(Translation)
This document is an English translation of the notice for the general meeting of shareholders originally
written in Japanese. This translation was made for reference purpose only and all warranties, and inparticular the accuracy of this translation, are hereby disclaimed.

(Securities Identification Code: 6703)
June 4, 2015

NOTICE OF 91ST ORDINARY GENERAL MEETING OF SHAREHOLDERS
Dear Shareholders,Oki Electric Industry Co., Ltd. (the “Company”) would hereby like to inform you that the 91ST
ordinary general meeting of shareholders will be held as follows. We would be grateful if you
could attend the meeting.
Those who will not be able to attend the meeting are kindly requested to review “4. Exercise of
Voting Rights” on page 2 and exercise their voting rights no later than 5:15 p.m., June 23(Tuesday), 2015 (JST).
Yours faithfully,
Hideichi Kawasaki,
President, Representative Director
Oki Electric Industry Co., Ltd.
1-7-12 Toranomon, Minato-ku, Tokyo-1-

(Translation)

1.
Date and Time:
Wednesday, June 24, 2015, from 10:00 a.m.
2.
Location:
Nikkei Hall, 3F Nikkei Building, 1-3-7 Otemachi, Chiyoda-ku, Tokyo
3. Meeting Agenda
Items to be reported:
1. Business Report, Consolidated Financial Statements and audit results of theConsolidated Financial Statements by the Accounting Auditor and the Audit &Supervisory Board for the 91st fiscal year (from April 1, 2014 to March 31,
2015)
2. Non-consolidated Financial Statements for the 91st fiscal year (from April 1,2014 to March 31, 2015)
Items to be resolved:
Agenda 1:
Agenda 2:
Agenda 3:
Agenda 4:
4.

Appropriation of Surplus
Partial Amendment of the Articles of Incorporation
Election of Three (3) Directors
Election of One (1) Audit & Supervisory Board Member

Exercise of Voting Rights(1) Attendance at the meeting in person
Please submit the enclosed ballot at the reception desk of the meeting.
(2) Exercise of voting rights via postal mailPlease indicate your approval or disapproval for each of the proposals in the spaceprovided on the ballot and return the ballot to the Company.
(3) Exercise of voting rights via electronic means (Internet)
Please read the appended “Instructions for the Exercise of Voting Rights via the Internet,”
and indicate your approval or disapproval online via the designated website at
http://www.it-soukai.com/. There is no need to mail the ballot if you choose to vote via
Internet.

* The Company has provided the Notice of 91st Ordinary General Meeting of Shareholders on its Internet
website (http://www.oki.com/). Any amendment to the Company’s Reference Documents for the
General Meeting of Shareholders, the Business Report, and the Consolidated and Non-consolidated
Financial Statements will be announced on the website.

-2-

(Translation)(Attachment)

Business Report(From April 1, 2014 to March 31, 2015)
1.

Status of the OKI Group(1) Operating progress and results
Looking at the global economy during fiscal 2014, economic recovery continued in
the U.S., including increases in private consumption and capital expenditure, and theeconomies of Europe and emerging countries headed towards a gradual recovery. The
Japanese economy remained on a recovery path, with improvement in the employment
conditions and corporate earnings.
Under this business environment, OKI Group reported net sales of ¥540.2 billion, a¥57.1 billion or 11.8% increase year-on-year, due to strong performances in each businesssegment, including Info-telecom systems business. Operating income was ¥32.4 billion, a¥5.2 billion increase year-on-year, thanks to increase in sales volume in Info-telecom
systems business and Printer business’ product mix improvement.
Ordinary income was ¥37.9 billion, a ¥1.2 billion increase year-on-year as increase ofoperating income offset a decrease in currency exchange gain. Net income was ¥33.1
billion, a ¥5.7 billion increase year-on-year as the expense of business structural reform
accrued in the last fiscal year was cleared.
Looking at non-consolidated business performance, net sales were ¥258.3 billion, up¥19.5 billion (8.2%) from the previous fiscal year. This was due to the increase in net
sales of the Info-telecom systems business, mainly for telecom systems, social
infrastructure systems and mechatronics systems. Operating income was ¥16.7 billion, an
increase of ¥4.1 billion year-on-year.
Ordinary income increased by ¥10.5 billion year-on-year to ¥23.8 billion, due toincreases in dividend income received and currency exchange gain. Net income grew
¥12.1 billion year-on-year to ¥24.2 billion.
The Company’s top management priorities are to strengthen its financial position andensure retained earnings in order to continually improve the OKI Group’s corporate value,
as well as to increase shareholder returns so that shareholders are encouraged to hold its
shares over the medium- to long-term. The Company will reinforce its financial condition
and management foundations by applying retained earnings to investments in research &development and facilities that are critical to future growth. In addition, the Company will
attach the highest importance to maintaining stable profit distributions to shareholders anddecide dividends after taking business performance into consideration. Based on thispolicy, the Company proposes to pay ¥3 per common stock as a dividend from the surplus(year-end dividend) in the current fiscal year.
Net sales by segment are as provided below.

-3-

(Translation)- Net Sales(Unit: billions of yen)Segment
Info-telecom
systems
Printers

Increase or
decrease

Compared to theprevious year (%)

FY2013 (reference:

FY2014 (the year

previous year)

under review)

303.6

352.5

48.9

16.1

124.8

129.3

4.5

3.6

EMS

37.1

40.3

3.2

8.6

Others

17.6

18.1

0.5

2.8

483.1

540.2

57.1

11.8

Total

Note: Figures less than ¥100 million for each item are rounded to the nearest ¥100 million.
“increase or decrease” are calculated on the basis of figures in units of ¥100 million.

The amounts of

The following provides a summary of each segment.
Info-telecom systems
Net sales to external customers were ¥352.5 billion, up ¥48.9 billion (16.1%) from theprevious fiscal year. In the solution & services business, sales of systems for government
agencies and corporate customers increased steadily on the whole, although sales offinancial systems declined. Sales of telecom systems increased because sales of existing
networks for telecom carriers grew due to frontloading of demand, and sales grew steadily
for home networks and GE-PON. Sales of social infrastructure systems also increased
because of frontloading of demand for digital wireless communication systems for
firefighting and strong sales of transportation-related projects. Sales of mechatronics
systems rose significantly due to favorable sales of overseas-bound ATMs centered on
China, and the effects of consolidation of the subsidiary in Brazil and increased sales ofcash-handling equipment in Japan.
Operating income increased by ¥2.5 billion to ¥25.9 billion because favorable resultsin each business absorbed the effects of consolidation of the subsidiary in Brazil.
Printers
Net sales to external customers were ¥129.3 billion, up ¥4.5 billion (3.6%) from theprevious fiscal year. Sales of color LED printers levelled off, although the product mix
improved. Sales of monochrome LED printers increased as a result of winning large-scale
projects. Sales of dot impact printers were almost on a par with the previous year’s level.
Operating income increased by ¥1.6 billion to ¥6.7 billion, due to the improved
product mix and the effects of implementation of structural reforms.
Electronics manufacturing services (EMS) and others
Net sales to external customers were ¥40.3 billion, up ¥3.2 billion (8.6%) from theprevious fiscal year, in EMS business and ¥18.1 billion, up ¥0.5 billion (2.8%) from theprevious fiscal year, in the Others business. Sales of the EMS business increased because
penetration of the OKI brand as a high-end EMS led to steady acquisition of new customers.
Sales of the Others business segment also increased as sales in the component-related-4-

