Annual Report 2021

Please read before you read the content
Many of the statements included in this annual report contain forward- looking
statements and information such as forecasts, plans and targets. CYBERDYNE
Inc. (the “Company”) bases these statements on beliefs as well as assumptions
made using information currently available to the Company. As these statements
reflect the Company’s current views concerning future events, these statements
involve risks, uncertainties and assumptions. The actual future performance of
the Company, its consolidated subsidiaries and its affiliates accounted for by theequity method (the “Group”) could differ materially from these forward-looking
statements.
Furthermore, text related to medical products (including products currently
under development) and Neuro HALFIT is not intended as a advertisement or
medical advices.

Trademarks

The following are trademarks of CYBERDYNE in Japan. Some are also registered in otherregions. In this annual report trademarks are stated without the TM or R mark.
"CYBERDYNE" registered trademark No. 5164351 No.5172034 No.5403306"HAL" registered trademark No.5300686 No.5302317 No.5924213"Neuro HALFIT" registered trademark No.6332846"Techno-peer Support" registered trademark No.5813772"Cybernics Treatment" registered trademark No.5986327"Wearable Cyborg" registered trademark No.6291786"IoH/IoT" registered trademark No.6074269

Editorial policy

Scope of this report

The Company published this annual report to present how it targets to continue
generating value for sustainable growth. In order to utilize the report as acommunication tool with many stakesholders, it was presented with charts andphotos, and the Company strive it to make it easy to read and understand.
In addition, the Company adopted the International Financial ReportingStandards (IFRS) from the year ended March 31, 2018. Unless otherwise noted,
information in this annual report is based on IFRS.
The following are trademarks registered by CYBERDYNE in Japan. Some arealso registered in other regions. In this annual report trademarks are statedwithout the R mark.

Organization

Fiscal year ended March 31, 2021 (April 1, 2020 to March 31, 2021)• Information available as of September, 2021 may also be included• When the applicable period and scope differ from the aforementioned period, it will be statedclearlyCYBERDYNE Inc. and its consolidated subsidiaries (the "Group")I Challenges for the future
President and CEO of CYBERDYNE

Yoshiyuki Sankai (Ph.D. in Engineering)
Yoshiyuki SANKAI earned a Ph.D. in Engineering from University of Tsukuba in Japan in 1987.
He has progressed from being a research fellow at the JSPS to assistant professor, associate
professor, and then professor at the Graduate School of Systems and Information Engineering,
University of Tsukuba. Dr. Sankai was also a visiting professor at Baylor College of Medicine in
Houston, Texas in the United States. Currently, he is a professor, the Executive Research Director at
the Center for Cybernics Research and the Director at the F-MIRAI, University of Tsukuba; and thePresident and CEO of CYBERDYNE Inc.
He successively held the position of Leader/PM for the FIRST program and ImPACT program,
both initiated by the Japanese Cabinet Office, and the Business producer of the Program for
Building Regional Innovation Ecosystem by MEXT. He also served as an Executive Board Memberof Advanced Robotics, and a member of Global Agenda Council on Robotics & Smart Devices ofthe WEF. Now, he is an Executive Board Member of the Japan Society of Embolus Detection andTreatment, and a fellow of the Robotics Society of Japan (“RSJ”) and the Society of Instrument andControl Engineers (“SICE”). He is a Center Partner of the Center for the Fourth Industrial Revolution,a member of Global Future Council of Production, and a member of Global Precision Medicine
Council of the WEF. And he is also appointed as an International Fellow of the Royal Swedish
Academy of Engineering Sciences(“IVA”).
【Main awards associated with Yoshiyuki SANKAI】
The 2005 World Technology Award (the Grand Prize)（2005）, the Good Design Award (the Gold
Prize) , the Japan Innovator Award (the Award of Excellence)（2006）, the Minister of Economy,
Trade and Industry Award（2007）, the 21st Century Invention Award at the National Invention
Awards, “Development of Cyborg-type Robot Technology”（2009）, the NetExplorateurs at UNESCO
Headquarters（2011）, the Capek Award（2012）, the 2014 Technology Pioneer at the World Economic
Forum（2013）, the 2014 Edison Awards Gold Award, the DealWatch Awards 2013, the IPO of theYear at the Thomson Reuters（2014）, the Zaikai Business Leader of the Year Award (2015), the DIA
Japan Outstanding Contribution to Health Award, the Robot Award - Ministry of Health Labour andWelfare Award (2016), the Prime Ministers Award (the Nippon Venture Award)(2017), the Medal of
Honor with Purple Ribbon（2019）, the Intellectual Property Achievement Awards (the Minister of
Economy Trade and Industry Awards) (2020), etc.

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1. Realizing Techno-peer Support Society
Humans have created technology, lived with technology, and evolved with technology.
From hunter-gatherer societies, agricultural societies, industrial societies, and now to theinformation society, technology has brought about social change.

In the face of unprecedented challenges such as the declining birthrate, aging population,and the need for nursing care, we are driving efforts to realize a "techno-peer support society"in which people and technology coexist and mutually support each other by promoting
innovation that leaves no one behind.

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2. What is Cybernics
Cybernics is a new field centered around the Human, Robot, and AI/Information Systems.
It fuses and combines different fields of academia such as neuroscience, behavioral science,robotics, AI, information technology, system engineering, physiology, psychology, philosophy,
ethics, law, business, etc.

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3. Integrated Cybernics System
Cyberdyne is working to create a Cybernics Industry for people and society, focusing on
medical care, welfare, lifestyle, workplace, and production, by realizing physical andinformational interaction with "Human" to solve various problems of an aging society with asuper low birthrate. We will build an integrated Cybernics System and realize the fusion of“Human" and "Cyber/Physical Space" as part of this effort.

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4. C-Startup
C-Startup is an innovation ecosystem for the creation of the Cybernics Industry.C-Startup
supports startups and entrepreneurs who aspire to create new industries to solve social
problems by providing technical advice from Yoshiyuki Sankai and business support throughfinancing, etc., by CYBERDYNE and CEJ Fund.

Through this ecosystem, we aim to create a Techno-Peer Support Society where humans
and technology support each other through a virtuous innovation spiral by integrally handlinginnovative technologies for people and society, the creation of new industries, and the supportof startup companies/entrepreneurs. We aim to realize "Society5.0/5.1" and achieve social andindustrial transformation by creating Cybernics Industry.

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5. Business structure
CYBERDYNE currently rents products to corporations and provides services to individuals,
including functional improvement services at our centers and in-home services.

Now, 80% of our revenue comes from the rental business, but for expansion and accelerationof our technology, we plan to increase the percentage of service revenue to 50% by FY23.

*1 Includes revenue from sales and maintenances*2 Includes revenue from rental

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6. Growth scenario
CYBERDYNE succeeded on developing the business base by rapidly expanding the productlineup and obtaining regulatory approvals in each countries. We have expanded the usage andstarted new business towards individual users.

Our next challenges are to reinforce the existing business by evolving our business modeland conducting M&A to accelerate the growth.

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7. Expansion of medical service
CYBERDYNE formed a strong partnership with RISE Physical Therapy Inc. in California, USA
through M&A. RISE group operates 16 medical centers around San Diego and Los Angeles
areas.

RISE group will add Cybernics Treatment with HAL in their service lineup following the deal.
This will enable CYBERDYNE to obtain its medical service platform for individual users.

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8. Growth scenario of medical service business
CYBERDYNE is formulating a platform to get direct access to individuals, and M&A of RISE
Physical Therapy will be the first step for this endeavor. While physical therapy is a large
and competitive market, most services focus on orthopedic aspects and conduct manualapproaches by physiotherapists’ hands. We will differentiate our services by focusing onneural elements of the disease by use of Wearable Cyborg HAL. We will also expand ourservices to homes and workspaces through products that could prevent diseases.

*"Physical Therapists in the US" IBIS World

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9. Formation of Cybernics Medical System
By deploying IoH/IoT (Internet of Human and Things) enabled cybernics technology inhospitals, nursing homes, homes, and workplaces, we will improve, regenerate, expand,and support the functions of users while accumulating, analyzing, and processing AI human
big data (physiological, psychological, lifestyle, behavioral, and environmental information

related to humans) through it.
All cybernics technologies have communication capabilities and can be seamlessly
connected to different locations by linking them with data and services.

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10. Medical/Healthcare service for individuals
All devices and software handled by Cybernics, including Wearable Cyborgs (Medical/Nonmedical), ultra-small vital sensors, and applications, have communication functions and canbe used in various activities by utilizing cloud computing.

For example, the user can now obtain detailed health data without visiting a medical
institution while going about their daily life.

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11. New product for prevention/early detection
We are preparing a new product, Cyvis, a tiny vital sensor. This sensor is designed to collect,analyze, and process various healthcare data such as cardiac activity, brain activity, bodytemperature, SpO2 (arterial blood oxygen saturation measured transcutaneously with a pulse
oximeter), and activity level daily in hospitals, nursing homes, workplaces, and other places

where people live, through a cloud system. This helps users to detect an irregular heartbeat
and neo-atrial fibrillation. This helps prevent myocardial infarction and cerebral infarction byappropriately managing heart attack and stroke risks.

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12. Introduction to JUKUSUIIn August 2021, through M&A, we acquired C2, a company known for developing the popular
sleep app JUKUSUI. The use of JUKUSUI makes it extremely easy to check sleep status while
sleeping and enables routine screening.

The app has been downloaded more than 3 million times, indicating the social interest in
health care.

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13. Initiatives to address SAS
One example of what can be accomplished by combining services like Cyvis and JUKUSUI is
to address sleep apnea-induced drowsy driving and driver health care.

We are beginning these initiatives in stages in cooperation with related industries.

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II Business environment of medical/healthcare business
1. Adressable market of our medical HAL
While CYBERDYNE's Medical HAL can be used for various diseases, currently, it is mainly
used for the treatment of stroke, spinal cord injury, and neuromuscular diseases.

The table below shows the number of addressable patients who could benefit from Medical
HAL in the top three medical devices markets and its status of medical device approval.

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2. Future of medical and healthcare
The boundaries between medical and non-medical care have been strictly separated. As
all of our devices are equipped with communication functions, connecting them to small vital

sensors and various applications will make it possible to handle data of a level that could only
be obtained by visiting a medical facility while going about one's daily life.

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Medical field

Cybernics Treatment: Innovative method that utilizes HAL for treating brain-nerve-musculoskeletal disorders

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3. Status of approvals by diseases and countries
Some of CYBERDYNE's product, such as HAL for Medical Use Lower Limb Type, is offered as
medical device. The company must apply for medical device approvals in each country andregion to disseminate this technology.

Although this process requires a vast amount of time and resources, CYBERDYNE has
succeeded in obtaining approvals in the following countries and regions.

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4. Global dissemination
Cybernics Technology deployed by the Company is being disseminated amid the global
pandemic of COVID-19. Currently, HAL is active in 19 countries and regions worldwide.

We use this technology as an international platform to strategically promote collaboration
with national and international doctors, patients and families, regulatory authorities,
certification bodies, and health organizations.

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4. Motion principle of HAL
HAL is the world’s first Wearable Cyborg. While it was initially developed to treat patients withbrain-nerve-musculoskeletal disorders, workers can wear it at construction sites to carry heavyloads or at nursing care facilities to reduce the risk of back pain by reducing the load on thelower back.
This section explains the motion principle of the technology.

Cybernics treatment with HAL "Lower Limb Type" (Germany)

Cybernics treatment with HAL "Single Joint Type" (Japan)

Why does HAL induce improvement?
Unlike conventional rehabilitation, even forpatients who cannot move on their own, theintervention of HAL establishes a loop offunctional improvement and regenerationthat is synchronized with the wearer's
intended motion, without excess burden on
the muscles. The cycle effectively changes
the function of the brain-nerve and muscularfunction.

Cybernics treatment with HAL "Lumbar Type" (Malaysia)

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5. Research on HAL
Medical professionals are exploring the use of HAL for brain-nerves-musculoskeletal
disorders. Below lists some examples of such research.
Spinal Cord Injury
1. "Gait ability required to achieve therapeutic effect in gait and balance function with thevoluntary driven exoskeleton in patients with chronic spinal cord injury: a clinical study"
Nature (2019)
2. "Functional Outcome of Neurologic—Controlled HAL—Exoskeletal Neurorehabilitationin Chronic Spinal Cord Injury: A Pilot With One Year Treatment and Variable Treatment
Frequency" Global Spine Journal (2017)
3. "Against the odds: what to expect in rehabilitation of chronic spinal cord with aneurologically controlled Hybrid Assistive Limb Exoskeleton. A subgroup analysis of 55
patients according to age and lesion level" Neurosurgical Focus (2017)
Stroke1. "Effects of Gait Treatment With a Single-Leg Hybrid Assistive Limb System After Acute
Stroke: A Non-randomized Clinical Trial" Frontiers in Neuroscience (2020)
2. "Microstructural white matter changes following gait training with Hybrid Assistive Limb
initiated within 1 week of stroke onset" Journal of Neurological Sciences (2020)
3. "Effectiveness of a Walking Program Involving the Hybrid Assistive Limb Robotic
Exoskeleton Suit for Improving Walking Ability in Stroke Patients: Protocol for a
Randomized Controlled Trial" JMIR Publications (2019)
4. "Gait training with Hybrid Assistive Limb enhances the gait functions in subacute stroke
patients: A pilot study" Neuro Rehabilitation (2017)
Other research
1. "Biofeedback Core Exercise Using Hybrid Assistive Limb for Physical Frailty Patients
With or Without Parkinson's Disease" Frontiers in Neurology (2020)
2. "Safety and immediate effect of gait training using a Hybrid Assistive Limb in patientswith cerebral palsy" Journal of Physical Therapy Science (2018)
3. "Reshaping of Gait Coordination by Robotic Intervention in Myelopathy Patients After
Surgery" Frontiers in Neuroscience (2018)
4. "Gait training using a hybrid assistive limb (HAL) attenuates head drop: A case report"
Journal of Clinical Neuroscience (2018)
5. "Biofeedback effect of hybrid assistive limb in stroke rehabilitation: A proof of concept
study using functional near infrared spectroscopy" PLOS ONE (2018)

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6, Effect of Medical HAL
After years of trials and clinical researches, we succeeded on accumulating clinical results that suggests high medical efficacy and safety of Medical HAL.
We have highlighted some of the most notable findingsa) Neuromuscular disease
For this patient group, we prepared a summary of
the post-marketing surveillance completed in 2020.
Twenty hospitals took part in the test, delivering a
total of 6,486 treatment sessions to 218 patients. The
test result suggests very high efficacy and safety ina clinical setting. Based on this result, the JapaneseSociety of Neurological Therapeutics submitted a
proposal to the Central Social Insurance Medical
Council, claiming that “the medical technology produced
significant improvement of physical function towards
slowly progressive neuromuscular disease, which are
intractable diseases with no established treatment
methods that are effective (excerpts from the proposal,
translated by CYBERDYNE).”
The proposal also stated that HAL did notincrease the destruction of the patient’s
muscles. The CK value in the blood* wasactually in the declining trend, whichis medically noteworthy. This suggeststhat HAL is a safe treatment method forprogressive neuromuscular patients.
*Creatine Kinase in the blood is anassessment index to show the disability
inthemusculoskeletal
system.
Conventional exercise therapy progresses
the destruction of the muscles andincreases the CK value.
Due to such results, HAL is used for the treatment of eight types of neuromuscular diseases, namely; Spinal muscular atrophy, spinal and bulbar muscular atrophy, amyotrophic lateral sclerosis,
Charcot-Marie-Tooth disease, distal muscular dystrophy, inclusion body myositis, congenital myopathy, muscular dystrophy. Treatment for these eight diseases is currently covered by publichealth insurance in Japan.

