January 31, 2024
For immediate release
Company name:CMIC HOLDINGS Co., Ltd.

Name of Representative: Kazuo Nakamura, Representative Director and CEO(Stock Code: 2309; TSE Prime Market)
Contact: Wataru Mochizuki, Director and CFO(Phone: +81-3-6779-8000)

Notice of Share Consolidation, Abolition of the Number of Shares Constituting One
Unit of Shares, and Partial Amendments to the Articles of Incorporation
The Company hereby announces that its Board of Directors has resolved at a meeting held on January 31, 2024 to convene
an extraordinary general meeting of shareholders (the "Extraordinary General Meeting of Shareholders") to be held on
March 4, 2024, and to submit Agenda Item 1 "Share Consolidation" and Agenda Item 2 "Partial Amendment to the Articles
of Incorporation" to the Extraordinary General Meeting of Shareholders.
In the course of the above procedures, the shares of common stock of the Company (the "Company's shares") will fall under
the delisting standards stipulated in the Securities Listing Regulations of the Tokyo Stock Exchange, Inc. (the "Tokyo Stock
Exchange") in the course of the above-mentioned procedures. As a result, the Company's shares will be designated as
Securities to Be Delisted from March 4, 2024 to March 27, 2024, and then delisted as of March 28, 2024. Please note thatafter the delisting, our shares cannot be traded on the Tokyo Stock Exchange Prime Market.
Notes
I.

Share Consolidation
1. Purpose and Reason for the Share Consolidation
As announced in the press release "Notice Regarding Implementation of Management Buyout andRecommendation to Tender Shares" dated November 7, 2023 (the "Press Release of Opinion"), Hokuto
Management Co., Ltd.(the "Tender Offeror") has decided to acquire all of the Company's shares (except for treasury
stock held by the Company and 2,160,000 shares of the Company's stock held by Artemis Co., Ltd. ("Artemis")(ownership ratio (Note): 12.67%) and 2,160,000 shares of the Company held by Keith Japan Co., Ltd. ("Keith
Japan")(ownership ratio 12.67%). Such shares of the Company owned by Artemis and Keith Japan are hereinafterreferred to as the "Non-Tendered Shares")) in a series of transactions (the "Transactions") for the purpose of taking
the Company's shares private. As part of a series of transactions (the "Transaction") to acquire all of the Company's
shares and make the Company's shares go private, the Tender Offeror conducted a tender offer for the Company's
shares with the Tender Offer Period from November 8, 2023 to January 4, 2024.
As announced in our press release dated January 5, 2024, "Notice Regarding Result of the Tender Offer by Hokuto
Management and Changes in the Parent Company and the Largest and the Major Shareholder" (hereinafter referred
to as the "Press Release of Tender Offer Results"), as a result of the completion of the Tender Offer, the Offeror
acquired 10,487,067 shares of the Company (ownership ratio: 61.53%) on January 12, 2024, the commencement
date of settlement of the Tender Offer.
Note: “Ownership ratio” means the percentage (rounded to two decimal places) of the difference(17,042,645 shares) of the total number of issued shares of the Company (18,923,569 shares) as of
September 30, 2023, as stated in the “Consolidated Financial Results for the Fiscal Year Ending September
2023” published by the Company on November 7, 2023 (the “Financial Results”), less the number of treasury

shares held by the Company (1,880,924 shares) as of that date (the Company Shares owned by theCompany’s employee stock ownership plan (J-ESOP) as of that date (158,000 shares) are recorded as treasury
shares in the Company’s financial results, but are not included in the number of treasury shares (1,880,924
shares) because the Tender Offeror plans to acquire those shares through the Tender Offer).
As announced in the Press Release of opinion, the Company received a proposal to delist the Company Sharesfrom Mr. Kazuo Nakamura ("Mr. Nakamura"), dated July 26, 2023, and informed Mr. Nakamura that it would
establish the Special Committee to examine the Proposal and would begin preparations to construct asystem for examination of the Transactions. As described in,"(3) Measures to Ensure the Fairness of theTransaction and to Avoid Conflicts of Interest" under "3. Basis, etc. of the amount of money expected to be delivered
to shareholders as a result of the fractional shares due to the consolidation of shares" below starting in late July 2023,
the Company individually explained to all seven of its independent directors and independent corporate auditors asof that time that it had received an initial proposal for the Transactions from Mr. Nakamura and that it is necessary
to take sufficient measures to address the issues of structural conflict of interest and information asymmetry in theTransactions in light of the fact that the Transactions are conducted as a management buyout (MBO), and a structural
conflict of interest exists, eliminate arbitrariness in the decision-making process of the Company’s board of directors,
and ensure the fairness, transparency, and objectivity of the Transactions, in order to ensure the fairness of theTender Offer Price and other aspects of the Transactions including the Tender Offer. In addition, in early August 2023,
the Company appointed Houlihan Lokey K.K. (“Houlihan Lokey”) as a financial advisor and third-party appraiser
independent of the Tender Offeror and the Company, and Mori Hamada & Matsumoto as a legal advisor
independent of the Tender Offeror and the Company, subject to the approval of the Special Committee as described
below. Furthermore, in order to address the issues of structural conflict of interest and information asymmetry in
the Transactions, eliminate arbitrariness in the decision-making process of the Company’s board of directors, andensure the fairness, transparency, and objectivity of the Transactions, the board of directors of the Company
adopted a written resolution on August 7, 2023 to establish the Special Committee and to establish an independent
team to examine, negotiate, and make decisions regarding the Transactions, based on legal advice from its legal
advisor, Mori Hamada & Matsumoto, and constructed a system for examining the Transactions. For the composition,authorities granted and specific activities of the Special Committee, please see “(c) Establishment by the Companyof an Independent Special Committee and Procurement of the Committee Report” in “(3) Measures to Ensure theFairness of the Transaction and to Avoid Conflicts of Interest" in "3. Basis, etc. of the amount of money expected to
be delivered to shareholders as a result of the fractional shares due to the consolidation of shares" below. For thecomposition, authorities granted and specific activities of the Special Committee, please see“(c)Establishment by the Company of an Independent Special Committee and Procurement of the Committee
Report” in “(3) Measures to Ensure the Fairness of the Transaction and to Avoid Conflicts of Interest" in "3. Basis,
etc. of the amount of money expected to be delivered to shareholders as a result of the fractional shares due to theconsolidation of shares" below, and for the composition and specific activities of the independent team, pleasesee “(d) Establishment by the Company of an Independent Examination System” in “(3) Measures to Ensure
the Fairness of the Transaction and to Avoid Conflicts of Interest" in "3. Basis, etc. of the Amount of Cash
Expected to be Delivered to Shareholders as a Result of the Fractional Share Consolidation" below.
Under the above structure, the Company discussed and examined the terms of the Transactions multiple times
including the Tender Offer Price based on the negotiation policy confirmed in advance by the Special Committee
and opinions, instructions, and requests from the Special Committee at critical points in the negotiations, as well asadvice from Houlihan Lokey and Mori Hamada & Matsumoto.
Specifically, on October 12, 2023, the Company, through the Special Committee, interviewed Mr. Nakamura,
who explained the process of deliberation that led to the proposal of the Transactions, the details of themeasures envisioned for after the Transactions, the expected disadvantages, advantages, and other effectsof the Transactions and their impact, and the management policy planned for after the Transactions,followed by a question-and-answer session. On October 3, 2023, the Company received a proposal from Mr.

