Note: This English document has been translated from the Japanese original for reference purposes only. In theevent of any discrepancy between this translation and the Japanese original, the Japanese original shallprevail.
Tosei Corporation assumes no responsibility for this translation or for direct, indirect or any other formsof damages arising from the translation.

January 23, 2015
To whom it may concern:

Tosei Corporation
Toranomon Tosei Building, 4-2-3 Toranomon, Minato-ku, Tokyo
President and CEO: Seiichiro Yamaguchi
Securities code: 8923 (Tokyo Stock Exchange, First Section)
Securities code: S2D (Singapore Exchange, Mainboard)
Contact: Director and CFO: Noboru Hirano
Tel: +81-3-3435-2864

Notice regarding Renewal of Countermeasures to Large-Scale Acquisitions ofTosei Shares (Takeover Defense Measures)
Tosei Corporation (the “Company”) renewed a plan for countermeasures to large-scale acquisitionsof the shares in the Company (the “Former Renewed Plan”) by a resolution of the board of directors on
January 25, 2012 and obtained shareholder approval at the ordinary general meeting of shareholders of theCompany held on February 24, 2009 (the “Former Ordinary General Meeting of Shareholders”). The
effective period of the Former Renewed Plan expires at the conclusion of the ordinary general meeting ofshareholders for the last fiscal year ending within three years after the conclusion of the Former Ordinary
General Meeting of Shareholders, and the Former Renewed Plan will become invalid at the conclusion of
the 65th ordinary general meeting of shareholders of the Company to be held on February 25, 2015 (the“65th Ordinary General Meeting of Shareholders”).

The Company announces that, due to the Former Renewed Plan becoming invalid, the Company’sboard of directors determined at the meeting held on January 23, 2015 to formally revise certain wordingsof the Former Renewed Plan and introduce a new plan (the introduction is to be referred to as the“Renewal,” and the renewed plan is to be referred to as the “Plan”) as a measure to prevent decisions on the
Company’s financial and business policies from being controlled by persons deemed inappropriate (Article
118, Item 3(b) of the Enforcement Regulations of the Companies Act) under the basic policy regarding thepersons who control decisions on the Company’s financial and business policies (as provided in Article 118,
Item 3 of the Enforcement Regulations of the Companies Act; the “Basic Policy”).

The Renewal will be

subject to approval by the shareholders at the 65th Ordinary General Meeting of Shareholders. At theboard of directors meeting described above, four directors in total including one outside director were inattendance and unanimously approved the Renewal and all of the Company’s Audit & Supervisory Board
Members, who are all outside Audit & Supervisory Board Members, were in attendance and did not raise
any objections in respect of the Renewal.
1Basic Policy Regarding the Persons Who Control Decisions on the Company’s Financial

I.

and Business Policies
The Company believes that the persons who control decisions on the Company’s financial andbusiness policies need to be persons who fully understand the details of the Company’s financial andbusiness affairs and the source of the Company’s corporate value and who will make it possible tocontinually and persistently ensure and enhance the Company’s corporate value and, in turn, the common
interests of its shareholders.

The Company believes that ultimately its shareholders as a whole must make the decision on any
proposed acquisition that would involve a change of control of the Company.

Also, the Company will not

reject a large-scale acquisition of the shares in the Company if it will contribute to the corporate value of
the Company and, in turn, the common interests of its shareholders.

Nonetheless, there are some forms of large-scale acquisition of shares that benefit neither the
corporate value of the target company nor the common interests of its shareholders including those with apurpose that would obviously harm the corporate value of the target company and the common interests of
its shareholders, those with the potential to substantially coerce shareholders into selling their shares; thosethat do not provide sufficient time or information for the target company’s board of directors andshareholders to consider the details of the large-scale acquisition, or for the target company’s board of
directors to make an alternative proposal and those that require the target company to discuss or negotiatewith the acquirer in order to procure more favorable terms for shareholders than those presented by theacquirer.

It is particularly necessary and essential for the persons who make decisions on the Company’s
financial and business policies to (i) maintain the system under which the Company internally covers the
six business fields that allow the “integration of real estate and finance,” which leads to maximization of
the potential of the Company group, (ii) maintain employees who support that system with knowledge andexperience specializing in real estate and finance, (iii) maintain the Company’s trust in the real estateindustry that has been built up over a long period of time based on the establishment of the ability andinformation networks supporting various value creation technologies, and (iv) master knowhow thatenables comprehensive business. Unless the acquirer of a proposed large-scale acquisition of the shares in
the Company understands the source of the corporate value of the Company as well as the details offinancial and business affairs of the Company and would ensure and enhance these elements over the
medium-to-long term, the corporate value of the Company and, in turn, the common interests of its
shareholders would be harmed.

The Company believes that persons who would make a large-scale acquisition of the shares in the2Company in a manner that does not contribute to the corporate value of the Company or the common
interests of its shareholders would be inappropriate as persons that control decisions on the Company’s
financial and business policies. The Company believes that it is necessary to ensure the corporate value of
the Company and, in turn, the common interests of its shareholders by taking necessary and reasonablecountermeasures against a large-scale acquisition by such persons.

II.

The Source of the Company’s Corporate Value and Special Measures to Realize the Basic
Policy1.

The Source of the Company’s Corporate Value
Under the corporate philosophy of “creating new value and inspiration in all aspects of real estate asa global-minded group of seasoned professionals,” the Company group holds up the corporate message“Putting heart into the city” and aims to increase its corporate value by contributing to society by
developing and revitalizing real estate for sustainable social development.

The Company group promotes a highly stable business portfolio through the six business fields it
maintains, namely real estate securitization, real estate development, real estate rental, real estate fund andconsulting, property management, and alternative investment.

The Company expects a high profit from real estate securitization and real estate development
businesses through real estate purchase and sale transactions, while ensuring a stable profit from real estate
rental, real estate fund and consulting, and property management businesses. By mutually complementing
these six business fields, the Company has established a business infrastructure which allows the Company
to flexibly respond to changing market trends.

Also, integration of the know-how obtained through these businesses lead to greater success ofmany business projects of the Company, making this “six-businesses portfolio” the Company’s distinctive
and advantageous asset.

2.

Measures to Enhance the Corporate Value
During the three years under the last medium-term management plan, the Company group has

improved and expanded the existing six business fields, and has doubled its sales and profit primarily byreal estate securitization and real estate development businesses. Also, the Company group has made its
way into the global business field as a result of having been listed on Singapore Exchange andincorporation of Tosei Singapore Pte. Ltd. and NAI Tosei Japan, Inc. Meanwhile, the Company focused onrenovation of management infrastructure, for example by introducing the International Financial ReportingStandards as the first in the real estate industry in Japan, upon having been listed in the Singapore
3Exchange. In 2014, which was the final year of the former medium-term management plan, the Company
successfully had Tosei REIT Investment Corporation, whose asset is managed by the Company’s subsidiary
Tosei Asset Advisors, Inc., listed. The Company believes that this will contribute to strengthening of thevalue chain in the future business portfolio of the Company group.
Under the new medium-term management plan called “Advancing Together 2017” (the targeted
period of the plan is three years from December 2014 to November 2017), the Company aims to further
strengthen the business infrastructure by expanding and developing of the existing six business areas andconsidering its advance to peripheral areas of business, to build optimum corporate governance for
expansion of the Company group and increase of the employees which are entailed in expansion of thebusiness, and to establish efficient organization management structure.

Further, the Company group willemphasize the cultivation of the most valuable asset of the Company group, i.e. the human resources toincrease satisfaction of the employees of the Company group.

As the Basic Policy in the new

medium-term management plan for the further growth of the Company group, the Company group isdetermined to establish the original and distinctive “Tosei brand” by providing products ensuring highcustomer satisfaction and high-quality services. Based on these policies, the Company group is dedicatedto redefine existing ideas with the spirit of challenge and advance as the risk-taking group of companies, toaim “creation of new values and sensation as the truly globally-minded and promising professionals”.

3.

Strengthening of Corporate GovernanceDiscussions on development of the Japan’s Corporate Governance Code is an example of anincreased view among our society that strengthened corporate governance would contribute to an increased
corporate value and sustainable development of companies.