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For this patient group, we prepared a summary of the clinical trial completed in 2020. Sixteen hospitals
took part in the test. Forty-nine patients who have reached a "plateau" state of improvement afterconventional rehabilitation were recruited for the trial. Patients were separated into the control group (80min conventional rehab each session) and HAL treatment group (60 min conventional rehab+20 min HAL
Treatment each session). Results were compared after 20-25 sessions without wearing HAL.
As a result, superiority of the HAL group was suggested for 6 min walking distance as presented in thechart on the right. The result indicated a more significant improvement of the HAL group for 10m walking
speed. Still, due to the number of cases, dispersion remained, and the result did not achieve statisticalsignificance (p<0.05).
Due to such results, HAL is currently used for treatment for stroke in many countries, except for Japan
where the company plans to submit medical device application based on the conducted clinical trial.

c) Spinal cord injury
For this patient group, we prepared a summary of the clinical trial completed in 2016. A hospital in Germany
conducted the trial. Fifty-five chronic stage patients (approx. seven years after injury) were recruited forthe trial. Tests without wearing HAL was used to investigate the outcome, and result before and after 60
treatment sessions was compared.
As a result, for the 10m walking speed test, the patients’ walking speed doubled on average, aspresented on the chart on the left. Also, for 6 min walking distance test, the distance covered increased by
1.5 times on average.
Furthermore, CYBERDYNE compared the result of HAL Treatment with other popular methodology. In
the referenced paper, there is one more group that was tested: OG (Overground + FES). We excluded
this results from the chart as the measurements for 10m speed and 2 minutes distance are done in an
overground walking setting. Subjects in the OG group had 60 opportunities to practice and get used tooverground walking, whereas subjects in the other groups were only walking on the treadmill. This intergroup difference in the practice effect of walking overground can affect measurement results.

Comparison of SCI Intervention Results

Compared studies
HAL group: endpoints are 10m walk speed and 6 minutes walk distanceGrasmücke D, Zieriacks A, Jansen O, Fisahn C, Sczesny-Kaiser M, Wessling M, Meindl RC, Schildhauer TA, Aach M. Against the odds: what to expect inrehabilitation of chronic spinal cord injury with a neurologically controlled Hybrid Assistive Limb exoskeleton. A subgroup analysis of 55 patients according toage and lesion level. Neurosurg Focus. 2017 May;42(5):E15. doi: 10.3171/2017.2.FOCUS171. PMID: 28463613.
Other groups: endpoints are 10m walk speed and 2 minutes walk distance (no influence on gain ration, but the actual measurement results are not directlycomparable with HAL study (therefore the results are labeled as “-estimate” to highlight that point)
Field-Fote EC, Roach KE. Influence of a locomotor training approach on walking speed and distance in people with chronic spinal cord injury: a randomized
clinical trial. Phys Ther. 2011 Jan;91(1):48-60. doi: 10.2522/ptj.20090359. Epub 2010 Nov 4. PMID: 21051593; PMCID: PMC3017322.

We have highlighted three types of diseases that are currently treated with HAL. To expand the target disease of HAL, there are clinical trials and research conducted for other conditions such as
Parkinson’s disease, cerebral palsy, multiple sclerosis, and many more. Furthermore, in addition to improvement of physical functions, there are also reports on the improvement of sensory suchas sensory of bladder and urinary issues.
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Non-medical field

Neuro HALFIT: Programs at Robocare Center etc., to improve brain-nerve-musculoskeletal functions

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7, Robocare Center
CYBERDYNE develops Robocare Centers as hubs for medical healthcare service businessfor individuals. The center offers a non-medical service called "Neuro HALFIT" to improve thefunctions of neuromuscular systems.

The program targets individuals with diseases not currently covered by public healthinsurance, individuals who strive for further recovery after hospital discharge, and visitorsfrom countries that do not have HAL installed yet.

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8, Neuro HALFIT at Home
Neuro HALFIT at Home is new non-contact home service for individual users. It is a newservice that allows the wearer to receive visual feedback from the HAL monitor, linked
to Cyberdyne's cloud data, to visualize the bio-potential signals that command physicalmovement and posture information.

In addition, the system provides remote online support by professional staff such as
therapists and trainers. This service is provided through CYBERDYNE STORE, an online
store that opened in November 2021, and as of December 31, 2021, a cumulative total of 441
subscriptions had been made.

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9, HAL Lumbar Type in care facilities
The issue of care is a challenge that plagues government agencies in many countries. In
collaboration with government agencies in various countries, we promote digital innovations
that could solve this issue.

For example, in the state of Hampshire in the U.K., the effectiveness of the HAL waist typehas been confirmed through long-term verification, and full-scale deployment is underwaywith the support of government agencies.

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10. HAL Lumbar Type to support workers
The product to support the workers maintains its advantages, not only by its features toassist when lifting something.

It also uses IoH/IoT features to visualize the wearer’s conditions and connect with acloud system to enable managers to instruct and supervise their workers according to theinformation obtained.

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11. Advantages of CYBERDYNE's Cleaning RobotCYBERDYNE's Disinfection/Cleaning Robot CL02 is currently one of the most sophisticatedsystems available today.

Its unparalleled autonomous navigation and disinfection/cleaning performances contributeto promoted quality and safety of disinfection/cleaning work that is currently faced withworkforce shortages.

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III Activity Report
1. Revenue

2. Revenue by geographical regions and type of transactions

For the fiscal year ended March 31, 2021, revenue was posted at ¥1,875 million.
The Group's primary business of "rental and maintenances" improved steadily. Although theGroup forecasts a short-term impact on the revenue from Cybernics Treatment and Neuro
HALFIT services due to spreading of the COVID-19 , it is also considered as a new opportunityof business.
The graph below shows revenue for the last 3 years.

Japan still accounts for about 80% of our sales revenue by region. Still, we are accelerating
our expansion in the Asia-Pacific region, including Southeast Asia and Oceania. Sales inthis region increased by about 70% as of the end of the previous fiscal year.

Revenue (Unit: Millions of yen)

Revenue by geographical regions and type of transactions (Unit: Millions of yen)

2,100

1,800

1,709
214

1,500

1,792

Rental/maintenance

Product sales

Service

Total

Japan

1,052

280

218

1,550

Americas

16

–

–

16

EMEA

65

–

44

109

APAC

140

53

6

200

Total

1,273

333

268

1,875

1,875

186

333

291

268

328

1,200

Product Sales(Assets transferred at a point of time)

Service

900(Service transferred at a point of time)

Rental/maintenance(Service transferred over time)

600

1,315

End of Mar. 2021

End of Mar. 2020

1,273

¥118 Million*

APAC 7%EMEA 10% ¥173 Million
Americas 2%

1,167

300

EMEA 6%¥29 Million

0¥200 Million*

APAC 11%¥109 Million

Americas 1%¥16 Million

End ofMar. 2019(IFRS)End ofMar. 2020(IFRS)End ofMar. 2021(IFRS)

Japan 82%

Japan 83%(¥1,472 Million)(¥1,550 Million)

Americas : North, Central and South America
EMEA: Europe, the Middle East and Africa
APAC: Asia-Pacific *Revenue from Japan is stated separately
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3. Number of operating units and revenue by products
In the fiscal year ended March 31, 2021, the number of units in operation increased, especiallyfor HAL for Medical Use Lower Limb Type and HAL Lumbar Type for Well-being.

The increase in Medical HAL was mainly due to sales for APAC, and for HAL Lumbar Type for
Well-being was mainly from sales to APAC and the newly started individual rental service.
On the other hand, HAL Lumbar Type for Labor Support rented to airports temporarily declined
due to the impact of COVID-19.
Rental Maintenance Sales (Unit: Millions of yen)

Number of operating units (Unit: unit)
End of Mar.
2019

End of Mar.
2020

End of Mar.
2021

HAL Lower Limb
(Medical)

291

310

351

HAL Lower Limb
(Non-medical)

357

357

342

HAL Single Joint

252

300

391

HAL Lumbar（Well-being)

919

951

1,074

HAL Lumbar(Labor)

572

624

459

Disinfection/Cleaning/
Transportation Robot

44

75

141

Total

2,435

2,617

2,758

Product

End of Mar. 2019 End of Mar. 2020

End of Mar. 2021

HAL Lower Limb
(Medical)

384

471

491

39%

HAL Lower Limb
(Non-medical)

232

222

196

15%

HAL Single Joint

108

119

127

10%

Well-being

HAL Lumbar

201

226

245

19%

Labor Support

HAL Lumbar

222

214

129

10%

Disinfection/Cleaning/Transportation Robot

16

49

61

5%

Other

5

13

24

2%

Total

1,167

1,315

1,273

100%

For hospital(improve functions)*Mainly from APAC

*Mainly from APAC andindividual rental

Number of units installed to APAC (Unit: unit)
End of Mar. 2020

End of Mar. 2021

Lower Limb

Single Joint

Lumbar

Total

Lower Limb

Single Joint

Lumbar

Total

Malaysia

8

14

4

26

22

28

22

72

Thailand

–

–

–

0

2

–

–

2

Indonesia

–

–

–

0

2

–

–

2

The Philippines

–

–

–

0

–

6

3

9

India

–

–

–

0

3

2

1

6

Taiwan

–

–

4

4

2

–

1

3

Australia

–

–

–

0

2

–

–

2

Total

8

14

8

30

33

36

27

96

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4. The Groups commitment on SDGs
The Sustainable Development Goals (SDGs), consisting of 17 goals and 169 targets, were
declared as an action plan for people, the planet, and prosperity at the UN Sustainable
Development Summit held in September 2015.

As a member of society, CYBERDYNE will contribute to achieving the relevant SDGs. The
initiatives that we are mainly focusing on are as follows.

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5. Paralym Art
The Group has hosted an art design competition collaborating with SHOUGAISHA JIRITSU
SUISHIN KIKOU ASSOCIATION. The winning entries of the competition in its affiliated facilities.
The Group also used the design for its novelty goods.

This year, the third year of the competition, the Group received 71 entries.
The pieces that were awarded with a prize are listed below. Please note that the title and thename of the artists were originally in Japanese and was translated by CYBERDYNE and it may
differ from the official title/artist name intended.

【Grand Prize】Is our future bright..? (HARUMARU)【Grand Prize】Lets walk together, lets live together (Shibuya Hiroko)【Excellence】Bright future of robot and us (NAMY)【Excellence】Eternal partner (Momotaro)【Excellence】Side by side with humanity (Tajiri Hajime)【Excellence】Life full of colors (KOTO)

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【Awarded】
Thank you for helping(Mito Yuki)【Awarded】
Person on a robot and a robot around it(NAKAMURA)【Awarded】"Love" Robot to Us, Us to Robots(Yuki-bo)【Awarded】
Fully automated construction robot(Yuki)【Awarded】
Joyful future of human and robots(Kisaragi Niji)【Awarded】
Andro-Horse celestial sphere(Takanbo)【Awarded】
System that makes us smile(Torame Rina)【Awarded】
Welcome to the future world of human and robots!
(Shumiya Ikumi)【Awarded】
Human, lets play together with robots(Kamijo Mika)【Awarded】
Mind Thermography(Kamiyoshi Michiru)

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IV Corporate information
1. The Company’s basic approach to corporate
governanceIn order to increase the corporate value over longterm,
the Company works to improve transparency andensuring compliance, while further enhancing thecorporate governance of the Company. The Company
regards corporate governance to be a vital to build
constructive relationships with its stakeholders. It is
important from the standpoint to ensure decisions
or actions of the Company complies to laws andmarket regulations, but also to make sure that theCompany’s endeavor is not against the needs of thesociety and that the Company is indeed contributing
to the society. The Company also believes that highlevels of transparency are essential to make corporate
governance function properly. As such, the Company
takes a proactive stance on disclosing information toits stakeholders, beyond the level that is obliged bylaw,etc.
2. Corporate organizationCYBERDYNE Inc. holds a Board of Directors at least
once a month to make timely decisions on businessmatters and to supervise whether the Members of
the Board of Directors (the “Directors“) appropriately
execute their duties. There are eight Directors in
the Board of Directors and four out of eight are
Outside Director, making the board capable ofefficient decision making and business judgments.
The Company also have an Audit and Supervisory
Board. There are four Audit and Supervisory Board
Members, and all four members are outside Audit
and Supervisory Board Member (the “Auditors”). The
Auditors proactively voice their opinions at the Board
Meeting to reinforce its function to monitor whether
the Board functions appropriately. The Auditor
also supervises business execution and important
decision-making by the Directors from an objective
standpoint. The compensation for the Directors are put

on resolution at the Compensation Committe, which is
a committee made from at least three members fromthe Board of Directors or Audit and Supervisory Board,selected by the President and CEO, and the result of
the resolution at the committee will be reported to
the Board of Directors. To prevent conflicts of interest
with University of Tsukuba, the Company will maintainat least the same or more number of Outside Board
Members with no affiliations with the University.
This enables the Outside Board Member to reject
the resolutions in the Board of Directors if there arepossibilities of conflicts of interest with the Universityof Tsukuba. To protect the interest of minority
shareholders, the Company has put in place a systemfor obtaining resolutions at the Board of Directors
based on preapprovals from a committee comprising
the Outside Directors and Outside Auditors when
decisions must be made concerning transactions
between the Company and Yoshiyuki Sankai, Sankai
Health Foundation or Sankai Science and Technology
Promotion Foundation (collectively referred to as the“Foundations”), both of which are represented andmanaged by Yoshiyuki Sankai. The Company shalltake the same measure upon transactions with thetrustees, directors or controllers of the Foundations.
The Company has also established the Peace andEthics Committee to prevent its technologies frombeing turned into something that could harm people,
such as weapons. The Peace and Ethics Committee
are comprised of all of Outside Directors, all of Outside
Auditors and the President and CEO. Before newly
offering the product to business field outside the areasof medicine, living support, and labor support, which
are defined in the Company Code of Conduct, thePeace and Ethics Committee investigates, deliberates
and reaches a decision on if there is any risk of theCompany’s technologies being turned into something
to harm people. The committee then submits its
findings to the Board of Directors.