Nakamura to set the Tender Offer Price at 2,500 yen. On October 12, 2023, the Special Committee decided,
based on the advice received from Houlihan Lokey regarding the value of the Company Shares anddiscussions at Special Committee meetings, that the Tender Offer Price of 2,500 yen did not give adequate
consideration to the interests of the minority shareholders of the Company, and requested that Mr.
Nakamura consider raising the Tender Offer Price. On October 17, 2023, the Company received a proposal
from Mr. Nakamura to set the Tender Offer Price at 2,580 yen. On October 18, 2023, the Special Committee
decided, based on the advice received from Houlihan Lokey regarding the value of the Company Shares anddiscussions at Special Committee meetings, that the Tender Offer Price of 2,580 yen still did not giveadequate consideration to the interests of the minority shareholders of the Company, and requested that
Mr. Nakamura consider further raising the Tender Offer Price. On October 25, 2023, the Company received
a proposal from Mr. Nakamura to set the Tender Offer Price at 2,650 yen from the standpoint ofconsideration to the minority shareholders, which he said was the maximum possible increase inconsideration of the Company’s financial situation and other factors expected after the Tender Offer. On
October 25, 2023, the Special Committee decided, based on the advice received from Houlihan Lokey
regarding the value of the Company Shares and discussions at Special Committee meetings, to ask Mr.
Nakamura to make another proposal because although the proposed share price was reasonable to a certain
degree, a further increase in the Tender Offer Price should be requested in order to further benefit theCompany’s shareholders, and responded to Mr. Nakamura in writing to that effect on October 26, 2023. On
November 1, 2023, the Company received a proposal from Mr. Nakamura to the effect that he had
considered the request, but a further increase would be difficult, and he could not change the price from2,650 yen (a 55.43% premium to the closing price on October 31, 2023), and he believed that pricesufficiently respected the interests of the minority shareholders. At the meeting of the Special Committee
on November 2, 2023 the Special Committee approved the Tender Offer Price of 2,650 yen based on theadvice received from Houlihan Lokey regarding the value of the Company Shares and the discussions of theSpecial Committee, and responded in writing to Mr. Nakamura on November 2, 2023, through Houlihan
Lokey, to the effect that it agreed to the proposed Tender Offer Price of 2,650 yen.
In addition, on October 3, 2023, Mr. Nakamura made a proposal to the Company to the effect that no
maximum number of shares to be purchased in the Tender Offer would be set, and that the minimum
number of shares to be purchased would be the number of shares such that the total number of voting rights
held by the Tender Offeror, Artemis, Keith Japan, Mr. Nakamura and Ms. Oishi after the successful
completion of the Tender Offer would be two-thirds of the voting rights of all shareholders of the Company.
On October 12, 2023, the Special Committee responded in writing requesting that Mr. Nakamura reconsider
setting a majority-of-the-minority condition in consideration of the interests of the Company’s minority
shareholders and from the perspective of enhancing the fairness of procedures in the Transactions. On
October 17, 2023, Mr. Nakamura explained in writing that he would not set a majority-of-the-minority
condition because he believed that a majority-of-the-minority condition would make the successful
completion of the Tender Offer uncertain and may not contribute to the interests of minority shareholders
who wish to tender their shares in the Tender Offer given that 49% of the voting rights are held by speciallyrelated parties, and that sufficient consideration has been given to the interests of the minority shareholders
by the implementation of other measures to ensure fairness. Based on this explanation, when requesting afurther increase in the Tender Offer Price on October 18, 2023 as described above, the Company stated to
Mr. Nakamura that if a majority-of-the-minority condition is not set, the Special Committee believes it isnecessary to more carefully examine whether the Tender Offer Price is appropriate from the perspective of
the interests of the Company’s minority shareholders. At the Special Committee meeting held on October25, 2023, the Special Committee determined that failure to request further consideration of the majority-ofthe-minority condition would not negate the fairness of the Transactions, given that the “Guidelines on Fair
M&A Practices” published by the Ministry of Economy, Trade and Industry on June 28, 2019 (the “Fair M&A
Guidelines”) state that when the purchaser holds a large proportion of the target’s shares, setting a majority-of-the-minority condition can be a disincentive to M&A that otherwise would enhance corporate value, andMr. Nakamura’s explanation above is not unreasonable, and that the Tender Offer Price of 2,650 yen
proposed by Mr. Nakamura is acceptable to a certain degree, and although the Company will continue toseek a further increase in the Tender Offer Price as stated above, it is possible to conclude that sufficientconsideration has been given to the interests of the Company’s shareholders through fair procedures in lightof the other fairness measures that have been taken in this matter.
The Company received necessary legal advice from Mori Hamada & Matsumoto concerning the method andprocess of decision-making with respect to the procedures related to the Transactions and other matters to
be noted, and after receiving the final proposal from the Tender Offeror on November 1, 2023, received areport from the Special Committee on November 6, 2023 (the “Committee Report”; for a summary of theCommittee Report and the specific activities of the Special Committee, please see “(c) Establishment by theCompany of an Independent Special Committee and Procurement of the Committee Report” in “(a)Measures to Ensure the Fairness of the Tender Offer, Such as Measures to Ensure the Fairness of the Tender
Offer Price and to Avoid Conflicts of Interest” below.)
At the board of directors meeting held on November 7, 2023, the Company carefully discussed and examined
the Transactions from the perspective of whether the corporate value of the Company can be enhanced
through the Transactions and whether benefit that should be enjoyed by the ordinary shareholders issecured by the Transactions being conducted through fair procedures, based on the legal advice received
from Mori Hamada & Matsumoto, its legal advisor, and a share valuation report (the “Share Valuation
Report,” defined in “(3) Matters Concerning Calculation” below) dated November 6, 2023 received from
Houlihan Lokey, its financial advisor and third-party appraiser, while respecting to the maximum possible
extent the content of the Committee Report received from the Special Committee.
After receiving the proposal for the Transactions on July 26, 2023, the Company’s independent team incharge of examining, negotiating, and making a decision on the Transactions repeatedly examined thenecessity of the Transactions, and the expected disadvantages, advantages, and other effects of theTransactions and their impact, and also considered whether or not delisting the Company Shares throughthe Transactions would contribute to the enhancement of the Group’s corporate value, based on the content
of Mr. Nakamura’s explanations of the management policy, etc. after the Transaction. In the course of suchconsideration, as described in “(i) Background, Purpose, and Decision-Making Process of the Tender Offeror’s
Decision to Implement the Tender Offer” in “(b) Background, Purpose, and Decision-Making Process of theTender Offeror’s Decision to Implement the Tender Offer, and Post-Tender Offer Management Policy” above,
the Company concluded that in order to respond to changes in the business environment surrounding theCompany, it is necessary to address issues such as the promotion of the Healthcare business, enhancementof comprehensive support for disease prevention and treatment from research and development throughsales, and contribution to a sustainable society, and in order to develop its business model into a personal
health value creator (PHVC) model through these efforts, it will be necessary to establish a management
structure that allows the necessary upfront investments to be made and other fundamental measures to betaken more flexibly and promptly than before, based on the fact that further intensification of competitionis expected in the pharmaceutical industry going forward due to a slowdown in growth of the domestic drug
discovery outsourcing market against a backdrop of increasing pressure to reduce drug prices as a result of
the annual drug price revisions since FY2021, cost increases due to the increasing demand for highly
specialized clinical trials such as for drugs with new modalities, cancer drugs, and drugs targeting rarediseases, and the shrinkage of the domestic clinical trial market due to the increase of international joint
trials and clinical trials in Asian countries, the fact that there is a concern that the Group’s revenues may
gradually decline going forward now that the Covid-19 pandemic has run its course, and the fact that the
Healthcare Revolution business (specifically, a medical information interfacing system based on an electronic
pharmacy handbook, and self-testing services that contribute to the early detection of diseases andprevention of serious illnesses), which the Group considers its new profit center, is in a growth area in thehealthcare tech sector which is attracting a great deal of attention, and is the subject of intensifying
competition due to the entry of not only startups but also major domestic and foreign tech companies andcompanies from other industries. Specifically, as described “(i) Background, Purpose, and Decision-Making
Process of the Tender Offeror’s Decision to Implement the Tender Offer” in “(b) Background, Purpose, andDecision-Making Process of the Tender Offeror’s Decision to Implement the Tender Offer, and Post-Tender
Offer Management Policy” above, the Company concluded that it will be necessary to implement measures
including (i) alliances with business partners to accelerate CRO business development in global markets
including Asia and the U.S., (ii) intermittent capital investments in the CRO business (non-clinical), (iii)
continuous investment in the Healthcare Revolution business, and (iv) a fundamental review of its personnel
evaluation system and compensation structure.
However, the Company concluded that, given that speed is of the essence in an increasingly competitivemarket environment, and such measures require a large amount of upfront investment, and if the Company
were to make such upfront investments while maintaining its listing, there is a risk that the Company’s
financial condition could deteriorate due to a decline in profit levels and cash flow, at least in the short term,
while additionally it is not necessarily clear whether the expected investment effect will be generated andlead to higher earnings for the Group in the medium to long term, it may not receive sufficient recognition
from the capital markets, which may result in a decline in the price of the Company Shares and have anegative impact on shareholders of the Company in the short term.
After receiving the proposal for the Transactions, the Company’s independent team repeatedly examined it
and, in light of the above points, concluded that in order to avoid such adverse effects on the Company’s
shareholders and to implement fundamental measures to enhance the Company’s corporate value from a
medium- to long-term perspective, it would be reasonable to delist the Company Shares, and that as amethod to achieve this, it would be useful to conduct an MBO under the leadership of Mr. Nakamura, whois the person most familiar with the Company’s business, and to have him continue to exercise leadership in
the management of the Group. Finally, on November 7, 2023, the board of directors of the Company reached
the conclusion that delisting the Company Shares through the Transactions would contribute to theenhancement of the Group’s corporate value. The delisting of the Company Shares could have a negative
impact on the Company’s business due to the fact that the Company will no longer be able to raise equity
financing from the capital markets, and will not be able to enjoy the benefits that are generally available tolisted companies as a result of greater name recognition, such as the recruitment of talented humanresources and the enhancement of public credibility. However, the disadvantages of delisting can beconsidered to be limited, considering the current financial situation of the Group and the recent low interest
rate environment for indirect financing, the Group has little need for equity financing to raise large amountsof capital for the time being, and the Group’s name recognition and credibility are largely secured throughits business activities.
Based on the above points, on November 7, 2023, the Company’s board of directors concluded that delisting
the Company Shares through the Transactions will contribute to the enhancement of the Group’s corporate
value.
In addition, based on the following points, the Company has determined that the Tender Offer Price (2,650
yen) is a reasonable price that secures the benefit that should be enjoyed by the ordinary shareholders of
the Company, and that the Tender Offer provides the ordinary shareholders with a reasonable opportunity
to sell their shares at a price with an appropriate premium:(A) the Tender Offer Price exceeds the upper bound of the range of values calculated by average market
price analysis, is greater than the median of the range of values calculated by comparable company
analysis, and is slightly below, but close to, the median of the range of values calculated by DCF
analysis in the Share Valuation Report prepared by Houlihan Lokey described in “(a) Procurement by

