Note: This document has been translated from a part of the Japanese original for reference purposes only. In theevent of any discrepancy between this translated document and the Japanese original, the original shallprevail.

Securities Code: 4215
June 3, 2021

To our shareholders:Kazuya Saito
Representative Director President

C.I. TAKIRON Corporation
3-1-3, Umeda, Kita-ku, Osaka

Notice of the 126th Ordinary General Shareholders’ Meeting
We are pleased to announce the 126th Ordinary General Shareholders’ Meeting of C.I. TAKIRON
Corporation (“the Company”), which will be held as described below.
You can exercise your voting rights, and we would like to ask you to do so after reviewing
the Reference Documents for the General Shareholders’ Meeting attached below.
1. Date and Time:
2. Venue:

Friday, June 25, 2021 at 10:00 a.m.
Naniwa Room, 20F, HOTEL GRANVIA OSAKA
3-1-1, Umeda, Kita-ku, Osaka
3. Purpose of the Meeting
Matters to be reported:
1. Report on the business Report, the Consolidated Financial Statements and the audit
results of the Consolidated Financial Statements by the Accounting Auditors andthe Audit & Supervisory Board for the 126th fiscal year (from April 1, 2020 toMarch 31, 2021)
2. Report on the Non-consolidated Financial Statements for the 126th fiscal year (from
April 1, 2020 to March 31, 2021).
Matters to be resolved:
Proposal No. 1
Appropriation of Surplus
Proposal No. 2
Election of Six Directors
Proposal No. 3
Election of One Substitute Audit & Supervisory Board
Member
Proposal No. 4
Revision of the Amount and Details of Stock-based
Remuneration, etc. for Directors
Proposal No. 5
Determination of Remuneration Intended to Grant
Restricted Shares to Directors

1Reference Documents for the General Shareholders’ Meeting
Proposals and Reference Information
Proposal No. 1

Appropriation of Surplus

Since the establishment of the Company in April 2017, C.I. TAKIRON Corporation and its
consolidated subsidiaries (the “Group”) has been steadily and promptly implementing concretemeasures to reform its structure and strengthen its management base in accordance with themedium-term management plan “Good chemistry Good growth 2020.”
As a measure to return profits to shareholders, the Company’s policy is to pay dividends ofapproximately 40% of profits excluding extraordinary gains and losses during the period of themedium-term management plan (fiscal year ended March 31, 2019 to fiscal year ended March 31,2021).
In consideration of the policy above and consolidated financial results, the Company proposes to
pay a year-end dividend for the fiscal year ended March 31, 2021 of ¥12 per share. Accordingly,
including the interim dividend of ¥10 per share, the annual dividend will total ¥22 per share.
Year-end dividends(1) Type of dividend property

Cash(2) Allotment of dividend property to shareholders and their aggregate amount¥12 per common share of the Company
Total payment: ¥1,169,755,356(3) Effective date of dividends of surplus

June 28, 2021

2

Proposal No. 2

Election of Six Directors

The terms of office of all eight Directors will expire at the conclusion of this meeting. Therefore,
the Company proposes the election of six Directors, lowering the number of Directors by two to
respond to changes in the business environment, and enabling us to make quicker and more
flexible decisions.
In order to enhance the objectivity and transparency of the election process, this proposal has
passed through the deliberation process of the Nomination and Remuneration Committee.
The candidates for Director are as follows:
5 males, 1 female
Candidate
No.

Name

1

Kazuya Saito

Current position and responsibility in the Company

Representative Director President
Director Senior Managing Executive
Officer
Chief Operating Officer of theEnvironmental Materials Division
Director Senior Managing Executive
Officer
Chief Operating Officer of theConstruction Materials Division

2

Takahisa Miyake

3

Akihiro Ueda

4

Mune Iwamoto

Director5

Kenichi Hatano

Director

6

Yoshiko Kosaka

Director

Attendance at Boardof Directors
meetings

Reelection

100%(16/16)

Reelection

100%(16/16)

Reelection

100%(16/16)

Reelection Outside
Independent
Reelection Outside
Independent
Reelection Outside
Independent100%(16/16)100%(16/16)100%(13/13)

Notes: 1. Attendance at Board of Directors’ meetings for Yoshiko Kosaka counts her attendance at the number of
meetings held after her appointment on June 25, 2020.
2. The name of Yoshiko Kosaka in the family register is Yoshiko Miyabata.
Candidate forReelection Director to bereelected

OutsideCandidate for outside
Director

3

Candidate registered at the
Independent Tokyo Stock Exchange asan Independent Officer

Candidate
No.