3. System to ensure the appropriateness of business
operations and status of its implementation
a.System to ensure the appropriateness of business
operations
The Company resolved the follwing items toestablish a system that makes sure that thebusiness operation by the Directors are executed
appropriately in compiance to laws, regulations andArticles of Incorporation and system to ensure theappropriateness of other business operations.
(a)Systems to ensure that the directors andemployees perform their duties in accordance withlaws, regulations and the Articles of Incorporation
The Company have established compliancerelated policies embodying the Company Codeof Conduct, to make sure that the directors andemployees of the Company and its subsidiaries(collectively referred to as the “Group”) complies tolaws, regulations, the Articles of Incorporation andother internal policies. A selected Member of theBoard of Director shall have cross-organizational
control over the Group’s compliance initiatives
and this Director responsible for the compliancerelated matter (the “Compliance Director”)
shall work to structure, improve and maintainsuch initiatives. The Compliance Director shalldisseminate the spirit of compliance to directors
and employees of the Group to identify and solve
problems.
The Company established the Affiliated Company
Management Policy. The Company appoints
director or auditor (if necessary) of the subsidiaires
and approves important matters of subsidiaries
in accordance to the policy. Furthermore, someof the subsidiaries’ administrative works are
conducted by the Corporate Unit of the Company.
These are the initiatives conducted to ensure theappropriateness of the subsidiaries business.
The Company established the Internal Audit
Office that works directly under the Company CEO.
The Internal Audit Office conducts internal auditsof the Group in accordance to the Internal Audit
Policy and Affiliated Company Management Policy
to ensure the compliance with laws, Articles ofIncorporation, and other internal regulations andto ensure appropriate risk management systems
are implemented. The Internal Audit Office shallreport the results of the internal audits to theCompany CEO, the Audit and Supervisory Boardand the Board of Directors.
The Company established the Hot-line System
Policy and operates appropriate measures thatenables employees to provide information about
legally suspicious behaviors directly to appropriate
person. The Hot-line System Policy defines oral
communication, e-mail, chat and opinion box, etc.
as a method of providing information about legally

suspicious behaviors.
(b)System to store and manage information related tothe execution of duties by the Directors
The Company established the Document
Management Policy, which defines appropriate
method to store and manage information related
to execution of duties. In accordance to law andthe aforementioned policy, information related to
execution of duties shall be recorded and stored in
paper or electronic format.
The information shall always be available forbrowsing by the Directors and the Auditors.
(c)Policies, procedures and other systems to manage
the risk of losses
In order to strengthen the risk management
structure of the Group, the Compliance Director
have determined the operating unit responsible foreach risk category. Each operating unit establishes
risk scopes, risk profiles, self evaluation policies
and guidelines for the responsible risk category.
The Director in charge of finance shall monitor
risks across the organization and addresscompany wide risks.
The Company CEO shall quickly appoint a
Director or a head of operating unit when a newrisk is identified. The appointed member will be
responsible to address the newly identified risk.
(d)System to ensure the efficient execution of duties
by the Directors
To ensure efficient execution of duties by the
Directors, the Board of Directors is scheduled
once every month. The Company also conducts
extraordinary meetings when necessary.
Status of matters resolved by the Board of
Directors is reported by either the responsible
Director or responsible head of operating unit
on a regular basis and the status of execution is
audited by the Audit and Supervisory Board.
The Company establishes medium-termbusiness policy and updates if there is any
changes in the business environment. Status of
The status of the Company’s operation in line withthis policy is reported to the Board of Directors
whenever necessary.
The Company established the AffiliatedCompany Management Policy with the aim of
efficient execution of the duties by the directors of
the subsidiaries. Subsidiaries are managed under
the supervision of a related units of the Company.
(e)System to ensure reporting on the performanceof duties by directors of the subsidiaries
When necessary, the directors of the subsidiaries
shall report the status of their duties to theCompany’s related business units supervising
the operation in accordance to the establishedAffiliated Company Management Policy.

Annual Report 2021

41

(f)Assistance of the Audit and Supervisory Board
When the Audit and Supervisory Board requests forassistance of their duties, the Board of Directors
shall communicate with the Audit and Supervisory
Board and assign appropriate employee(s) to serveas assistants or as assistants with a concurrent
post.
The assigned assistance(s) shall be put under
the chain of command of the Audit and Supervisory
Board, and the assistance shall not be subject
to orders from a Director. Any performance
evaluation and personnel changes concerning theassistant shall require the consent of the Audit andSupervisory Board.
(g)System for directors and employees of the Group toreport to an Auditor
Directors and employees of the Group shall reportany significant matters that i) are against the law or
the Articles of Incorporation and ii) are considereddishonest acts iii) may have a significant impact on
the Group, to an Auditor immediately. Furthermore,
if directors or employyes of the Group are asked
to report from the Auditor in accordance to thelaw, Regulations of Audit and Supervisory Board
Meeting or Auditing Standards established by
the Audit and Supervisory Board, the relevant
director or employee shall report promptly. In
order to improve comprehensiveness of the report
regarding any significant matters, directors and/or employees of the Group shall work to gather
information from the report,
Internal Audits,
hot-lines and Independent Accounting Auditors inaccordance to the items stated below.
If matters that suggests violation of the law or
corporate compliance are reported, the ComplianceDirector shall report the matter to the Board of
Directors in accordance to the Hot-line System
Policy. The Compliance Director shall report to thefull-time Auditor.
The Internal Audit Office of the Company shallreport the status of the internal audits to an Auditor.
Furthermore, the Compliance Director shall report
the status of compliance to the Auditor whennecessary.
(h)System to ensure that a person who made a reportto an Auditor is not mistreated
The Company shall not mistreat a person becauseof his/her report to an Auditor.
(i)Matters regarding the processing of auditing fees
If an Auditor requests for an advanced payment
or quick reimbursement of expenses caused ina process of their duty, the Company shall pay
them promptly unless the expenses are clearly
unrelated to the execution of their duty.
(j)Other systems to ensure the effective execution ofaudits by Auditors
Directors and employees of the Group shall comply

with requests for hearing, visitation and othermethods of examination by the Auditor in order tosecure the effectiveness of the audits.
The
Company
shallprovidesufficient
opportunities to Auditors to exchange opinion with
the Directors, Independent Accounting Auditors
and any other personnel required to appropriately
execute the duty.
The Company shall also provide enoughopportunities to Auditors to coordinate with auditor
and employees of the subsidiaries to gather
necessary information.
b. Status of systems to ensure appropriateness ofbusiness operations
The Group established and implemented theaforementioned systems. Notable actions
conducted within this fiscal year, which are thought
to be important for internal control are statedbelow.
(a)Compliance System
All members of the Group worked to comply tothe laws and regulations with compliance related
policies, such as the Company Code of Conduct.
Furthermore, all members received explanatonson the Hot-line System Policy where necessary,as a method to prevent compliance violation or todetect it at early stages.
(b)Risk Management System
The Compliance Director determined the operating
unit responsible for each risk categories. The
Compliance Director monitors the status of risk
status and responds accordingly. Furthermore, thestatus of risk management are subject to internal
audits and audits conducted by the Auditor.
(c)Efficiency of the duty executed by the Director
The Board of Directors have been meeting once amonth and extraodinary Board of Directors was
conducted whenever necessary, for the purpose ofreceiving reports on business execution (including
reports from subsidiaries), progress of businessfor the fiscal year (including subsidiaries), and soon.
4. Statusof risk management structure
The Group works to enhance its risk management
system by updating its Code of Conduct, the Risk
Management Policy, Hot-line Policy and etc. Sincesound management practices and a stable earnings
foundation through risk control are key priorities for
the Company, the Company has an advisory contract
with a law firm “ TMI Associates” to receive advice andguidance about all legal matters when necessary
5. Purchase of treasury stock
In accordance with Article 165-2 of the Companies Act,
the Company’s Article of Incorporation statethat purchase of treasury stock can be determinedby the Board of Directors with the objective of flexibly
returning profits to shareholders
6. Interim dividends
The Company’s Articles of Incorporation states thatthe payment of interim dividend to shareholders
listed in the shareholders’ register as of the close of
September 30 every year or registered pledgees ofshares can be determined by the Board of Directors
with the objective of flexibly returning profits toshareholders.
7. Outline of limitation of liability contracts
In accordance with Article 427-1 of the Companies Act,
the Company’s Articles of Incorporation permit theCompany to enter into contracts that limit the liabilityof the Directors (excluding Internal Directors etc) and
Auditors for damages defined by Article 423-1 of theCompanies Act. The limit is set to the amount statedin law.
8. Outline of exemption from liability
In accordance with Article 426-1 of the Companies Act,
the Company’s Articles of Incorporation states that theBoard of Directors can pass a resolution to exempt theliability of the Directors (including former Directors)
and the Auditors to the fullest extent allowable bylaw for damages defined by Article 423-1 of theCompanies Act. The purpose of this exemption is toensure the abilities of the Directors and the Auditors
can be performed at the fullest extent and their
expected roles can be fulfilled.
9. Summary of directors' and officers' liability insurance
The Company has concluded a directors' and officers'
liability insurance contract with an insurance company
as stipulated in Article 430-3(1) of the Companies Act.
The insured's scope under the insurance contract
covers the Directors and Auditors of the Company
and its subsidiaries. The insured does not bear thepremiums. The policy covers damages (defense costs,
compensation, and settlement payments) sufferedby the insured due to claims (including shareholder
lawsuits) brought against the insured during theinsurance period in connection with the insured's
performance of their duties. The policy will berenewed at the next renewal with the same contents.
10.Number of Members of the Board of Directors
The Articles of Incorporation state that the Company
shall have no more than eight Directors.
11.Election of the Directors
The Company’s Articles of Incorporation state that
resolutions for election of the Directors can only beresolved with more then one third of the shareholders
in posession of voting rights are present at the General
Meeting of the Shareholders and majority of the votes
are casted to support the election. The Articles ofIncorporation also states that cumulative voting is notallowed for resolutions to elect the Directors.
12.Matters subject to resolution by the General Meetingof Shareholders, which can be resolved by the Boardof Directors
The Company’s Articles of Incorporation states thatthe Board of Directors may resolve to pay dividendsof surplus, as prescribed by Article 454-5 of theCompanies Act to shareholders, class shareholders
and registered pledgee of shares, who are registeredor recorded on the last shareholder registry as of theclose of September 30 each year.
13.
Requirements for validity of special resolutions atGeneral Meeting of Shareholders and General Meetingof Class Shareholders
The Company’s Articles of Incorporation statethat special resolutions at the General Meetingof Shareholders defined by Article 309-2 of theCompanies Act, will only be valid if one-thirds ormore shareholders entitled to exercise their voting
rights attends and two-thirds of the voting rights are
exercised. The Articles of Incorporation also statesthat special resolutions at the General Meeting ofClass Shareholders defined by Article 324-2 of theCompanies Act, will only be valid if one-thirds ormore shareholders entitled to exercise their voting
rights attends and two-thirds of the voting rights
are exercised. These regulations are intended tofacilitate the smooth operation of the General Meetingof Shareholders and the General Meeting of Class
Shareholders by relaxing the requirements for aquorum on special resolutions put to a vote at theGeneral Meeting of Shareholders and the General
Meeting of Class Shareholders.
14.Class B Shares
The Company’s Articles of Incorporation state that
10 Class B Shares constitute one share unit and 100
Common Shares constitute one share unit.
This dual class structure is implemented toconcentrate voting rights to Yoshiyuki Sankai and theFoundations in order to ensure that the Company’s
technologies are used for peaceful purposes only, andto prevent it being turned into something that could
harm people or to create weapons.
The Group’s vision for the future is to create a
Cybernics Industry—a new industrial field that will
support people by solving issues directly causedby aging and declining birth rate. To realize thisvision, the Company must coordinate business
management with research and development in
Cybernics Technologies. Yoshiyuki Sankai is thecreator of Cybernics Technologies, and continues tobe a central figure in Cybernics research. He is also
a business leader who seeks to make this innovativetechnology widely available for the benefit of society.
To increase corporate value, which will also benefit theshareholders, Yoshiyuki Sankai must remain to havea stable control over the management of the Company
for the time being. This scheme was designed toensure this.
In order to preserve the continuity of this Scheme,
Yoshiyuki Sankai plans to transfer part of the Class B
Shares held to the Foundations at no cost.

Annual Report 2021

42

Furthermore, the Foundations plans to hold theClass B Shares for the foreseeable future.
As holders of Class B Shares, the Foundations havecreated the following guidelines concerning theexercise of voting rights with the objective of ensuringthat the Group’s advanced technologies are used forpeaceful purposes only and preventing damage tothe corporate value of the Company. As the owner of
the Class B Shares the Foundations shall vote against
resolutions that contain language defined in a and b
below at the General Meeting of Shareholders and theGeneral Meeting of Class Shareholders.
The Foundation is required to obtain the approval
from its board meetings and disclose the changes
through predetermined format in case of changing
the guideline. In the General Meeting of Shareholders
and General Meeting of Class Shareholders, theFoundation will vote against cases stated below.
a) A resolutions to dismiss or appoint directors that
may lead to the misuse of the Group’s innovativetechnology and to damaging the Group’s corporatevalueb) All other resolutions that with risk of turning theGroup’s technologies to harm people or damaging
the Group’s corporate value

1.List of Board Members
Board of Directors

Yoshiyuki Sankai
Born June 24, 1958 (Male)

President and CEO

Ph.D. in Engineering

Description of the positions, personal history, assignments and other important position held outside the Company
2003/7

Professor of Functional Engineering, University of Tsukuba

2013/8

2004/4

Professor of Information & Systems, University of Tsukuba(present)

2014/11

Program manager of ImPACT Program hosted by the Cabinet Office

2016/8

Director of CYBERDYNE USA Inc. (present)

2004/6

Director at incorporation of CYBERDYNE

2017/10

2006/2President and CEO of CYBERDYNE (present)

Executive Research Director of the Center for Cybernics
Research, University of Tsukuba (present)

2010/3

Core Researcher of FIRST program hosted by the Cabinet Office

2020/6

2011/10

Director of Center for Cybernic Research, University of Tsukuba

Director of R&D Center for Frontiers of MIRAI in Policy and Technology,
University of Tsukuba (present)

Years in service as Director

17 years

Director of Cyberdyne Care Robotics GmbHSpecial interest in CYBERDYNE

none

Shinji Uga

Certified Public Accountant

Director

Born February 15, 1970 (Male)

Number of company shares owned
Common3,042,000 SharesClass B
77,696,000 Shares

MBA

Description of the positions, personal history, assignments and other important position held outside the Company
1994/4

Joined Tomen Corporation (Now known as Toyoda Tsusho)

2009/2

2001/10

Joined Chuo Aoyama Audit Corporation (Now known as
PricewaterhouseCoopers)

Director (present) and head of Financial Affairs and Accounting
Department of CYBERDYNE

2013/8

Director of Cyberdyne Care Robotics GmbH (present)

2005/10

Assigned to PricewaterhouseCoopers Shanghai office

2013/12

Manager of Corporate Department of CYBERDYNE (present)

2007/6

Joined Ridgeway Capital Partners Ltd.