(Translation)business, including reed switches, remained strong.
Operating income of the EMS business increased ¥0.3 billion to ¥2.0 billion and thatof the Others business increased ¥0.7 billion to ¥3.5 billion.
(2) Capital expenditure
Capital expenditures for the fiscal year equaled ¥11.5 billion.
Investment amounts by segment were as follows.
(Unit: billions of yen)Segment

Amount ofcapitalexpenditure

Info-telecom systems

6.1

Printers

3.1

EMS

0.7

Others
Total

Major investments
Investments in R&D, development of new products andproduction activities for financial systems, automationequipment systems, systems related to fire- and disasterprevention and optical access systems, etc.
Investments in R&D, development and production activities
relating to business-use printers
Investments in electronic manufacturing services for medical,
telecommunications and industrial equipment

1.6
11.5

(3) Financing
Funds required for the current term were obtained from our own funds and borrowed
funds.
Borrowing funds are mainly long-term debt principally from major banks.
(4) Future challenges
In November 2013, the OKI Group announced the Medium-term Business Plan 2016,
and established it as its vision to become a high-value added creation group, which
contributes to the realization of safe and comfortable society. Its management policy is tomake continuous investments by ensuring stable profits, thus achieving sustainable growth,with the management objectives for FY2016, the final year of the Medium-term Business
Plan, of net sales of ¥560.0 billion, operating income of ¥34.0 billion, operating profit
margin of 6%, shareholders’ equity ratio of at least 30%, debt equity ratio of 1.0 or less, andoverseas sales ratio of 40%.
To ensure stable profits, the Group will respond to demand for renewing financial,social, and telecom systems, and continue to seize opportunities in China’s ATM market aswell. In addition, it will generate stable profits through structural reforms of the Printerbusiness, following on from those in fiscal year 2013, and by making each business more
efficient.
To achieve sustainable growth, the Group will carry out various measures in the
future under three main pillars: “expanding business in global markets,” “supporting
customers’ “asset-free” management” and “entering the field of next-generation social
infrastructure.” It aims to tap new ATM markets including Brazil, to expand products withthe rollout of cash handling equipment and maintenance services, and promote the global
development of high-value added printers for the copier and professional services market.
Besides, it will support customers’ “asset-free” management, such as by strengthening-5-

(Translation)
cloud services, Life Cycle Management (LCM) services, etc. Furthermore, by leveraging
its strengths in sensing and network technology, it will focus on disaster prevention,
disaster mitigation, and measures for aging social infrastructure, etc. to make inroads into
the field of next-generation social infrastructure. It will also carry out a production/design
revolution and reduce procurement costs, shrink working capital, strengthen research &development, and enhance human resources, such as by shifting human resources to growthfields, recruiting global human resources, and encouraging women to play active roles, inorder to achieve the objectives above in FY2016.

-6-

(Translation)(5) Trends in assets and profit/loss
Trends in assets and profit/loss for the fiscal year under review and the past three
years are as follows.

Sales

428.1

billion yen

455.8

billion yen

483.1

billion yen

91st year(the year underreview, FY2014)
540.2
billion yen

Net income

8,000

million yen

13,599million yen

27,359million yen

33,091

Net income per share

9.14

yen

17.24

yen

36.21

yen

40.03

yen

Total assets

374.8

billion yen

349.3

billion yen

412.5

billion yen

439.4

billion yen

Net assets

67.5

billion yen

56.6

billion yen

91.9

billion yen

121.4

billion yen

Net assets per share

49.36

yen

34.40

yen

79.32

yen

137.74yen

88th year(FY2011)89th year(FY2012)90th year(FY2013)

million yen

Notes:
1. Net income per share is computed based on the average number of shares of common stock during the year
(weighted average). Net assets per share are computed based on the number of shares of common stock
outstanding at the year-end. These figures exclude treasury stocks.
2. Business performances after amendments were made to past financial results based on the Financial
Instrument and Exchange Act are as follows.

Sales

88th year(FY2011)423.5
billion yen

Net income

1,555

Net income per share

0.32

yen

Total assets

368.1

billion yen

Net assets

41.3

billion yen

Net assets per share

13.42

yen

million yen-7-(Translation)(6) Status of major subsidiaries(i) Status of major subsidiaries

Oki Data Corporation

29,000 million yen

Company’s
voting rightratio (%)
100

Oki Customer Adtech Co., Ltd.

1,800 million yen

100

OKI Software Co., Ltd.

400 million yen

100

Oki Wintech Co., Ltd.

2,001 million yen

100

Oki Data Americas, Inc.
Oki Data Manufacturing(Thailand) Co., Ltd.
Oki Europe Ltd.
OKI Brasil Indústria e Comércio
de Produtos e Tecnologia em
Automação S.A.
Oki Electric Industry(Shenzhen) Co., Ltd.
OKI Banking Systems(Shenzhen) Co., Ltd.

10 million U.S. dollars

100*

Manufacturing and sales of printers
Maintenance, construction andsales of information processing
equipment and telecommunications
equipment
Development and operation of
telecommunications system
softwareDesign and construction ofelectronic works and electronic
telecommunications works
Sales of printers

Name

CapitalMajor business

420 million baht

100*

Manufacturing of printers

33 million pound sterling

100*

251 million real

70

66 million Renminbi

100*

33 million Renminbi

100

Sales of printers
Design, development, manufacture,and sales and maintenance ofautomation equipment
Manufacturing of information
processing equipment and printers
Sales of information processing
equipment

Note: Figures marked with an asterisk (*) indicate the ratio of voting rights held by subsidiaries of the Company.

(ii)
-

-

Major partners
Major technical partners:
International Business Machines Corporation (US)Canon Inc.
Major business partners:
Hewlett-Packard Company (US)Cisco Systems G.K.

(7) Major businesses
The OKI Group offers as its core businesses info-telecom systems/equipment, andprinters as well as related solutions, services and EMS.
Major business items include the following.
Segment

Info-telecom systems

Printers
EMS

Business items
Financial systems, automation equipment systems (ATM, cash handling equipment,
ticket reservations and issuing terminals, etc.), systems for government agencies(aviation, transportation, disaster prevention, firefighting, various info-telecom
systems, etc.), telecom carrier systems (switching, transmission, optical access, etc.),
IP telecommunication systems (PBX, call center, videoconferencing, etc.), various
information systems (travel, logistics, manufacturing, etc.), and IT services for thesaid business items (cloud computing service, system integration, support,
maintenance, etc.), etc.
Color LED printers, monochrome LED printers, dot impact printers, multi-purpose
printers, etc.
Designing & manufacturing services, printed circuit boards, etc.

-8-

(Translation)(8) Major offices
Our major offices are as follows.
Name

Classification
Head office

Head office
Head office
Head office
Head office
Head office

Location
Minato-ku, Tokyo
Hokkaido region (Sapporo, Hokkaido), Tohoku
region (Sendai, Miyagi), Chubu region (Nagoya,
Aichi), Kansai region (Osaka, Osaka),
Chugoku region (Hiroshima, Hiroshima), Shikoku
region (Takamatsu, Kagawa), and Kyushu region(Fukuoka, Fukuoka)
Minato-ku (Tokyo), Warabi (Saitama), Honjo(Saitama), Takasaki (Gunma), Tomioka (Gunma)and Numazu (Shizuoka)
Warabi (Saitama), Osaka (Osaka) and Takasaki(Gunma)Minato-ku, Tokyo
Koto-ku, Tokyo
Warabi, Saitama
Shinagawa-ku, Tokyo
New Jersey, U.S.A.