The Company group has previously appointed

multiple outside directors (two members), invited

all Audit & Supervisory Board Members (four members) from outside the company, and has notified all of
the above six outside directors and Audit & Supervisory Board Members as “independent directors and/or
Audit & Supervisory Board Members” in accordance with the “Principles of Corporate Governance for
Listed Companies” of the Tokyo Stock Exchange. Also, the Company group has reinforced the businessexecution function by the introduction of the executive officer system, and the establishment of thecorporate governance board, and will continue to endeavor to further strengthen corporate governance.
Specifically, the Company group will focus on putting into practice actions based on a high-level awarenessof compliance through raising awareness from the level of “role model” to that of “ideal” in accordancewith the Compliance Principles of the Company, thorough implementation of risk management by correctly
understanding and analyzing risks involved in corporate activities, continuous performance ofaccountability to various stakeholders including investors by promptly publicly disclosing correct corporate
information under the spirit of fair disclosure, and other efforts for strengthening corporate governance.

4The Company will endeavor to ensure and enhance the corporate value of the Company and, in turn,the common interests of its shareholders by implementing the measures set out above.

III.

Measures to Prevent Decisions on the Company’s Financial and Business Policies frombeing Controlled by Persons Deemed Inappropriate Under the Basic Policy (the Plan)

1.

Purpose of the Plan
The Plan is in line with the Basic Policy set out above in section I ‘Basic Policy Regarding the

Persons Who Control Decisions on the Company’s Financial and Business Policies’ for the purpose of
ensuring and enhancing the corporate value of the Company and, in turn, the common interests of its
shareholders.

As set out in the Basic Policy, the Company’s board of directors believes that persons who would
propose a large-scale acquisition of the shares in the Company in a manner that does not contribute to thecorporate value of the Company or the common interests of its shareholders would be inappropriate to
become persons who control decisions on the Company’s financial and business policies.

The purpose of

the Plan is to prevent decisions on the Company’s financial and business policies from being controlled bypersons deemed inappropriate, to deter large-scale acquisitions that are detrimental to the corporate value of
the Company and the common interests of its shareholders, and on the occasion that the Company receivesa large-scale acquisition proposal from an acquirer, to enable the Company’s board of directors to present
an alternative proposal to the shareholders or ensure necessary time and information for the shareholders todecide whether or not to accept the large-scale acquisition, and to enable the board of directors to negotiate
for the benefit of the shareholders.

The status of major shareholders of the Company as of November 30, 2014 is set out in Schedule“Major Shareholders of the Company,” and as of that date, approximately 39.1% of the total number of theCompany’s issued and outstanding shares are held by the representative director of the Company and his
related parties (the “Company Officers”).

The Company recognizes that the significance of listing is that it enables financing from a broader
market than usual, and while the scale of the Company’s business favorably expanded and the stock priceshifted firmly after the public offering in the JASDAQ market in February 2004, the Company
implemented a capital increase through a public offering and the like three times after the listing on
JASDAQ. After the financial crisis occurred during the latter half of 2008, the real estate industry, inwhich the Company is engaged, faced a continued severe business environment, but the Company
promoted measures to ensure the soundness of the financial position of the Company such as by furthering
replacement of inventory assets.

In addition, in September 2009, the Company resolved the fourthissuance of stock acquisition rights as a measure to increase capital, and those stock acquisition rights were5all exercised. Further, in July 2013, the Company implemented a capital increase through a public
offering outside of Japan upon being listed in the Singapore Exchange. As a result, the ratio of holding ofissued and outstanding shares in the Company by the Company Officers (the “Shareholding Ratio”) has
decreased from approximately 76.5%, which was the percentage immediately after the listing (as of May 31,2004), by approximately 37 points in seven and a half years after the listing. The Company believes that
it is possible that in the future the Company will implement financing in the capital market for investments
in new growing business or similar investments and amplification of equity capital, which could result in
the expansion of the business field over a medium-to-long term. At the same time, the Company as alisted company is aware of the importance of ensuring and enhancing the liquidity of shares on acontinuous basis. If financing or enhancement of liquidity is attempted from such perspectives, theShareholding Ratio of the Company Officers will decrease.

Also, it is not unusual due to each shareholder’s circumstances that shares held by individual
investors are dissipated through disposal of shares, including transfer. With regard to the Company
Officers who are individual investors, it is considered that there is a possibility that the Shareholding Ratio
might decrease and shares be dissipated in the future.

In light of these circumstances, it is possible that in the future the Shareholding Ratio of theCompany Officers will gradually decrease while the liquidity of the shares issued by the Company will
increase. The Company therefore cannot deny the possibility that large-scale acquisitions of the shares in
the Company by persons who are inappropriate will be made in the future.

Furthermore, the Company also cannot deny the possibility that, as characteristics of the real estateindustry, acts of large-scale acquisitions of the shares in the Company will be performed for purposes suchas acquiring assets owned by the Company, especially when the stock price shifts unfavorably compared to
the value of the owned assets and the like.

As of the date of this press release, the Company has not received any proposal of an act oflarge-scale acquisition of the shares in the Company that has not been approved by the Company.

2.

Plan Outline

2.1

Plan Outline(a)PurposeThe purpose of the Plan is, on the occasion that a proposal of large-scale acquisition of the shares in

the Company is made, to ensure necessary and sufficient time and information for the shareholders to makeappropriate decisions and to ensure opportunities to negotiate with the acquirer and the like, and thereby todeter takeovers that are against the corporate value of the Company and, in turn, the common interests of its
6

shareholders, and to ensure and enhance the corporate value of the Company and the common interests of
its shareholders.

(b)

Establishment of Procedures
The Plan sets out procedures necessary to achieve the purpose stated in (a) above, including

requirements for acquirers to provide information in advance in the case that the acquirer intends to makean acquisition of 20% or more of the Company’s share certificates1 or other equity securities. In addition,an acquirer, etc. must not effect an acquisition until and unless the Company’s board of directors resolves
not to trigger the Plan if the procedures for the Plan has commenced. (See section 2.2 ‘Procedures for
Triggering the Plan’ below for details.)(c)

Triggering of the Plan by Gratis Allotment of Stock Acquisition Rights
In cases such as where an acquirer does not follow the procedures set out in the Plan, or alarge-scale acquisition of shares and other equity securities in the Company could harm the corporate valueof the Company and, in turn, the common interests of its shareholders (see section 2.3 ‘Requirements for
the Gratis Allotment of Stock Acquisition Rights’ below for the details of the requirements), the Company
will allot stock acquisition rights with (a) an exercise condition that does not allow the acquirer, etc. toexercise the rights (except where any exception event occurs) and (b) an acquisition provision to the effectthat the Company may acquire the stock acquisition rights in exchange for shares and other equity
securities in the Company from persons other than the acquirer, etc. (the outline of the stock acquisitionrights to be allotted is set out below in 2.4 ‘Outline of the Gratis Allotment of Stock Acquisition Rights’;the relevant stock acquisition rights are hereinafter referred to as the “Stock Acquisition Rights”), by meansof a gratis allotment of stock acquisition rights (shinkabu yoyakuken mushou wariate) to all shareholders,
except the Company, at that time.

If a gratis allotment of Stock Acquisition Rights were to take place in accordance with the Plan andall shareholders other than the acquirer, etc. received the Company’s shares as a result of those shareholders
exercising or the Company acquiring the Stock Acquisition Rights, the ratio of voting rights in the
Company held by the acquirer, etc. may be diluted by up to a maximum of 50%.

(d)

Establishment of Mechanism Enhancing Rationale of the Plan
For matters such as the implementation or non-implementation of the gratis allotment of Stock

Acquisition Rights or the acquisition of Stock Acquisition Rights, the Company will obtain an objective
determination from the independent committee, which is composed of members who are independent fromthe management of the Company such as outside directors subject to the rules of the independent
1

The Company is no longer a company issuing share certificates since the electronic share certificate
system came into effect; however, we use the term “share certificate” in the Plan in accordance with theprovisions of the Financial Instruments and Exchange Act from the perspective that using descriptions in
the Plan that are in accordance with the provisions of the Financial Instruments and Exchange Act willcontribute to clarity and objectivity.
7

committee in order to eliminate arbitrary decisions by directors.

