointment by the court of an inspector to examine Bellsystem24's operational and financial condition.
3) Basis for the filing
On July 20, 2004, Bellsystem24 Inc. signed a basic agreement to develop a comprehensive business affiliation with Softbank BB Corp. However, before signing this basic agreement Bellsystem24 Inc. did not carry out requisite investigations such as due diligence (price valuation) and the studies on the viability of its plans for the business in the future.
Furthermore, without sufficient disclosure or deliberation, the Bellsystem24 Inc. board of directors on July 20, 2004 decided to make an investment of ¥128 billion, an enormous sum of money. Moreover, some ¥85 billion of this ¥128 billion is expected to be earmarked for leasing, a business that is outside the scope of Bellsystem24's corporate objectives as stipulated in its articles of incorporation.
As such, the signing of this basic agreement contravenes Bellsystem24's articles of incorporation and is illegal. It is therefore essential to have an inspector appointed to examine Bellsystem24's operational and financial condition.
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