Name
(Date of birth)<<Career summary, position and responsibility in the Company, andsignificant concurrent positions outside the Company>>
Apr. 1981
Apr. 2012

Number of theCompany’s
shares owned

Joined ITOCHU Corporation
Executive Officer
Chief Operating Officer of Chemicals Division

June 2014

Executive Officer of the Company

Nov. 2014

General Manager of the High Functional Materials
Business and Branch Manager of Tokyo Branch

June 2015

Director and Executive Officer

Apr. 2016

Responsible for Logistics, High Functional Materials
Business and Overseas Business

Assistant to President
Reelection
Kazuya Saito(January 18, 1959)

Attendance at Board ofJune 2016
Directors meetings
Apr. 2017100% (16/16)

48,196

Director and Managing Executive Officer
Director and Senior Managing Executive Officer
Chief Operating Officer of the High Functional
Materials Business

1
Apr. 2018

Chief Operating Officer of the Environmental Materials
Division

Apr. 2019

Representative Director President & COO

Apr. 2020

Representative Director President (current position)[Reasons for nomination as candidate for Director]
The Company appointed Kazuya Saito as the Representative Director President in April 2020 after serving as theRepresentative Director President & COO in 2019 based on his many years of service to the ITOCHU Corporationin the Chemicals Division and after his appointment as Director, Chief Operating Officer of the High Functional
Materials Business, and Chief Operating Officer of the Environmental Materials Business since 2015. The
Company nominated Kazuya Saito because it can expect him to further the expansion of business and greater
profitability as the highest authority in management business execution currently and for his continued executionof decision making and supervision of management based on his wealth of experience and expertise in overallbusiness, including the overseas fields of the Company.
Notes: 1. There is no special interest between Kazuya Saito and the Company.
2. The above “Career summary, position and responsibility in the Company, and significant concurrent positions
outside the Company” includes Kazuya Saito’s current and past positions and responsibilities as a person who
executes business at ITOCHU Corporation, the owners of parent of the Company, in the past 10 years.

4Candidate
No.

Name
(Date of birth)

Reelection
Takahisa Miyake(February 5, 1961)

2

Attendance at Board of
Directors meetings
100% (16/16)<<Career summary, position and responsibility in the Company, andsignificant concurrent positions outside the Company>>
Apr. 1984

Joined the Company

Apr. 2009

General Manager of the Purchasing Department

Apr. 2011

General Manager of the Flooring Department

Apr. 2014

General Manager of the Corporate Planning
Department

June 2014

Executive Officer

June 2016

Director and Executive Officer

Apr. 2017

Director and Senior Managing Executive Officer(current position)

Number of theCompany’s
shares owned

34,029Chief Operating Officer of the Corporate Planning
Division
Apr. 2018

Chief Operating Officer of the Corporate Planning
Division and responsible for the R&D Department

Apr. 2019

Chief Operating Officer of the Environmental Materials
Division (current position)[Reasons for nomination as candidate for Director]
Takahisa Miyake was appointed Director in 2016 and Chief Operating Officer of the Corporate Planning Divisionin 2017 after working as the General Manager of the Purchasing, Flooring and Corporate Planning Departments.
He has been serving as the Chief Operating Officer of the Environmental Materials Division since 2019. The
Company nominated Takahisa Miyake because it can expect him to continue to execute the decision making andsupervision of management based on his wealth of experience and expertise in management and the overallbusiness operations of the Company.
Note:

There is no special interest between Takahisa Miyake and the Company.

5

Candidate
No.

3

Name
(Date of birth)<<Career summary, position and responsibility in the Company, andsignificant concurrent positions outside the Company>>
Apr. 1982

Joined ITOCHU Corporation

Apr. 2008

General Manager of Plastics Department

Apr. 2012

Deputy Chief Operating Officer of Chemicals Division
and General Manager of Plastics Department

Apr. 2013

Executive Officer

Reelection

Apr. 2014

Akihiro Ueda
(October 13, 1958)

Vice President of ITOCHU East Asia Bloc (East
China) (stationed in Shanghai) and Managing Directorof ITOCHU SHANGHAI LTD.

Apr. 2015

Managing Executive Officer of ITOCHU Corporation
CEO for East Asia Bloc (stationed in Beijing),
Chairman of ITOCHU (CHINA) HOLDING CO.,LTD., Chairman of ITOCHU SHANGHAI LTD.,
Chairman of ITOCHU HONG KONG LTD. andChairman of BIC

Attendance at Board of
Directors meetings
100% (16/16)
Apr. 2019

Number of theCompany’s
shares owned

15,590Senior Managing Executive Officer of the Company
Chief Operating Officer of the Construction Materials
Division (current position)

June 2019

Director Senior Managing Executive Officer (current
position)[Reasons for nomination as candidate for Director]
Akihiro Ueda spent his many years of service at ITOCHU Corporation in the Chemicals Division and was
appointed Managing Executive Officer of ITOCHU Corporation in 2015. He assumed office as Director Senior
Managing Executive Officer of the Company in April 2019, and in the same year he started serving as Chief
Operating Officer of the Construction Materials Division of the Company. The Company nominated Akihiro Ueda
because of his extensive experience and knowledge mainly in the chemicals field, including management
experience in multiple overseas companies, as well as sufficient experience in the Company’s management ingeneral, and expects him to continue to fulfill his role in management decision-making and supervision.
Notes: 1. There is no special interest between Akihiro Ueda and the Company.
2. The above “Career summary, position and responsibility in the Company, and significant concurrent positions
outside the Company” includes Akihiro Ueda’s current and past positions and responsibilities as a person who
executes business at ITOCHU Corporation, the owners of parent of the Company, in the past 10 years.