In addition, the Company’s board of

directors may, if prescribed in the Plan, convene a meeting of shareholders and confirm the intent of theCompany’s shareholders regarding the implementation of the gratis allotment of the Stock Acquisition
Rights.

Transparency with respect to the course of those procedures will be ensured by timely information
disclosure to all of the Company’s shareholders.

2.2

Procedures for Triggering the Plan(a)Targeted Acquisitions
The Plan will be applied in cases where any purchase or other acquisition of share certificates, etc.

of the Company that falls under (i) or (ii) below or any similar action (including a proposal for such action)(except for such action as the Company’s board of directors separately determines not to be subject to thePlan; the “Acquisition”) takes place.

(i)

A purchase or other acquisition that would result in the holding ratio of share certificates, etc.
(kabuken tou hoyuu wariai) 2 of a holder (hoyuusha) 3 totaling at least 20% of the sharecertificates, etc. (kabuken tou)4 issued by the Company; or(ii)

A tender offer (koukai kaitsuke)5 that would result in the party conducting the tender offer’sownership ratio of share certificates, etc. (kabuken tou shoyuu wariai)6 and the ownership ratioof share certificates, etc. of a person having a special relationship (tokubetsu kankei-sha)7
totaling at least 20% of the share certificates, etc. (kabuken tou)8 issued by the Company.

The party intending to make the Acquisition (the “Acquirer”) shall follow the procedures prescribedin the Plan.

2

Defined in Article 27-23.4 of the Financial Instruments and Exchange Act. The same is applied
throughout this document.
3 Including persons described as a holder under Article 27-23.3 of the Financial Instruments and Exchange
Act (including persons who are deemed to fall under the above by the board of directors of the Company).
The same is applied throughout this document.
4 Defined in Article 27-23.1 of the Financial Instruments and Exchange Act.
The same is applied
throughout this document unless otherwise provided for.
5 Defined in Article 27-2.6 of the Financial Instruments and Exchange Act.
The same is applied
throughout this document.
6 Defined in Article 27-2.8 of the Financial Instruments and Exchange Act.
The same is applied
throughout this document.
7 Defined in Article 27-2.7 of the Financial Instruments and Exchange Act (including persons who are
deemed to fall under the above by the board of directors of the Company); provided, however, that persons
provided for in Article 3.2 of the Cabinet Office Regulations concerning Disclosure of a Tender Offer by an
Acquirer other than the Issuing Company are excluded from the persons described in Article 27-2.7(i) of
the Financial Instruments and Exchange Act. The same is applied throughout this document.
8 Defined in Article 27-2.1 of the Financial Instruments and Exchange Act.
8

(b) Submission of Acquirer’s Statement
The Company will request the Acquirer to submit to the Company in the form separately prescribedby the Company a document that includes an undertaking that the Acquirer will comply with theprocedures set out in the Plan (signed by or affixed with the name and seal of the representative of theAcquirer) and a qualification certificate of the person who signed or affixed its name and seal to that
document (collectively, “Acquirer’s Statement”) before commencing or effecting the Acquisition. The
Acquirer’s Statement must include the name, address or location of headquarters, location of offices,
governing law for establishment, name of the representative, contact information in Japan for the Acquirer
and the outline of the intended Acquisition. The Acquirer’s Statement and the Acquisition Document set
out in (c) below must be written in Japanese.

(c)Request to the Acquirer for the Provision of Information
The Company will provide the Acquirer the format for the Acquisition Document (defined below),

including a list of information that the Acquirer should provide to the Company, no later than 10 businessdays after receiving the Acquirer’s Statement.

The Acquirer must provide the Company’s board of

directors with the document in the form provided by the Company (the “Acquisition Document”), which
includes the information described in each item of the list below (“Essential Information”).

If the Company’s board of directors receives the Acquisition Document, it will promptly send it to
the Independent Committee (standards for appointing members, requirements for resolutions, resolution
matters, and other matters concerning the Independent Committee are as described in Attachment 1‘Outline of the Rules of the Independent Committee’ and business backgrounds and other matters regarding
members of the Independent Committee at the time of the Renewal will be as described in Attachment 2‘Profiles of the Members of the Independent Committee’). If the Company’s board of directors and theIndependent Committee determine that the Acquisition Document does not contain sufficient Essential
Information, it may set a reply period and request that the Acquirer additionally provide information. In
such case, the Acquirer should additionally provide such information within the relevant time limit.

(i)

Details (including name, capital structure, financial position, operation results, status ofcompliance with laws or ordinances, terms of previous transactions by the Acquirer similar to
the Acquisition and effects on the corporate value of the target companies as a result of thetransactions) of the Acquirer and its group (including Joint Holders9, persons having a special
relationship, members (in the case of a fund) and persons having a special relationship with aperson in relation to whom the Acquirer is the controlled corporation10)11.

9

Defined in Article 27-23.5 of the Financial Instruments and Exchange Act, including persons deemed as a
Joint Holder under Article 27-23.6 of the Financial Instruments and Exchange Act (including persons who
are deemed a Joint Holder by the Company’s board of directors). The same is applied throughout thisdocument.
10 Defined in Article 9.5 of the Order of the Enforcement of the Financial Instruments and Exchange Act.
9

(ii)

The purpose, method and specific terms of the Acquisition (including the amount and type of
consideration, the timeframe, the scheme of any related transactions, the legality of theAcquisition method, terms and conditions and the probability of the Acquisition).

(iii)

The amount and basis for the calculation of the purchase price of the Acquisition (including
assumptions and the like).

(iv)

Financial support for the Acquisition (including the names of providers of funds (including all
indirect providers of funds), financing methods and the terms of any related transactions and thelike).

(v)

Details of communications regarding the Acquisition with a third party (if any).

(vi)

Post-Acquisition management policy, administrative organization, business plan, capital,
dividend and asset management policies for the Company and the Company group.

(vii) Post-Acquisition policies for the Company’s shareholders (other than the Acquirer), employees,
business partners, customers, and any other parties such as stakeholders in the Company.
(viii) Specific measures to prevent conflicts of interests between the Acquirer and other shareholders
in the Company.
(ix)

(d)

Any other information that the Independent Committee reasonably considers necessary.

Consideration of Acquisition Terms, Negotiation with the Acquirer, and Consideration of an
Alternative Proposal
Request to the Company’s Board of Directors for the Provision of Information(i)

If the Acquirer submits the Acquisition Document and any additional information that the
Independent Committee requests (if any), the Independent Committee may set a reply period (up to sixty
days as a general rule) taking into account the necessary time for the Company’s board of directors tocollect information and consider corporate valuation and other matters (including consideration by
third-party experts as necessary) and request that the Company’s board of directors present an opinion(including an opinion to refrain from giving such opinion; hereinafter the same) on the Acquirer’s
Acquisition terms, materials supporting such opinion, an alternative proposal (if any), and any otherinformation that the Independent Committee considers necessary.

(ii)

Independent Committee Consideration

The Independent Committee will conduct its consideration of the Acquisition terms, collection of
information on the materials such as the management plans and business plans of the Acquirer and theCompany’s board of directors and comparison thereof, and consideration of any alternative plan presented
11

If an Acquirer is a fund, information relating to the matters described in (i) about each partner and otherconstituent members is required.
10

by the Company’s board of directors, and the like for a period of time that does not, as a general rule,
exceed sixty days after the date on which the Independent Committee receives the information (including
the information additionally requested) from the Acquirer and (if the Independent Committee requests theCompany’s board of directors to provide information as set out in (i) above) the Company’s board of
directors (the period for information collection and consideration by the Independent Committee ishereinafter referred to as the “Independent Committee Consideration Period”). Further, if it is necessary
in order to improve the terms of the Acquisition from the standpoint of ensuring and enhancing thecorporate value of the Company and the common interests of its shareholders, the Independent Committee
will directly or indirectly discuss and negotiate with the Acquirer.
In order to ensure that the Independent Committee’s decision contributes to the Company’s
corporate value and, in turn, the common interests of its shareholders, the Independent Committee may, atthe cost of the Company, obtain advice from independent third parties (including financial advisers,
attorneys, certified public accountants, tax accountants, consultants or any other experts).