the Company of a Share Valuation Report from an Independent Financial Advisor and Third Party
Appraiser” in “(3) Matters Concerning Calculation”;(B) the Tender Offer Price represents a premium of 54.16% to the closing price of the Company Shares(1,719 yen) on the TSE Prime Market on the last business day before the announcement of the Tender
Offer (November 6, 2023), a premium of 57.18% to the simple average closing price of the Company
Shares (1,686 yen; rounded to the nearest whole yen; the same applies hereinafter to the calculationof simple average closing prices) on the TSE Prime Market over the one-month period ending on
November 6, 2023, a premium of 53.53% to the simple average closing price of the Company Shares(1,726 yen) on the TSE Prime Market over the three-month period ending on November 6, 2023, apremium of 43.55% to the simple average closing price of the Company Shares (1,846 yen) on the TSE
Prime Market over the six-month period ending on November 6, 2023, and these premiums arereasonable and generally greater than the average premium offered in the 45 MBOs announced andconducted since the publication of the Fair M&A Guidelines by the Ministry of Economy, Trade andIndustry on June 28, 2019 (a premium of 42.68% to the closing price on the last business day before
the announcement, 45.25% to the simple average closing price over the one-month period ending on
the last business day before the announcement, 49.60% to the simple average closing price over thepreceding three-month period, and 51.65% to the simple average closing price over the preceding
six-month period);(C) in determining the Tender Offer Price, measures to secure the fairness of the Tender Offer Price andmeasures to avoid conflicts of interest described in “(6) Measures to Ensure the Fairness of the Tender
Offer, Such as Measures to Ensure the Fairness of the Tender Offer Price and to Avoid Conflicts ofInterest” below were taken, and consideration was otherwise given to the interests of minority
shareholders;(D) the Tender Offer Price was determined through multiple rounds of discussions and negotiations
between the Company and the Tender Offeror with the substantial involvement of the Special
Committee, which were equivalent to discussions and negotiations in an arm’s length transaction,
after taking the above measures;(E)

the Tender Offer Price was recognized to be fair and reasonable in the Committee Report received
from the Special Committee described in “(c) Establishment by the Company of an Independent
Special Committee and Procurement of the Committee Report” in “(6) Measures to Ensure theFairness of the Tender Offer, Such as Measures to Ensure the Fairness of the Tender Offer Price andto Avoid Conflicts of Interest” below.

Therefore, the Company resolved at its board of directors meeting held on November 7, 2023 to endorse
the Tender Offer and to recommend that the shareholders of the Company tender shares in the Tender
Offer.
Subsequently, as described above, the Tender Offer was consummated, but the Offeror was unable to acquire allof the Company's shares (excluding the treasury stock held by the Company and the non-tendered shares)
through the Tender Offer. As announced in the Opinion Press Release, at the request of the Offeror and subject
to shareholder approval at the Extraordinary General Meeting of Shareholders held today, the Company's Boardof Directors has resolved that, in accordance with the Offeror's request, the Tender Offeror, Artemis and Keith
Japan (collectively, the "Tender Offer Related Parties") will be the only shareholders of the Company. In order tomake the Company's shares go private, the Company will conduct a Share Consolidation (the "Share
Consolidation") as described in "2. (2) Summary of the Share Consolidation", and resolved to submit a proposal
for the Share Consolidation to the Extraordinary General Meeting of Shareholders. As a result of the Share
Consolidation, the number of shares of the Company held by shareholders other than the Tender Offer Related
Parties will be reduced to fractions of less than one share.
Please refer to the Press Release of Opinion and the Tender Offer Result Press Release for details on the
background of the Transaction.
2. Summary of Share Consolidation(1) Schedule of Share Consolidation

Date of Public Notice of the Record Date for thisJanuary 5, 2024

Extraordinary General Meeting of Shareholders
Record date of this Extraordinary General Meeting ofJanuary 20, 2024

Shareholders
Date of resolution by the Board of Directors

January 31, 2024

Date of the Extraordinary General Meeting of Shareholders

March 4, 2024 (tentative)

Date of designation as Securities to Be Delisted

March 4, 2024 (tentative)

Last day of trading of the Company's shares

March 27, 2024 (tentative)

Delisting date of the Company's shares

March 28, 2024 (tentative)