2017/12President and CEO of CEJ Capital, Inc. (present)

2008/9Joined CYBERDYNE
Years in service as Director

12 years

Yoshihiro Yasunaga
Born November 14, 1974 (Male)

Special interest in CYBERDYNE

none

Number of company shares owned
Common60,000 Shares

Certified Public Accountant (U.S.)

Director

Masters in academics

Description of the positions, personal history, assignments and other important position held outside the Company
1997/4

Joined Takefuji Corporation

2017/11

Outside Director of SUMS, Inc. (present)

2002/7

Joined Tyco Healthcare Japan Inc

2018/4

Representative Director of Shonan Robocare Center Co., Ltd. (present)

2006/10

Joined ON Semiconductor Japan Ltd.

2019/2

Outside Director of Okayama Robocare Center Co., Ltd. (present)

2008/4

Joined CYBERDYNE’s Business Management Team

2019/6

Director of CYBERDYNE (present)

2013/1

Manager of the Sales Department (present)

2019/8

Director of CYBERDYNE USA Inc.

2013/4

Representative Director of Suzuka Robocare Center Co., Ltd. (present) 2020/4

2013/9Representative Director of Oita Robocare Center Co., Ltd. (present)
Years in service as Director

2 yearHiroaki Kawamoto
Born August 25, 1974 (Male)

Director of MOVETEX Kabushiki Kaisha

Special interest in CYBERDYNE

none

Number of company shares owned
Common8,000 Shares

Ph.D. in Engineering

Director

Description of the positions, personal history, assignments and other important position held outside the Company
2004/6

Representative director at incorporation of CYBERDYNE

2006/2

Director of CYBERDYNE (present)

2005/8

Researcher at Japan Association for the Advancement of Medical
Equipment
Representative Director of CYBERDYNE

2015/4

Associate Professor of Information & Systems, University ofTsukuba (present)

2005/5

Years in service as Director

17 yearsSpecial interest in CYBERDYNE

none

Number of company shares owned
Common14,000 Shares

Annual Report 2021

43

Hikari Imai
Born July 23, 1949 (Male)

Outside Director
Independent Officer

Skill matrix of the Board of Director
MBA
Industry specific skill

Description of the positions, personal history, assignments and other important position held outside the Company
1974/10

Joined Yamaichi Securities Co., Ltd.

2012/4

Outside Director of Olympus Corporation

1983/1Joined Morgan Stanley Co., Ltd.

2015/6

Outside Director of CYBERDYNE (present)Name

1993/4

Joined Merrill Lynch Securities Company

2016/6

Outside Director of PACIFIC METAL CO., LTD. (present)

1999/1Vice Chairman of Merrill Lynch Japan Securities Company, Limited

2016/12

Director and Chairman of 3DOM Inc. (present)

2007/11

Director, Vice President of RECOF Corporation

2019/1

Director of GPSS Holding Inc. (present)

2008/4President and CEO of RECOF Corporation

2019/1Chairman of the Keiaikai Medical Foundation (present)

2019/11

Outside Director of SHIMACHU Co., Ltd. (present)

Special interest in CYBERDYNE

Years in service as Director

6 years

Yuzo Toda
Born July 21, 1946 (Male)none

Outside Director
Independent Officer

Number of company shares owned–

Ph.D. in Engineering

Description of the positions, personal history, assignments and other important position held outside the Company
1973/4

Joined Fuji Photo Film Co., Ltd.

2009/6

2004/6

Executive officer of FUJIFILM Corporation
General Manager of FUJIFILM Life Science Research Lab

2015/6

Director and Executive Vice President of FUJIFILM Corporation

2008/6

Director of FUJIFILM Corporation

2016/6

Director and CTO of FUJIFILM Holdings Corporation

2009/6

Director of FUJIFILM Holdings Corporation

2016/6

Director, Senior Executive Vice President and CTO of FUJIFILM Corporation

2017/6

Outside Director of Anicom Holdings, Inc.

Years in service as Director

Special interest in CYBERDYNE–

Akira Matsumura
Born October 25, 1954 (Male)

Director and Corporate Vice President of FUJIFILM Corporationnone

Outside Director
Independent Officer

Number of company shares owned–

Ph.D. in Medicine

Description of the positions, personal history, assignments and other important position held outside the Company
Professor of Clinical Medicine, University of Tsukuba

2016/4

Hospital Board Trustee of Kennan Hospital

2007/4Vice Director of University of Tsukuba Hospital

2018/6

2011/4

Director of Clinical Trial and Research Center,
University of Tsukuba Hospital
Director of University of Tsukuba Europe Office Bonn/Germany

Committee Chairman of Medical Education Committee at Association ofJapan Medical Colleges

2018/10Vice President, International Society for Neutron Capture Therapy

2020/4President of Ibaraki Prefectural University of Health Sciences

2014/4
2016/3Vice President of University of Tsukuba and Director of University
Hospital
Co-Representative Director of Artron (present)
Years in service as Director

Kenji Suzuki
Born January 17, 1975 (Male)

2020/4Advisor of Telix Pharmaceuticals (Japan) Ltd

2021/4

Committee member of Ibaraki Prefecture Council for CardiovascularCountermeasures

Special interest in CYBERDYNE

–

none

Outside Director
Independent Officer

ShinjiUga

Yoshihiro
Yasunaga

Inside(Representative/
R&D)

Inside(Corporate)

Inside(Sales)HiroakiKawamoto(Clinical Research)

Hikari
Imai

Outside/Independent

Yuzo
Toda

Outside/Independent

Akira
Matsumura

Kenji
Suzuki2004/3

2011/4

Medical/clinicalYoshiyuki
SankaiCommon skill

Role

Inside(Newly appointed)

Outside/Independent(Newly appointed)

Outside/Independent(Newly appointed)

R&D

GlobalManagement
Experience

Finance/BusinessAcounting/ development/
Legal
M&A

・ ・・ ・
・
・
・ ・
・ ・
・
・・
・ ・ ・ ・・ ・・ ・
・
・・
・
・・
・
・

Number of company shares owned–

Ph.D. in Engineering

Description of the positions, personal history, assignments and other important position held outside the Company
2016/42017/10

Professor of Engineering, Information and Systems
University of Tsukuba
Director of Center for Cybernics Research, University of Tsukuba
Years in service as Director–

2018/4President and CEO of PLIMES Inc.

2021/2Advisor of Tsukuba City on Smart City/Super City

Special interest in CYBERDYNE

none

Number of company shares owned–

Annual Report 2021

44

Audit and Supervisory Board Members

Kazuaki Tanaka
Born April 3, 1957 (Male)

Outside Audit andSupervisory Board Member

Independent Officer
Full-time

Skill matrix of the Audit and Supervisory Board Members
Name

Type

KazuakiTanakaFull time

YutakaFujitaniPart time

Cees
Vellekoop

Part time

Kenichiro
OkamuraPart time

Description of the positions, personal history, assignments and other important position held outside the Company
1980/4

Joined Marubeni Corporation

2015/4

Managing Executive Officer of Marubeni

2008/4

Executive Officer of Marubeni

2016/6Chairman of the Board of MX Mobiling Co., Ltd.

2011/4

Managing Executive Officer of Marubeni

2020/6Advisor of MX Mobiling Co., Ltd.

2013/6

Representative Director and Managing Executive Officer of Marubeni
Years in service as
Audit and Supervisory Board Member

Special interest in CYBERDYNE

none

–

Yutaka Fujitani
Born April 1, 1953 (Male)

Outside Audit andSupervisory Board Member

Number of company shares owned–

Independent Officer

Description of the positions, personal history, assignments and other important position held outside the Company
Joined The Mitsubishi Bank, Ltd.
(Now known as The Bank of Tokyo Mitsubishi UFJ, Ltd.)Years in service as
Audit and Supervisory Board Member

Born May 4, 1956(Male)

Joined KPMG AZSA LLC.
Outside Audit and Supervisory Board Member of CYBERDYNE (present)

Special interest in CYBERDYNE

none

10 years

Cees Vellekoop

2005/1
2011/6

Businessmanagement

Risk
management

Legal

Finance/
Accounting

Auditing
experience

Global

・ ・
・
・
・ ・・
・ ・ ・
・
・ ・
・ ・・

Number of company shares owned–

Outside Audit andSupervisory Board Member

Description of the positions, personal history, assignments and other important position held outside the Company
Registered as attorney-at-law at Court of Rotterdam District ofAmsterdam District
Admitted in Japan as attorney for foreign law
Years in service as
Audit and Supervisory Board Member

Born August 18, 1971 (Male)

Joined Allen & Overy Gaikokuho Kyodo Jigyo Horitsu Jimusho
Admitted in England and Wales as attorney-at-law

2007/6

Audit and Supervisory Board Member of CYBERDYNE (present)

Special interest in CYBERDYNE

none

14 years

Kenichiro Okamura

2003/5
2005/10Outside Audit andSupervisory Board Member

Number of company shares owned–

Independent Officer

Description of the positions, personal history, assignments and other important position held outside the Company
Joined Chuo Audit Corporation

2011/6

Outside Audit and Supervisory Board Member of CYBERDYNE (Present)

Representative Director of Kabushiki Kaisha BizNext (Now known
as Kaede Accounting Advisory Inc.) (present)

2015/6

Outside Audit and Supervisory Board Member of SG Holdings Co., Ltd. (present)

2016/6

Outside Director of Kanematsu Sustech Corporation (Audit Comittee)

Representative Director of Tokyo-IAS Inc. (Present)

2016/6

Audit and Supervisory Board Member of United Urban Investment
Corporation (present)

Senior Partner of Akasaka Sogo Accounting Firm Co., Ltd.
(Now known as Kaede Tax Corporation) (present)
Years in service as
Audit and Supervisory Board Member

10 yearsSpecial interest in CYBERDYNE

none

Number of company shares owned–

Annual Report 2021

45

Notes to the List of Board Members
1. Director Hikari Imai, Yuzo Toda, Akira Matsumura,
Kenji Suzuki are Outside Directors
2. 
Auditor Kazuaki Tanaka, Yutaka Fujitani, Cees
Vellekoop, and Kenichiro Okamura are Outside
Auditors
3. Director Hikari Imai, Yuzo Toda, Akira Matsumura
and Auditor Kazuaki Tanaka, Yutaka Fujitani,
Kenichiro Okamura fullfills the requirement of the
Independent Officer defined by the Tokyo Stock
Exchance Securities Listing Regulation Article
436-2 as well as the Company’s regulation on
independence of the outside board member. As
such the Company registers the aforementioned
members as Independent Officers to Tokyo Stock
Exchange.
4.The elected period of the Directors are from the endof the Ordinary General Meeting of Shareholders
on June 24, 2021 to the end of the Ordinary General
Meeting of Shareholders for the fiscal year ending
March 31, 2023.
5. The elected period of Yutaka Fujitani, Cees Vellekoop
and Kenichiro Okamura is from the end of theOrdinary General Meeting of the Shareholders on
June 24, 2021 to the end of the Ordinary General
Meeting of the Shareholder for the Fiscal Year Ending
March 31, 2025.
2. S tatus of Outside Board Member
The Company has elected four Outside Directors andfour Outside Auditors.
The Company has not set any regulations or policies
regarding the independence of its Outside Directors
and Outside Auditors. Instead, the Company appoints
Outside Directors and Outside Auditors based on theirextensive experience as management, as well as their
deep insight about research, finance, accounting andlegal affairs, for the purpose of building an effective
corporate governance system from an external
standpoint.
The Company expects its Outside Directors andOutside Auditors to supervise the business executionof internal Directors.
Outside Director Akira Matsumura provides his
opinions and proposals regarding medical andclinical affairs in the Board of Directors from thestandpoint of the experiences as a medical doctor
and manager of a hospital. While Akira Matsumura
holds 5,000 shares of the Company as of June 25th,
2021, when the securities report was submitted, theCompany does not recognize it to have significant
impact on the relationship with Akira Matsumura.
Furthermore, there are no human, capital, businessaffiliation or any other conflicts of interests between
the Company and Akira Matsumura. In addition, while
Akira Matsumura currently serves as the Hospital
Board Trustee of Kennan Hospital, President of
Ibaraki Prefectural University of Health Sciences, CoRepresentative Director of Artron, and Advisor of Telix
Pharmaceuticals, the Company does not have any

human, capital, business affiliations or other conflictsof interest with the aforementioned four organizations.
Furthermore, there are no human, capital, businessaffiliation or any other conflicts of interests between
the Company and other Outside Directors and Outside
Auditors.
The Company share held by Outside Directors
and Outside Auditors are stated in the list of Board
Members “Numbers of Shares Held”.
3. Mutual cooperation between supervision or auditing by
Outside Directors, Outside Auditors, and supervision or
auditing by Internal Auditors, and Accounting Auditors
Outside Audit and Supervisory Board Members
supervise the business execution of inside membersof the Board of Directors and other management.
Audit and Supervisory Board Members conduct anaudit of the business execution of Members of theBoard of Directors and and Accounting Auditors.
Audit and Supervisory Board Members report theprocess and results of their audits at the Meeting of
the Board of Directors on a regular basis. This activity
is a significant support to the supervision of each
Board Member’s business execution by the Board of
Directors.