If theIndependent Committee directly or indirectly requests the Acquirer to provide materials for considerationor any other information, or to discuss and negotiate with the Independent Committee, the Acquirer must
promptly respond to such request.

(e)

Recommendation by the Independent Committee
The Independent Committee will make recommendations to the Company’s board of directors as

follows based on the abovementioned procedures.

(i)

Recommendation for the Triggering of the Plan
If the Independent Committee determines that the Acquisition falls under any of the trigger events

set out below in 2.3, ‘Requirements for the Gratis Allotment of Stock Acquisition Rights’ (collectively“Trigger Event”) arises with respect to the Acquisition, the Independent Committee will recommend theimplementation of the gratis allotment of Stock Acquisition Rights (the outline of the stock acquisitionrights to be allotted is set out below in 2.4 ‘Outline of the Gratis Allotment of Stock Acquisition Rights’) to
the Company’s board of directors except in any specific case where further disclosure of information by the
Acquirer or discussion or negotiation with the Acquirer is necessary.

If it is concerned that an Acquisition

may fall under the Trigger Event (2) set out below in 2.3, ‘Requirements for the Gratis Allotment of Stock
Acquisition Rights,’ the Independent Committee may recommend implementation of the gratis allotment ofStock Acquisition Rights subject to confirming the shareholders’ intent in advance.
Notwithstanding the foregoing paragraph, even after the Independent Committee has already made a
recommendation for the implementation of the gratis allotment of Stock Acquisition Rights, if the
Independent Committee determines that either of the events in (A) or (B) below applies, it may make a newrecommendation that (i) on or before the second business day prior to the ex-rights date with respect to thegratis allotment of Stock Acquisition Rights, the Company should suspend the gratis allotment of Stock
Acquisition Rights, or (ii) from the effective date of the gratis allotment of Stock Acquisition Rights and11until the day immediately prior to the commencement date of the exercise period of the Stock Acquisition
Rights, the Company should acquire the Stock Acquisition Rights for no consideration.

(A)

The Acquirer withdraws the Acquisition or the Acquisition otherwise ceases to exist after therecommendation.

(B)

There is no longer any Trigger Event due to a change or the like in the facts or other matters on
which the recommendation decision was made.

If there is a concern that an Acquisition may fall under any of the Trigger Events set out in items (b)through (e) in 2.3, ‘Requirements for the Gratis Allotment of Stock Acquisition Rights’, ‘Trigger Events(2)’ below, the Independent Committee may recommend implementation of the gratis allotment of Stock
Acquisition Rights subject to obtaining the approval of the general meeting of shareholders in advance12.

(ii)

Recommendation for the Non-Triggering of the Plan
If the Independent Committee determines the Acquisition does not fall under either Trigger Event,the Independent Committee will recommend the non-implementation of the gratis allotment of Stock
Acquisition Rights to the Company’s board of directors, regardless of whether the Independent Committee
Consideration Period has ended.

Notwithstanding the foregoing paragraph, even after the Independent Committee has already madeone recommendation for the non-implementation of the gratis allotment of Stock Acquisition Rights, if
there is a change in the facts or other matters on which the recommendation decision was made and a
Trigger Event arises, the Independent Committee may make a new recommendation that the Company
should implement the gratis allotment of Stock Acquisition Rights.

(iii)

Extension of the Independent Committee Consideration Period
If the Independent Committee does not reach a recommendation for either the implementation or

non-implementation of the gratis allotment of Stock Acquisition Rights during the initial Independent
Committee Consideration Period, the Independent Committee may, to the reasonable extent that it isconsidered necessary for actions such as consideration of the terms of the Acquirer’s Acquisition,
consideration of an alternative proposal and discussion and negotiation with the Acquirer, extend theIndependent Committee Consideration Period (in principle up to 30 days in total).
12

Based on the fact, among other things, that it was indicated in the report dated June 30, 2008 (“Takeover
Defense Measures in Light of Recent Environmental Changes”) published by the Corporate Value Study
Group that it is necessary that the decision is made based on the shareholders’ intent if a substantive
decision is necessary as to whether the takeover proposal is detrimental to the common interests ofshareholders, the Plan expressly sets out that, if there is a concern that an Acquisition may fall under any of
the Trigger Events set out in items (b) through (e), for which such substantive decision would be necessary,the matter may be brought up before the general meeting of shareholders again.
12

If the Independent Committee Consideration Period is extended because of the above resolution, theIndependent Committee will continue to collect information, deliberate and perform similar activities, anduse its best efforts to make a recommendation for the implementation or non-implementation of the gratis
allotment of Stock Acquisition Rights within the extended period.

(f)Resolutions by the Board of Directors
If any recommendation of the Independent Committee described above is made, the Company’sboard of directors, in exercising its role under the Companies Act, will pass a resolution relating to theimplementation or non-implementation of a gratis allotment of Stock Acquisition Rights respecting thatrecommendation to the maximum extent.

If a meeting of shareholders is convened in accordance with (g)below, the Company’s board of directors will pass a resolution in accordance with the resolution at themeeting of shareholders.

(g)Convocation of the Shareholders Meeting
Upon the implementation of the gratis allotment of the Stock Acquisition Rights pursuant to the Plan,

the Company’s board of directors may convene a meeting of shareholders (the “Shareholders Meeting”)
and confirm the intent of the Company’s shareholders regarding the implementation of the gratis allotmentof the Stock Acquisition Rights, if (i) the Independent Committee recommends implementation of the gratis
allotment of Stock Acquisition Rights subject to confirming the shareholders’ intent in advance inaccordance with (e)(i) above, or (ii) the applicability of Trigger Event (2) becomes an issue in respect of theAcquisition and the board of directors determines it appropriate to confirm the shareholders’ intent taking
into consideration the time required to convene the Shareholders Meeting or other matters pursuant to theduty of care of a director.

(h)Information Disclosure
When operating the Plan, the Company will disclose, in a timely manner, information on mattersthat the Company’s board of directors considers appropriate including the progress of each procedure set
out in the Plan (including the fact that the Acquirer’s Statement and Acquisition Document have been
submitted and the Independent Committee Consideration Period has commenced, and the fact that the
Independent Committee Consideration Period has been extended, as well as the extended period and thereason for the extension), or an outline of recommendations made by the Independent Committee, anoutline of resolutions by the Company’s board of directors and an outline of resolutions at the Shareholders
Meeting, in accordance with the applicable laws and ordinances or the regulations of the financial
instruments exchange.

2.3

Requirements for the Gratis Allotment of Stock Acquisition Rights

The requirements to trigger the Plan to implement a gratis allotment of Stock Acquisition Rights are13

as follows. As described above in (e) of 2.2, ‘Procedures for Triggering the Plan,’ the Company’s boardof directors will make a determination as to whether any of the following requirements applies to an
Acquisition for which the recommendation by the Independent Committee has been obtained.

Trigger Event (1)The Acquisition is not in compliance with the procedures prescribed in the Plan (including cases that timeand information reasonably necessary to consider the details of the Acquisition is not offered) and it isreasonable to implement the gratis allotment of Stock Acquisition Rights.

Trigger Event (2)The Acquisition falls under any of the items below and it is reasonable to implement the gratis allotmentof Stock Acquisition Rights.

(a)

An Acquisition that threatens to cause obvious harm to the corporate value of the Company and, inturn, the common interests of its shareholders through any of the following actions.
(i)A buyout of share certificates, etc. to require such share certificates, etc. to be compulsorily
purchased by the Company or the Company’s affiliates at a high price.

(ii) Management that achieves an advantage for the Acquirer to the detriment of the Company,
such as temporary control of the Company’s management for the low-cost acquisition of theCompany’s material assets.
(iii) Diversion of the Company’s assets to secure or repay debts of the Acquirer or its groupcompany.
(iv) Temporary control of the Company’s management to bring about the disposal of high-value
assets that have no current relevance to the Company’s business and declaring temporarily
high dividends from the profits of the disposal, or selling the shares at a high price taking
advantage of the opportunity afforded by the sudden rise in share prices created by the
temporarily high dividends.
(b)

Certain Acquisitions that threaten to have the effect of coercing shareholders into selling shares,
such as coercive two-tiered tender offers (meaning acquisitions of shares including tender offers, inwhich no offer is made to acquire all shares in the initial acquisition, and acquisition terms for thesecond stage are set that are unfavorable or unclear).