Effective date of Share Consolidation

March 30, 2024 (tentative)(2) Details of the share consolidation
1. Type of shares to be consolidated
Common stock
2. Consolidation ratio
The Company's shares will be consolidated into one share at a ratio of 2,160,000 shares.
3. Total number of shares issued and outstanding to be reduced
17,279,992 shares(Note) The Company's Board of Directors resolved today to cancel 1,643,569 shares of treasury stock on
March 29, 2024, so the "Total number of shares issued and outstanding to be reduced" is based on the numberof shares issued and outstanding after such cancellation.
4. Total number of shares issued and outstanding before the effective date
17,280,000 shares(Note) Since the Company's Board of Directors resolved today to cancel 1,643,569 shares of treasury stockon March 29, 2024, the "Total number of shares issued and outstanding before the effective date" is thenumber of shares after deducting the number of treasury stock (1,643,569 shares) that the Company plans
to cancel on March 29, 2024.
5. Total number of shares issued and outstanding after the effective date
8 shares6. Total number of shares authorized to be issued as of the effective date
32 shares
7. Method of treatment of fractional shares and amount of money expected to be delivered to shareholders as aresult of such treatment
As stated in "1. Purpose and Reason for the Share Consolidation" above, as a result of the Share Consolidation,
the number of shares of the Company held by shareholders other than the Tender Offer Related Parties will
be fractions of less than one share. With respect to the method of treatment of fractions of less than one shareresulting from the Share Consolidation, the total number of shares (If there is a fraction of less than one sharein the total number of shares, such fraction will be rounded down pursuant to Article 235, Paragraph 1 of theCompanies Act (Act No. 86 of 2005, as amended). The Company will sell the number of shares equivalent to
the number of fractional shares of the Company's common stock in accordance with the provisions of Article
235 of the Companies Act and other applicable laws and regulations. With respect to such sale procedures,
the Company plans to sell shares equivalent to the total number of such fractions to the Tender Offeror after
obtaining permission of the court pursuant to Article 234, Paragraph 2 of the Companies Act.
In this case, if the necessary court approval is obtained as scheduled, we plan to set the sale price at a pricethat is equivalent to the Tender Offer Price multiplied by the number of our company's shares held byshareholders listed or recorded in our company's final shareholders' register as of March 29, 2024, the day
before the effective date of the Share Consolidation, multiplied by 2,650 yen, which is the same amount as theTender Offer Price. However, the actual amount to be delivered may differ from the above amount in cases
where permission of the court cannot be obtained or where fractional adjustments are required in thecalculation.
3. Basis, etc. of the amount of money expected to be delivered to shareholders as a result of the fractional shares dueto the consolidation of shares(1) Basis and reason for the amount of money expected to be delivered to shareholders as a result of fractional
shares(i) Matters taken into consideration so as not to impair the interests of shareholders other than the parent
company, etc., in cases where the parent company, etc., exists.
The Tender Offeror and the Company have taken into consideration the fact that the Tender Offer is part of
the Transaction, which falls under the category of a so-called management buyout (MBО), and that there are
structural conflicts of interest, etc., and have taken measures to ensure the fairness of the Tender Offer Price,eliminate arbitrariness in the decision-making process leading to the decision to conduct the Tender Offer,and avoid any conflicts of interest. Specifically, measures listed in “(3) Measures to ensure the fairness of theTransaction including the Tender Offer and to avoid conflicts of interest" below were taken from theperspective of eliminating arbitrariness and avoiding conflicts of interest.
(ii) Matters concerning the method of fractional share treatment (fractional share treatment), the amount ofmoney expected to be delivered to shareholders as a result of fractional share handling, and thereasonableness of such amounti. Method of handling of fractions of less than one shareA) Whether the Company plans to process in accordance with Article 235, Paragraph 1 of the Companies
Act or Article 234, Paragraph 2 of the Companies Act as applied mutatis mutandis pursuant to Paragraph 2of the same article, and the reason for such processing.
Please refer to "7. Method of disposal of fractional shares and amount of money expected to be delivered
to shareholders as a result of such disposal" in "(2) Details of the Share Consolidation" of the above "2.
Summary of the Share Consolidation."B) Name of the party expected to be the purchaser of the shares involved in the sale
Hokuto Management Co., Ltd.
C) Method and reasonableness of the method for securing funds for payment of the proceeds of the sale by
the person who is expected to be the purchaser of the shares to be sold
The Tender Offeror will use the funds for the acquisition of the Company's shares equivalent to the total
amount of fractions resulting from the Share Consolidation to pay for the purchase of the Company's
shares by Sumitomo Mitsui Banking Corporation ("Sumitomo Mitsui Banking") and Mizuho Bank, Ltd.
("Mizuho Bank"), and the Company has confirmed the Tender Offeror's method of securing funds byconfirming the loan certificates regarding the borrowings from Sumitomo Mitsui Banking and Mizuho Bank.
According to the Tender Offeror, no event has occurred that would hinder the payment of the proceedsfrom the sale of fractional shares, nor is any event expected to occur in the future that would hinder thepayment of the proceeds from the sale of fractional shares. Therefore, the Company has determined thatthe method of securing funds for the payment of the price for the sale of fractional equivalent shares by
the Tender Offeror is reasonable.
D) Estimated timing of sale and timing of delivery to shareholders of the proceeds from the sale
The Company plans to file a petition with the court in early April 2024, pursuant to Article 235, Paragraph
2 of the Companies Act, as applied mutatis mutandis pursuant to Article 234, Paragraph 2 of the same Act,requesting permission to sell the Company shares equivalent to the total number of fractional shares
resulting from the Share Consolidation. Although the timing of obtaining such permission may varydepending on the status of the court, the Company plans to sell the shares to the Tender Offeror in earlyMay 2024 upon obtaining the permission of the court, and then make the necessary preparations to deliver
the proceeds from such sale to the shareholders, and to sell the shares in early July 2024 upon obtaining
the permission of the court.
Considering the period of time required for the series of procedures related to the sale from the effective
date of the Share Consolidation, the Company has determined that the sale of the Company's sharesequivalent to the total number of fractional shares resulting from the Share Consolidation will be
conducted and the proceeds of such sale will be delivered to the shareholders at the respective times as
described above.
ii. Matters concerning the amount of money expected to be delivered to shareholders as a result of thefractional shares and the reasonableness of such amountAs stated in "1. Purpose and Reason for the Share Consolidation" above, the amount of cash expected to
be delivered to shareholders as a result of the fractional shares will be calculated by multiplying the numberof the Company's shares held by shareholders listed or recorded in the Company's final shareholders'register as of March 29, 2024, the day before the effective date of the Share Consolidation, by 2,650 yen,
the same amount as the Tender Offer Price.
In addition, the Company has determined that the Tender Offer Price (2,650 yen) is a reasonable price that
ensures the benefits to be enjoyed by the Company's common shareholders, and that the Tender Offer
provides the Company's common shareholders with a reasonable opportunity to sell their shares at a pricewith an appropriate premium, based on the following points and others.
(a) The Tender Offer Price is an amount that exceeds the upper limit of the range of the valuation results
based on the average market share price method and the median of the range of the valuation results
based on the comparable company method, as well as being close to, but slightly below, the median of
the range of the valuation results based on the DCF method, as calculated in the Share Valuation Reportby Houlihan Lokey, which is described below "(i) Obtaining a Share Price Valuation Report from an
Independent Financial Advisor and Third Party Calculation Agent of the Company " under "(3) Measures
to Ensure the Fairness of the Transaction and to Avoid Conflicts of Interest" under "3. Basis, etc. of theAmount of Cash Expected to be Delivered to Shareholders as a Result of Fractional Share Consolidation".
(b) The Tender Offer Price represents a premium of 54.16% on the closing price of 1,719 yen of theCompany's shares on the Tokyo Stock Exchange Prime Market on November 6, 2023, the business day
immediately preceding the announcement of the Tender Offer. The premiums are 57.18% on the simple
average of 1,686 yen of the closing price for the past one month until November 6 (rounded to thenearest yen. The same shall apply hereinafter in the calculation of the simple average of the closing price),
53.53% on the simple average of 1,726 yen of the closing price for the past three months, and 43.55% on
the simple average of 1,846 yen of the closing price for the past six months. Each of these premiums
was calculated by comparing the average premiums in the 45 MBO cases that were announced andcompleted after June 28, 2019, when METI published its fair M&A guidelines (42.68% of the closing priceon the business day preceding the announcement date, 45.25% of the simple average of the closing
prices for the past one month until the business day preceding the announcement date, 49.60% of thesimple average of the closing prices for the past three months until the business day preceding theannouncement date, and 51.65% of the simple average of the closing prices for the past six months).
The premium level is considered to be reasonable and generally higher than these premium levels.
(c) In determining the Tender Offer Price, consideration is given to the interests of minority shareholders,
including measures to ensure the fairness of the Tender Offer Price and to avoid conflicts of interest as
described below (3) Measures to ensure the fairness of the Transaction and to avoid conflicts of interest"in "3. Basis, etc. of the amount of money expected to be delivered to shareholders as a result of thefractional shares resulting from the consolidation of shares.
(d) The Tender Offer Price was determined after the above measures were taken and after multiple roundsof discussions and negotiations equivalent to those conducted in an arm's length transaction between
the Company and the Tender Offeror with the substantial involvement of the Special Committee.
(e) The Tender Offer Price has also been determined to be appropriate based on the Written Reportobtained from the Special Committee as described in "(iii) Establishment of an Independent Special
Committee and Acquisition of the Report of the Special Committee" in "(3) Measures to Ensure theFairness of the Transaction and to Avoid Conflicts of Interest".
In addition, after the Company's Board of Directors' meeting held on November 7, 2023, at which it
expressed its opinion in favor of the Tender Offer and recommended that the Company's shareholders
tender their shares in the Tender Offer, until the resolution of the Company's Board of Directors' meeting
held today, which decided to convene this Extraordinary General Meeting of Shareholders, the Company
The Company has confirmed that no factors have arisen that would require a change in the Company's
decision regarding the Transaction.
Based on the above, the Company has determined that the amount of money expected to be delivered toshareholders as a result of the fractional purchase is reasonable.
iii. Disposition of material assets, incurrence of material liabilities, or other events occurring after the last dayof the last fiscal year of the Company that materially affect the status of the Company's assets
A) Completion of the Tender Offer
As described in "1. Purpose and Reason for the Share Consolidation" above, the Offeror conducted theTender Offer for 37 business days from November 8, 2023 to January 4, 2024. As a result of the Tender
Offer, as of January 12, 2024 (the commencement date of settlement of the Tender Offer), the Offeror
holds 10,487,063 shares of the Company (ownership ratio: 61.53%).
B) Cancellation of Treasury shares
At a meeting of the Company's Board of Directors held today, the Company resolved to cancel 1,643,569
shares of the Company's treasury shares on March 29, 2024. Such cancellation of treasury shares issubject to approval of the proposal at the Extraordinary General Meeting of Shareholders as proposed,
and the total number of outstanding shares of the Company after the cancellation of treasury shares willbe 17,280,000 shares.
(2) Likelihood of delisting(i) Delisting
As stated in "1. Purpose and Reason for the Share Consolidation" above, subject to the approval ofshareholders at the Extraordinary Shareholders' Meeting, the Company plans to implement the Share
Consolidation and the only shareholders of the Company will be the Tender Offer Related Parties. As a result,
the Company's shares are scheduled to be delisted through prescribed procedures in accordance with thedelisting standards of the Tokyo Stock Exchange. As for the schedule, the Company's shares are expected to
be delisted on March 28, 2024, after being designated as Securities to Be Delisted from March 4, 2024, to
March 27, 2024. After the delisting, the Company's shares cannot be traded on the Tokyo Stock Exchange
Prime Market.
(ii) Reason for Purpose of Delisting
As stated in "1. Purpose and Reason for the Share Consolidation" above, the Company has determined thattaking the Company's shares private through this transaction will contribute to the enhancement of theCompany's corporate value.
(iii) Impact on minority shareholders and the Company's approach to such impact
As described in "(3) Measures to Ensure the Fairness of the Transaction and to Avoid Conflicts of Interest"
under "(iii) Establishment of an Independent Special Committee and Acquisition of the Report by theCompany" below, the Board of Directors of the Company has received the Report dated November 6, 2023
from the Special Committee to the effect that the decision on the Transaction (including that the Board of
Directors of the Company expresses its opinion in favor of the Tender Offer and recommends that theshareholders of the Company tender their shares in the Tender Offer) is not detrimental to the minority
shareholders of the Company. The Board of Directors of the Company received a written report from theSpecial Committee on November 6, 2023 to the effect that the decision of the Transaction is notdisadvantageous to minority shareholders of the Company.
(3) Measures to Ensure the Fairness of the Tender Offer and to Avoid Conflicts of Interest in this transaction
In light of the structural conflict of interest that exists due to the Tender Offer being part of the Transactions, whichconstitute a management buyout (MBO), the following measures have been taken to ensure the fairness of theTransactions including the Tender Offer Price from the perspective of ensuring the fairness of the Tender Offer
Price, eliminating arbitrariness in the decision-making process leading to the decision to conduct the Tender Offer,and avoiding conflicts of interest.
The Tender Offeror has not set a minimum number of shares to be purchased which corresponds to a “majorityof the minority” in the Tender Offer, having judged that setting such minimum number of shares to be purchasedin the Tender Offer would make the successful completion of the Tender Offer uncertain, and therefore may be
detrimental to the interests of those minority shareholders who wish to tender their shares in the Tender Offer.
However, the Tender Offeror believes that sufficient consideration has been given to the interests of the minority
shareholders of the Company given that the Tender Offeror and the Company have taken the following measures((a) through (f)).
The statements below that relate to measures taken by the Tender Offeror are based on explanations received
from the Tender Offeror.
(a) Procurement by the Company of a Share Valuation Report from an Independent Financial Advisor and Third
Party Appraiser
Prior to expressing its opinion on the Tender Offer, the Company requested the valuation of the Company Shares
by Houlihan Lokey as a measure to ensure the fairness and objectivity of the terms of the Transactions, including
the Tender Offer Price, and obtained the Share Valuation Report dated November 6, 2023. Houlihan Lokey is afinancial advisor and third-party appraiser independent of the Tender Offeror and the Company, and is not a
related party of the Tender Offeror or the Company. The Company has not obtained an opinion concerning thefairness of the Tender Offer Price (a fairness opinion) from Houlihan Lokey.
Houlihan Lokey’s compensation for the Transactions includes a contingency fee that is subject to the successful
completion of the Transactions and other conditions. The Company appointed Houlihan Lokey as its financial
advisor and third-party appraiser under the above compensation structure based on the judgment that theinclusion of a contingency fee to be paid on the condition that the Tender Offer is successfully completed does notnegate Houlihan Lokey’s independence, in consideration of the standard practice in similar transactions and themerits of a compensation structure that could impose a substantial financial burden on the Company even if theTransactions are not successful.
In addition, the Special Committee has approved the financial advisor and third-party appraiser appointed by theCompany, as there are no problems with its independence and expertise, and has confirmed that the Special
Committee may also receive professional advice from that financial advisor as necessary.
The Company obtained the Share Valuation Report from Houlihan Lokey dated November 6, 2023. Afterconsidering which of the various valuation methods should be adopted for calculating the value of the Company
Shares, Houlihan Lokey used average market price analysis, because the Company Shares are listed on the TSE
Prime Market and the market price of the Company Shares is available, comparable company analysis, because
there are several listed companies engaged in business relatively similar to the Company’s and it is possible toanalogize the stock value by comparison with similar companies, and DCF analysis, to reflect the intrinsic value of
the Company based on its future business activities.
The following are the valuation ranges per Company Share based on the above valuation methods.
Average market price analysis:

1,686 yen to 1,846 yen

Comparable company analysis:

2,298 yen to 2,908 yen

DCF analysis:

2,475 yen to 2,908 yen

For the average market price analysis, the reference date was set as November 6, 2023, and the value range
per Company Share was calculated to be 1,686 yen to 1,846 yen based on the closing price of the Company
Shares on the TSE Prime Market as of the reference date (1,719 yen), the simple average closing price overthe preceding one-month period (October 10 to November 6, 2023; 1,686 yen), the simple average closing
price over the preceding three-month period (August 7 to November 6, 2023; 1,726 yen), and the simple
average closing price over the preceding six-month period (May 8 to November 6, 2023; 1,846 yen).
For the comparable company analysis, Linical Co., Ltd., I'rom Group Co., Ltd., SHIN NIPPON BIOMEDICALLABORATORIES, LTD., WDB coco Co., Ltd., and PhoenixBio Co., Ltd. were selected as listed companies
engaged in business relatively similar to the Company’s, and the value range per Company Share wascalculated to be 2,298 yen to 2,908 yen using a multiple of EBITDA to corporate value.
For the DCF analysis, the corporate value and the share value of the Company were calculated bydiscounting, based on a certain discount rate, the free cash flows that the Company is expected to generate
in and after the fiscal year ending September 2024 based on various factors including the earnings forecasts
and investment plans in the business plan of the Company for the three fiscal years from the fiscal year
ending September 2024 through the fiscal year ending September 2026 (the preparation of which did not
involve Mr. Nakamura or Ms. Oishi in any capacity) and publicly available information, and the value range
per Company Share was calculated to be 2,475 yen to 2,908 yen. The discount rate employed was 6.25%%
to 7.25%, and the going concern value was calculated by the perpetual growth method based on apermanent growth rate of -0.25% to 0.25%. As stated in the “Announcement of New Mid-termManagement Plan” issued on November 5, 2021, the Company had formulated a mid-term management
plan for the four fiscal years from the fiscal year ending September 2022 to the fiscal year ending
September 2025, but in the course of Houlihan Lokey’s valuation of the Company Shares, it was determinedthat it would be appropriate to reflect the current business situation, including the transition of CMIC CMO
Co., Ltd., CMIC CMO Korea Co., Ltd. and CMIC CMO USA Corporation from consolidated subsidiaries toequity method affiliates in connection with the strategic business alliance with Dai Nippon Printing Co.,
Ltd., and the Company formulated a new business plan. In formulating the business plan, the Company
considered three fiscal years to be an appropriate period of time to formulate a reasonable plan, in lightof the accelerating changes in its business environment, including the slowdown of the domestic CRO
market, the subsidence of the Covid-19 pandemic, and the progress of digitalization in the healthcare field.
The business plan prepared by the Company and used by Houlihan Lokey as the basis for the DCF analysis
contains fiscal years in which a significant decrease in earnings is expected. Specifically, the Company
expects a significant decrease in sales in the vaccine development and vaccination support-related businessin the Healthcare Solutions segment in the fiscal year ending September 2024 due to the end of the Covid19 pandemic and its reclassification under the Act on the Prevention of Infectious Diseases from a “Novel
Influenza Infection, etc.” (a so-called Class II equivalent) to a “Class V Infectious Disease,” and a significant
on-year decrease in operating profit in the fiscal year ending September 2024 due to the transition of CMIC

CMO Co., Ltd., CMIC CMO Korea Co., Ltd. and CMIC CMO USA Corporation from consolidated subsidiaries
to equity method affiliates. In addition, due to the significant decrease in profit expected for the fiscal year
ending September 2024, the Company expects a significant on-year increase in free cash flow in the fiscal
year ending September 2025 due to a decrease in the amount of bonuses paid in that year, which is partly
linked to the previous year’s performance. The Company expects a significant on-year increase in free cash
flows in the fiscal year ending September 2026, due to a slowdown in the year-on-year sales growth rate,
which will result in a smaller increase in working capital compared to the previous year. The business plan
prepared by the Company and used by Houlihan Lokey for the DCF analysis is not based on the assumptionthat the Transactions will be implemented, and the measures to enhance corporate value that the Tender
Offeror intends to implement after the Transactions are successfully completed are not taken into accountin the financial projections below, given the difficulty of estimating them quantitatively at this time.
The financial projections based on the business plan prepared by the Company and used by Houlihan Lokey
for the DCF analysis are as follows:(units: million JPY)
FY2025/9

FY2024/9

FY2026/9

Net sales

75,94085,116

87,795

EBITDA

4,910

5,561

6,083

Operating profit

3,020

3,661

4,054

Free cash flow

531

998

2,093

Houlihan Lokey did not verify the accuracy, appropriateness, or completeness of the information provided
by the Company or publicly available information when calculating the value of the Company Shares, nor
has Houlihan Lokey made any independent evaluation or appraisal of the Group’s non-consolidated assets
and liabilities (including off-balance sheet assets and liabilities), and the Company has not obtained any
appraisal or valuation report with respect to those assets and liabilities. Houlihan Lokey further assumed
that there are no undisclosed material facts that would affect the valuation of the Company Shares andthat the Company’s financial projections (including business plans and other information) have beenreasonably prepared based on the best currently available estimates and judgment of the Company’s
management.
(b) Procurement by the Company of Advice from an Independent Law Firm
In order to ensure the fairness and appropriateness of the decision-making process of the board of
directors of the Company with respect to the Transactions including the Tender Offer, the Company
appointed Mori Hamada & Matsumoto as its legal advisor independent of the Tender Offeror, the Company,
and the Transactions, and received the necessary legal advice from that firm concerning the method andprocess of decision-making with respect to the procedures related to the Transactions and other mattersto be noted. Mori Hamada & Matsumoto is not a related party of the Tender Offeror or the Company, anddoes not have any material interest in respect of the Transactions. Mori Hamada & Matsumoto’s
compensation consists solely of an hourly rate irrespective of the success of the Transactions, and thatcompensation does not include any part that is subject to the successful completion of the Transactions.
In addition, the Special Committee approved the legal advisor appointed by the Company, as there are no
problems with its independence and expertise, and has confirmed that the Special Committee may also
receive professional advice from that legal advisor as necessary.
(c) Establishment by the Company of an Independent Special Committee and Procurement of the Committee
Report(i) Background of Establishment, Etc. of the Special Committee
In light of the structural conflict of interest that exists due to the Transactions being conducted
as part of a management buyout (MBO), the board of directors of the Company adopted awritten resolution on August 7, 2023 to establish the Special Committee, which comprises
members who are independent of the Tender Offeror, in order to address the issues of structural
conflict of interest and information asymmetry in the Transactions, eliminate arbitrariness in thedecision-making process of the Company’s board of directors, and ensure the fairness,transparency, and objectivity of the Transactions. Mr. Nakamura did not participate in thatboard of directors resolution (written resolution) because he is a director with a special interest
due to his conflict of interest with the Company in relation to the Transactions, given that heplanned to establish the special purpose corporation (SPC) that would become the Tender
Offeror, and that Artemis and Keith Japan, which are the asset management companies of Mr.
Nakamura and his relatives within the first degree of kinship, will continue to hold the NonTendered Shares after the completion of the Tender Offer. Ms. Oishi did not participate in thatboard of directors resolution (written resolution) based on the possibility that she has a special
interest in the Transactions, given that she is Mr. Nakamura’s spouse and will continue tomanage the Company with Mr. Nakamura after the Transactions. In addition, starting in late July
2023, the Company individually explained to all seven of its independent outside directors andindependent outside corporate auditors as of that time that it had received an initial proposal
for the Transactions from Mr. Nakamura and that it is necessary to take sufficient measures toin order to address the issues of structural conflict of interest and information asymmetry in theTransactions, eliminate arbitrariness in the decision-making process of the Company’s board of
directors, and ensure the fairness, transparency, and objectivity of the Transactions, in order toestablish a system to examine, negotiate, and make decisions regarding the Transactions froma standpoint independent of the Tender Offeror and from the perspective of enhancing thecorporate value of the Company and securing the interests of the Company’s ordinary
shareholders prior to the establishment of the special committee. The Company also confirmed,
with advice from Mori Hamada & Matsumoto, that the independent outside directors andindependent outside corporate auditors of the Company that were candidates for the membersof the Special Committee are independent of the Tender Offeror, do not have any materialinterests that differ from those of the ordinary shareholders regarding the success or failure of
the Transactions, and are qualified to serve as members of the Special Committee, andappointed Mr. Takeshi Karasawa (independent outside director of the Company), Mr. Masaru
Ota (independent outside director of the Company), Mr. Kei Hata (independent outside
corporate auditor of the Company) and Mr. Hidetoshi Watanabe (independent outside
corporate auditor of the Company) as the members of the Special Committee, based on theopinions of the independent outside directors and independent outside corporate auditors of
the Company, in order to ensure a balance of knowledge, experience, and abilities of the Special
Committee as a whole while establishing a special committee of an appropriate size. The Special
Committee selected Mr. Masaru Ota as the chairman of the Special Committee by mutual vote.
These four were the members of the Special Committee originally selected by the Company, andthe Company has not changed the members of the Special Committee. The Special Committee’scompensation consists solely of fixed compensation irrespective of the content of its report, andthat compensation does not include any part that is payable subject to the successful completionof the Transactions including the Tender Offer.
The Company instructed the Special Committee to: (a) examine and report to the board of
directors on whether the board of directors should endorse the Tender Offer, and whether theboard of directors should recommend that the shareholders of the Company tender shares inthe Tender Offer, and (b) consider and give its opinion to the board of directors on whether theboard’s decision with respect to the Transactions is disadvantageous to the minority
shareholders (ordinary shareholders) of the Company (the matters described in (a) and (b)collectively, the “Referred Matters”). With respect to Referred Matter (a), the Special
Committee was to consider and determine (x) the merits of the Transactions from thestandpoint of whether they will contribute to the corporate value of the Company and (y)whether the transaction terms are appropriate and the procedures fair from the standpoint ofpromoting the interests of the ordinary shareholders of the Company (including the measures
to ensure fairness taken with respect to the Transactions). When establishing the Special
Committee, the Company also passed a resolution to the effect that decisions regarding theTransactions made by the board of directors of the Company, including whether to endorse theTender Offer, will respect the content of the Special Committee’s decision to the maximum
possible extent, and if the Special Committee determines that the execution or the terms of theTransactions are not appropriate, the board of directors will not approve the Transactions(including not endorsing the Tender Offer), and granting the Special Committee authority to: (a)negotiate with the Tender Offeror (including indirect negotiation through the Company’s
officers, employees, advisors, and the like) regarding the transaction terms and other matters;(b) appoint its own financial and legal advisors (at the Company’s cost) as necessary for making
its report on the Referred Matters, and nominate or approve the Company’s financial and legal
advisors (including approval after the fact; the Special Committee may seek professional advice
from the Company's advisors if it confirms that there are no problems with the independence
and expertise of those advisors); (c) request the attendance of persons deemed necessary by
the Special Committee at meetings of the Special Committee to explain necessary information;(d) receive the information necessary for its examination and judgment regarding theTransactions from the Company’s officers and employees, including information on the content
and assumptions of the business plan; and (e) other powers that the Special Committee deems
necessary for its examination and judgment regarding the Transactions.
(ii) Background of Examination, Etc. by the Special Committee
The Special Committee met a total of 11 times between August 15, 2023 and November 6, 2023
(for a total of approximately 11 hours), and the Special Committee carefully reviewed anddiscussed the Referred Matters following reports, discussions and deliberations by email andother methods in the interim between meetings. Specifically, the Special Committee received
an explanation from the Company regarding the background to the Transactions being proposed,
the purpose of the Transactions, the business environment, the business plan, businesschallenges, and similar matters, and conducted a question and answer session, and received an
explanation from the Tender Offeror regarding the background and reasons for proposing theTransactions, the purpose of the Transactions, the conditions of the Transactions, and similar
matters, and conducted a question and answer session. In addition, the Special Committee has
actively negotiated the terms of the Transactions, including the Tender Offer Price, with Mr.
Nakamura, directly or indirectly through Houlihan Lokey, on multiple occasions. The Special
Committee also received an explanation from Houlihan Lokey regarding the method and resultsof the valuation of the Company Shares.
(iii) Details of Decision of the Special Committee
The Special Committee carefully discussed and examined the Referred Matters, and on
November 6, 2023, submitted to the board of directors of the Company its Committee Report,
which represents the unanimous opinion of the Special Committee in generally the followingsubstance.
i. Content of the OpinionA.