(Audit)1. Status of audit by Auditors
In accordance to Regulation of Audit and Supervisory
Board and Code of Kansayaku Auditing Standards,
the Auditors audits business execution of theGroup’s directors and other business executions. The
Company elected four Outside Auditors with extensive
experience on accounting, legal affairs and legal
management in general, each with a license of either
certified public accountant or attorney-at-law, for the
purpose of supervising the business management
effectively.
Full-time Outside Auditor Yutaka Fujitana has anextensive experience on business management
gained through his service in a financial institute andauditing firm. Outside Auditor Cees Vellekoop has anextensive experience on legal affairs gained throughhis service as attorney-in-law in Britain and theNetherland (both certificates have been relinquished).
Outside Auditor Kenichiro Okamura has an extensive
experience on financials and accounting gained
through his service as an Certified Public Accountant
in both Japan and in the U.S. Outside Auditor Kazuro
Kawamata has an extensive experience on business
management gained through his service in a financial
institution.
2. Status of audit by Internal Audit Office
The Company has an Internal Audit Office that consistsof one internal auditor (with a concurrent post) andperforms necessary operational audits based on theInternal Audit Policy. Internal Audit Office contributes
to the enhancement of the Company’s internal control
systems. As the internal auditor concurrently belongsin the Corporate sector as a leader of General Affairs
and HR team, an internal audit on General Affairs and
HR team are conducted by an auditor selected by thepresident and CEO. Internal Audit Office coordinateswith full-time Outside Auditor upon establishmentof an annual internal audit plan. Results of internal
audits are reported to the President and CEO and
Auditors on regular basis. Furthermore, if issues
related to internal control are found in the midstof internal audits, Internal Audit Office provides
proposals for improvement to the unit in charge ofthe internal control process. Internal Audit Officeexchanging opinions and information with Auditors aswell as Independent Accounting Auditors for effective
execution of audits.

d.Assistants involved in audit work
10 support members made up by two CPAs and eight
other professionals
e.The reason of selecting the firm
In selecting an auditing firm, the Company
confirmed that Deloitte Touche Tohmatsu LLC is
indepent and has necessary expertise, sufficient
size and overseas network to perform efficient audit
operations in accordance with a wide range of theCompany's operations. The Company also confirmedthat the audit system, audit scope, audit schedule,
other audit plans and expenses related to audit thatwere explained by the audit firm were reasonable
and appropriate. Also considering the past record of
the auditing and other factors the Company made acomprehensive judgment.
The Audit and Supervisory Board shall dismiss the
Independent Accounting Auditor with the consent of
all the Auditors, if the auditing firm is deemed to fallunder any of the grounds set forth in Article 340-1of the Companies Act. In such case, an Auditor shallreport the dismissal of the Independent Accounting
Auditor and the reason for the dismissal at the first
General Meeting of Shareholders convened after thedismissal.
In addition to the above cases, the Audit andSupervisory Board shall propose a resolution todismiss or not re-elect the Independent Accounting
Audior to the Board of Director, who will thenpropose the resolution to the General Meeting of
Shareholders based on the decision made.
f.Evaluation from the Auditor
The Audit and Supervisory Board confirmed that
Deloitte Touche Tohmatsu LLC is indepent and hasnecessary expertise, sufficient size and overseas
network to perform efficient audit operations inaccordance with a wide range of the Company's
operations. The Audit and Supervisory Board also
confirmed that the audit system, audit scope, audit
schedule, other audit plans and expenses related
to audit that were explained by the audit firm werereasonable and appropriate. Also considering thepast record of the auditing and other factors the Audit
and Supervisory Board made a comprehensive
judgment.

3. S
 tatus of audit by Independent Accounting Auditorsa.Name of the auditing firm
Deloitte Touche Tohmatsu LLC
b.Continuous audit period
11 yearsc.Name of the CPA responsible for the audit
Hajime Seishi
Joji Furukawa

Annual Report 2021

46

2.Remuneration for Directors, Auditors by each types and its total number

4. Compensation for Independent Accounting Auditors
a.Compensation for Certified Public Accountants, etc.
Class

The Company

Previous fiscal year
(As of March 31, 2020)
Compensation for audit andCompensation forattestation service
non-audit service(Millions of Yen)
(Millions of Yen)
28—

Consolidated subsidiary
Total

Current fiscal year
(As of March 31, 2021)
Compensation for audit andCompensation forattestation service
non-audit service(Millions of Yen)
(Millions of Yen)
30
—

3

—

4

—

31

—

34

—

b.Compensaton for organizations belonging to the same network as certified public accountants, etc. (excluding a. )Class

The Company

Previous fiscal year
(As of March 31, 2020)
Compensation for audit andCompensation forattestation service
non-audit service(Millions of Yen)
(Millions of Yen)——

Consolidated subsidiary
Total

Current fiscal year
(As of March 31, 2021)
Compensation for audit andCompensation forattestation service
non-audit service(Millions of Yen)
(Millions of Yen)
—
—

0

0

—

—

0

0

—

—

Detail of non-audit service
Previous fiscal year (from April 1, 2019 to March 31, 2020)
Non-audit service in consolidated subsidiary were mainly supporting accounting of individual companies
Detail of non-audit service
Relevent fiscal year (from April 1, 2020 to March 31, 2021)
Non-audit service in consolidated subsidiary were mainly supporting accounting of individual companiesc.Contents of remuneration for other important audit and attestation services
Previous fiscal year (from April 1, 2019 to March 31, 2020)
There were no items to report
Relevent fiscal year (from April 1, 2020 to March 31, 2021)
There were no items to reportd.Policy on determination of compensation
Compensation for Independent Accounting Auditors are determined by the Board of Directosrs, based on consent of the
Audit and Supervisory Board Members, considering the size of the Group, its nature of business, days required to conduct
audit and other factors.
e.Reason of consent from the Board of Audit and Supervisory Board
Based on the “Practical Guidelines on Cooperation with Accounting Auditors” published by the Japan Institute of Corporate
Auditors, the Audit and Supervisory Board confirmed changes in audit time and audit fees in the audit plan, the audit planfor the previous fiscal year and the status of performance, and examined the appropriateness of the estimated amountof remuneration. As a result, the Audit and Supervisory Board has given consent as set forth in Article 399, Paragraph 1of the Companies Act.
Compensation for Directors and Auditors
1. Policy on determination of amount of compensation and its calculation
The compensation for Directors and Auditors are determined within the limits approved by the General Meeting of
Shareholders, based on the discussion by the Compensation Commitee. The Committee have discussed the compensation
for such members after July 2019, in the committee of June 2019 and the decision was approved at the Board of Directors
on July 2019.
The upper limit of remuneration for the Directors was set at ¥100 million per year (maximum of 8 members), in accordance
to the resolution at the 2nd General Meeting of Shareholders on May 31, 2006.
The upper limit of remuneration for the Auditors was set at ¥50 million per year (maximum of 5 members), in accordance
to the resolution at the 3rd Ordinary General Meeting of Shareholders on June 28, 2007.
The compensation for the Directors and Auditors is fixed remuneration only, and there is no performance-linked
compensation.

Total Compensation(Millions of Yen)Type

Breakdown of compenstion (Millions of Yen)
Base salary

Stock options

Bonus

Retirement benefits

Number ofapplicable members(people)Directors (excluding Outside Directors)

44

44

—

—

—

4

Auditors (excluding Outside Auditors)

—

—

—

—

—

—

Outside Directors and Auditors

20

20

—

—

—

7

3. Total amount of consolidated compensation for each member
Since there were no members who received more than ¥100 million for a consolidated compensation, there were noitems to report.
Status of investment in other companies
1. Criteria and approach to classification of investment shares
The Company supports and nurtures startups for the purpose of solving problems in the society and creating a new
Cybernics Industry. The Company holds a investment securities of startups (non-listed) with unique technologies.
However the purpose of this is not purely for investment, and the Company also enters into business alliance with allof the companies.
2. Investment shares held for purposes other than pure investmenta. M
 ethods of verifying the rationality of the holding policy and the holding of each sharesDetails of verification
The Company will consider investments if the companies has the potential to contribute to maintaining or increasing
CYBERDYNE's corporate value by solving social problems and creation of new Cybernics Industry.
The shares held are reviewed by the Board of Directors as necessary, taking into account the results of initiatives,
progress, risks and other factors in light of the significance of holding the shares.
b. Number of companies and the total amount reported on the balance sheet
Total amount reported on thebalance sheet (Millions of yen)
2,202
197

Numbers of companies
Shares of unlisted companies
Shares of companies that are not unlisted22
1

The companies which the number of shares held by CYBERDYNE increased during the fiscal year ended March 31, 2021
Numbers of companies
Shares of unlisted companies
Shares of companies that are not unlisted

6—

Total amount of acquisition costs pertaining
to the increase in the number of shares(Millions of yen)709—

Reason for the increase in the numberof shares
Increase from acquisition of shares—

The companies which the number of shares held by CYBERDYNE decreased during the fiscal year ended March 31, 2021
Total amount of the sale price pertaining
to the decrease in the number of shares(Millions of yen)——

Numbers of companies
Shares of unlisted companies
Shares of companies that are not unlisted——

c. Number of shares of specific investment stock and information on its total amount reported on the balance sheet
Current fiscal year
Company name

Previous fiscal year

Numbers of shares

Numbers of shares

Total amount reported on thebalance sheet(Millions of yen)

Total amount reported on thebalance sheet(Millions of yen)

200,000

10,000(Purpose of holding)To accelerate the creation of the cybernics
industry.
(Quantitative effects)
Difficult to describe

100

The number of shares increased due to a
20-for-1 share split of common shares on 12
November 2020. In addition, Kringle Pharma
was listed on the Tokyo Stock Exchange on 28
December 2020.

Kringle Pharma, Inc.
197

Purpose of holding, quantitative effect andreasons for increase in number of shares

Shares held in
CYBERDYNE's
shareholding

None

Annual Report 2021

47

Risks associated with business operations
Set out below are some of the major risks associatedwith the business operations of the Group as well asother potential risks that the Group may face. Listed
items include risks that may not apply directly, but havebeen included in order to disclose information fairly
and accurately as they are thought to be important forinvestors upon making sound investing decisions. While
the Group recognizes the possibilities of the listed risks
occurring and will take necessary measures either toavoid their occurrence or to react appropriately to reduce
damages, investors should carefully consider both thestated risks and other risks unstated, prior to making an
investment.
Furthermore, please keep in mind that the items set
out below do not cover all of the potential risks. The statedrisks are based on assumptions and beliefs derived frominformation currently available to the Group and they may
be altered due to change of circumstances in the future.
1. Risk in business execution(1) The Group business in a novel business category
The Group’s main product is HAL*, the world’s
first “Wearable Cyborg”, developed by Yoshiyuki
Sankai, President and CEO. The Group is currently
developing business of Medical HAL in Japan,
Europe, U.S., Asia Pacifics, and the Middle East.
Also in Japan, the Group is developing businessof HAL for Well-being Lower Limb Type, Single
Joint Type, Lumbar Type and HAL Lumbar Type forCare/Labor Support, etc. The Group’s technologies
are thought to be applicable to various fields,
including medicine, living support, labor support,
entertainment and so on. However, since the Groupis working in a novel business category, uncertainty
is very high, and there is no guarantee that themarket will grow steadily. Moreover, if penetration of
the Group’s products does not progress as planned,
or if the Group is unable to achieve profitability, its
business performance, financial condition, andfuture business development may be affected.
(2) Competition
The Group is developing its business in the fields of
medicine, care support and living support mainly
centered on HAL.
Currently, wearable robots with autonomous
control systems are being developed by companies
in Japan and elsewhere in the world. However
the Cybernics Voluntary Control technology** thatutilizes BES originating from the brain is uniqueto the Group. Due to this difference, the Group canmaintain its competitive edge. Intellectual properties
related to HAL such as the basic principles ofCybernic Voluntary Control are jointly held by theGroup and the University of Tsukuba.
The Group has exclusive rights to use allof the patent rights that give it a competitive
advantage in the wearable robot market. However,various companies are conducting research andcommercialization of wearable robots. On theotherhand, the environment surrounding the Groupis changing constantly and many more companies,
including giant technology companies are entrying
the competition of commercial robotics. There isa possibility that some of the Group’s competitors
have or may have substantially greater capital,
human and other resources, more efficient
cost structures, higher brand recognition andmore diversified product lines than the Group.
For advanced products such as HAL, while theresearch, development, verification tests, process
to obtain safety standards certification and medical
device approval and receiving insurance coverage
requires a lot of time and investment, there are no
guarantees that the products sells successfully. Insuch business environment, if another company
succeeds in developing newer technologies ormore effective products than the Group, the Groupwill lose its advantage in the competition and theGroup’s business performance, financial condition,and future business development may be affected.
* Note, HAL is a Cybernic System that fuses and integrates the functionof human and robot. It is regarded to be the world’s first technology that
could improve, support, expand and regenerate the physical function of
the wearer. The Group obtained several patents to deploy the technology
as an international platform. Listed below are some of the basic patents
held by the Company.
Application number/
Name of invention/Inventor
Registration number
Type of invention(Date of application)
2004-068790/4200492 Wearable action assist device(2004/03/11)
Inventor: Yoshiyuki Sankai
Wearable action assist device, and controlling
2004-040168/4178185 methods of drive source in wearable action assist(2004/02/17)
device, and its program
Inventor: Yoshiyuki Sankai
Wearable action assist device, and method and2004-045354/4178186 program for controlling wearable action-assist device(2004/02/20)
Inventor: Yoshiyuki Sankai
2005-018295/4178187 Wearable action assist device and control program(2005/01/26)
Inventor: Yoshiyuki Sankai(3) Internal organizational structure
The Company was established on June 24, 2004
and has the following issues which are specific toventure companies.
i)The Group heavily relies on Yoshiyuki Sankai, thefounder, President and CEO of CYBERDYNE, inboth business management and development of
new technology. If he becomes unable to perform
his duties in the Group, the Group’s businessperformance and future business development
might be affected.
ii)
The Group employees a great number of highlevel staff members in research and development.
However, if a staff members that are crucial
to the Group’s business resigns, the speed ofdevelopment might be affected.