Head office

Ayutthaya, Thailand

Head office

Surrey, UK

Head office

Sao Paulo, Brazil

Head office

Guangdong, China

Head office

Guangdong, China

Branch offices
Oki Electric Industry Co., Ltd.
Business offices
Research institutes
Oki Data Corporation
Oki Customer Adtech Co., Ltd.
OKI Software Co., Ltd.
Oki Wintech Co., Ltd.
Oki Data Americas, Inc.
Oki Data Manufacturing(Thailand) Co., Ltd.
Oki Europe Ltd.
OKI Brasil Indústria e Comércio
de Produtos e Tecnologia em
Automação S.A.
Oki Electric Industry (Shenzhen)Co., Ltd.
OKI Banking System (Shenzhen)Co., Ltd.

-9-

(Translation)(9) Employees(i) Employees of the OKI Group
Segment

Number of employees

Info-telecom systems

12,405

Printers

4,963

EMS

1,284

Others1,632Company-wide (shared)

369

Total

(ii)

20,653

Employees of Oki Electric Industry
Number of employees

Average age

3,881 (increased by 93 from the end of the previous year)

43.0

Average years ofservice20.5(10) Major creditors
Major creditors of the OKI Group are as follows:
Creditor

Loan balanceBillion yen

Mizuho Bank, Ltd.
Sumitomo Mitsui Banking Corporation
Mizuho Trust & Banking Co., Ltd.
The Norinchukin Bank
Aozora Bank, Ltd.

28.8
18.2
6.0
3.7
3.4

(11) Other significant events of the OKI GroupOn November 18, 2014, the Company underwent an on-site inspection by the Japan
Fair Trade Commission on suspicion of violating the Antimonopoly Act with respect to“products or services related to digitization of wireless communication systems for
firefighting and emergency use.” The Company will give its full cooperation in theinspection by the Commission.

- 10 -

(Translation)
2.

Shareholders’ Equity(1)

Number of shares authorized to be issued by the Company:
2,400,000 thousand shares

(2)

(3)

Total number of classified shares authorized to be issued
Common Stock:
2,400,000 thousand sharesClass A Preferred Stock:
30,000 shares
Number of outstanding shares:
Common Stock:872,176 thousand shares(including 3,432 thousand shares of treasury stock)
Class A Preferred Stock:0 shares
Number of shareholders:Common Stock:
84,926Class A Preferred Stock:0

Notes:
1. The number of outstanding shares of common stock increased by 140,738 thousand shares from the end of
the previous fiscal year due to factors such as conversion of all the shares of Class A Preferred Stock intoshares of Common Stock.
2. Shares of Class A Preferred Stock were acquired by the Company as treasury stock upon request forpurchase from their holders, all of which were retired on March 27, 2015. As a result, there are no
outstanding shares of Class A Preferred Stock as of the end of the current fiscal year.

(4)

Major shareholders (Top 10)
Number ofshares held
(thousand shares)

Name of shareholder

Percentage ofshares held(%)

Japan Trustee Services Bank, Ltd. (trust account)

28,383

3.27

The Master Trust Bank of Japan, Ltd. (trust account)

27,002

3.11

MSCO CUSTOMER SECURITIES

24,7992.85

CHASE MANHATTAN BANK GTS CLIENTSACCOUNT ESCROW

22,011

2.53

Oki Denki Group Employees’ Shareholdings Committee

17,303

1.99

MSIP CLIENT SECURITIES

16,689

1.92

NTT DATA Corporation

14,634

1.68

Mizuho Bank LTD.

14,196

1.63

Hulic Co., Ltd.

14,076

1.62

Meiji Yasuda Life Insurance Company

14,000

1.61

Note:

The percentages of shares held are calculated after deducting treasury stock (3,432 thousand shares).

- 11 -

(Translation)
3.

Equity Warrants(1) Equity warrants granted to the Company’s officers as consideration for theirperformance of duties(i) Number of equity warrants
117(ii) Type and number of shares subject to equity warrants
117,000 shares of the Company’s common stock (1,000 shares per equity warrant)(iii) Status of equity warrants held by the Company’s officers
Directors(excluding outside Directors)
Issued Number

No. 4 equity warrant (406 yen)
(Issued on July 20, 2005)
No. 5 equity warrant (277 yen)
(Issued on July 28, 2006)
No. 6 equity warrant (277 yen)
(Issued on July 28, 2006)
No. 7 equity warrant (248 yen)
(Issued on July 27, 2007)
No. 8 equity warrant (248 yen)
(Issued on July 27, 2007)

Exercise period

Number ofequitywarrants

Number ofholders

July 1, 2007 to June 28, 2015

34

2

July 1, 2008 to June 28, 2016

26

2

July 1, 2008 to June 28, 2016--

July 1, 2009 to June 25, 201757

2

July 1, 2009 to June 25, 2017--(2) Equity warrants issued to employees in consideration of performance during the fiscal
year under review
The Company did not issue equity warrants in the fiscal year under review.

- 12 -

(Translation)
4.

Corporate Officers(1) Names, etc. of Directors and Audit & Supervisory Board Members
Note
1
X

X

Position
President,
Representative
Director
Senior Executive Vice
President andMember of the Board,
Representative
Director

Name

Status or main duties

Hideichi Kawasaki

Supervision
Chief Compliance Officer
In charge of, IT Solution & Services Business Division,
Secretarial Office, Corporate Planning Division, Group
Administration Division and General Affairs Division

Naoki SatoX

Executive Vice
President andMember of the Board

Hisao Suzuki

X

Executive Vice
President andMember of the Board

Takao Hiramoto

X

Senior Vice President
and Member of theBoard

Toshinao Takeuchi

X

Senior Vice President
and Member of the
Board

Shinya Kamagami

Chief Financial Officer
In charge of Enterprise Systems Marketing & Sales
Division, Partner Business Marketing & Sales Division,
Accounting & Control Division, Public Relations
Division and Audit Office
In charge of Printer Business Division
President, Oki Data Corporation
Chief Information Officer
In charge of Public Systems Business Division,
Marketing & Sales Division, Financial Systems
Marketing & Sales Division, Government & Public
Systems Marketing & Sales Division and Next Social
Infrastructure Business Planning Taskforce
Chief Technology Officer
In charge of Systems Hardware Business Division,
Human Resources Division and Engineering Support
CenterDirector
Takuma Ishiyama
Standing Audit & Supervisory
Shuichi Kawano
Board Member
Standing Audit & Supervisory
Tsutomu Tai
Board Member
Audit & Supervisory Board Kuninori
MemberHamaguchi
Audit & Supervisory Board
Kaoru Yoshida
MemberNotes:
1. X indicates executive officer.
2. Director Takuma Ishiyama is an Outside Director.
3. Audit & Supervisory Board Members Kuninori Hamaguchi and Kaoru Yoshida are Outside Audit &Supervisory Board Members.
4. Director Takuma Ishiyama, Audit & Supervisory Board Members Kuninori Hamaguchi and Kaoru Yoshidaare independent officers based on the terms of the Tokyo Stock Exchange.
5. Audit & Supervisory Board Member Tsutomu Tai has many years of experience working in the Company’s
accounting divisions, and has extensive knowledge of finance and accounting.
6. Executive officers as of March 31, 2015 are as follows (excluding those who concurrently serve as
Directors).