We believe that the board of directors of the Company should resolve to endorse the Tender
Offer and recommend that the shareholders of the Company tender their shares in theTender Offer.

B.

We believe that a resolution of the board of directors of the Company to endorse the Tender
Offer and recommend that the shareholders of the Company tender their shares in theTender Offer would not be disadvantageous to the minority shareholders (ordinary
shareholders) of the Company. In addition, we believe that conducting the Squeeze-Out
Procedures in the event that the Tender Offeror does not acquire all of the Company Sharesthrough the Tender Offer would not be disadvantageous to the minority shareholders(ordinary shareholders) of the Company.

ii. Reasons for the Opinion
A.

Based on the following points, we believe that the Transactions will contribute to theenhancement of the Company’s corporate value and that the purposes of the Transactions
are justified and reasonable.
• We recognize that the environment surrounding the Company is changing rapidly giventhat the pharmaceutical industry faces, in addition to the increasing pressure to lower drug
prices, a slowdown in the growth of the domestic drug discovery outsourcing market
against a background of rising costs caused by increased demand for highly specialized
clinical trials, the declining competitiveness of the domestic pharmaceutical industry, andintensifying competition in the domestic clinical trial market, such that the Company
anticipates that competition will further intensify going forward, that we are also
concerned that our revenues will gradually decrease in the future as the impact of theCovid-19 pandemic runs its course and that the healthcare tech field, which the Company
has positioned as its new profit center, is also the subject of intensifying competition due
to the entry of not only startups but also major domestic and foreign tech companies andcompanies from other industries.
• In this business environment, we recognize the urgent need for the Company to increase
orders from overseas pharmaceutical companies, particularly biotech companies, expand
its access to the growing Asian clinical trial market, make its Asian CRO business profitable,
expand the Healthcare business, and solve the problem of retaining and securing talented
personnel, which are the key to growth in both the PVC and PHVC businesses.
• In light of the business and management environment surrounding the Company, theGroup formulated a medium-term plan covering the four-year period from the fiscal year
ending September 2022 to the fiscal year ending September 2025 (the “Medium-TermPlan”), and based on the basic policy of “pharmaceutical value creator to personal healthvalue creator,” the Group aims to transition toward a personal health value creator (PHVC)
business model, which will “maximize the health value of each individual,” with its unique
pharmaceutical value creator (PVC) business model, which comprehensively supports thevalue chain of pharmaceutical companies, as a foundation for sustainable growth, and has
been working to address issues including the following, which are described as key issues
in the Medium-Term Plan: (i) promotion of the Healthcare business, (ii) enhancement ofcomprehensive support for disease prevention and treatment from research anddevelopment through sales, and (iii) contribution to a sustainable society. In order for theCompany to flexibly respond to the changing healthcare ecosystem and achievesustainable growth and expansion, we believe that it is essential for it to take boldmeasures from a medium- to long-term perspective in the core CRO business.
• Mr. Nakamura explained that in light of the above changes in the business environment
surrounding the Company, he believes that it would be difficult for the Group to achievesustainable growth simply by developing the Company’s existing businesses in the same
way as before, and that it would be possible to further enhance the corporate value of theGroup by delisting the Company through the Transactions and implementing measures
including (i) alliances with business partners to accelerate CRO business development inglobal markets including Asia and the U.S., (ii) intermittent capital investments in the CRO
business (non-clinical), (iii) continuous investment in the Healthcare Revolution business,and (iv) a fundamental review of its personnel evaluation system and compensation
structure.
• The Company also believes that it is necessary to establish a management structure thatallows the necessary upfront investments and other fundamental measures that become
necessary in the future to be made more flexibly and promptly, in light of the businessenvironment surrounding the Company and the Company’s management challenges
described above, and that it is necessary to implement the measures described above.
• The Company explained that while it anticipates a potentially negative impact on the
Company’s business due to the fact that the Company will no longer be able to raise equity
financing from the capital markets, and will not be able to enjoy the benefits that are
generally available to listed companies as a result of greater name recognition, such as therecruitment of talented human resources and the enhancement of public credibility, thedisadvantages of delisting can be considered to be limited, considering the current financial
situation of the Group and the recent low interest rate environment for indirect financing,the Group has little need for equity financing to raise large amounts of capital for the time
being, and the Group’s name recognition and credibility are largely secured through its
business activities. Although there is a possibility that there will be restrictions on the
management and business operations of the Group as a result of the financing procuredby the Tender Offeror for the Transactions, Mr. Nakamura explained that, based on thebusiness plan provided to Mr. Nakamura by the Company, the content will leave a sufficientmargin that will not overly restrict the future business activities of the Group, and basedon the advice of the Company’s financial advisor, Houlihan Lokey, we expect the impact of
the Transactions on the Company’s investment capacity and cash flow to be limited.
• Based on the above, the Special Committee has carefully discussed and examined thebusiness environment surrounding the Company and the Company’s management
challenges, as well as the Company’s understanding of the content and status of measures
based on that business environment, which were explained to the Special Committee by
the Company, and there is no discrepancy with the Special Committee’s understanding. In
addition, Mr. Nakamura’s explanation regarding the significance of the Transaction is notunreasonable, and while the realization of the above measures requires upfront
investments that entail risk and prompt and bold action from the perspective of enhancing
medium- to long-term corporate value, delisting will make it easier to implement measures
for which it would be difficult to make sufficient upfront investment in a timely manner as
a listed company, and we expect that the Company will be able to implement structuralreforms by making upfront investments that entail risk in order to enhance corporate value
over the medium to long term, and which do not necessarily match the expectations of thestock market, which seeks short-term returns. Furthermore, the Company’s understandingof the disadvantages of conducting the Transactions described above and the methods ofmitigating such disadvantages are reasonable, and those disadvantages are not expected
to be so great as to outweigh the advantages of the Transactions. In addition, the financing
procured by the Tender Offeror in connection with the Transactions is expected to have alimited impact on the Company’s investment capacity and cash flow after the Transactions.
B. Based on the following points, we believe that the fairness and appropriateness of the termsof the Transactions are ensured.
• The average market price analysis, comparable company analysis, and DCF analysis usedby Houlihan Lokey in the valuation of the Company’s shares are common and reasonable
methods in light of current practice, the methods used to classify business assets and nonbusiness assets in the DCF analysis and the explanation regarding the basis for the discountrate are reasonable, and the details of the calculation are also appropriate in light ofcurrent practice. Therefore, the content of the calculations in the Share Valuation Report
is reasonable.
• The procedures for formulating the business plan of the Company that was used as thebasis for the DCF analysis in the Share Valuation Report, and the content of that plan, arereasonable.
• In light of the valuation of the Company’s shares in the Share Valuation Report, the TenderOffer Price exceeds the upper bound of the range of values calculated by average market
price analysis, is greater than the median of the range of values calculated by comparable
company analysis, and is slightly below, but close to, the median of the range of values
calculated by DCF analysis.
• The premium represented by the Tender Offer Price is reasonable and generally greaterthan the average premium to the closing price on the last business day before theannouncement and the simple average closing price over the preceding one-month, threemonth, and six-month periods, in MBO deals involving Japanese listed companies
announced after June 28, 2019, which is the date of publication of the “Guidelines on Fair
M&A Practices” by the Ministry of Economy, Trade and Industry (to the closing price on thelast business day before the announcement: 42.68%; to the preceding one-month period:
45.25%; to the preceding three-month period: 49.60%; to the preceding six-month period:
51.65%).
• The Special Committee actively negotiated with Mr. Nakamura, taking into account theopinions and advice of the Company and Houlihan Lokey, and there are no other specificcircumstances that would raise doubts about the fairness of the process of determining theTender Offer Price.
• It is reasonable to conduct the Transactions at the time proposed by the Tender Offeror,
given the need for prompt and bold structural reform in light of the rapid changes in theexternal environment surrounding the Company and the significant decrease in the
Company’s Covid-19-related business.
• The method of acquisition used in the Transactions, namely conducting the Tender Offer
as the first step and conducting a squeeze-out through the Share Consolidation as thesecond step, is a method commonly adopted in transactions for the purpose of delisting,as in the case of the Transactions. Although some of the shares held by Artemis and Keith
Japan will not be tendered in the Tender Offer, according to Mr. Nakamura, thosecompanies’ continued ownership of the Company Shares demonstrates Mr. Nakamura’scommitment to the Company’s management after the Transactions, and is intended toreduce the amount of outside financing required to procure the funds necessary for theTransactions. There is nothing particularly unreasonable about this explanation.
C.