iii)In accordance to the expansion of the business,
the Group intends to reinforce the manpower
and internal management structure. However, if
the Company fails to do so smoothly, the Group’sbusiness performance and future businessdevelopment might be affected.
(4) D ependence on a specific product
The majority of the Group’s revenue is composedfrom sales of HAL, and the product continues tobe the main source of revenue. As such, if there
is delay in approval process, changes of law or
healthcare policy and delay of preparing sufficient
insurance systems for HAL, the Group’s businessand profitability might be affected. In addition tothese factors, incase of lawsuits or other legal
action arising from the use of HAL, the emergenceof new technologies or technological innovation that
replaces HAL, the introduction of more competitive
products in the same category, changes in relevantlaws and regulations, changes in the relationshipwith the University of Tsukuba regarding the grantof exclusive rights to the use of intellectual property
related to HAL, and any other factors that could
preclude the potential of HAL, the Group’s businessperformance, financial condition, and futurebusiness development might be affected.
(5) Approval of medical devices
In order to sell HAL and other Group products
as medical devices, the products need to obtainapproval from authorities in each country and region
after undergoing certain tests and examinations
based on local laws and regulations.
The Group has obtained medical device approvaland clearances for HAL in EU, Japan, U.S., andetc. However, there is no guarantee that the Groupwill succeed in obtaining medical device approvaland clearances for HAL and other Group products
in other country or region. Even if it is approvedor cleared, the timing may be different for eachcountries and regions. Furthermore if laws andregulations in respective countries and regions
changes, approval for HAL might be canceled or fails
to be renewed. In such cases, the Group’s businessperformance, financial condition and future businessdevelopment might be affected.
(6) Insurance coverage
In order to spread Cybernics Treatment with theGroup’s technology, it is very important to receive
the coverage from both public and private healthinsurances so that the hospitals can be reimbursed
and a patient can receive the treatment with minimal
financial burden. However, insurance systems
is different in each countries and regions, andaspects such as the scope of coverage and payment
levels are determined separately by the respective
public insurance institutions or private insurancecompanies in each country and region. These
determinations may affect the Group’s businessperformance, financial condition, and futurebusiness development.
(7) Alliances and investments to startups
The Group regards its endeavors to make strategic
investment and formation of business alliance withstartups to be important procedure to accelerate
the creation of Cybernics Industry. The Groupwill continue to drive this endeavor proactively.
However, in this endeavor, it is difficult to predict
the effect of investment or alliance completely
beforehand. Moreover, there is no guarantee thatthe investment or alliance proceeds smoothly. The
Group cannot make guarantees that the effect ofstrategic investment and business alliance can beobtained within an initially projected time frame.
There are also possibilities that the Group might failto utilize the effects from an investment or allianceappropriately. In addition, the Group may be required
to change the evaluation of the share in accordances
to the status of the business of startups that theGroup invests in. These factors may affect theGroup’s business performance, financial condition,and future business development.
(8) B usiness activities in general
The Group conducts business activities in Japanand in other countries. The Group recognizes thefollowing risks in business activities for all countries
and regions. With regards to countermeasure
towards the new coronavirus, the Group encourages
remote work and web meetings to all of its
employees. The Group also constantly explains theneed of social distance in the office as well as
measures to prevent the infection to its employees
in suitable occations.
•
Geopolitical risks associated with political andeconomic situations•Risks of infectious diseases and natural disasters•Risk of changes in legal and tax systems
Risks specific to business activities outside of Japan•
Risk of differences in commercial and tradecustoms•Risk of large-scale strikes or other disruptions inworking conditions•Risk of difficulties in managing local personnel andbusiness operations due to cultural differences andother factors•Risk of difficulties in repatriation of funds to Japan•
Risk associated with fluctuations in foreignexchange rates
There risks might affect business performance,
financial condition, and future businessdevelopment of the Group.

Annual Report 2021

48

(9) Loss of clients due to product malfunctions
The Group continuously strives to improve
the quality of its products based on ISO13485(international standards for quality control
management systems for medical equipment).
However, there is no guarantee that its products
will be free of deficiency or that product liability
claims or recalls will not occur in the future. While
the product liability claims would be covered
entirely or in part by product liability insurance; itwill damage the social credibility of both the Groupand the product, resulting in effects of the Group’sbusiness performance, financial condition, andfuture business development.
(10) Intellectual propertyi)
HAL is a unique technology that utilizes
a wearer’s BES and the patent rights fortechnologies used in HAL are jointly held by the
University of Tsukuba and the Company, except
for patents independently owned by the Company.
The Company concluded a contract concerning
an exclusive license for use of these patented
technologies. This contract is considered to beimportant for the Group’s operation. While thecontract is valid until the expiry date, if the contract
lapses due to breach of the contract, a merger,
an acquisition of significant assets, or transferof the Company’s key business line, the Group’sbusiness performance, financial condition, andfuture business development might be affected.
ii)The Group has never received any claims from,nor been involved in a lawsuit with any third party
concerning intellectual property such as patentrights related to the Group’s business. Moreover,the Group considers it unlikely that its business
operations would be materially hindered due toa problem arising in relation to infringement on
intellectual property such as other parties’ patentrights during its business operations. The Grouptakes measures to avoid problems concerning
intellectual property infringement by conducting
continuous technical investigations.
However, as the Group ‘s business is strongly
associated with R&D, it is very difficult to avoid theoccurrence of problems concerning intellectual
property infringement completely. If the Groupgets involved in such situation, the Group willconsider countermeasures according to details ofeach case and consult with lawyers and patent
attorneys. In anycases, the process will require
a lot of time and money to reach a settlement,
regardless of the validity of the counter-party’s
claim. Furthermore, although the Group manages
its technologies with the utmost care, if a third
party violates the intellectual property of theGroup’s technologies, settlement of the issue will
also consume a lot of time and money. In suchcases, the Group’s business strategies, businessperformance, financial condition, and futurebusiness development might be affected.
(11) Legal risks
The Group’s business is subject to respective
laws and regulations of each country and region.
For example, laws and regulations concerning
intellectual property rights, product liabilities
related to technologies, pharmaceutical affairs,commercial transactions, import and export
restrictions, tax obligations, including tariffs, antibribery, anti-corruption, fair competition, labor,
consumers, personal information, environment,
foreign exchange and various others. Moreover, theGroup may encounter unexpected issues relating
to aforementioned laws, regulations or businesscustoms. In particular, some of the Group’s
products are medical devices designated under the
Pharmaceuticals and Medical Devices Act of Japan,
and the Group obtained the manufacture anddistribution approval from the MHLW in complianceto this law. Similarly, in other countries and regions,
local regulatory authorities’ approvals may berequired, along with supervision from respective
supervisory authorities. Approval inspections are
conducted to validate the effectiveness and safetyof the products and an application can be deniedor be delayed as a result of the inspection. Even
if it is approved, the approval could become void
if problems in product effectiveness or safety are
discovered. In addition, if the Group violates any
laws or regulations related to its business, it could
be subjected to civil, administrative, or criminal
sanctions, which might affect the Group’s social
credibility. In such a case, the Group’s businessperformance or financial condition may be affectedmaterially.

(12) Risks associated with personal information
The Group obtains the personal information of
HAL users. The Group lilmits the number of staff
who can access this personal information andalso signs nondisclosure agreements with all
executives and employees. Moreover, the Group
has taken adequate measures for the protection of
personal information, including the establishmentof regulations for protection of personal Informationand the appointment of a person in charge ofprotecting personal information. With suchmeasures, the Group has not recognized any
problem, such as leakage of clients information
to this date. However, if such problem occurs in
the future, not only the Group will be required tocompensate for damages caused but the Group’ssocial credibility will also be damaged, and affect
the Group’s business, financial status, and businessperformance.
(13) Peace and Ethics Committee
The Group has also established the Peaceand Ethics Committee to prevent the use of its
advanced technologies to harm people or to create
military weapons. The Committee are composedof all members of CYBERDYNE’s outside board
members and President and CEO. Resolutions in
the Committee requires two-thirds of the attending
member supporting the resolution. Before entering
fields outside the areas of medicine, living supportand disaster recovery, which are defined in the
Company Code of Conduct, the Peace and Ethics
Committee investigates, deliberates and reports
the results to the Board of Directors.
The result of the Committee’s examinationand verification might not necessarily contributeto improving the Group’s short-term businessperformance.
2. R isks associated with the President’s engagement as a
University professor(1) 
President’s engagement as a professor at the
University of Tsukuba
Yoshiyuki Sankai, President and CEO of theCompany, holds concurrent positions as a professorof the University of Tsukuba. Details of “i) measures
to avoid conflicts of interest between the Group,
the University of Tsukuba and ii) impediments toperformance of duties as the President and CEO are
as follows:i) M easures to avoid conflicts of interest
All decisions related to conflicts of interest, includingtransactions and conclusions of joint research
agreements with the University of Tsukuba aremade by the Board of Directors. When a resolution
concerns such cases, decision will be made by five
directors (three outside directors) and Yoshiyuki
Sankai as well as board member affiliated with the

University of Tsukuba will not take part. In addition,
Audit and Supervisory Board monitors for cases that
may be related to conflicts of interest and reports
any findings at the Meeting of the Board of Directors.
ii) Impediments to performance of duties as President
and CEO
Although duties related to Cybernics research by
the Group as well as University of Tsukuba areintegral and inseparable, the effect of duties asa faculty member of the University of Tsukuba(lectures, attendance at intramural meetings as auniversity professor, etc.) are limited at it does not
disturb performance of duties as President and CEOof the Company such as attendance at the Boardof Directors meetings, approval of requests andcommunication with investors, etc.
However, if Yoshiyuki Sankai prioritize his duties
as a university professor over his position as a
President and CEO of the Company, the Group’s
financial condition and business performance might
be affected.
3. M
 atters associated with advanced device businesses
in general(1) Risks associated with development businesses ingeneralIn the field of developing advanced technologies,
companies around the world compete with eachother for quality and speed of technologicalinnovation. In the long process that sretches frombasic research, development and manufacturing
and sales, companies must invest large amountsof funds over long term, since they must proceedin accordance with the various regulations of eachcountry. As such, research and development entail
many uncertainties and such risks are inherent in
the products developed or planned to be developedby the Group. While the Group develops its businessaccording to its business plan, there are no
guarantee that the Group will expand its businessdomains as planned, recognizes risks such aschanges of insurance systems that were previously
covering the cost of using the Group’s product.
If such risks materializes, the Group’s business,financial condition, and business performance might
be affected.
(2)Newly developed products
The Group explores and creates newly developed
products through joint research with research
institutions, such as University of Tsukuba, andregards development of new products as animportant business strategy to expand the existingproduct line up such as HAL for Medical Use, Wellbeing, Care Support, Labor Support, and Cleaning
Robot as well as Transportation Robot that is
equipped with artificial intelligence.

Annual Report 2021

49

However, there is no guarantee that such new
products will be successfully explored and created.
If exploration and creation activities of new products
were hindered for some reason, the Group’s
financial condition and business performance might
be affected.
(3) D elays of research and development
The Group proceeds research and development
efficiently by establishing cooperative relationships
with external partners, such as University ofTsukuba. However, there are no guarantee that
research and development activities proceeds asplanned. If the Group fails to obtain results asplanned or if the start or completion of various
experiments are delayed, it may delay the timing
or limit the range of medical device approvals andmanufacturing and marketing clearance. To avoid
such situations as much as possible, the Groupmanages and evaluates the progress of each productunder development in a timely manner and prioritize
products under development by changing the levelsof management resources invested in products
or deciding to suspend development temporarily.
While the Group works to reduce the risk of a sharp
increase in research and development expenses
with such measures, if research and development
does not proceed as planned, the Group’s, business,financial condition, and business performance might
be affected.
4. Risks related to the dual class share structure(1) Outline of the Scheme
Under the Group’s philosophy “Technology exists
for humans and society” the Group implements
advanced technologies such as HAL for peacefulpurposes. The peaceful application of Cybernics
Technologies to improve, support, expand andregenerate wearers’ physical functions matches theneeds of the hyper aging society, leading to increaseof the Group’s long-term corporate value. However,the Group’s technology has a potential to be turned
into tools of damaging people or into weapons in
the military industry. As a scheme to raise funds
from the market while ensuring peaceful use for theGroup’s technologies, the Company issues “Class B
Shares”, which is different from the listed Common
Shares. (The scheme involving the Company’s ClassB Shares is hereafter referred to as the “Scheme”)
In order to solve social problems surrounding
hyper aging and decline of population while
pioneering the new industrial field of Cybernics
Industry, the Group must advance the processof development of Cybernics Technologies andbusiness management as a whole. Yoshiyuki Sankai
is the creator of Cybernics Technologies, the central
figure of Cybernics researches and a business leader
who works to make contribution by making thisinnovative technology widely available. As such, theGroup believes it is necessary for Yoshiyuki Sankai

to continue his stable involvement in managementof CYBERDYNE in order to increase the corporate andbenefit the common interest of shareholders for thetime being. As such, the Group regards the Scheme
to ensure continuous involvement of Yoshiyuki
Sankai are important for the perspective of common
interest of shareholders.
To explain in detail, while Class B Shares areranked the same as Common Shares and paid thesame amount as Common Shares with regard to
dividends and distribution of residual assets, Class B
Shares differ from Common Shares in traded units.
Common Shares are traded in units of 100 shares,
while Class B Shares are traded in units of 10 shares.
This grants a holder of Class B Shares 10 times morevoting rights in comparison to the holder of Common
Shares with equal numbers of shares. Class B
Shares are currently held by Yoshiyuki Sankai, thefounder and President and CEO of the Company
and the two foundation; general incorporated
foundation Sankai Health Foundation and generalincorporated foundation Sankai Foundation for the
Promotion of Science (collectively referred to as
the “Foundation”), both of which Yoshiyuki Sankai
serves as Representative Director. As of March 31,
2021, Yoshiyuki Sankai holds 3,042,000 Common
Shares and 77,696,000 Class B Shares, which makes
up approximately 38% of the total number of sharesissued and 85% of the total number of voting rights.
Set out below is certain information concerning
this Scheme, Common Shares and Class B Shares.
i) Outline of the shares
Common shares
Dividends of surplus anddistribution of residual assets
The number of sharesconstituting one unit
Article of incorporation topreclude a resolution of theCommon Shareholders' Class
Shareholders’ Meeting
Shares with put option
Shares subject to call
Share split or consolidation
Listing

Class B Shares

Receive the same amount of dividends ofsurplus per share in the same rank
100 Shares
10 Shares(1 voting rights per (1 voting rights per 10
100 shares)
shares)
Yes

None

Yes
(1 Class B Share for 1
Common Share)
Yes
None(1 Class B Share for 1
Common Share)
Executed into the same numbers ofshares simultaneously
ListedUnlisted
Noneii)Difference between the share units of the two share
types
While shareholders of both Common Shares andClass B Shares receive the same amount of dividends
and distribution of residual assets at the samepriority level, they differ in the number of shares that
constitute one share unit. One hundred (100) Common
Shares constitute one share unit whereas ten (10)Class B Shares constitute one share unit. As such, ashareholder of Class B Shares has 10 times as many
voting rights as a shareholder of Common Shares
when they have the equal number of shares.
As of the consolidated financial year ended March
31, 2020, there was total numbers of 137,445,809
Common Shares and 77,700,000 Class B Sharesissued. Yoshiyuki Sankai, the President and CEOof the Company, holds 3,042,000 Common Sharesand 77,696,000 Class B Shares, which represents
approximately 38% of all issued and outstanding
shares of the Company and holds 85% of the total
number of voting rights, making him capable ofdetermining matters for resolution in the General
Meeting of Shareholders such as the selection of
directors or reorganization by acting on his own.
iii)Scheme to prevent changes of shareholders of ClassB SharesClass B Shares are issued to prevent the Group’s
technology from being turned to technology to harm
people or to weaponarys. In order to prevent Class B
Shares from being transferred to people or entities
other than the shareholders of Class B Shares, asof the submission date of the Company’s Annual
Securities Report released on June 26, 2020, theArticles of Incorporation of the Company states thata)The approval of the Board of Directors is necessary
upon the transfer of the Class B Shares to any
person who does not own Class B Sharesb)The Company shall acquire all Class B Shares inexchanged of one Common Share per Class B Shareupon a request for approval of share transfer byshareholder other than shareholder of Class B
Share, which is a request for approval as set downin Article 136 and 137 of the Companies Act or after
90 days from the date where a shareholder of theClass B Shares dies (excluding Class B shares thatwas transfered or inherited to other holders of ClassB Shares within 90 days from the date where ashareholder of the Class B Shares dies).
As of the submission date of the Company’s Annual
Securities Report, June 25, 2021, 77,696,000 ClassB Shares are held by Yoshiyuki Sankai and 4,000
Class B Shares are held by the Foundations. In
order to preserve the continuity of this Scheme,
Yoshiyuki Sankai plans to transfer part of the Class B
Shares held to the Foundations at no cost in case of
aforementioned event. Furthermore, the Foundations
plans to hold the Class B Shares for the foreseeable
future.