6Candidate
No.

Name
(Date of birth)

Reelection
OutsideIndependent<<Career summary, position and responsibility in the Company, andsignificant concurrent positions outside the Company>>
Apr. 1976

Joined Mitsui Toatsu Chemicals, Inc. (current Mitsui
Chemicals, Inc.)

June 1995

General Manager of Polymers Division, Osaka R&D
CenterOct. 1997

Assistant Director of Planning & Coordination
Division, Polymers Group

July 1999

Director General Manager of ABS Business Divisionof NIPPON A&L INC.

June 2001

General Manager of Industrial Polymeric Division,
Functional Polymeric Business Sector of Mitsui
Chemicals, Inc.

June 2003

Councillor

Mune Iwamoto(January 3, 1949)

Representative Director and Vice President of Japan
Polystyrene, Inc.

Attendance at Board of June 2004
Directors meetings
Apr. 2010
100% (16/16)

Number of theCompany’s
shares owned

11,757

Representative Director and President
In charge of Production & Technology Center of Mitsui
Chemicals, Inc.
Senior Administrative Officer

4June 2010

Chairman of Energy & Climate Change LeadershipGroup of ‘International Council of Chemical
Associations (ICCA)’

Mar. 2014

Retired from Mitsui Chemicals, Inc.

June 2014

Director of the Company (current position)

Mar. 2016

Outside Director of TOYO TANSO CO., LTD. (current
position)[Reasons for nomination as candidate for outside Director and summary of expected role]
Mune Iwamoto has served as outside Director of the Company since June 2014, leveraging his extensive
experience and knowledge cultivated through R&D in the field of functional polymers during many years at amajor chemicals conglomerate, management of multiple companies, as well as serving as Chairman of Energy &Climate Change Leadership Group at the ‘International Council of Chemical Associations (ICCA)’, and theCompany expects him to continue speaking actively from an independent perspective, and to continue fulfilling
his role in appropriate management decision-making and supervision. At the conclusion of this meeting, Mune
Iwamoto’s tenure as outside Director of the Company will have been seven years.
[Independence of the candidate]
Mune Iwamoto was an executive officer of Mitsui Chemicals, Inc. until March 2014. The Company has
transactions with this company for the purchase of raw materials, etc., but as the percentage of transaction amountis less than 2%, Mitsui Chemicals, Inc. is not a major business partner of the Company.
Mune Iwamoto satisfies the “Independence Standards for Outside Officers” established by the Company, and has
been designated as an independent officer in accordance with the provisions of the Tokyo Stock Exchange. If thereelection of Mune Iwamoto is approved as proposed, the Company plans to continue the said designation.
Notes: 1. There is no special interest between Mune Iwamoto and the Company.
2. Mune Iwamoto is a candidate for outside Director.
3. In May 2017, while he was serving as an outside Director of TOYO TANSO CO., LTD., it was revealed that an
employee of a consolidated subsidiary in France had embezzled a refund due to improper declaration of valueadded tax in the said country. Although he was not aware of this matter in advance, he has been making
proposals from the viewpoint of compliance with laws and regulations to ensure proper business execution at
the meetings of the Board of Directors, etc. Also, after this matter was revealed, an internal investigationcommittee was set up, and Mune Iwamoto appropriately fulfilled his responsibilities as an outside Director,
participating in the investigation as a member of the investigation committee, and making proposals for theformulation of measures to prevent recurrence, including improvement of management at the said subsidiaryand strengthening of management throughout the entire group.

7

Candidate
No.

Name
(Date of birth)

Reelection
OutsideIndependent
Kenichi Hatano(December 28, 1947)<<Career summary, position and responsibility in the Company, andsignificant concurrent positions outside the Company>>Mar. 1966

Joined Sumitomo Chemical Co., Ltd. (current
SUMITOMO CHEMICAL COMPANY, LIMITED)

June 1998

General Manager of Osaka Industrial Chemicals
Department, Inorganic Industrial Chemicals Division

Apr. 2001

General Manager of Osaka Industrial Chemicals
Department, Industrial Chemicals Division

June 2001

General Manager of Industrial Chemicals Department I,
Industrial Chemicals Division

June 2003

General Manager of Industrial Chemicals Division andGeneral Manager of Industrial Chemicals Department I,
Industrial Chemicals Division

June 2005

Executive Officer
General Manager of Industrial Chemicals Division

Oct. 2007
Attendance at Board of June 2009
Directors meetings
Apr. 2010
100% (16/16)

5

Number of theCompany’s
shares owned

5,344Managing Executive Officer
Representative Director & Managing Executive Officer
Representative Director & Senior Managing Executive
Officer

Apr. 2013

Retired from Representative Director & Senior
Managing Executive Officer

June 2013

Retired from Director
External Director of Sumitomo Seika Chemicals
Company, Limited.