Based on the following points, we believe that sufficient consideration has been given to theinterests of the Company’s shareholders through fair procedures in the Transactions.
• The Company established a special committee that is appropriately constituted to protect
the interests of ordinary shareholders from the perspective of having no material interestin the Tender Offeror and no material interest that differs from those of the ordinary
shareholders regarding the success or failure of the Transactions, and the Special
Committee can be considered to have been substantively involved in the process ofnegotiating the purchase price and other terms of the Transactions between the Company
and the Tender Offeror, and functioned effectively.
• With the approval of the Special Committee, the Company received legal advice from Mori
Hamada & Matsumoto, a legal advisor independent of the Tender Offeror and theCompany, which is not a related party of the Tender Offeror or the Company and does nothave a material interest in the Transactions including the Tender Offer.
• With the approval of the Special Committee, the Company received advice and opinionsfrom a financial standpoint and obtained the Share Valuation Report from Houlihan Lokey,
a financial advisor and third-party appraiser independent of the Tender Offeror and theCompany, which is not a related party of the Tender Offeror or the Company and does nothave a material interest in the Transactions including the Tender Offer.
• With the approval of the Special Committee, the Company established a system within the
Company for examination, negotiation, and decision-making regarding the Transactions,from a standpoint independent of the Tender Offeror, by an independent team comprisingsolely directors, officers and employees who are recognized as independent from theTender Offeror.
• Of the directors of the Company, representative director Mr. Nakamura did not participate
in the deliberations or resolution of the board of directors of the Company with respect tothe Transactions, nor did he participate in any discussions or negotiations with the Offeror
on the side of the Company, given that he is a director with a special interest due to his
conflict of interest with the Company in relation to the Transactions as the sole shareholder
and representative director of SORA, which holds all the shares of the Tender Offeror, andas the representative director of the Tender Offeror, and because Artemis and Keith Japan,
which are the asset management companies of Mr. Nakamura and his relatives within thefirst degree of kinship, will continue to hold shares of the Company after the Transactions.
Ms. Oishi did not participate in the deliberations or resolution of the board of directors of
the Company with respect to the Transactions, nor did she participate in any discussions or
negotiations with the Offeror on the side of the Company, based on the possibility that she
has a special interest in the Transactions, given that she is Mr. Nakamura’s spouse and willcontinue to manage the Company with Mr. Nakamura after the Transactions.
• The Tender Offeror plans to set a tender offer period of 37 business days, where thestatutory minimum tender offer period is 20 business days, and by setting a relatively longtender offer period, the Tender Offeror aims to secure an appropriate opportunity for theshareholders of the Company to make a decision as to whether to tender their shares in
the Tender Offer, and to secure an opportunity for any party other than the Tender Offeror
to make a competing offer to purchase the shares of the Company, the Tender Offeror has
not entered into any agreement with the Company that limits the Company’s contact with
Competing Bidders, including any agreement containing a transaction protection clausethat forbids the Company from contacting Competing Bidders and, thus, a so-called passive
market check has been conducted. The Company did not conduct an active market check todetermine whether there were any potential purchasers in the market. However, although
Mr. Nakamura is not the controlling shareholder of the Company, Mr. Nakamura and his
specially related parties hold 49% of the Company Shares, and according to Mr. Nakamura,these shareholders have no intention to sell their holdings of the Company Shares to any
third party, except for their intention to sell part of their holdings in the Tender Offer;
therefore, a market check would have limited function as a measure to ensure fairness in
the Transactions. Given that other substantial measures to ensure fairness have been takenin this matter, and sufficient consideration has been given to the interests of theCompany’s shareholders through fair procedures, the fact that no active market check was
conducted for the Transactions does not undermine the fairness of the procedures in theTender Offer.
• Mr. Nakamura’s explanation that he does not plan to set a majority-of-the-minority
condition in the Tender Offer because (a) a majority-of-the-minority condition would makethe successful completion of the Tender Offer uncertain and may not contribute to theinterests of minority shareholders who wish to tender their shares in the Tender Offer, (b)the Tender Offeror and the Company have taken sufficient measures to ensure fairness
including the establishment of a special committee, and sufficient consideration has been
given to the interests of the Company’s minority shareholders, and (c) a passive market
check has been conducted as described above, is not unreasonable, given that the Tender
Offer Price is of an appropriate level and that substantial measures to ensure fairness havebeen taken in the Transactions and that sufficient consideration has been given to theinterests of the Company’s shareholders through fair procedures, the fairness of theTransaction is not negated even if a majority-of-the-minority condition is not set.
• In order to ensure that ordinary shareholders have an opportunity to make an appropriate
decision with respect to the Tender Offer based on sufficient information, substantial
information disclosures are planned by means of press releases and the position statement
concerning the Transactions.
• In the Transactions, the Squeeze-Out Procedures are to be conducted shortly after thecompletion of the Tender Offer, and the amount of money to be delivered to shareholders
through those procedures is to be calculated so as to be equal to the product of the Tender
Offer Price multiplied by the number of the Company Shares held by each shareholder. The
legality of the Squeeze-Out Procedures has been ensured, taking into consideration thefact that the Squeeze-Out Procedures will be conducted in compliance with the Companies
Act and other applicable laws and ordinances, and that the Squeeze-Out Procedures will
be expressly announced in the press release and other disclosures, so that no issues of
coercion will exist with respect to the Transactions.

D.

We believe that the Transactions will contribute to the enhancement of the corporate valueof the Company and the purposes of the Transactions are justified and reasonable as describedin A. above, that the fairness and appropriateness of the Tender Offer Price and other termsof the Transactions are ensured as described in B. above, and that the Transactions are
conducted through appropriate procedures from the standpoint of promoting the interests of
the ordinary shareholders as described in C. above, and as such, we believe that the decisionof the Company’s board of directors to endorse the Tender Offer and recommend that theshareholders of the Company tender their shares in the Tender Offer is appropriate.

(d) Establishment by the Company of an Independent Examination System
As described in “(c) Process of and Reasons for the Company’s Decision to Endorse the Tender Offer”
in “(2) Grounds and Reasons for the Opinion” above, in order to address the issues of structural
conflict of interest and information asymmetry in the Transactions, eliminate arbitrariness in thedecision-making process of the Company’s board of directors, and ensure the fairness, transparency,
and objectivity of the Transactions, the Company established a system to examine, negotiate, andmake decisions regarding the Transactions from a standpoint independent of the Tender Offeror andfrom the perspective of enhancing the corporate value of the Company and securing the interests of
the Company’s ordinary shareholders. Specifically, the Company decided that no person who
participates in or assists the Tender Offeror in its deliberation, negotiation, and decision-making
regarding the Transactions should be part of the independent team, and the board of directors of theCompany adopted a resolution (written resolution) on August 7, 2023 to establish an independent
team comprising one director of the Company and nine officers and employees of the Company, fromthe perspective of ensuring that the independent team comprises only officers and employees who
are recognized as independent from the Tender Offeror, and has maintained this policy up to thepresent day.
In addition, the business plan presented to the Tender Offeror and the business plan used by Houlihan
Lokey as the basis for the valuation of the Company’s shares were prepared under the leadership of
the independent team, with support from Houlihan Lokey as necessary, and Special Committee
confirmed that the content, material assumptions, and preparation process of the final business plan
were reasonable, and approved that plan.
The system established within the Company to examine the Transactions, including such measures, isbased on the advice of Mori Hamada & Matsumoto, and the Special Committee has confirmed that
there are not problems from the standpoint of independence and fairness.
(e)