- 13 -

(Translation)

Position

Name

Senior Vice President

Hidetoshi Saigo

Senior Vice President

Kouichirou Shimizu

Executive Officer
Executive Officer

Toshiya Hatakeyama
Kenichi Tamura

Executive Officer

Yoshiyuki Nakano

Executive Officer

Seiji Mouri

Executive Officer

Makoto Nagaiwa

Executive Officer
Executive Officer
Executive Officer
Executive Officer

Shinya Andou
Toru Hatano
Shinya Takahashi
Tetsuya Izaki

Principal duty
In charge of Telecom Systems Business Division, Carriers
Systems Marketing & Sales Division, Government &External Relations Division and Corporate Research &Development CenterIn charge of Electronics Manufacturing Services Business
Division and Procurement Center
Manager, Accounting & Control Division
Assistant Manager, Telecom Systems Business Division
President and Representative Director, OKI Brasil
Indústria e Comércio de Produtos e Tecnologia em
Automação S.A.
Manager, Systems Hardware Business Division
Manager, Government & Public Systems Marketing &Sales Division
In charge of Overseas Marketing & Sales Division
Manager, IT Solution & Services Business Division
Manager, Corporate Planning Division
In charge of Information Planning Division(2) Compensation paid to Directors and Audit & Supervisory Board Members
Title
Number of persons
Amount of payment
Directors
7¥279 million
Audit & Supervisory Board
4¥60 million
Members
Total
11¥339 million
Note: The amounts of compensation approved by the 82nd Ordinary General Meeting of Shareholders held on
June 29, 2006 are within ¥600 million per year for Directors and ¥100 million per year for Audit &Supervisory Board Members. The amount of compensation for Directors excludes employee wages for
Directors who are also employees.

- 14 -

(Translation)(3) Outside Directors and Audit & Supervisory Board Members(i) Major activities in the fiscal year under review(a) Attendance at meetings of the Board of Directors and the Audit & Supervisory
Board
Board of Directors meeting(number of meetings in parenthesis)
Attendance
Attendance ratefrequency
Takuma Ishiyama,
Director
Kuninori
Hamaguchi,
Audit & Supervisory
Board Member
Kaoru Yoshida,
Audit & Supervisory
Board Member

Audit & Supervisory Board meeting(number of meetings in parenthesis)
Attendance
Attendance ratefrequency

9 (11)

81.8%

-

-

11 (11)100%

16 (16)100%

11 (11)100%

16 (16)100%(b) Major activities
a. Takuma Ishiyama, Director
Making objective statements mainly as a specialist in corporate law, heprovided advice and made proposals for the appropriateness and propernessof decision making by the Board of Directors. He also served as an advisor
to the Risk Management Committee and contributes to strengthening
compliance by providing a good example to managerial personnel through hisleadership.
b. Kuninori Hamaguchi, Audit & Supervisory Board Member
With regard to deliberations of the Board of Directors, he determined thecorrectness of Directors’ managerial decisions. Using his many years ofextensive experience and knowledge as a director at other companies, hemade efforts to formulate the Company’s appropriate audit opinions bymaking proper statements and carrying out, when necessary, adequate
activities concerning performances of the Audit & Supervisory Board.
c. Kaoru Yoshida, Audit & Supervisory Board Member
With regard to deliberations of the Board of Directors, he determined thecorrectness of Directors’ managerial decisions. Using his many years ofextensive experience and knowledge as a director at other companies, hemade efforts to formulate the Company’s appropriate audit opinions bymaking proper statements and carrying out, when necessary, adequate
activities concerning performances of the Audit & Supervisory Board.
(ii) Outline of Liability Limitation Agreements
The Company concluded agreements to limit liabilities with outside officers(Director Takuma Ishiyama, and Audit & Supervisory Board Members Kuninori
Hamaguchi and Kaoru Yoshida) under the provisions of Article 427 of the Companies
Act. The outline of the agreements is as follows:- In cases where outside officers are liable for any damages arising from their- 15 -

(Translation)
negligence to the Company, they shall compensate for such damages only to theextent of the minimum liabilities as stipulated in Article 427, Paragraph 1 of theCompanies Act.
- The above limitation of liability shall be applied only when the relevant outside
officers have executed their duties that caused the liabilities in good faith and withoutgross negligence.
(iii) Total amount of compensation, etc.
¥24 million (for the three individuals)- 16 -

(Translation)
5.

Status of Accounting Auditor(1) Name: Ernst & Young ShinNihon LLC(2) Compensation, etc.
Amount of payment
1. Compensation, to be paid to the accounting auditor for the fiscal year under review
138 million yen
2. Total sum of cash and profits on other assets that the Company and its subsidiaries
217 million yen
should pay to the accounting auditor
Notes:
1. The Company does not distinguish between auditor compensation regarding (i) auditing in accordance with
the Companies Act, and (ii) auditing in accordance with the Financial Instruments and Exchange Act. The
total of these amounts is recorded above.
2. Among major subsidiaries, Oki Data Americas, Inc., Oki Data Manufacturing (Thailand) Co., Ltd., Oki
Europe Ltd., OKI Brasil Indústria e Comércio de Produtos e Tecnologia em Automação S.A., Oki ElectricIndustry (Shenzhen) Co., Ltd. and OKI Banking Systems (Shenzhen) Co., Ltd. have undergone statutory
audits by accounting auditors other than the accounting auditor of the Company.

(3) Content of non-auditing services
The Company has also hired the accounting auditor for “advisory services on thetransition, etc. to International Financial Reporting Standards,” which is a service other than
the audits specified in Article 2, Paragraph 1 of the Certified Public Accountants Act, andpays the auditor compensation for that service.
(4) Policy regarding decision to dismiss or not reappoint the accounting auditor
The Audit & Supervisory Board, in principle, will determine the detail of the proposal
to be submitted to the general meeting of shareholders regarding dismissal or nonreappointment of the accounting auditor if it is deemed unlikely that the accounting auditor
will be able to perform audits properly. In addition, if the accounting auditor falls underprovisions of the items in Paragraph 1, Article 340 of the Companies Act, the Audit &Supervisory Board will dismiss the accounting auditor upon the consent of all the Audit &Supervisory Board Members.

- 17 -

(Translation)
6.

Policies and procedures of the Company(1) Procedures to ensure that Directors and employees comply with applicable laws,
regulations and the Articles of Incorporation in conducting their business(i) As the foundation for ensuring compliance, the Company has established the “OKIGroup Charter of Corporate Conduct” and “OKI Group Code of Conduct.” In
addition, officers take the initiative in compliance activities in conformance with the“Compliance Commitment.”(ii) The Company has established a Compliance Committee chaired by the Chief
Compliance Officer to decide on and examine basic policies regarding complianceprograms.
(iii) In accordance with the basic policies formulated by the Compliance Committee, thedivision responsible for compliance plans, draws up, and promotes specific measures
such as education and training for Directors and employees. In education andtraining, we aim to raise employee awareness about compliance by utilizing means
such as e-learning.
(iv) The Company establishes whistle-blowing regulations which ensure reporting to
Outside Directors and Audit & Supervisory Board Members and provides a contact
point for reporting and consultation, aiming to detect any misconduct at its earliest
stages.
(v) The Company stands firmly against antisocial groups that threaten the order andsafety of civil society in cooperation with the police and related organizations, andrefuses to have any relationship with them as a whole.
(2) Procedures to retain and manage information relating to Directors’ conduct ofbusiness
The Company retains and stores information relating to the conduct of business byDirectors as appropriate in accordance with applicable laws, regulations and internal rules.
(3) Rules concerning risk management and other procedures(i) The Company has established a Risk Management Committee and promotes
measures for appropriately grasping risks that may occur in relation to businessactivities of the Company and Group companies, and preventing such risks fromemerging.
(ii) Pursuant to risk management rules, each section of the Company manages risks that
may occur in relation to its main duties. At the same time, the Company has
established a supervisory section to deal with risks needing company-wide
management. This section assesses risks, draws up policies for risk countermeasuresand develops appropriate structures based on such policies.
(iii) If any risk occurs, the Company will set up an emergency countermeasure
headquarters to handle the risk.