(c)

Acquisitions to which the terms (including the amount and type of consideration, timeframe,
legality of the Acquisition method, probability of the Acquisition being effected, andpost-Acquisition management policies or business plans and policies dealing with the Company’sother shareholders, employees, customers, business partners and any other stakeholders in the
Company) are inadequate or inappropriate in light of the Company’s intrinsic value.
14

(d)

Acquisitions that materially threaten to oppose the corporate value of the Company and, in turn,the common interests of shareholders, by destroying relationships with the Company’s employees,
customers, business partners and the like and the brand strength or the corporate culture of theCompany, which are indispensable to the generation of the Company’s corporate value.

(e)

An Acquisition to be effected by an Acquirer who is extremely inappropriate to acquire the controlof the Company in terms of public order and morals in cases such as where a person related to ananti-social force is included in the management of or the major shareholders in the Acquirer.

2.4

Outline of the Gratis Allotment of Stock Acquisition Rights

The following is an outline of the gratis allotment of Stock Acquisition Rights scheduled to be
implemented under the Plan.

(a)

Number of Stock Acquisition Rights
The Company will implement a gratis allotment of Stock Acquisition Rights in the same number as

the most recent total number of issued and outstanding shares in the Company (excluding the number ofshares in the Company held by the Company at that time) on a certain date (the “Allotment Date”) that is
separately determined in a resolution by the Company’s board of directors or general meeting ofshareholders relating to the gratis allotment of Stock Acquisition Rights (the “Gratis Allotment
Resolution”).

(b)

Shareholders Eligible for Allotment
The Company will allot the Stock Acquisition Rights to shareholders, other than the Company, who

are recorded in the Company’s last register of shareholders on the Allotment Date, at a ratio of one Stock
Acquisition Right for each share in the Company held.

(c)Effective Date of Gratis Allotment of Stock Acquisition Rights
The effective date of the gratis allotment of Stock Acquisition Rights will be separately determinedin the Gratis Allotment Resolution.

(d)Number of Shares to be Acquired upon Exercise of the Stock Acquisition Rights
The number of shares in the Company13 to be acquired upon exercise of each Stock Acquisition

Right (the “Applicable Number of Shares”) will, in principle, be one share.
13

Even if the Company becomes a company issuing class shares (Article 2, Item 13 of the Companies Act)in the future, both (i) the shares in the Company to be delivered upon exercise of Stock Acquisition Rightsand (ii) the shares to be delivered in exchange for acquisition of Stock Acquisition Rights are the sameclass of shares of common stock that have been issued at the time of the 65th Ordinary General Meeting of
Shareholders.
15

(e)

Amount to be Contributed upon Exercise of Stock Acquisition Rights
Contributions upon exercise of the Stock Acquisition Rights are to be in cash, and the amount per

share in the Company to be contributed upon exercise of the Stock Acquisition Rights will be an amountseparately determined in the Gratis Allotment Resolution within the range of a minimum of one yen and amaximum of the amount equivalent to one-half of the fair market value of one share in the Company.
“Fair market value” means an amount equivalent to the average closing price (including quotations) for
regular transactions of the common stock of the Company on the Tokyo Securities Exchange on each day
during the three-month period prior to the Gratis Allotment Resolution (excluding the days on which trades
are not made), with any fraction of a yen after such calculation to be rounded up to the nearest whole yen.

(f)

Exercise Period of the Stock Acquisition Rights
The commencement date will be a date separately determined in the Gratis Allotment Resolution(this commencement date of the exercise period is referred to as the “Exercise Period Commencement
Date”), and the period will, in principle, be a period from one month to six months long as separately
determined in the Gratis Allotment Resolution.

(g)

Conditions for Exercise of Stock Acquisition Rights
Except where any exceptional event14 occurs, the following parties may not exercise the Stock

Acquisition Rights (the parties falling under (I) through (VI) below are collectively be referred to as“Non-Qualified Parties”):(I)

Specified Large Holders;15

Specifically, the Company intends to set out that an “exeptional event” means when (x) the Acquirer
cancels or revokes the Acquisition, or promises that it will not conduct any subsequent Acquisition, after
the Gratis Allotment Resolution and the Acquirer or other Non-Qualified Parties dispose of their shares in
the Company through a securities firm appointed and authorized by the Company to do so and (y) the
Acquirer’s shareholding ratio determined by the Company’s board of directors (when calculating theshareholding ratio, Non-Qualified Parties other than the Acquirer and its Joint Holders are deemed to be theAcquirer’s Joint Holders, and Stock Acquisition Rights held by Non-Qualified Parties, the conditions ofwhich have not been satisfied, are excluded) (the “Non-Qualified Parties Shareholding Ratio”) falls below
the lower of (i) the Non-Qualified Parties’ Shareholding Ratio before the Acquisition, or (ii) 20%, theAcquirer or other Non-Qualified Parties making the disposal may exercise Stock Acquisition Rights to theextent that the number of shares to be issued or delivered upon exercise of the Stock Acquisition Rights is
up to the number of shares disposed of and to the extent of the ratio under either (i) or (ii) above. Detailed
conditions and procedures for exercise of Stock Acquisition Rights by Non-Qualified Parties will be
determined separately by the Company’s board of directors.
15 “Specified Large Holder” means, in principle, a party who is a holder of share certificates, etc. issued by
the Company and whose holding ratio of share certificates, etc. in respect of such share certificates, etc. is
at least 20% (including any party who is deemed applicable to the above by the Company’s board of
directors); provided, however, that a party that the Company’s board of directors recognizes as a party
whose acquisition or holding of share certificates, etc., of the Company is not contrary to the Company’s
corporate value or the common interests of shareholders or a certain other party that the board of directors
determines in the Gratis Allotment Resolution is not a Specified Large Holder. The same is applied
throughout this document.
14

16

(II)

Joint Holders of Specified Large Holders;(III)

Specified Large Purchasers;16(IV)

Persons having a Special Relationship with Specified Large Purchasers;(V)

Any transferee of, or successor to, the Stock Acquisition Rights of any party falling under (I)through (IV) without the approval of the Company’s board of directors; or(VI)

Any Affiliated Party17 of any party falling under (I) through (V).

Further, nonresidents of Japan who are required to follow certain procedures under applicableforeign laws and ordinances to exercise the Stock Acquisition Rights may not as a general rule exercise theStock Acquisition Rights (provided, however, that the Stock Acquisition Rights held by nonresidents will
be subject to acquisition by the Company in exchange for shares in the Company subject to compliancewith applicable laws and ordinances as set out in (ii) of paragraph (i) below, ‘Acquisition of the Stock
Acquisition Rights by the Company’).

In addition, anyone who fails to submit a written undertaking, inthe form prescribed by the Company and containing representations and warranties regarding matters suchas the fact that he or she satisfies the exercise conditions of the Stock Acquisition Rights, indemnity clauses
and other covenants, may not exercise the Stock Acquisition Rights.

(h)Assignment of Stock Acquisition Rights
Any acquisition of the Stock Acquisition Rights by assignment requires the approval of theCompany’s board of directors.