Approval of All Disinterested Directors of the Company and Opinion of Auditors of the Company
That They Have No Objections
The Company carefully deliberated the terms of the Transactions, including the Tender Offer, taking
into account the Share Valuation Report obtained from Houlihan Lokey and the legal advice obtained
from Mori Hamada & Matsumoto, while respecting the content of the Committee Report to the
maximum possible extent.
As a result, the board of directors of the Company determined that the Transactions would contributeto enhancing the corporate value of the Group by enabling the establishment of a management
structure that allows the necessary upfront investments and other fundamental measures that
become necessary in the future to be made more flexibly and promptly, and that the Tender Offer
provides a reasonable opportunity to sell the Company Shares, and resolved at the board of directors
meeting held on November 7, 2023, with the unanimous agreement of all directors of the Company
that participated in the deliberations and resolution (eight directors excluding Mr. Nakamura and Ms.
Oishi), to endorse the Tender Offer and recommend that the shareholders of the Company tendertheir shares in the Tender Offer. All four corporate auditors of the Company (Mr. Takanori Tobe, Mr.
Kei Hata, Mr. Hidetoshi Watanabe, and Ms. Eiko Hakoda) attended that board of directors meeting,and each expressed the opinion that they had no objection to that resolution.
Of the directors of the Company, representative director Mr. Nakamura did not participate in the
deliberations or resolution of the board of directors of the Company with respect to the Transactions,
including the board of directors meeting described above, nor did he participate in any discussions or
negotiations with the Offeror on the side of the Company, given that he is a director with a special
interest due to his conflict of interest with the Company in relation to the Transactions as the soleshareholder and representative director of SORA, which holds all the shares of the Tender Offeror,
and as the representative director of the Tender Offeror, and because Artemis and Keith Japan, which
are the asset management companies of Mr. Nakamura and his relatives within the first degree ofkinship, will continue to hold the Non-Tendered Shares after the completion of the Tender Offer. Ms.
Oishi did not participate in the deliberations or resolution of the board of directors of the Company
with respect to the Transactions, including the board of directors meeting described above, nor did
she participate in any discussions or negotiations with the Offeror on the side of the Company, basedon the possibility that she has a special interest in the Transactions, given that she is Mr. Nakamura’s
spouse and intends to continue to manage the Company with Mr. Nakamura after successful
completion of the Tender Offer.
(f)Securing Objective Circumstances to Ensure the Fairness of the Tender Offer
The Tender Offeror has set a tender offer period of 37 business days, where the statutory minimum
tender offer period is 20 business days. By setting a tender offer period that is longer than thestatutory minimum, the Tender Offeror aims to secure an appropriate opportunity for theshareholders of the Company to make a decision as to whether to tender their shares in the Tender
Offer, and to secure an opportunity for any person other than the Tender Offeror (a “Competing
Bidder”) to make a competing offer to purchase the shares of the Company, and thereby to ensure
the appropriateness of the Tender Offer Price. In addition, the Tender Offeror has not entered into
any agreement with the Company that limits the Company’s contact with Competing Bidders,
including any agreement containing a transaction protection clause that forbids the Company fromcontacting the a Competing Bidder. Thus, consideration has been given to ensuring the fairness of theTender Offer by ensuring opportunities for competing bids, combined with the establishment of thetender offer period described above.

4. Future outlook
With the implementation of this stock consolidation, as stated in "(i) Delisting" in "(2) Expected to be delisted" in "3.
Basis, etc. of the amount of money expected to be delivered to shareholders as a result of the fractional shares dueto the consolidation of shares" mentioned above, our company's stock is expected to be delisted.
5. Matters concerning transactions with controlling shareholders, etc.
As of today, the Tender Offeror is the parent company of the Company, and the transaction relating to the Share
Consolidation constitutes a transaction with the controlling shareholder.
(1) Applicability of Transactions with Controlling Shareholders and Compliance with Guidelines Concerning
Minority Shareholder Protection Policies
In the report on corporate governance disclosed on December 19, 2023, the Company has not established"Guidelines Concerning Minority Shareholders Protection Policy in Transactions with Controlling Shareholders,etc." However, when conducting transactions with controlling shareholders, etc., the Company shall takemeasures to ensure the fairness of the content and terms of such transactions, including obtaining advice fromlawyers and independent third parties as necessary, and shall make decisions after careful deliberation by the
Board of Directors of the Company. However, when conducting a transaction with a controlling shareholder,
the Company takes measures to ensure the fairness of the content and terms of the transaction, including
obtaining advice from lawyers and independent third-party institutions as necessary, and the Board of
Directors makes a decision after careful deliberation, and it is the Company's policy to take appropriate
measures so as not to harm the interests of minority shareholders. In order to ensure the fairness of theTransaction including the Tender Offer, the Company has taken the measures described in "(3) Measures to
Ensure the Fairness of the Transaction and to Avoid Conflicts of Interest" in "3. Basis, etc. of the amount ofmoney expected to be delivered to shareholders as a result of the fractional shares due to the consolidationof shares”.
(2) Matters concerning measures to ensure fairness and to avoid conflicts of interest

Please refer to "(3) Measures to Ensure the Fairness of the Transaction and to Avoid Conflicts of Interest" in "3.
Basis of the Amount of Cash Expected to be Delivered to Shareholders as a Result of the Fractional Share
Consolidation" above.
(3) Summary of opinions obtained from persons who have no vested interest in the controlling shareholder
regarding the matter not being disadvantageous to minority shareholders
On November 6, 2023, the Company received a report from the Special Committee to the effect that thedecision to implement the Transaction (including the Board of Directors expressing its approval of the Tender
Offer and recommending that the Company's shareholders tender their shares in the Tender Offer) will not be
detrimental to the Company's minority shareholders. For details, please refer to "(iii) Establishment of an
Independent Special Committee and Acquisition of the Written Report by the Company" in "(3) Measures to
Ensure the Fairness of the Transaction and to Avoid Conflicts of Interest" under "3. Basis, etc. of the amount ofmoney expected to be delivered to shareholders as a result of the fractional shares due to the consolidationof shares" above. Since the Written Report relates to the Transaction including the Share Consolidation, theCompany has not obtained another opinion from a person who does not have an interest in the Controlling
Shareholder when conducting the Share Consolidation.
II.

Abolition of the number of shares constituting one unit of stock(1) Reason of Abolition
This is due to the fact that when this Share Consolidation takes effect, the total number of shares issued by theCompany will be eight (8) shares and the number of shares constituting one unit of shares will no longer need to be
determined.
(2) Scheduled date of abolition
March 30, 2024
(3) Condition of Abolition
The share consolidation will become effective upon approval of the proposal for the share consolidation and the
proposal described in "III. Partial Amendments to the Articles of Incorporation" below as originally proposed at theExtraordinary General Meeting of Shareholders.

III.

Partial Amendments to the Articles of Incorporation
1. Aim of the Amendments to the Articles of Incorporation(1) If the proposal for the Share Consolidation is approved at this Extraordinary General Meeting of Shareholders
as originally proposed and the Share Consolidation takes effect, the total number of authorized shares of theCompany's stock will be reduced to 32 shares in accordance with the provisions of Article 182, Paragraph 2 of
the Companies Act. In order to clarify this point, Article 6 (Total Number of Authorized Shares) of the Articles
of Incorporation is to be amended on the condition that the Share Consolidation takes effect.
(2) When the Share Consolidation takes effect, the total number of Company Shares will be 8 shares, and there
will be no need to determine the number of shares per unit. Therefore, in order to abolish the provisions
regarding the number of shares per unit of our shares, which is currently 1 unit of 100 shares, under thecondition that the effect of this stock consolidation occurs, the Company proposes to delete the entire text ofArticle 7 (Number of Shares Constituting One Unit of Shares) and Article 8 (Additional Purchase of Shares Less
Than One Unit) of the Articles of Incorporation, and carry forward the numbering of the articles in connection
with such change.
(3) When the Share Consolidation takes effect, the only shareholders of the Company will be the Tender Offer
Related Parties, and since the Company's shares will be delisted, the provisions relating to the electronic
provision system for the materials of the General Meeting of Shareholders will lose their necessity. Therefore,subject to the Share Consolidation taking effect, the Company proposes to delete the entire text of Article 14(Measures for Electronic Provision, etc.) of the Articles of Incorporation and to carry forward the number ofarticles in connection with such change.
2. Amendments to be applied to the Articles of Incorporation
The details of the amendment are as follows. The amendments to the Articles of Incorporation pertaining to this
proposal will become effective on March 30, 2024, on the condition that the proposal for the Share Consolidation isapproved and passed as originally proposed at the Extraordinary General Meeting of Shareholders and the Share
Consolidation takes effect.
(The sections underlined are the points of change)
Description in the current Articles of Incorporation

Proposed Changes

Article 6 (Total Number of Authorized Shares)

Article 6 (Total Number of Authorized Shares)

The total number of authorized shares of the Company

The total number of authorized shares of theshall be 46,000,000.

Company shall be 32.

Article 7 (Number of Shares Constituting One Unit of(to be deleted)

Shares)The number of shares constituting one unit of shares of
the Company shall be 100 shares.
Article 8 (Additional Purchase of Shares Less Than One(to be deleted)

Unit)
Any shareholder of the Company may, in accordance with
the Share Handling Regulations, request the Company tosell to him the number of shares that, together with thenumber of shares less than one unit held by suchshareholder, will constitute one unit of shares.
Articles 9-13 (Omitted)

Articles 7-11 (no change)

Article 14 (Electronic Provision of Information, etc.)(to be deleted)(1) When convening a general meeting of shareholders,the Company shall take measures to provide electronicallythe information contained in the Reference Documents for
the General Meeting of Shareholders, etc.
(2)The Company shall not be required to include all or partof the matters for which it takes electronic provision of
information as provided for in the applicable Ordinance ofthe Ministry of Justice in the document to be delivered toshareholders who have made a written request by the
Record Date for Voting Rights.
Articles 15-39 (Omitted)

Articles 12-36 (no change)