- 18 -

(Translation)(4) Procedures to secure efficient business performance by Directors(i) The Company holds regular meetings of the Board of Directors once a month todecide important matters and supervise the work of Directors.
(ii) The Company holds meetings of the Board of Executive Officers consisting ofexecutive officers etc. to provide for flexible decision making on fundamental andsignificant matters in managing the business.
(iii) The Company assigns Directors responsibilities and authority pursuant to rules on
division of duties and authorities.
(5) Procedures to secure appropriate Group (Company and subsidiaries) operations(i) To ensure that Group companies run their operations properly, the Company has
established the “OKI Group Charter of Corporate Conduct” which sets out the values
for the entire Group. In addition, the Company has established the “OKI Group
Code of Conduct” as the code of conduct which all officers and employees of Group
companies should comply with, and is striving to make the code known to all of them.
(ii) The division responsible for compliance implements various measures for promoting
compliance common to the Group through each Group company’s compliance officer.
The Division also determines, through regular monitoring, the implementation statusof such measures by each Group company and reports to the Compliance Committee
on the results.
(iii) Group companies establishes whistle-blowing regulations that ensure reporting totheir Outside Directors and Audit & Supervisory Board Members, provides a contact
point for reporting and consultation, and aims to detect any misconduct at its earliest
stages after reporting to the Company.
(iv) The Company, in accordance with Group management rules, determines the status ofeach Group company’s management activities through receiving reports regularly
from Group companies and provides necessary advice and guidance includingorganization designing, rules and regulations, and business plannings.
(v) To secure the reliability of financial reporting, the Company and Group companies
establish an internal control system for financial reporting in accordance with related
laws and regulations, and strive to maintain and improve that system.
(6) Procedures for employees who assist Audit & Supervisory Board Members;
independence of employees from Directors(i) The Company assigns employees as staff to assist Audit & Supervisory Board
Members.
(ii) The Company assigns employees, who are not subject to Directors’ instructions andorders, as staff to assist Audit & Supervisory Board Members, and any change in such
staffing and personnel evaluation requires the prior consent of the Audit &Supervisory Board.

- 19 -

(Translation)(7) Procedures for Directors and employees to report to Audit & Supervisory Board
Members; procedures for Audit & Supervisory Board Members to receive otherreports(i) If Directors discover anything that may cause significant damage to the Company,
they are required to report the matter immediately to the Audit & Supervisory Board
Members pursuant to applicable laws and regulations.
(ii) Standing Audit & Supervisory Board Members attend meetings of the Board of
Directors and meetings of the Board of Executive Officers in order to understandimportant decision-making processes and the status of business operations, as well as
to inspect important documentation.
(iii) Audit & Supervisory Board Members attend the Risk Management Committee asadvisors and receive the necessary reports.
(iv) Audit & Supervisory Board Members receive whistle-blowing reports based onwhistle-blowing regulations, and receive reports biannually on the status of operationof the regulations from relevant divisions.
(v) Audit & Supervisory Board Members receive reports on the status of establishinginternal control systems and their operations from Directors and employees on aregular basis, and may request Directors and employees to report on matters deemednecessary.
(vi) The Company ensures that a person who made a whistle-blowing report to Audit &Supervisory Board Members will not be treated unfavorably on account of making
such report.
(8) Other procedures to secure effective audits by Audit & Supervisory Board Members(i) In conducting inspections on the Company’s operations and assets and performing
other audit duties, Audit & Supervisory Board Members shall conduct audits
efficiently and effectively in close cooperation with the internal audit section.
(ii) Audit & Supervisory Board Members implement efficient audits by closelycooperating with the accounting auditor. To this end, Audit & Supervisory Board
Members hold meetings with the accounting auditor on a regular basis, attend on-site
audits by the accounting auditor, and request reports from the accounting auditor on
the progress of audits when necessary.
(iii) The Company pays all the expenses necessary for the execution of the duties of Audit& Supervisory Board Members.

Note: indication of amounts
Figures in this business report are indicated as follows.
1. Units of ¥1 million: Figures less than one unit are disregarded.
2. Units of ¥100 million: Figures less than one unit are rounded to the nearest unit.

- 20 -

(Translation)

Consolidated Balance Sheet(as of March 31, 2015)(Unit: millions of yen)Account title

AmountAccount title(Assets)

Amount(Liabilities)

Current assets

Current liabilities

Cash and deposits

53,632

Notes and accounts payable

79,053

Notes and accounts receivable

137,895

Short-term borrowings

63,32936,060Finished goods

37,355

Other accrued expenses

Work in process

22,406

Income taxes payable

5,965

Raw materials and supplies

26,293

Other current liabilities

27,171

Total current liabilities

211,580

Deferred tax assets

9,647

Other current assets

14,339Long-term liabilities

Allowance for doubtful receivables(7,940)Long-term debt

Total current assets

293,629

Lease obligations

4,499

Deferred tax liabilities

19,34044,241

Provision for Directors’ retirement benefits
Liability for retirement benefits
Non-current assets

15,084

Total long-term liabilities

106,362

Total liabilities
23,069Machinery, equipment and vehicle

10,64822,817

Other long-term liabilities
Property, plant and equipment
Buildings and structures378

317,943(Net Assets)
Shareholders’ equity

Tools, furniture and fixtures

10,211

Capital stock

44,000Land

12,461

Additional paid-in capital

21,554Retained earnings

41,989Construction in progress

785

Total property, plant and equipment

57,176

Treasury stock, at cost

Intangible assets

10,240Total shareholders’ equity

Investments and other assets(453)
107,090

Accumulated other comprehensive income

Investments in securities

38,432Net unrealized holding gain/loss on othersecurities

8,291

Asset for retirement benefits

30,478Loss on deferred hedges(72)

Other investments and other assets

10,221

Translation adjustments(10,433)

Allowance for doubtful receivables(820)

Retirement benefits liability adjustments

14,750Total investments and other assets

78,311

Total accumulated other comprehensive
income12,536

Total non-current assets

145,728

Total assets

439,358- 21 -

Subscription rights to shares

79

Minority interests in consolidated subsidiaries

1,708

Total net assets

121,414

Total liabilities and net assets

439,358

(Translation)

Consolidated Statement of Operations(From April 1, 2014 to March 31, 2015)(Unit: millions of yen)Account title

AmountNet sales

540,153

Cost of sales

399,647

Gross profit

140,506

Selling, general and administrative expenses

108,090

Operating income

32,415Non-operating income
Interest income

290

Dividend income

767

Share of profit of entities accounted for using equity
method652

Foreign exchange gain, net.