(i)Acquisition of Stock Acquisition Rights by the Company(i)

At any time on or before the date immediately prior to the Exercise Period Commencement“Specified Large Purchaser” means, in principle, a person who makes a public announcement ofpurchase, etc. (as defined in Article 27-2.1 of the Financial Instruments and Exchange Act; the same isapplied throughout this Note 16) of share certificates, etc. (as defined in Article 27-2.1 of the Financial
Instruments and Exchange Act; the same is applied throughout this Note 16) issued by the Company
through a tender offer and whose ratio of ownership of share certificates, etc. in respect of such sharecertificates, etc. owned by such person after such purchase, etc. (including similar ownership as prescribedin Article 7.1 of the Order of the Enforcement of the Financial Instruments and Exchange Act) is at least
20% when combined with the ratio of ownership of share certificates, etc. of a person having a special
relationship (including any party who is deemed to fall under the above by the Company’s board of
directors); provided, however, that a party that the Company’s board of directors recognizes as a party
whose acquisition or holding of share certificates, etc. of the Company is not contrary to the Company’s
corporate value or the common interests of shareholders or certain other party that the Company’s board of
directors determines in the Gratis Allotment Resolution is not a Specified Large Purchaser. The same isapplied throughout this document.
17 An “Affiliated Party” of a given party means a person who substantially controls, is controlled by, or isunder common control with such given party (including any party who is deemed to fall under the above by
the Company’s board of directors), or a party deemed by the Company’s board of directors to act in concert
with such given party. “Control” means to “control the determination of the financial and business
policies” (as defined in Article 3.3 of the Enforcment Regulations of the Companies Act) of othercorporations or entities.
16

17

Date, if the Company’s board of directors deems that it is appropriate for the Company toacquire the Stock Acquisition Rights, the Company may, on a day that falls on a dateseparately determined by the Company’s board of directors, acquire all of the Stock
Acquisition Rights for no consideration.
On a day that falls on a date separately determined by the Company’s board of directors, the(ii)Company may acquire all of the Stock Acquisition Rights that have not been exercised
before or on the day immediately prior to such date separately determined by the Company’sboard of directors, that are held by parties other than Non-Qualified Parties and, in exchange,
deliver shares in the Company in the number equivalent to the number of the Applicable
Number of Shares for each Stock Acquisition Right.
Further, if, on or after the date upon which the acquisition takes place, the Company’s boardof directors recognizes the existence of any party holding Stock Acquisition Rights otherthan Non-Qualified Parties18, the Company may, on a day falling on a date determined by
the Company’s board of directors after the date upon which the acquisition described above
takes place, acquire all of the Stock Acquisition Rights held by that party that have not been
exercised by or on the day immediately prior to such date determined by the Company’sboard of directors (if any) and, in exchange, deliver shares in the Company in the number
equivalent to the number of the Applicable Number of Shares for every one Stock
Acquisition Right. The same will apply thereafter.

(j)

Delivery of Stock Acquisition Rights in Case of Merger (gappei), Absorption-type Demerger(kyushu bunkatsu), Incorporation-type Demerger (shinsetsu bunkatsu), Share Exchange (kabushiki koukan),
and Share Transfer (kabushiki iten)
These matters will be separately determined in the Gratis Allotment Resolution.

(k)Issuance of Certificates Representing the Stock Acquisition Rights
Certificates representing the Stock Acquisition Rights will not be issued.

(l)

Other
In addition to the above, the details of the Stock Acquisition Rights will be separately determined in

the Gratis Allotment Resolution.

2.5

Effective Period, and Abolition, Revision or Amendment of the Plan

18

For example, the case of a person who initially had a Special Relationship with a Specified Large
Purchaser but cancels the relationship with the Specified Large Purchaser after the triggering of the Plan
and thereby is no longer a Non-Qualified Party.
18

The effective period of the Plan (the “Effective Period”) will be the period until the conclusion of
the ordinary general meeting of shareholders relating to the last fiscal year ending within three years after
the conclusion of the 65th Ordinary General Meeting of Shareholders.
However, if, before the expiration of the Effective Period, the Company’s board of directors resolves
to abolish the Plan, the Plan will be abolished at that time.
Further, the Company’s board of directors may revise or amend the Plan even during the Effective
Period of the Plan in cases where any law, ordinance, or regulations or rules of a financial instruments
exchange or the like concerning the Plan is established, amended or abolished and it is appropriate toreflect such establishment, amendment or abolition, cases where it is appropriate to revise the wording forreasons such as typographical errors and omissions, or cases where the revision or amendment does notcause any disadvantage to the Company’s shareholders subject to the approval of the Independent
Committee.

If the Plan is abolished, revised, amended or the like, the Company will promptly disclose facts
including the fact that such abolition, revision or amendment has taken place, and (in the event of a revisionor amendment) the details of the revision, amendment and any other matters.

2.6

Revision Due to Amendment to Laws and Ordinances

The provisions of laws and ordinances referred to under the Plan are subject to the prevailingprovisions as of January 23, 2015. If it becomes necessary after such date to revise the terms andconditions or definitions of terms set out in the paragraphs above due to the establishment, amendment or
abolishment of laws and ordinances, the terms and conditions or definitions of terms set out in theparagraphs above will be read accordingly as required to a reasonable extent, taking into consideration the
purposes of such establishment, amendment or abolishment.

3.

Impact on Shareholders and Investors

3.1

Impact on Shareholders and Investors Upon the Renewal of the Plan

Upon the Renewal of the Plan, the Plan will have no direct or material impact on shareholders andinvestors because no actual gratis allotment of Stock Acquisition Rights will be implemented.

3.2

Impact on Shareholders and Investors at the Time of the Gratis Allotment of Stock Acquisition
Rights(i)

Procedures for Shareholders upon Gratis Allotment of Stock Acquisition Rights
19

If the Company’s board of directors or general meeting of shareholders resolves to make a gratis
allotment of Stock Acquisition Rights, it will also decide the Allotment Date in the same resolution andgive public notice of this Allotment Date. In this case, the Company will make a gratis allotment of Stock
Acquisition Rights to the shareholders who are recorded in the Company’s last register of shareholders asof the Allotment Date (the “Entitled Shareholders”) for one Stock Acquisition Right per share in the
Company held by the Entitled Shareholders. All Entitled Shareholders will automatically become Stock
Acquisition Right holders on the effective date of the gratis allotment of Stock Acquisition Rights, and nofurther procedures, such as applying for such gratis allotment, will be necessary.
In addition, even if the Company’s board of directors has resolved to make a gratis allotment ofStock Acquisition Rights, the Company may, by respecting any recommendation of the Independent
Committee described above in section (e)(i) of 2.2, ‘Procedures for Triggering the Plan,’ to the maximum
extent, (i) on or before the second business day prior to the ex-rights date with respect to the gratis
allotment of Stock Acquisition Rights, cancel the gratis allotment of Stock Acquisition Rights, or (ii) fromthe effective date of the gratis allotment of Stock Acquisition Rights and until the day immediately prior tothe commencement date of the exercise period of the Stock Acquisition Rights, acquire the Stock
Acquisition Rights for no consideration. In such cases, no dilution of the value per share in the Company
held by the shareholders will result, and it is possible that any investors who have sold or bought the sharesin the Company expecting to see such a dilution will suffer unexpected loss as a result of a fluctuation in
the share price.

(ii)

Procedures for Exercising Stock Acquisition Rights
The Company will deliver, as a general rule, a document necessary to be submitted for the exerciseof the Stock Acquisition Rights (in the form prescribed by the Company and containing necessary matterssuch as the terms and number of the Stock Acquisition Rights for exercise and the exercise date for the
Stock Acquisition Rights, as well as representations and warranties regarding matters such as that theshareholders themselves satisfy the exercise conditions of the Stock Acquisition Rights, indemnity clauses
and other covenants, and information necessary to allocate shares of the Company to the account of the
Entitled Shareholders) and other documents necessary for the exercise of the Stock Acquisition Rights tothe Entitled Shareholders. After the gratis allotment of Stock Acquisition Rights, the shareholders will be
issued, as a general rule, one share in the Company per Stock Acquisition Right upon submitting thesenecessary documents during the exercise period of Stock Acquisition Rights and, as a general rule, by
paying in a prescribed manner as the exercise price for the Stock Acquisition Rights an amount equivalent
to the exercise price separately determined in the Gratis Allotment Resolution, which will be an amountwithin the range of one yen and one-half of the fair market value of the Company’s stock per Stock
Acquisition Right.
If the Company’s shareholders do not exercise their Stock Acquisition Rights or pay the amountequivalent to the exercise price, the shares they hold in the Company will be diluted by the exercise of20

Stock Acquisition Rights by other shareholders.