June 2015

Retired from External Director

June 2018

Director of the Company (current position)[Reasons for nomination as candidate for outside Director and summary of expected role]
The Company nominated Kenichi Hatano as Director because it expects him to utilize his wealth of experienceand expertise cultivated through his involvement in management of a comprehensive chemicals manufacturer inthe management of the company. In addition, Kenichi Hatano has actively provided advice from an independent
standpoint since his appointment as outside Director of the Company in 2018, and the Company expects him tocontinue to execute the proper decision making and supervision of management as an outside Director of theCompany. At the conclusion of this meeting, Kenichi Hatano’s tenure as outside Director of the Company will
have been three years.
[Independence of the candidate]
Kenichi Hatano was an executive officer of SUMITOMO CHEMICAL COMPANY, LIMITED until April 2013.
The Company has transactions with this company for the purchase of raw materials, etc., but as the percentage oftransaction amount is less than 2%, SUMITOMO CHEMICAL COMPANY, LIMITED is not a major business
partner of the Company.
Kenichi Hatano satisfies the “Independence Standards for Outside Officers” established by the Company, and has
been designated as an independent officer in accordance with the provisions of the Tokyo Stock Exchange. If thereelection of Kenichi Hatano is approved as proposed, the Company plans to continue the said designation.
Notes: 1. There is no special interest between Kenichi Hatano and the Company.
2. Kenichi Hatano is a candidate for outside Director.

8

Candidate
No.

Name
(Date of birth)
Reelection
OutsideIndependent<<Career summary, position and responsibility in the Company, andsignificant concurrent positions outside the Company>>
Oct. 2003

Registered as an attorney at law

July 2007

Termination of attorney at law registration (due tochildcare leave, etc.)

Joined Nishimura Law & Accounting Office

Yoshiko Kosaka
Jan. 2013(September 20, 1976)
Attendance at Board ofApr. 2016
Directors meetings
100% (13/13)
June 2020
6

Number of theCompany’s
shares owned

Re-registered as an attorney at law

1,426

Joined Takagi Law Office
Joined Irokawa Law Office (current Irokawa Legal
Professional Corporation) (current position)
Director of the Company (current position)[Reasons for nomination as candidate for outside Director and summary of expected role]
Yoshiko Kosaka has served as outside Director of the Company since June 2020, leveraging her advanced
expertise as an attorney and extensive knowledge related to corporate legal affairs, and the Company expects her
to continue speaking actively from an independent perspective, and to continue fulfilling her role in appropriate
management decision-making and supervision. Yoshiko Kosaka has never been involved in the management of acompany except for serving as outside officer so far. However, the Company judges she will appropriately fulfill
her duties as an outside Director based on the above reasons. At the conclusion of this meeting, Yoshiko Kosaka’s
tenure as outside Director of the Company will have been one year.
[Independence of the candidate]
Yoshiko Kosaka satisfies the “Independence Standards for Outside Officers” established by the Company, and has
been designated as an independent officer in accordance with the provisions of the Tokyo Stock Exchange. If thereelection of Yoshiko Kosaka is approved as proposed, the Company plans to continue the said designation.

Notes: 1. There is no special interest between Yoshiko Kosaka and the Company.
2. Yoshiko Kosaka is a candidate for outside Director.
3. The name of Yoshiko Kosaka in the family register is Yoshiko Miyabata.

9

■ Summary of details of limited liability agreement
The Company has entered into an agreement with Mune Iwamoto, Kenichi Hatano and Yoshiko
Kosaka to limit their liability for damages under Article 423, paragraph (1) of the Companies Act
in accordance with the provisions of Article 427, paragraph (1) of the same Act. If their reelection
is approved as proposed, the Company plans to renew this agreement with them. The maximum
amount of liability for damages based on this agreement is the minimum liability amountstipulated in Article 425, paragraph (1) of the said Act. The said limitation of liability is allowed
only when the concerned Director performs the duties that caused the liability in good faith andwithout any gross negligence.
■ Summary of details of contract for directors and officers liability insurance
The Company concluded a liability insurance contract for directors and officers with an insurancecompany, as stipulated in Article 430-3, paragraph (1) of the Companies Act, whereby insured
persons are covered under said insurance contract for any damages and litigation costs incurredin the event a claim for damages is filed by a shareholder or a third party.
Each candidate will be included as an insured person under the insurance contract.