7,035

Other

1,042

9,787

Non-operating expenses
Interest expense

2,357

Commission for syndicate loan

723

Other

1,194

Ordinary income

4,274
37,928Extraordinary profit
Gain on sale of investments in securities

225

225

621

621

Extraordinary loss
Loss on sale and disposition of property, plant andequipment
Income before income taxes and minority interests

37,532

Income taxes

4,179

Income taxes for prior periods

3,546

Income taxes deferred(2,359)5,365

Income before minority interests

32,166

Minority interests in losses of consolidated
subsidiaries(924)

Net income

33,091- 22 -

(Translation)

Consolidated Statement of Changes in Net Assets(Year ended March 31, 2015)(Unit: Millions of yen)
Shareholders’ equity
Capital stock

Additional paid-in
capitalRetained earnings

21,554

18,38244,000

Balance at April 1, 2014
Cumulative effects of changes
in accounting policies

Treasury stock,at costTotal shareholders’equity(432)

83,504(4,522)

Restated balance at April 1,
2014

44,00021,554(4,522)

13,860(432)

78,982

Changes during the term underreviewDividends from surplus(4,962)

Net income

33,091(4,962)33,091(21)

Purchases of treasury stock
Change of scope of
consolidation

(21)

0

0

Net changes in items otherthan shareholders’ equity
during the term underreview
Net changes during the term
under review--

28,129(21)

28,107

Balance at March 31, 2015

44,00021,554

41,989(453)

107,090

Accumulated other comprehensive income

Balance at April 1, 2014

Net unrealized
holding
gain/loss onother securities

Loss / Gainon deferredhedgesTranslation
adjustments

Retirement
benefits
liability
adjustments

4,333

(389)

(10,358)

11,644

Minority
Total
Subscription
interests inaccumulated
rights toconsolidated
othersharessubsidiaries
comprehensive
income
5,230

79

3,104

Cumulative effects fromchanges in accounting
policies
Balance at the beginningof current period afterreflecting changes inaccounting policies

Total
net assets

91,918(4,522)

4,333

(389)

(10,358)

11,644

5,230

79

3,104

87,396

Changes during the term
under review
Dividends from surplus(4,962)

Net income

33,091

Purchases of treasury
stock

(21)

Change of scope of
consolidation0

Net changes in items
other thanshareholders’ equity
during the term underreview

3,958

317

(75)

3,106

7,305

-

(1,395)

5,910

Net changes during theterm under review

3,958

317

(75)

3,106

7,305

-

(1,395)34,018

Balance at March 31,
2015

8,291

(72)

(10,433)

14,75012,53679

1,708

121,414- 23 -

(Translation)

Notes to Consolidated Financial Statements
Principles for Preparing Consolidated Financial Statements and Notes to Changes in Scopeof Consolidation and Scope of Equity Method Application
1.

Scope of consolidation(1) Number of consolidated subsidiaries: 89 companies
Names of major consolidated subsidiaries:
Oki Data Corporation; Oki Customer Adtech Co., Ltd.; Oki Wintech Co., Ltd.;OKI Software Co., Ltd.; Oki Proserve Co., Ltd.; Oki Data Americas, Inc.; Oki
Data Manufacturing (Thailand) Co., Ltd.; Oki Europe Ltd.; Oki ElectricIndustry (Shenzhen) Co., Ltd.; Oki Banking Systems (Shenzhen) Co., Ltd.; andOKI Brasil Indústria e Comércio de Produtos e Tecnologia em Automação S.A.
(2) Names of major non-consolidated subsidiaries:
OKI BR Argentina S.A. and 6 other companies
Reasons for excluding from consolidation:
Total assets, retained earnings, net sales and net income or loss are individually
and wholly immaterial and have no significant influence.
(3) Changes in scope of consolidation:
Oki Sensor Device (Shanghai) Co., Ltd. was included within the scope of
consolidation as it was newly established; OKI Proserve (Thailand) Co., Ltd.
and OKI India Private Limited were included within the scope of consolidation
because of an increase in its relative importance of this subsidiary. The
following four companies are excluded from the scope of consolidation for thereasons given below:- Oki Systems (Hong Kong) Pte. Ltd. (due to its liquidation)- Payment First Corporation (due to its liquidation)- Oki Information Systems Co., Ltd. (due to its liquidation)- OKI ACCESS Technologies Co., Ltd. (due to its liquidation)- 24 -

(Translation)
2.

Application of equity method(1) Number of affiliated companies to which the equity method is applied: 4 companies
Name of major company to which the equity method is applied:Oki Electric Cable Co., Ltd.
(2) Names of major non-consolidated subsidiaries and affiliated companies to which theequity method is not applied:
Non-consolidated subsidiaries:
Oki BR Argentina S.A. and 6 other companies
Affiliated company: TOWN NETWORK SERVICE Corporation
Reason for not applying the equity method:
The companies individually have little influence and have no significance as awhole on net income or loss and retained earnings.

3.

Matters concerning account settlement dates of consolidated subsidiaries
Although the account settlement date of a consolidated subsidiary OKI Brasil
Indústria e Comércio de Produtos e Tecnologia em Automação S.A. is December 31 each year,
which differs from the consolidated account settlement date, financial statements as of thecompany’s settlement date are used. However, necessary adjustments for consolidated
accounting are made to reflect material transactions that occurred between the respective
settlement dates.

4.

Accounting standards(1) Valuation standards and methods for significant assets(i) Negotiable securities
The Company and its domestic consolidated subsidiaries value securities inaccordance with how they are held as indicated below. Overseas consolidated
subsidiaries apply the lower of cost or fair value.
Other negotiable securities:
Marketable securities:
Stated at fair value based on the market price at the end of the
fiscal year
(Any difference between book value and fair value is included in
net assets; sales costs are calculated by the moving averagemethod.)Non-marketable securities:
Stated at cost based on the moving average method(ii) Inventories
The Company and its domestic consolidated subsidiaries evaluate inventories asfollows, and overseas consolidated subsidiaries primarily apply the lower of cost or fairvalue.
Finished goods:
Principally stated at cost based on the moving average method.
(Balance sheet values are measured by the method of devaluing
the book price to reflect declines in profitability.)- 25 -

(Translation)Work in process:Principally stated at cost based on the specific identification
method. (Balance sheet values are measured by the method ofdevaluing the book price to reflect declines in profitability.)
Raw materials and supplies:
Principally stated at cost based on the moving average method.
(Balance sheet values are measured by the method of devaluing
the book price to reflect declines in profitability.)(iii) Derivatives
Stated at fair value(2) Depreciation and amortization(i) Property, plant and equipment (excluding lease assets)
The Company and its domestic consolidated subsidiaries primarily apply the
declining-balance method; overseas consolidated subsidiaries primarily apply thestraight-line method.
(ii) Intangible assets (excluding lease assets)
The Company and its domestic consolidated subsidiaries apply the straight-line
method.
For software sold in the market, amortization is based on the estimated amounts ofsales in the estimated number of years for sales (3 years). For software for internaluse, the straight-line method, based on the estimated durable years (5 years), is used.
Overseas consolidated subsidiaries primarily apply the straight-line method.
(iii) Lease assets
Lease assets relating to finance lease transactions that do not transfer ownershipare depreciated over the lease contract’s lifetime by the straight-line method, assuming
the residual value is zero.
In addition, out of the finance lease transactions that do not transfer ownership,lease transactions whose lease transaction commencement date was on or prior to
March 31, 2008 are accounted for on a basis similar to ordinary rental transactions.
(3) Basis for provision of reserves(i) Allowance for doubtful receivables
To prepare for any losses of accounts receivable and loans, the Company and its
domestic consolidated subsidiaries calculate the amount of potential loss by using thehistorical loss ratio for non-classified loans/receivables and individual assessment forclassified loans/receivables. Overseas consolidated subsidiaries calculate the amountof potential losses by individually assessing the possibility of collection for specificloans/receivables.
(ii) Provision for Directors’ retirement benefits
Some consolidated subsidiaries register the necessary amount at the end of the- 26 -