However, it is also possible for the Company to acquire the Stock Acquisition Rights of allshareholders other than Non-Qualified Parties and, in exchange, deliver shares in the Company, in
accordance with the procedures set out in (iii) below.

If the Company carries out such acquisition

procedures, all shareholders other than Non-Qualified Parties will, in principle, come to receive shares in
the Company without exercising their Stock Acquisition Rights or paying an amount equivalent to theexercise price and, in principle, there will be no subsequent dilution of the shares in the Company they
hold.

(iii)

Procedures for the Acquisition of Stock Acquisition Rights by the Company
If the Company’s board of directors determines to acquire the Stock Acquisition Rights, theCompany will acquire the Stock Acquisition Rights in accordance with the statutory procedures from theshareholders other than Non-Qualified Parties, on the day that falls on the date separately determined by theCompany’s board of directors and, in principle, deliver shares in the Company in exchange. In this case,the shareholders concerned will, in principle, come to receive one share in the Company for each Stock
Acquisition Right as consideration for the acquisition by the Company of those Stock Acquisition Rights,
without paying an amount equivalent to the exercise price. However, in such case, the shareholders
concerned will be separately requested to provide information necessary to allocate shares of the Company
to the account of the Entitled Shareholders and submit, in the form prescribed by the Company, a written
undertaking including representations and warranties regarding matters such as the fact that they are not
Non-Qualified Parties, indemnity clauses and other covenants.

In addition to the above, the Company will disclose information to or notify all of its shareholders
with respect to the particulars of the allotment method, exercise method and method for acquisition by theCompany after these matters are determined in the Gratis Allotment Resolution, so we request thatshareholders check these details at that time.

IV.

Decisions by the Company’s Board of Directors Regarding Measures Described Above andReasons for the Decisions

1.

Special Measures to Realize the Basic Policy (Measures Set Out in II Above).
The new medium-term management plan and other measures such as the efforts to enhance thecorporate vale and the strengthening of corporate governance set out in II above were established as
specific measures to continuously and sustainably enhance the corporate value of the Company and, in turn,the common interests of its shareholders, and these are the exact measures to realize the Basic Policy.

These measures, therefore, are in accordance with the Basic Policy and correspond with the21corporate value of the Company and, in turn, the common interests of its shareholders and are not for the
purpose of maintaining the positions of the corporate officers of the Company.
Measures to Prevent Decisions on the Company’s Financial and Business Policies from2.

being Controlled by Persons Deemed Inappropriate Under the Basic Policy (Measures Set
Out in III Above)
2.1

The Measures are in Accordance with the Basic Policy

The Plan is in line with the Basic Policy and for the purpose of maintaining the corporate value of
the Company and, in turn, the common interests of its shareholders by ensuring the necessary time andinformation is made available for the shareholders to decide whether or not to accept the Acquisition ofshare certificates, etc. of the Company and for the Company’s board of directors to present an alternative
proposal to the shareholders, and by enabling the Company’s board of directors to negotiate with theAcquirer for the benefit of the shareholders when the Acquisition is to be effected.

2.2

The Measures are not Detrimental to Common Interests of the Company’s Shareholders and not
for Purpose of Maintaining Positions of the Company’s Corporate Officers

The Company believes that the Plan is not detrimental to the common interests of the Company’s
shareholders and not for the purpose of maintaining the positions of the corporate officers of the Company
because of the reasons set out below.

(i)Satisfying the Requirements of the Guidelines Regarding Takeover Defense Measures
The Plan fully satisfies the three principles set out in the Guidelines Regarding Takeover Defense

for the Purposes of Protection and Enhancement of Corporate Value and Shareholders’ Common Interests
released by the Ministry of Economy, Trade and Industry and the Ministry of Justice on May 27, 2005

(ii)

Placing High Value on the Intent of Shareholders
The Renewal of the Plan will be made subject to shareholder approval at the 65th Ordinary General

Meeting of Shareholders.

The Company’s board of directors may, under certain circumstances, confirm the intent of theCompany’s shareholders at the Shareholders Meeting regarding the need to trigger the Plan.
Further, as set out in section III.2.5 ‘Effective Period, and Abolition, Revision or Amendment of thePlan,’ the Plan is subject to a so-called sunset clause setting the Effective Period of approximately three
years and if, even before the expiration of the Effective Period of the Plan, the Company’s board of
directors resolves to abolish the Plan, the Plan will be abolished at that time. In this regard, the life of the22Plan depends on the intent of the Company’s shareholders.

(iii)

Emphasis on the Decisions of Independent Parties Such As Outside Directors and Information

Disclosure
The Company must obtain a recommendation from the Independent Committee, composed only ofmembers who are independent, such as outside directors, when making decisions for triggering the Plan.

Further, information disclosure must be made to shareholders regarding the outline of the decisions
by the Independent Committee, which ensures a mechanism to carry out transparent operation of the Planin a manner that is in accordance with the corporate value of the Company and, in turn, the common
interests of its shareholders.

(iv)

Establishment of Reasonable Objective Requirements
As set out above in section III.2.3, ‘Requirements for the Gratis Allotment of Stock Acquisition

Rights,’ the Company believes that the Plan is established so that it will not be triggered unless reasonable
and objective requirements have been satisfied, and ensures a structure to eliminate arbitrary triggering by
the Company’s board of directors.

(v)

Obtaining Advice of Third-Party Experts
As set out above in (d)(ii) of section III.2.2 ‘Procedures for Triggering the Plan,” if an Acquirer has

emerged, the Independent Committee may, at the cost of the Company, obtain advice from independent
third parties (including financial advisers, certified public accountants, attorneys, tax accountants,
consultants or any other experts).

This is a mechanism to more firmly secure the fairness and objectivityof the decisions by the Independent Committee.

(vi)

No Dead-Hand or Slow-Hand Takeover Defense Measures
The Plan may be abolished by a meeting of the board of directors composed of directors who arenominated by a person who acquires a large number of share certificates, etc. and appointed at theCompany’s general meeting of shareholders. Therefore, the Plan is not a dead-hand takeover defense
measure (a takeover defense measure in which even if a majority of the members of the board of directors
are replaced, the triggering of the measure cannot be stopped). Also, as the Company has not adopted asystem of staggered terms of office for the directors, the Plan is not a slow-hand takeover defense measure
either (a takeover defense measure in which triggering takes more time to stop due to the fact that all
members of the board of directors cannot be replaced at once).

--- End of Document ---23

Attachment 1

Outline of the Rules of the Independent Committee
・ The Independent Committee will be established by resolution of the Company’s board of
directors.
・ There will be no less than three members in the Independent Committee, and the Company’sboard of directors shall elect the members from (i) outside directors of the Company, (ii)outside Audit & Supervisory Board Members of the Company, or (iii) other outside experts, ineach case someone who is independent from the management that executes the business of theCompany.

However, such experts must be experienced corporate managers, former

government employees, parties with knowledge of the investment banking industry, parties withknowledge of the Company’s business, lawyers, certified public accountants, researchers whose
research focuses on the Companies Act or the like, or parties of similar qualifications, and musthave executed with the Company an agreement separately specified by the Company’s board of
directors that contains a provision obligating the experts to exercise their duty of care to theCompany or a similar provision.
・ Unless otherwise determined by a resolution of the Company’s board of directors, the term ofoffice of members of the Independent Committee will be until the conclusion of the ordinary
general meeting of shareholders relating to the last fiscal year ending within three years after
the 65th Ordinary General Meeting of Shareholders. However, the term of office of any
member of the Independent Committee who is an outside director or outside Audit &Supervisory Board Member of the Company will end at the same time when they cease to be an
outside director or outside Audit & Supervisory Board Member (except in the case of theirre-appointment).
The term of office of a member of the Independent Committee who is elected as a substitute fora member of the Independent Committee who retires before the expiration of the term will be
until the expiration of the term of office of the retiring member of the Independent Committee.
・ The Independent Committee will make decisions on the matters listed below and makerecommendations to the Company’s board of directors containing the details of and reasons forthe decisions.