10

Proposal No. 3

Election of One Substitute Audit & Supervisory Board Member

The Company proposes the election of one substitute outside Audit & Supervisory Board Member
in advance to be ready to fill a vacant position should the number of outside Audit & Supervisory
Board Members fall below the number required by laws and regulations.
In addition, the consent of the Audit & Supervisory Board has been obtained for this proposal.
In order to enhance the objectivity and transparency of the election process, this proposal has
passed through the deliberation process of the Nomination and Remuneration Committee.
The candidate for substitute Audit & Supervisory Board Member is as follows:
Name(Date of birth)

Takashi Honda(December 24, 1972)<<Career summary and significant concurrent positions outside theCompany>>
Oct. 1996

Joined Aoyama Audit Corporation (currently
PricewaterhouseCoopers Aarata LLC)

Apr. 2001

Registered as a certified public accountant

July 2003

Joined Zeirishi-Hojin PricewaterhouseCoopers (current
PwC Tax Japan)

Oct. 2007

Registered as a certified public tax accountant

Oct. 2014

Director of Honda Certified Public Accountant Office

Sept. 2016

Senior Partner

Aug. 2020

Director of Takashi Honda Certified Public Accountant& Tax Accountant Office (current position)

Number of theCompany’s shares
owned

0

Joined EXPERTS LINK LTD., CO.

Senior Partner of Progressive Advisory LLC (current
position)[Reasons for nomination as candidate for substitute outside Audit & Supervisory Board Member]
The Company nominated Takashi Honda as a candidate for substitute outside Audit & Supervisory Board Member as he has
worked for an audit corporation and a tax accountant corporation for many years and has a wealth of experience andknowledge in these fields as well as a high level of expertise in finance and accounting as a certified public accountant andtax accountant, and it expects him to provide appropriate advice and verification in order to ensure the appropriateness ofdecision making by the Board of Directors.
[Independence of the candidate]
Takashi Honda satisfies the “Independence Standards for Outside Officers” established by the Company, and if his
reelection is approved as proposed and he assumes office as an outside Audit & Supervisory Board Member, the Company
plans to designate him as an independent officer in accordance with the provisions of the Tokyo Stock Exchange.

11[Limited liability agreement]
If the election of Takashi Honda is approved as proposed and he assumes office as an Audit & Supervisory Board Member,the Company plans to enter into an agreement with him to limit his liability for damages under Article 423, paragraph (1) of
the Companies Act in accordance with the provisions of Article 427, paragraph (1) of the same Act. The maximum amountof liability for damages based on this agreement is the minimum liability amount stipulated in Article 425, paragraph (1) of
the said Act. The said limitation of liability is allowed only when the concerned Audit & Supervisory Board Member
performs the duties that caused the liability in good faith and without any gross negligence.
[Contract for directors and officers liability insurance]
The Company concluded a liability insurance contract for directors and officers with an insurance company, as stipulated in
Article 430-3, paragraph (1) of the Companies Act, whereby insured persons are covered under said insurance contract forany damages and litigation costs incurred in the event a claim for damages is filed by a shareholder or a third party.
If Takashi Honda’s appointment is approved and he becomes an Audit & Supervisory Board Member, he will be included as
an insured person under said insurance contract.
Notes: 1. There is no special interest between Takashi Honda and the Company.
2. Takashi Honda is a candidate for substitute outside Audit & Supervisory Board Member.

(Reference) “Independence Standards for Outside Officers”
In selecting candidates for outside officers, the Company selects candidates who satisfy thefollowing unique standard of the Company in addition to the criteria set forth in the
Companies Act and the Tokyo Stock Exchange.
In order for the Company to determine that an outside officer is independent, the said outside
officer must be independent and neutral from the Company’s management without coming
under any of the following.
1. A person or a person who executes business (“executive”) who has the Group as a major
business partner (sales to the Group account for 2% or more of the consolidated sales of
the relevant business partner group)
2. A major business partner of the Group or such an executive (sales to the relevant business
partner group account for 2% or more of the consolidated sales of the Group)
3. A person who belongs to the Company’s main bank, to a lead managing securities
company, or to an auditing firm that is the Company’s financial auditor
4. Attorneys at law, consultants, etc. who receive a certain amount of money (¥10 million
per year) or more in monetary or other financial benefits from the Company in addition to
the remuneration for officers (including those who belong to corporations, partnerships,
or other organizations if the person receiving such benefits is a member of suchorganization)
5. A Director who is not an executive or an executive of the owners of parent of theCompany, an Audit & Supervisory Board Member of the owners of parent of theCompany, or an executive of a brother company, at any time within 10 years prior to theassumption of office
6. Major shareholders of the Company (persons who directly or indirectly hold 10% ormore of the total voting rights, excluding the owners of parent of the Company) or theirbusiness executors
7. Spouse, relative within the second degree of kinship, or relative living in the same
household of a person who is an executive of the Group or of a person who falls under 1
through 6 above
8. A person who has come under 1 to 4, 6, or 7 above in the last 5 years
9. A person who has been in office as an outside Director for a total of more than 8 years