(Translation)
year in accordance with internal rules to prepare for the payment of Directors’
retirement allowance.
(4) Basis for provision of income and expense
Basis for provision of income relating to contract work and software development
contracts
a. Income from those with certain results in progress before the end of the fiscal year
Percentage-of-completion method (The progress ratio of construction is estimatedby the cost proportion method.)b. Other income
Inspection basis (completed-contract method for some domestic consolidated
subsidiaries)(5) Important hedge accounting methods(i) Method of hedge accounting
Deferred hedging is applied. Allocation treatment is applied for forward
exchange contracts and currency swap contracts eligible for allocation treatment.
Special treatment is applied to interest rate swaps that meet requirements for special
treatment.
(ii) Means of hedging and coverage
Forward exchange contracts and currency swap contracts are used to hedge
fluctuations of exchange rates on credits and debts in foreign currencies. Interest rate
swaps are employed to hedge fluctuations of market interest rates on variable-rate
short-term borrowings and long-term debt.
(iii) Hedging policy
Derivative transactions are used to hedge fluctuations of market rates on credits
and debts.
(iv) Assessment method of the effectiveness of hedges
To determine the effectiveness of hedges, the Company compares the accumulated
total of market fluctuations or cash flow fluctuations for the targets of hedging and thatof the market fluctuations or the cash flow fluctuations for the means of hedging,
during the period from the start of hedging to the assessment. The Company thenmakes a decision based on the changes of the two.
(6) Amortization of goodwill and amortization period
Goodwill is evenly amortized over its useful life (mainly five years).
(7) Other important matters in preparation of consolidated financial statements(i) Method of accounting for retirement benefitsa. Attributing expected retirement benefits to a period
When calculating retirement benefit obligations, the Company applies thebenefit formula basis to attribute expected retirement benefits to the period until
the end of the fiscal year under review.

- 27 -

(Translation)b.

Accounting for actuarial gains and losses, prior service costs, and differences
caused by changes in accounting standards
Differences caused by changes in accounting standards are amortized over 15
years except for consolidated subsidiaries that amortize the difference in the firstyear of application and some overseas consolidated subsidiaries that directlydeduct the difference from retained earnings.
Prior service costs are amortized by the straight-line method over a set
number of years (11 to 13 years) within the average remaining years of service of
employees.
Actuarial gains and losses are amortized by the straight line method over a
set number of years (11 to 13 years) within the average remaining years of serviceof employees at the time of their accrual in each fiscal year. Amortization ofsuch gains and losses is deemed to be effective from the year after the one inwhich they arise.
(ii) Accounting processing of consumption tax
The tax-exclusion method is used for accounting of consumption tax and local
consumption tax.
(iii) Application of consolidated tax payment
The consolidated tax payment is applied.
Changes in Accounting Policies
From the fiscal year under review, the Company has applied the “Accounting Standard
for Retirement Benefits” (ASBJ Statement No. 26, May 17, 2012; the “Retirement Benefits
Accounting Standard”) and the “Guidance on Accounting Standard for Retirement Benefits”(ASBJ Guidance No. 25, March 26, 2015; the “Guidelines for Retirement Benefits”)
concerning the main clause stipulated in Paragraph 35 of the Retirement Benefits AccountingStandard and that of Paragraph 67 of the Guidelines for Retirement Benefits. Accordingly,
the Company has revised its method of calculating retirement benefit obligations and service
costs and changed from the point system or the straight-line method to the benefit formulabasis in attributing expected benefit to periods. Moreover, the Company has changed themethod of determining the discount rate from a rate based on a period that approximates theaverage remaining years of service of the eligible employees to the use of a single weightedaverage discount rate reflecting the expected timing and amount of benefit payments.
In applying the Retirement Benefits Accounting Standard, etc., in accordance with theprovisions for transitional treatment specified in paragraph 37 of the Retirement Benefits
Accounting Standard, the Company recognized the effect of the changes in the calculation
methods of retirement benefit obligations and service costs as an adjustment to retained
earnings at the beginning of the fiscal year under review.
As a result, at the beginning of the fiscal year under review, assets for retirement benefits
decreased by ¥3,939 million, liability for retirement benefits increased by ¥923 million andretained earnings decreased by ¥4,522 million. There were no material effects on operating
income and income before income taxes for the fiscal year ended March 31, 2015.
Meanwhile, net assets per share decreased by ¥4.85.

- 28 -

(Translation)
Notes to Consolidated Balance Sheet
1. Assets pledged as collateral
Buildings and structures
Land
Investments in securities
Total
Liabilities collateralized by the above assets:
Short-term borrowings
Long-term debt
Total
2.

Accumulated depreciation on property, plant and equipment

3.

Liabilities for guarantee
Guarantee for borrowings by employees- 29 -¥310 million¥138 million¥19,148 million¥19,597 million¥3,595 million¥263 million¥3,859 million¥153,785 million¥384 million

(Translation)
Notes to Consolidated Statement of Changes in Net Assets
1. Matters concerning class and total number of shares outstanding as of the end of FY2014
Common Stock872,176 thousand shares
2.

Matters concerning appropriation of surplus(1) Dividends paid
Resolution

Ordinary General
Meeting of
Shareholders
on June 25, 2014
Board of Directors
Meeting on
October 31, 2014

Class ofsharesCommonStockClass A
Preferred
Stock
CommonStockClass A
Preferred
Stock

Source ofdividends

Total
dividends(millions ofyen)

Dividends
per share
(yen)

2,184

3.00

Retainedearnings

1,004

33,490.00

1,685

2.00

Retainedearnings

87

16,525.00

Recorddate

Effective
date

March 31,2014

June 26,2014

September
30, 2014

December
10, 2014(2) Dividends for which the record date falls in the fiscal year under review and the effective
date falls in the following fiscal year.

3.

Proposal

Class ofshares

Source ofdividends

Total
dividends(millions ofyen)

Dividends
per share(yen)

Recorddate

Effective
date

Ordinary General
Meeting of
Shareholders
on June 24, 2015

CommonStockRetainedearnings

2,606

3.00

March 31,2015

June 25,
2015

Number of shares to be issued upon exercise of equity warrants
Category

Breakdown of equity warrants

The Company

No. 4 Equity Warrants(issued on July 20, 2005)
No. 5 Equity Warrants(issued on July 28, 2006)
No. 6 Equity Warrants(issued on July 28, 2006)
No. 7 Equity Warrants(issued on July 27, 2007)
No. 8 Equity Warrants(issued on July 27, 2007)

Type of shares to be issued
upon exercise of equity
warrants

Number of shares to beissued upon exercise of
equity warrants (shares)

Common stock

442,000

Common stock

185,000

Common stock

157,000

Common stock

287,000

Common stock

222,000- 30 -

(Translation)

Notes on Financial Instruments
1. Matters concerning the status of financial instruments
The OKI Group mainly uses short-term deposits and highly safe marketable securities forfund management, and raises its funds primarily through borrowings from financial institutions
and issuance of corporate bonds.
The Group strives to mitigate its customers’ credit risks associated with notes and accounts
receivable, which are operating receivables, by carrying out customer credit investigations inaccordance with regulations for the management of accounts receivable of individual companies.
For borrowings, the Group raises short-term funds mainly for working capital and long-term
funds for working capital and capital investment. For borrowings exposed to the interest rate risk
and foreign currency risk, the Group applies derivative instruments (interest rate swap transactions
and currency swap transactions) to hedge its risk.
The Group executes and manages derivative transactions in accordance with OKI Group’s
policy.
2.

