Hiroki Sampei has a long list of things he does not like about Toyota Motor Corp.'s new class of equity.

Japan's largest company is about to seek approval to offer as much as ¥500 billion of convertible equity, which has debt-like characteristics and cannot be sold for five years. As part of the proposal, it would buy back an equal amount of common shares, which it says is to avoid dilution.

Toyota's claim that the stock will improve corporate governance by locking in patient owners masks its real intent, which is staunching dissent, according to Sampei, the director of research at Fidelity Worldwide Investment in Tokyo. His views echo proxy adviser Institutional Shareholder Services Inc., which told investors to oppose the motion to create the Model AA shares when they vote on June 16. The California State Teachers' Retirement System is also against the plan.