12Proposal No. 4

Revision of the Amount and Details of Stock-based Remuneration, etc. for
Directors

1. Reasons for proposal and justification of the remuneration
At the 123rd Ordinary General Meeting of Shareholders held on June 27, 2018, theCompany received approval for introduction of a stock-based remuneration system(hereinafter “the current system”) for Directors of the Company (excluding non-executive
Directors), and then at the 124th Ordinary General Meeting of Shareholders held on June
26, 2019, received approval for revision of some of the details of the current system (themaximum value of the Company’s shares to be contributed by the Company necessary fordelivering the Company’s shares to Directors based on the current system, and the
maximum number of points to be granted which is the basis for calculating the number ofshares to be delivered to each Director, etc.), allowing operation of the current system until
now. As part of the review of the remuneration level and system for Directors, the Company
requests approval of changing the current system to a performance-linked stock-based
remuneration system (hereinafter “the proposed system”) and its continued operation after
the change.
The proposed system further clarifies the link between remuneration for Directors and theCompany’s business performance and stock value, would allow Directors to share the sameprofits and risks as all shareholders due to fluctuations in the stock price, and thereby aiming
to raise their awareness to contribute to improving medium- to long-term businessperformance and increasing corporate value, in addition to that, the proposed system links
the number of Company shares to be delivered to Directors to the performance of theCompany, thereby aiming to raise the awareness of officers to achieve the targets put
forward in the medium-term management plan. Specifically, it is, separate from the
maximum amount of remuneration for Directors approved at the 111th Ordinary General
Meeting of Shareholders held on June 29, 2006 (annual amount up to ¥420 million per year,
however not including salaries for Directors who are also employees), a separate frameworkfor performance-linked stock-based remuneration described in the details of 2. below, to be
distributed to Directors (excluding non-executive Directors, the same applies below) who
are in office during the three business years from the fiscal year ending March 31, 2022 to
the fiscal year ending March 31, 2024.
The Company proposes to delegate the details to the Board of Directors within theframework in 2. below. The determination policy for details of individual remuneration etc.
for Directors has been established at the Board of Directors meeting held on February 24,
2021 as described on pages pp 35-37 of the Business Report (available in Japanese only),and since the purpose of introducing the proposed system as described above and the
proposed system is in line with the said policy, the details of this proposal and the proposedsystem are deemed to be appropriate.
If the Proposal No. 2 “Election of 6 Directors” is approved as originally proposed, thenumber of directors subject to the proposed system will be three.
*The current system has also been introduced for executive officers who have concluded adelegation contract with the Company, and if this proposal is approved as originallyproposed, the Company plans to alter and continue to apply the current system to executive
officers by resolution of the Board of Directors.

13

2. The amount of remuneration and details etc. under the proposed system(1) Outline of the Proposed system
The proposed system is a stock-based remuneration system, whereby a trust which theCompany established by making a financial contribution (already established, hereinafter
the “Trust”) acquires the Company shares, and delivers the Company shares to each
Director equivalent to the number of points the Company granted to each Director.
Shares of the Company shall be delivered to each Director at the time of his or her
retirement from office in principle.
1

Persons eligible for the proposed system

Directors of the Company (excluding
non-executive Directors)

2

Target Period

From the fiscal year ending March 31,
2022 to the fiscal year ending March 31,
2024

3

Maximum amount of money theCompany will contribute as funds for theacquisition of the Company sharesrequired to be delivered to the persons
eligible mentioned in 1 during the target
period of three years mentioned in 2

Total: ¥90 million

4

Method of acquisition of shares of theCompany

Either by disposing of treasury shares orby purchasing shares on the exchange
market (including after-hours trading)5

Upper limit for total number of points that
the Company shall grant to the persons
eligible mentioned in 1

30,000 points for each fiscal year

6

Criteria for granting points

For the initial target period, the number ofpoints calculated according to theachievement rate of performance targets
set forth in the medium-term management
plan will be granted