established the following guidelines on the executionof their voting rights, to prevent the Group’s
technologies from being turned into something thatwould damage the Group’s corporate value such as
weapons.
The Foundation is required to obtain the approval
from its board meetings and disclose the changes
through predetermined format in case of changing
the guideline. In the General Meeting of Shareholders
and General Meeting of Class Shareholders, theFoundation will vote against cases stated below.
a)A resolutions to dismiss or appoint directors that
may lead to the misuse of the Group’s innovativetechnology and to damaging the Group’s corporate
valueb)All other resolutions that with risk of turning theGroup’s technologies to harm people or damaging
the Group’s corporate valueiv)Breakthrough provision
If the shares held by one acquirer is over threequarters of the total number of issued shares(excluding the treasury stock) as a result of atakeover bid, all Class B Shares will be converted toCommon Shares.
v)Sunset provision
As stated in iii) above, Yoshiyuki Sankai plans totransfer portions of Class B Shares he holds to theFoundations at no cost in order to preserve thecontinuity of this Scheme. This Scheme is planned
to be continued after Yoshiyuki Sankai resigns hisrole as a director of CYBERDYNE, or after his death.
However, the Group recognizes a possibility wherethe voting by the Foundations after Yoshiyuki Sankai’s
resignation from the post of director (excluding cases
where he is reappointed or resumes to the post
simultaneously or immediately after resignation) does
not match the intention of the Company shareholders(including holders of the Common Shares), an
intention verification procedure of shareholders will
be conducted by the conclusion of the last General
Meeting of the Shareholders held in the fiscal year
ending within one year of the date of Yoshiyuki Sankai’s
resignation or within three months after the end of thelast fiscal year that ends within five years time since
the most recent intention verification procedure ofshareholders. More specifically, if the shareholders
of Common Shares and Class B Shares who holdone third of the total voting right (calculated using 100
Class B Shares for each share unit) participate in theintention verification procedure and two thirds (2/3) of
those who participated agree, all Class B Shares will
be converted to Common Shares of the Company.

As a shareholder of Class B Shares, the Foundations

Annual Report 2021

50vi)Elimination of the Meeting of Class Shareholders comprised of shareholders of Common Shares
The Company’s Articles of Incorporation states that, theexecution of actions stated in each item of Article 322-1
of the Companies Act does not require the resolutionof the Meeting of Class Shareholders comprisedof shareholders of common shares, unless statedotherwise by law or by the Articles of Incorporation.
However, to ensure that the elimination of the
Meeting of Class Shareholders does not unfairly
damage the shareholders of Common Shares, out of
the actions stated in each item of Article 322-1 of theCompanies Act the Group will,a)Both common share and Class B Share shall becalculated at the same timing and same ratio upon
reverse share splits, share splits, free allocation ofshares, free allocation of stock acquisition rights,
allocation of shares as well as stock acquisition rights
to shareholders, share transfers (excluding cases
where the share transfer is conducted together withother companies) and changes to the calculation of theshare units.
b)in case of a merger agreement where the Company
will be absorbed, or a share exchange agreement
or share transfer plan (limited to cases where theshare transfer is conducted together with othercompanies) where the Company will become awholly owned subsidiary, is approved by all Meetingof Shareholders (if an approval by the Meeting of
Shareholders is not required, resolution by the Boardof Directors) of relevant companies, every Class B
Shares shall be converted to Common Shares.
(2)Risks of this Scheme
Class B Shares have been issued for the purposeof preventing the Group’s technology from being
used to harm people or to create military weapons.
However, this Scheme also presents potential risks
stated below. If such risks were to materialize, rights
and interests of the shareholders of the Company’s
Common Shares may be affected.
i)
Strong influence of Class B Shareholders on
business matters
As of the fiscal year ended on March 31, 2021,
Yoshiyuki Sankai holds 3,042,000 Common Sharesand 77,696,000 Class B Shares which accounts
for 38% of the total number of issued shares. Thisequates to 85% of the total number of voting rightsof the Company, giving him strong influence overbusiness matters, while the influence of othershareholders are limited. Especially in cases where
Class B Shareholders exercises their voting rights
to ensure peaceful use of the Group’s technologies,
it may conflict the interest of other shareholders.

ii)Prevention of takeover bids
As Class B Shareholder possess 10 times morevoting rights in comparison to Common Shareholder
with same number of shares. While the Company
sets “breakthrough provision”, the outstanding
Class B Shares will only be converted to Common
Shares if the acquirer comes to possess threequarters (3/4) of the total numbers of issued shares(including Class B) in a take overbid or if two thirds(2/3) of shareholders who took part in the intention
verification procedures agrees to the conversion of
the Class B Shares to Common Shares.Therefore,
the Scheme may prevent acquisitions that may
benefit the shareholders of Common Shares.
iii)Elimination of the Meeting of Class Shareholders
comprised of shareholders of Common Shares
As the Company is capable of executing eachactions stated in Article 322-1 without the resolutionof the Meeting of Class Shareholders comprised ofshareholders of Common Shares (unless statedotherwise in law or Article of Incorporation), thedecisions made by the Company may not reflect theintention of the shareholders of Common Shares.
iv) C onversion of the Class B Shares
Because Class B Shares include the right to request
acquisitions under acquisition terms, there is
the possibility that a future conversion of Class B
Shares to Common Shares will increase the total
number of authorized Common Shares issued on
the market, and the market price of the Common
Shares may be affected.
5. Other risks(1) Dividend policy
The Company has not been able to pay dividends toshareholders since its establishment, and as of June25, 2021 when the Annual Securities Report wasissued the Company does not meet the requirement
stated in the Companies Act to pay dividends. For
the time being, the Company sets its priority onachieving profitability quickly, improving its financial
strength through retaining earnings and reinvestingin research and development activities. On the other
hand the Company recognizes returning profit toshareholders to be an important management issue
and will consider to pay dividends in the future taking
into account its financial condition and businessresults. However, if the Company’s earnings plan
does not proceed as envisaged, and it continues to beunable to achieve steady earnings, the Company may
have difficulty paying the dividends to shareholders.

(2) F inancing and fund procurement
The Group records large amount of cost due toresearch and development of products that are
still in the early stages. This has been leading
to continuos recording of operating losses. The
Group’s funding needs are expected to increasein accordance to its business proceeds, such as
operating capital, investment in research anddevelopment, investment in facilities and potential
M&A, etc. Although the Group plans to continue
strengthening its financial base, depending on how
successful the Group is at securing profits andraising capital, its financial condition and businessperformance may be affected.
(3) Recording negative retained earnings brought
forward
The Group has been putting a lot of focus on researchand development activities, which led to postingof large amount of research and development
expenses and negative retained earnings brought
forward. The Group aims to achieve profitability
quickly and to establish a strong and stable financialbase. However, there is a risk that the Group’sbusiness might not proceed as planned, and that theGroup may be unable to eliminate the recording ofnegative retained earnings brought forward, whichmight affect its business, financial condition, andbusiness performance.
(4) Loss carried forward for tax purposes
Since the Group has been making upfront
investments in development as a corporate researchand development group, the Group has posted aloss carried forward for tax purposes. Should there
be any changes to the Japanese tax systems in
the future to tighten the restrictions on deductionof losses carried forward, the Group might lose
the opportunity to recover part of the capital thatit has invested in research and development, andits business, financial condition, and businessperformance may be affected.
(5) Fluctuations in foreign exchange rates
Since the financial results of the group companies
that are located outside of Japan needs to betranslated into Japanese yen, when the results
are reflected in the Group’s consolidated financial
statements, the Group is exposed to risk from theeffects of fluctuations in foreign exchange rates.
Therefore, if foreign exchange rates were to fluctuate
sharply in the future, the Group’s financial condition
and business performance might be affected.

Annual Report 2021

51

【Status of the Company】
Consolidated management indicators under International Financial Standards (IFRS)

Non-consolidated management indicators

International Financial Standards (IFRS)Fiscal Year
Revenue
Operating profit (loss)
Profit (loss) before tax
Profit (loss) attributable to owner of the parent
Comprehensive profit(loss) attributable toowners of the parent
Equity attributable to owners of the parent
Total assets
Equity attributable toowners of the parent per share

March 2019

March 2020

March 2021

Millions of yen
Millions of yen
Millions of yen
Millions of yen

1,709
(830)
(569)
(632)

1,792
(1,039)
91
(152)

1,875
(700)
408
(59)

Millions of yen(1,480)42(479)

Millions of yen
Millions of yen

44,21745,74644,26847,80843,776
48,119Yen

205.50205.71203.39Basic earnings (loss) per share

Yen(2.94)(0.71)(0.27)

Diluted earnings (loss) per share
Ratio of equity attributable to owners of the parent
Return of equity attributable toowners of the parent
Price-to-earnings ratio
Cash flow from operating activities
Cash flow from investing activities
Cash flow from financing activities

Yen%(2.94)
96.7(0.71)
92.6(0.27)
91.0

Balance of cash and cash equivalents at
the end of the fiscal year
Numbers of employee(Average number of non-regular employees)

Fiscal year
Net sales
Operating profit (loss)
Net profit (loss)
Share capital
Total number of issued shares
Net assets
Total assets
Net assets per share
Dividend per share(Interim dividend per share)
Net profit (loss) per share
Diluted net income per share
Capital ratio
Return on equity
Price-to-earnings ratio
Payout ratio
Numbers of employee(Average number of non-regular employees)

%

—

—

—

Ratio
Millions of yen
Millions of yen
Millions of yen—(775)(1,917)
670

—
(215)
(244)
1,304

—
(775)
(2,794)
617

Millions of yen

8,796

9,636

6,704

Total shareholder return(Comparative index: TSE Mothers Index)

persons

84
(47)

95
(56)

96
(44)

Highest share price
Lowest share priceMarch 2019
Millions of yen
Millions of yen
Millions of yen
Millions of yen

March 2020

March 2021

1,530
1,595
1,663
(734)
(615)
(521)
(1,906)(849)(527)
26,77826,778
10
Common Share Common Share Common Share
137,445,809
137,445,809
137,445,809
Class B Share Class B Share Class B Share
77,700,000
77,700,000
77,700,000
44,02043,16742,70844,74043,89943,295204.52200.56
198.43
—
—
—
(—)
(—)
(—)
(8.86)(3.95)(2.45)
—
—
—
98.4
98.3
98.6
—
—
—
—
—
—
—
—
—
65
78
81
(41)
(47)
(39)
31.8
28.1
29.7
(93.6)(60.7)(117.9)
1,538
753
975
449
320
360

SharesMillions of yen
Millions of yen
Yen
Yen
Yen
Yen
%
%
Ratio
%
Persons
%
%
Yen
Yen

Notes

Notes

1.Revenue does not include consumption tax etc.

1.Net sales does not include consumption tax etc.

2.Consolidated financial statement have been prepared in accordance with International Accounting Standards since the 14th business term.

2.Diluted net income per share is not stated because, while there are diluted shares, CYBERDYNE recorded net loss per share.

3.Price-to-earnings ratio is not stated because CYBERDYNE recorded a loss attributable to owners of the parent

3.Return of equity is net is not stated as CYBERDYNE recorded net loss attributable to owners of the parent.

4.Return of equity attributable to the owners of the parent is not stated because CYBERDYNE recorded a loss attributable to the owners of the parent

4.Price-to-earnings ratio is not stated as CYBERDYNE recorded net loss per share.

5.Rounded down to the closest millions of yen

5.The highest and lowest share prices are based on share price at Tokyo Stock Exchange (Mothers)

Annual Report 2021

52

【Consolidated financial statements】
Consolidated statement of financial position
Previous consolidated fiscal year
(As of March 31, 2020)

Current consolidated fiscal year
(As of March 31, 2021)

Millions of yen

Millions of yen

AssetsCurrent assets
Cash and cash equivalents
Trade and other receivables
Other financial assets
Inventories

9,636
263
19,004

6,704
352
19,007832

808

Other current assets
Total current assets
Non-current assets
Operating lease assets
Property, plant and equipment
Right of use assets
Goodwill
Intangible assets
Investment accounted forusing equity method
Other financial assets
Other non-current assets
Total non-cur rent assets
Total assets

156
29,891

350
27,220481
11,553
361
57
53

475
12,206
337
57
38

472

454

4,872
68
17,91747,8087,271
61
20,898
48,119Liabilities and equity
Liabilities
Current liabilities
Trade and other payables
Bonds and borrowings
Lease liabilities
Other current liabilities
Total current liabilities
Non-current liabilities
Bonds and borrowings
Third-party interests in CEJ Fund
Lease liabilities
Provisions
Deferred tax liabilities
Total non-current liabilities
Total liabilities
EquityShare capital
Capital surplus
Treasury shares
Other components of equity
Retained earnings
Total equity attributable to owners of the parent
Non-controlling interests
Total equity
Total liabilities and equity

Previous consolidated fiscal year
(As of March 31, 2020)
Millions of yen

Current consolidated fiscal year
(As of March 31, 2021)
Millions of yen

247

268

37

31

61
464
810

61
276
635

51
1,714
313
93
568
2,739
3,549

49
2,429
280
93
847
3,697
4,332

26,75326,494(0)(854)(8,124)44,268(9)44,25910
42,861(0)(1,272)
2,177
43,776
10
43,78647,808

48,119Annual Report 2021

53

【Consolidated statement of profit or loss and consolidated statement of comprehensive income】
Consolidated statement of profit or loss

Revenue
Cost of sales
Gross profit
Selling, general and administrative expenses
Research and development expenses
Other selling, general and administrative expenses
Total selling, general and administrative expenses
Other income
Other expenses
Operating profit (loss)
Finance income
Finance costs
Gains related to CEJ Fund
Share of profit (loss) of investments
accounted for using equity method
Profit (loss) before tax
Income tax expense