Respecting such recommendations by the Independent Committee to the

maximum extent possible, the Company’s board of directors shall make decisions regarding theimplementation or non-implementation of a gratis allotment of Stock Acquisition Rights as anorganization under the Companies Act (or, if the Shareholders Meeting otherwise resolves toimplement the gratis allotment of Stock Acquisition Rights as set out in (a) below, in
accordance with such resolution by the Shareholders Meeting).

Each member of the

Independent Committee and each director of the Company must make such decisions solely
from the perspective of whether or not the corporate value of the Company and the common
interests of its shareholders will be enhanced, and they must not serve the purpose of their own- 24 -

interests or those of the management of the Company.
(a)

The implementation or non-implementation of the gratis allotment of Stock Acquisition
Rights.

(b)

The cancellation of the gratis allotment of Stock Acquisition Rights or the gratis
acquisition of Stock Acquisition Rights.

(c)

Any other matters that are for determination by the Company’s board of directors in
respect to which it has consulted the Independent Committee.

・ In addition to the matters prescribed above, the Independent Committee may conduct thematters listed below.
(a)Determination whether the Acquisition should be made subject to the Plan.

(b)

Determination of the information that the Acquirer and the Company’s board of
directors should provide to the Independent Committee, and the deadline for theprovision of that information.

(c)

Examination and consideration of the terms of the Acquirer’s Acquisition.

(d)

Discussion and Negotiation with the Acquirer.

(e)Request for an alternative proposal to, and consideration of the alternative proposal by,
the Company’s board of directors.

(f)

Determination regarding extension of the Independent Committee Consideration
Period.

(g)

Determination whether the Shareholders Meeting should be convened regarding theimplementation of the gratis allotment of the Stock Acquisition Rights.

(h)Approval of revision or amendment of the Plan.

(i)

Any other matters prescribed in the Plan that the Independent Committee may conduct.

(j)

Any matters that the Company’s board of directors separately determines that the
Independent Committee may conduct.

・ The Independent Committee may, at the Company’s expense, obtain advice from an
independent third party (including financial advisers, attorneys, certified public accountants, tax
accountants, consultants and other experts) or conduct similar actions.
・ Any member of the Independent Committee may convene a meeting of the Independent
Committee when an Acquisition arises, or at any other time.
・ As a general rule, resolutions of meetings of the Independent Committee shall pass with amajority when all of the members of the Independent Committee are in attendance (including
attendance via video conference or telephone conference).

However, in unavoidable

circumstances a resolution may pass with a majority of voting rights when a majority of themembers of the Independent Committee are in attendance.

--- End of Document ---- 25 -

Attachment 2

Profiles of the Members of the Independent Committee
The following three persons will be the members of the Independent Committee upon the Renewal.

Gorou Kamino
Business Background
April, 1983

Entered Mitsui Trust and Banking Co., Ltd. (the predecessor of Sumitomo
Mitsui Trust Bank, Limited)

August, 1990

Entered Chubu Gas Co., Ltd.

May, 1995

Entered Gastec Service Inc. and appointed as Corporate Planning
Department Chief

December, 1995

Appointed as Outside Director of Toyohashi Cable Network inc. (current
position)

August, 2000

Appointed as President CEO of Gastec Service Inc. (current position)

May, 2002

Appointed as President CEO of Sala Corporation (current position)

June, 2002

Appointed as Outside Director of System Location Co., Ltd.

January, 2004

Appointed as Outside Director of Sala House Co., Ltd. (current position)

March, 2006

Appointed as Chief Executive Officer of Chubu Gas Co., Ltd.

February, 2007

Appointed as Chairperson of Sala Cars Japan Co., Ltd. (current position)

February, 2007

Appointed as Director of Tosei Corporation (current position)

October, 2009

Appointed as Outside Director of Japan Post Holdings Co., Ltd.

March, 2012

Appointed as President CEO of Chubu Gas Co., Ltd. (current position)

June, 2012

Appointed as Outside Director of Musashi Seimitsu Industry Co., Ltd.
(current position)

June, 2014

Appointed as Outside Director of Nippon Venture Capital Co., Ltd. (current
position)*Mr. Gorou Kamino is an outside director as set out in Article 2, Item 15 of the Companies Act.
Mr. Kamino does not have any special interest in the Company and there is no business relationshipbetween Mr. Kamino and the Company.

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Yutaka Kitamura
Business Background
April, 1972

Entered Yasuda Trust & Banking Co., Ltd. (the predecessor of Mizuho Trust& Banking Co., Ltd.)

May, 1996

Appointed as Branch Manager of Singapore Branch of Yasuda Trust &Banking Co., Ltd.

October, 1998

Appointed as Manager of the First Credit Division of Yasuda Trust &Banking Co., Ltd.

October, 1999

Appointed as Branch Manager of Niigata Branch of Dai-Ichi Kangyo Fuji
Trust & Banking Co., Ltd. (the predecessor of Mizuho Trust & Banking Co.,Ltd.)

March, 2005

Appointed as Full-Time Audit & Supervisory Board Member of Nippon
Carbon Co., Ltd.

May, 2010

Appointed as Full-Time Advisor of J-COACH Corporation

June, 2010

Appointed as Full-Time Audit & Supervisory Board Member of
J-COACH Corporation

February, 2013

Appointed as Full-Time Audit & Supervisory Board Member of Tosei
Corporation (current position)

February, 2013

Appointed as Outside Audit & Supervisory Board Member of Tosei
Community Co., Ltd. (current position)*Mr. Yutaka Kitamura is an outside Audit & Supervisory Board Member as set out in Article 2, Item
16 of the Companies Act.
Until 2005, Mr. Kitamura served as the executive officer of Mizuho Trust & Banking Co., Ltd. with which
the Company has business relations. However, taking into consideration that economic dependence of theCompany on Mizuho Trust & Banking Co., Ltd. is low in light of the size of business transactions, etc., theCompany determines that Mr. Kitamura’s former position does not affect his independence as a member of
the Independent Committee of the Company.

Tatsuki Nagano
Business Background
April, 1983

Entered Chuo Trust and Banking Co., Ltd. (the predecessor of Sumitomo
Mitsui Trust Bank, Limited)

July, 1995

Appointed as Financial Planning Chief of Corporate Planning Dept. at
headquarters of The Chuo Mitsui Trust and Banking Co., Ltd.

July, 2000

Appointed as Management Director of RG Asset Management Pte. Ltd.

July, 2004

Appointed as Director of Reference Group Holdings Ltd.
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August, 2004

Appointed as Representative Director of RG Asset Management Services
Co., Ltd. (the predecessor of The RG Asset Management K.K.)

February, 2012

Appointed as Audit & Supervisory Board Member of Tosei Corporation

April, 2013

Appointed as Director of RG Asset Management Services Limited (BVI)

April, 2013

Appointed as Director and Representative Partner of RG Asset Management
Services Limited (HK) (current position)

June 2014

Appointed as Director of System Location, Co., Ltd. (current position)*Mr. Tatsuki Nagano is an outside Audit & Supervisory Board Member as set out in Article 2, Item 16of the Companies Act.
Mr. Nagano does not have any special interest in the Company and there is no business relationshipbetween Mr. Nagano and the Company.

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Schedule
Major Shareholders of the Company

Major shareholders of the Company as of November 30, 2014 are as follows.

Status of shareholding in the Company
Name of Shareholder

Number of shares
held

Shareholding ratio(%)

Seiichiro Yamaguchi

12,885,500

26.68

Zeus Capital Limited

6,000,000

12.42Japan Trustee Services Bank, Ltd. (Trust
Account)
Barclays Bank PLC A/C Client Segregated
A/C PB Cayman Clients
State Street Bank and Trust Company

3,286,300

6.80

1,480,700

3.06

1,185,900

2.45

The Chase Manhattan Bank, N.A London
Secs Lending Omnibus Account
The Master Trust Bank of Japan, Ltd. (Trust
Account)
HSBC-Fund Services, Sparx AssetManagement Co. Ltd.
BNP PARIBAS Securities Services
Luxembourg/ JASDEC/ FIM/ Luxembourg
Funds
Deutsche Bank AG London-PB Non-Treaty
Clients 613

1,029,700

2.13

921,100

1.90

693,800

1.43

580,000

1.20

556,700

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