7

Time of delivery of the Company sharesto persons eligible mentioned in 1

At the time of retirement from office inprinciple

14

(2) Maximum amount of money to be contributed by the Company
During the target period, the Company will add up to a total of ¥90 million of money ofadditional contribution (additional trust) to the funds for the acquisition of the Company
shares required to be delivered to Directors under the proposed system as remuneration for
the Directors in office during the target period. This amount is believed to be appropriate
to achieve the purpose of the proposed system. The Trust will use the money additionallycontributed by the Company and certain amount of money remaining in the Trust as asource of funds, and the Company shares will be additionally acquired by disposing oftreasury shares or by purchasing shares on the exchange market (including after-hours
trading).
Note: The amount of money that the Company actually entrusts in the Trust will be thesum of the above-mentioned acquisition funds for Company shares and theestimated amount of necessary expenses such as trust fees and trust administrator
remuneration etc. In addition, if the current system is to be continued for executive
officers of the Company as mentioned above, the funds for the acquisition ofCompany shares necessary for delivery to executive officers will also be
additionally entrusted.
At the decision of the Company’s Board of Directors, the target period may be extended by
setting a period within three fiscal years each time, and the entrustment period of the Trust
will be extended accordingly (for the same purpose as the Trust established by theCompany for transferring trust assets of the Trust, including extending the entrustment
period in real terms. The same applies below), which can allow the proposed system tocontinue. In that case, during the target period of said extension, as additional acquisition
funds for the necessary Company shares to deliver to Directors under the proposed system,
additional financial contribution to the Trust up to a maximum value of the amountcalculated by multiplying ¥30 million and the number of fiscal years of the target period ofsaid extension will be added, allowing the granting of points and delivery of the Company
shares in (3) below to continue. This amount is believed to be appropriate to achieve thepurpose of the proposed system.
In addition, even if the target period is not extended and the proposed system is notcontinued as described above, if there are Directors who have already been granted points
but have not retired as of the expiration of the entrustment period, the entrustment periodof the Trust may be extended until said Directors retire and delivery of Company shares iscompleted.

(3) Calculation method and maximum number of shares of the Company to be delivered to
Directors(i)

Method of granting points to Directors, etc.
Based on the rules for share delivery established by the Board of Directors of theCompany (although already established, some details will be changed due to changes
in the current system), on the grant date during the entrustment period stipulated in
the rules for share delivery, the number of points calculated according to theachievement rate of the performance targets set forth in the medium-term
management plan will be granted during the initial target period.
However, the aggregate number of points to be granted by the Company to Directors
shall be up to 30,000 points for each fiscal year. This number is believed to beappropriate to achieve the purpose of the proposed system.

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(ii) Delivery of shares of the Company based on the number of points granted
Directors shall receive, in accordance with the procedure described in (iii) below, thedelivery of the number of shares of the Company corresponding to the number ofpoints granted under (i) above. In the event there are points granted based on thecurrent system before the change, the Company shares commensurate with the said
points will also be delivered in the same way. However, if a Director retires before
the expiration of his or her term of office due to reasons other than unavoidable
circumstances, etc., all or a portion of the points granted will lose validity and theCompany shares will not be delivered in proportion to the lost points. One point shallbe worth one share of the Company’s stock (however, in the event of a stock split orreverse stock split of the Company’s shares, the number of shares per point shall be
adjusted according to the split ratio or consolidation ratio).
(iii) Delivery of shares of the Company to Directors
In principle, the delivery of Company shares in (2) above to each Director will bemade by the Trust by each Director completing the prescribed beneficiary finalization
procedures when he or she retires.
However, a certain portion of shares of the Company to be delivered may besold/realized in the Trust first for the purpose of the Company to withhold funds to
pay taxes such as withholding taxes, and delivered in the form of money in lieu ofshares of the Company. In addition, in the event of realization of shares of theCompany held in the Trust due to the settlement following the circumstances such as
subscription to a tender offer for shares of the Company held in the Trust, the Trust
may also effect the delivery in the form of money in lieu of shares of the Company.
(4) Exercise of voting rights
Pursuant to the instructions of the trust administrator who is independent from theCompany and its officers, the voting rights associated with shares of the Company held in
the Trust shall not be exercised without exception, which will assure the neutrality of theCompany’s management in relation to exercise of voting rights of such shares.

(5) Handling of dividends
Dividends on shares of the Company held in the Trust shall be received by the Trust, andshall be appropriated towards payment for acquisition of shares of the Company, trust fees
for the trustee associated with the Trust, etc.