Previous consolidated fiscal year
(From April 1, 2019 to March 31, 2020)
Millions of yen
1,792
(492)
1,300

Current consolidated fiscal year
(From April 1, 2020 to March 31, 2021)
Millions of yen
1,875
(591)
1,283

(812)
(1,646)(2,459)138(18)(1,039)
1,184
(100)
75

(689)
(1,471)(2,160)
181
(4)
(700)
770
(2)
359

(29)

(18)

91

408

(240)

(479)

Profit (loss)

(149)

(71)

Profit (loss) attributable to
Owners of parent
Non-controlling interests
Profit (loss)

(152)
3
(149)

(59)
(12)
(71)

Earnings (loss) per share
Basic earnings (loss) per share (yen)(0.71)(0.27)

Diluted earnings (loss) per share (yen)(0.71)(0.27)

Consolidated statement of comprehensive income

Profit (loss)
Other comprehensive income
Items that will not be reclassified to
profit or loss
Financial assets measured at fair value through othercomprehensive income
Total of items that will not be reclassified to profit
or loss

Previous consolidated fiscal year
(From April 1, 2019 to March 31, 2020)

Current consolidated fiscal year
(From April 1, 2020 to March 31, 2021)

Millions of yen(149)

Millions of yen
(71)

191

(406)

191

(406)

Items that may be reclassified to profit or loss
Exchange differences on translation of foreign
operation
Total of items that may be reclassified to profit or loss
Total other comprehensive income, net of tax
Comprehensive income

4

(16)

4
195
46

(16)
(422)
(492)

Comprehensive income attributable to
Owners of parent
Non-controlling interests
Comprehensive income

42
4
46

(479)
(14)
(492)

Annual Report 2021

54

Consolidated statement of changes in equity

Share capital

April 1, 2019
Profit (loss)
Other comprehensive income
Total comprehensive income
Acquisition of treasury shares
Share-based payment transaction
Equity transaction with noncontrolling interest
Increase (decrease) by businesscombination
Total transactions with owners
March 31, 2020
Profit (loss)
Other comprehensive income
Total comprehensive income
Capital reduction
Deficit disposition
Acquisition of treasury shares
Share-based payment transactions
Equity transaction with noncontrolling interest
Disposal of subsidiaries
Total transaction with owners
March 31, 2021

Capital surplus

Equity attributable to owners of parent
Other components of equity
Financial assets
Exchangemeasured at fair
Treasury sharesdifferences on
Stock acquisition
value through othertranslation ofrightscomprehensive
foreign operations
incomeMillions of yen
Millions of yen
Millions of yen
Millions of yen(0)(1,071)
3
19
—
—
—
—
—
191
3
—
—
191
3
—
(0)
—
—
—
—
—
—
—

Millions of yen
26,745————
8

Millions of yen
26,494
—
—
—
—
—

—

—

—

—

—

—

—

—

—

—

—

—

8
26,753———(26,751)——
8—
26,494———26,751(10,355)
—
—

(0)
(0)
—
—
—
—
—
(0)
—

—
(880)
—
(406)
(406)
—
—
—
—

—
6
—
(14)
(14)
—
—
—
—

—
19
—
—
—
—
—
—
—

—

(29)

—

—

—

—

—
(26,743)
10—
16,36742,861

—
(0)
(0)

—
—
(1,286)

2
2
(6)

—
—
19

April 1, 2019
Profit (loss)
Other comprehensive income
Total comprehensive income
Acquisition of treasury shares
Share-based payment transaction
Equity transaction with noncontrolling interest
Increase (decrease) by businesscombination
Total transactions with owners
March 31, 2020
Profit (loss)
Other comprehensive income
Total comprehensive income
Capital reduction
Deficit disposition
Acquisition of treasury shares
Share-based payment transactions
Equity transaction with noncontrolling interest
Disposal of subsidiaries
Total transaction with owners
March 31, 2021

Equity attributable to owners of parent
Other componentsof equity
Retained earnings
Total
Total
Millions of yen
Millions of yen
Millions of yen(1,048)(7,972)
44,217
—
(152)
(152)
194
—
194
194
(152)
42
—
—
(0)
—
—
8

Non-controllinginterests

Total equity

Millions of yen
(15)
3
1
4
—
—

Millions of yen
44,203
(149)
195
46
(0)
8

—

—

—

8

8

—

—

—

(6)

(6)

—
(854)
—
(420)
(420)
—
—
—
—

—
(8,124)
(59)
—
(59)
—
10,355——8
44,268
(59)
(420)
(479)
—
—
(0)
8

2
(9)
(12)
(2)
(14)
—
—
—
—

10
44,259
(71)
(422)
(492)
—
—
(0)
8

—

—

(29)

33

4

2
2
(1,272)

5
10,360
2,177

8
(13)
43,776

—
33
10

8
19
43,786

Annual Report 2021

55

Consolidated statement of cash flows
Previous consolidated fiscal year
(From March 31, 2019 to March 31, 2020)

Current consolidated fiscal year
(From March 31, 2020 to March 31, 2021)

Millions of yen

Millions of yen

Profit (loss) before tax

91

408

Depreciation and amortization

492

463

Finance income(1,184)(770)

Cash flows from operating activities

Finance costs

100

2

Losses (gains) on CEJ Fund

(75)

(359)

Share of loss of investments accounted for using
equity method

29

18

Decrease (increase) in inventories

85

24

Decrease (increase) in trade and other receivables

1

(88)

Increase (decrease) in trade and other payables

(45)

45

Other

85

(429)
(686)

Subtotal(420)

Interest and dividends received

318

22

Interest paid

(0)

(1)

Income taxes paid

(2)

(0)

Income taxes refund—

1

Payments for administrative expenses etc. related to
CEJ Fund

(111)

(110)

Net cash provided by (used in) operating activities

(215)

(775)

Cash flows from investing activities
Purchase of investments(29,999)(26,999)

Proceeds of redemption of investments

29,00027,000

Proceeds from withdrawal of time deposits

2,500

—

Purchase of property, plant and equipment(399)(1,070)Purchase of intangible assets

(6)

(5)

Purchase of investment securities(1,715)(1,716)

Proceeds from sale of investment securities

333—

Proceeds from purchase of stock of subsidiaries withchange of scope consolidation

91—

Purchase of investments accounted for using equity
method

(46)

—

Other

(2)

(3)

Net cash provided by (used in) investing activities(244)(2,794)

Cash flows from financing activities
Proceeds from long-term borrowings—

20

Repayments of long-term borrowings

—

(29)

Lease liabilities paid

(53)

(53)

Contributions into CEJ Fund from third-party investors

1,360

680

Other

(3)

(1)

Net cash provided by (used in) financing activities

1,304

617

(5)

20

Net increase (decrease) in cash and cash equivalents

840(2,932)

Cash and cash equivalents at beginning of fiscal year

8,796

9,636

Cash and cash equivalents at end of year

9,636

6,704

Effect of exchange rate changes on cash and cash
equivalents

Annual Report 2021

56

Major shareholders
Number of shares held

Channges in the total number of issued shares and share capital
Date

Changes in the
total number of issued
shares (shares)

April 1 2016 to June 6,2016 *2

Common Share
11,771,609

March 5, 2019 *3

Common Shares
98,200March 4, 2021 *3—

Total outstanding
shares (shares)

Changes in the sharecapital(Millions of yen)

Outstanding
share capital(Millions of yen)

Changes in the capitalsurplus (Millionsof yen)Outstanding capitalsurplus (Millionsof yen)10,232

26,744

10,232

26,680Common Shares
137,347,609
Class B Shares
77,700,000
Common Shares
137,445,809
Class B Shares
77,700,000

As of March 31, 2021

Name of shareholder
Yoshiyuki Sankai
Daiwa House Industries Co., Ltd.

35

26,77835

26,714(26,768)

10—

26,714RBC IST 15 PCT LENDING ACCOUNT-CLIENT ACCOUNTGCAS BANA LONDON US CLIENT

Common Shares
137,445,809
Class B Shares
77,700,000

THE BANK OF NEW YORK, NON-TREATY JASDEC ACCOUNTThe Nomura Trust & Banking Co., Ltd. (Investment Trust Account)

Notes

The Master Trust Bank of Japan. Ltd.

1. B
 etween April 1, 2016 to June 6, 2016, stock acquistion rights included in the Euro Yen Zero Coupon Convertible Bonds Due 2017 were exercized. As such, there wasincrease of 11,771,609 shares in total amount of issued shares. There was also an increase of ¥10,232 million in share capital and capital surplus.

SBI SECURITIES Co., Ltd.

2. T he Company allocated shares with transfer restriction to employees of the Company on March 5, 2019. Due to this event, there was an increase of 98,200 commonshares in the amount of issued shares. There was also an increase of ¥35 million in share capital and capital surplus.

BBH FOR GLOBAL X ROBOTICS AND ARTIFICIAL INTELLIGENCE ETF

3. On 4 March 2021, under Article 447, paragraph 1 of the Companies Act, the capital was reduced by JPY 26,758 million and transferred to other capital surpluses.

Matsui Securities Co., Ltd.
Total

Classification of shareholders
Common Share
Foreign investors

Financial
institution

Financial instrument
service operators

Other
corporations

Number ofshareholder(person)

1

13

42

446

Number ofshareholder(unit)

27

52,74940,429322,720

198,123

2,067

757,981

1,374,096

36,209

Shareholding
ratio (%)

0.00

3.84

2.94

23.49

14.42

0.15

55.16

100

—

Non-individuals

Individual
Investors etc.

Status of shares lessthen one share unit
(share)Government andlocal government

Individuals

Total

30,000,000

13.94

6,749,600

3.13

3,730,647

1.73

2,609,350

1.21

2,200,600

1.02

1.170,400

0.54

1,148,396

0.53

791,635

0.37

690,200

0.32

129,828,828

60.35

Number of voting rights held

As of March 31, 2021

Name of shareholder
189

169

80,404

81,264—

Yoshiyuki Sankai
Daiwa House Industries Co., Ltd.
RBC IST 15 PCT LENDING ACCOUNT-CLIENT ACCOUNTGCAS BANA LONDON US CLIENT

Notes
1. Y oshiyuki Sankai has both Common Share and Class B Share
2. O ut of 8,771 shares in the treasury stock, 87 units were included in “Individual investors etc.“ and 71 shares were included in “status of shares less than one share unit“

THE BANK OF NEW YORK, NON-TREATY JASDEC ACCOUNTThe Nomura Trust & Banking Co., Ltd. (Investment Trust Account)

As of March 31, 2021

Class B Share
Status of shares (10 shares per 1 share unit)
Classification

Shareholding
ratio (%)
37.53

As of March 31, 2021
Status of shares (100 shares per 1 share unit)

Classification

Numbers of share held
(shares)
80,738,000

Foreign investors

Financial
institution

Financial instrument
service operators

Other
corporations

Number ofshareholder(person)

—

—

—

2

—

—

1

3

—

Number ofshareholder(unit)

—

—

—

400

—

—

7,769,600

7,770,000—

Shareholding
ratio (%)

—

—

—

0.01

—

—

99.99

100

—

Non-individuals

Individuals

Individual
Investors etc.

Status of shares lessthen one share unit
(share)Government andlocal government

Total

The Master Trust Bank of Japan. Ltd.
SBI SECURITIES Co., Ltd.
BBH FOR GLOBAL X ROBOTICS AND ARTIFICIAL INTELLIGENCE ETF
Matsui Securities Co., Ltd.
Total

Numbers ofvoting rights held
(units)7,800,020

voting rights
ratio (%)
85.30

300,000

3.28

67,4960.74

37,3060.41

26,0930.29

22,0060.24

11,7040.13

11,483

0.13

7,916

0.09

6,902

0.08

8,290,926

90.67

Annual Report 2021

57

Status of affiliated companies
Name

As of March 31, 2021
Location

Share capital

Ownershipof votingrights (%)

Major business line

(Consolidated subsidiary)(Outside Japan)
CYBERDYNE Care Robotics GMBH

As of March 31, 2021

Number of employees (person)
96 (44)(Notes)State of NRW, GermanyEU€25,000

Functional improvement/regeneration treatment
service with HAL and sales of HAL

100.0(1) The number of employees includes full-time employees and members on temporary transfer assignments. It does not include the number ofMembers of the Board of Directors who also hold positions as Company employees or dispatch workers sent from a temp agencies.
(2) The number of contract employees are stated in the brackets (). This number includes part-time workers but excludes those who work in theState of California, USA

Management and acceleration of the Company’s
US$1,100,000
business in the U.S.

100.0

Suzuka RoboCare Center Co., Ltd.

Mie prefecture, Japan

JPY¥3,000,000 Training service with HAL

100.0

Shonan RoboCare Center Co., Ltd.

Kanagawa prefecture, Japan

JPY¥3,000,000 Training service with HAL

100.0

Oita RoboCare Center Co., Ltd.

Oita prefecture, Japan

JPY¥3,000,000 Training service with HAL

100.0

CEJ Capital, Inc.

Ibaraki prefecture, Japan

JPY¥25,000,000

Cybernic Excellence Japan Fund 1
Investment Limited Partnership**Tokyo prefecture, Japan

JPY¥3,960,000,000

CYBERDYNE USA Inc.

Status of employees
Status of employees in the Group(Within Japan)

Management and operation of Cybernic Excellence
Japan Fund 1 Investment Limited Partnership

60.0

Investment fund-related businesses aimed at creating
the new Cybernics Industry

60.0(60.0)

Group as second jobs.

Status of employees in the Company
Number of employees (person)
81(39)

As of March 31, 2020

Average age (years old)

Average years in service (years)

43.5

Average annual salary (thousands of yen)

6.3

6,072

(Notes)(1) The number of employees includes full-time employees and members on temporary transfer assignments.
(2) The number of contract employees and part-time workers are stated in the brackets ().
(3) Average annual salary includes bonuses and substandard wages.
(4) As the company operates in a single business sector, the number of employees is company-wide.

and two other companies

As of March 31, 2021
Name

Location

Share capital

Major business line

Ownershipof votingrights (%)(affiliated company accounted for byequity method)CYBERDYNE Omni Networks, INC.

Tsukuba city,
Ibaraki prefecture, Japan

Communication business in relation to IoH/IoT and¥160 million Cybernics field, sales of communication device andoffering of related services

49.0

Shisei Datum Ltd.

Machida city,
Tokyo prefecture, Japan¥150 million

Design, development, and manufacture of electronic
blood pressure monitors for medical use

32.0

Notes
1. There are no companies that have submitted securities registration statements or securities reports.
2. Brackets in the ownership of voting rights is the joint ownership percentage and is included in the total.

Annual Report 2021

58