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Proposal No. 5

Determination of Remuneration Intended to Grant Restricted Shares to
Directors

The amount of remuneration etc. for Directors of the Company was approved at the 111st
Ordinary General Meeting of Shareholders held on June 29, 2006 for an annual amount up to¥420 million per year (however not including salaries for Directors who are also employees),
however this time, for the purpose of giving Directors of the Company (excluding nonexecutive Directors; hereinafter “Eligible Directors”) incentive to continuously improve thecorporate value of the Company, as well as of further promoting sharing value between the
Eligible Directors and shareholders, apart from the remuneration framework above and theframework requested approval on the revision of the amount and details of stock-based
remuneration, etc. for Directors in Proposal No. 4, the Company requests approval for the newprovision of remuneration for granting restricted shares to the Eligible Directors.
The total amount of monetary remuneration for granting restricted shares to the Eligible
Directors based on this proposal shall be, as the amount believed to be appropriate for the
purpose above, up to ¥20 million per year.
In addition, based on resolution by the Board of Directors of the Company, the Eligible
Directors shall provide all of the monetary remuneration claims arising from this proposal as inkind contribution property, and shall be delivered the common shares of the Company throughthe issue or disposal of them, and the total number of the common shares of the Company to beissued or disposed shall be, as the number believed to be appropriate for the purpose above, up
to 20,000 shares per year (however, from the date of resolution of this proposal onward, a stock
split of the Company’s common stock (including allotment of the Company’s common stock
without contribution) or in the event shares are consolidated, the amount shall be adjusted
according to the split ratio or consolidation ratio), and the amount to be paid-in per share shallbe the closing price of the Company’s common stock on the Tokyo Stock Exchange on thebusiness day prior to the date of each resolution by the Board of Directors (if the shares did nottrade on that day, the closing price on the most recent trading day prior to that). Specific timingof delivery and amount to be allotted shall be determined by the Board of Directors.
At the Board of Directors meeting held on February 24, 2021, the Company established thedecision policy regarding details of individual remuneration etc. for Directors as described on
pages pp 35-37 of the Business Report (available in Japanese only). The purpose of introducing
the proposed system is as described above, and since this system is in line with the said policy,
details of this proposal and the proposed system are deemed to be appropriate.
If Proposal No. 2 “Election of 6 Directors” is approved as originally proposed, the number ofthe Eligible Directors will be three.
In the issuance or disposal of the Company’s common stock under this proposal, the Company
and the Eligible Directors shall conclude a share allotment agreement with transfer restrictions(hereinafter the “Allotment Agreement”) including the following details.
(1) Transfer restriction period
During the period from the allotment date per the Allotment Agreement until the Eligible
Director retires his or her position as Director of the Company (however if he or she isconcurrently serving as executive officer, or if he or she steps down as Director and is
appointed as executive officer of the Company at the same time, he or she will be deemedas “retired” when leaving either the position of Director or as executive officer of theCompany (hereinafter the “transfer restriction period”), the Eligible Directors shall nottransfer, set collateral rights on or otherwise dispose of (hereinafter “transfer restrictions”)
allotted common shares of the Company’s stock (hereinafter referred to as the “allotted17

shares”) per the Allotment Agreement.
(2) Lifting of the transfer restrictions
The Company shall lift transfer restrictions upon expiration of the transfer restriction
period for all allotted shares (however, in the event of having acquired all or a portion ofallotted shares without contribution pursuant to (3) (ii) below, the remaining portion after
acquisition without contribution), provided that the retirement of the Eligible Director isdue to reasons deemed justified by the Board of Directors of the Company.
(3) Acquisition of the Allotted Shares without contribution(i)When the transfer restriction period expires, the Company will automatically acquire
the allotted shares for which transfer restrictions have not been lifted based on theprovisions of (2) above, without contribution.

(ii) In addition, in the event of that the Eligible Director retires within the period of
execution of duties which is the subject of remuneration for the allotted shares, theCompany will acquire the number of allotted shares without contribution according to
the remaining period, and if he or she falls within certain reasons specified in the
Allotment Agreement, such as his or her any illegal activities etc., the Company shallacquire all or a portion of the allotted shares without contribution.
(4) Treatment in case of reorganization, etc.
Notwithstanding the provisions of (1) above, if, during the transfer restriction period,
matters relating to a merger agreement in which the Company is the disappearing
company, a share exchange agreement or share transfer plan in which the Company
becomes a wholly owned subsidiary, or other reorganization, etc. are approved at theCompany’s General Meeting of Shareholders (or at a meeting of its Board of Directors incases where approval at the Company’s General Meeting of Shareholders is not required inrelation to the reorganization, etc.), the Company shall lift, by resolution of the Board of
Directors of the Company, the transfer restrictions on the allotted shares with regard to thenumber of shares that is reasonably determined considering the period from the start dateof the transfer restriction period to the effective date of the reorganization, etc. prior to thedate on which the reorganization, etc. becomes effective. In this case, the Company shall
automatically acquire without contribution the allotted shares for which the transfer
restrictions have not been lifted, as of the time immediately after the transfer restrictions
are lifted.
(5) Other matters determined by the Board of Directors
In addition to the above, the method for expressing intentions and giving notifications in
the Allotment Agreement, the method for amending the Allotment Agreement, and othermatters to be determined by the Board of Directors shall be laid out in the Allotment
Agreement.
So that the shares allocated to the Eligible Directors under the proposed system cannot betransferred, set collateral rights or disposed in other ways during the transfer restriction
period, they will be managed in dedicated accounts opened by the Eligible Directors at asecurities company specified by the Company.

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