Disclosure concerning fair value of financial instruments
As of March 31, 2015 (consolidated balance sheet date), the amount recorded in the
consolidated balance sheet, fair value, and the amount of differences are as shown in the tablebelow. Any item whose fair value is deemed extremely difficult to assess is excluded from thetable. (See Note 2.)(Unit: millions of yen)Amount recorded inconsolidated balance
sheet(1) Cash and deposits

53,632(2) Notes and accounts receivable

137,895

Allowance for doubtful receivables (*1)

Fair value

Difference

53,632-

130,549-(7,346)
130,549(3) Investments in securities

28,74229,803

1,060(4) Notes and accounts payable(79,053)(79,053)-(5) Short-term borrowings (*2)(44,981)(44,981)-(6) Other accrued expenses(36,060)(36,060)-(7) Long-term debt (*2)(62,589)(62,844)255(8) Derivative transactions
385
385(*1) Allowance for doubtful receivables specifically provided for notes and accounts receivable is deducted.
(*2) Long-term debt (¥18,348 million) that will be reimbursed within one year are classified as “short-termborrowings” in the consolidated balance sheet.
Notes:
1.
Disclosure concerning methods of calculation of fair value of financial instruments, securities and derivativetransactions(1) Cash and deposits and (2) Notes and accounts receivable
These items are settled over a short period of time and their fair value is virtually equal to their book value.
Hence, their fair value is based on the relevant book value.
(3) Investments in securities
The fair value of investments in securities is based on their prices determined at the financial instruments
exchanges, and the fair value of bonds is based on the quotations offered by the correspondent financial
institution.
(4) Notes and accounts payable, (5) Short-term borrowings, and (6) Other accrued expenses- 31 -

(Translation)

2.

These items are settled over a short period of time and their fair value is virtually equal to their book value.
Hence, their fair value is based on the relevant book value.
(7) Long-term debt
The fair value of these items is based primarily on the method of calculation whereby the sum of principal
and interest is discounted by an assumed interest rate on the assumption that the said sum is freshly
borrowed in a similar manner. Some long-term debt with floating interest rates are prescribed to be subject
to special accounting treatment applicable to interest rate swaps (see (8) below). Hence, the fair value of along-term debt is based on the method of calculation whereby the sum of principal and interest, treated in
combination with the said interest rate swap, is discounted by a reasonably estimable interest rate on theassumption that the said amount is freshly borrowed in a similar manner.
(8) Derivative transactions
Derivative transactions subject to allocation treatment applicable to currency swaps, and to special
accounting treatment applicable to interest rate swaps are treated in combination with long-term debt ashedged items. Hence, their fair value is included in that of long-term debt.
Financial instruments whose fair value is considered extremely difficult to assess
Unlisted equity securities (¥9,690 million on the consolidated balance sheet) are not included in (3) Investments insecurities because they have no market price and it is deemed extremely difficult to assess their fair values.

Notes to Per-share Information
1. Net assets per share:¥137.74
2. Net income per share:¥40.03- 32 -

(Translation)

Transcript of Accounting Auditors’ Report on Consolidated Financial Statements

Independent Auditors’ Report
May 21, 2015
To: Board of Directors
Oki Electric Industry Co., Ltd.
Ernst & Young ShinNihon LLC
Yoshimi Kimura,Engagement Partner, Certified Public Accountant
Akira Sato,Engagement Partner, Certified Public Accountant
Makoto Usui,
Engagement Partner, Certified Public Accountant
Yukiyasu Yamakawa,Engagement Partner, Certified Public Accountant
We have audited the consolidated financial statements – the consolidated balance sheets, the consolidated statementof operations, the consolidated statement of changes in shareholders equity and notes to the consolidated financial
statements – of Oki Electric Industry Co., Ltd. for the 91st term from April 1, 2014 to March 31, 2015 inaccordance with Article 444 Paragraph 4 of the Companies Act.
Responsibility of management for preparing consolidated financial statements
Oki Electric Industry’s management is responsible for preparing and presenting fairly these consolidated financial
statements in accordance with corporate accounting standards generally accepted in Japan. This includes
designing and operating internal control that the management determines necessary to prepare and fairly present
these consolidated financial statements that are without material misstatement due to fraud or errors.
Responsibility of auditors
Our responsibility is to express our independent opinion regarding these consolidated financial statements based on
audits by Ernst & Young ShinNihon LLC. We conducted our audit in accordance with auditing standards
generally accepted in Japan. These auditing standards require that we prepare audit plans and implement audit
based on them to obtain reasonable assurance as to whether the consolidated financial statements are withoutmaterial misstatement.
The audit requires procedures to obtain audit evidence about amounts and disclosure of these consolidated financial
statements. The audit procedures are selected and applied based on evaluation of risks about material
misstatement of these consolidated financial statements due to fraud or errors. Although the purpose of the audit
is not to express our opinion about the effectiveness of internal control, we consider the internal control associatedwith preparation and fair presentation of these consolidated financial statements, in order to plan appropriate audit
procedures in line with actual situations at the time of risk evaluation. Also, our audit includes reviews ofaccounting policies, and methods that management adopts, and an evaluation of management estimates and thepresentation of the consolidated financial statements as a whole.
We believe we have obtained enough and appropriate audit evidence as the basis for our opinion.
Audit opinion
We concluded that the consolidated financial statements fairly present in all aspects Oki Electric Industry’s and its
subsidiaries’ assets and income or loss in accordance with corporate accounting standards generally accepted inJapan.
Conflict of interest
No conflict of interest as defined by the Accounting Law exists between Oki Electric Industry, our firm (Ernst &Young ShinNihon LLC) and the respective engagement partners.

- 33 -

(Translation)

Non-Consolidated Balance Sheet(as of March 31, 2015)
Account title(Assets)
Current assets
Cash and deposits
Notes receivable
Accounts receivable, trade
Lease investment assets
Finished goods
Work in process
Raw materials and supplies
Prepaid expenses
Short-term loans
Accounts receivable-other
Deferred tax assets
Other current assets
Allowance for doubtful receivables
Total current assets
Non-current assets
Property, plant and equipment
Buildings
Accumulated depreciation
Structures
Accumulated depreciation
Machinery and equipment
Accumulated depreciation
VehicleAccumulated depreciation
Tools, furniture and fixtures
Accumulated depreciation
Land
Construction in progress
Total property, plant and equipment
Intangible assets
Right of using facilities
SoftwareTotal intangible assets
Investments and other assets
Investments in securities
Investments in and advances tosubsidiaries and affiliates
Contribution
Contribution in subsidiaries andaffiliates
Long-term loans receivable fromsubsidiaries and affiliates
Long-term prepaid expenses
Claims provable in bankruptcy,
rehabilitation and other
Lease and guarantee deposits
Other investments and other assets
Allowance for doubtful receivables
Total investments and other assets
Total non-current assets
Total assets

Amount30,487894
74,8293,445
4,955
15,7035,384
312
44,896
7,640
3,186
848
(43)
192,540
38,209(26,997)
2,491(2,178)13,291(11,333)
65(53)
34,397(28,128)

11,212
312
1,957
12
6,268
8,397
36
28,197

Account title(Liabilities)
Current liabilities
Notes payable
Accounts payable, trade
Short-term borrowings
Current portion of long-term debt
Lease obligations
Accounts payable, others
Other accrued expenses
Income taxes payable
Advances received
Deposits received
Provision for loss on construction
contracts
Asset retirement obligations
Other current liabilities
Total current liabilities
Long-term liabilities
Long-term debt
Lease obligations
Deferred tax liabilities
Retirement benefits
Provision for loss on business of
subsidiaries and affiliates
Asset retirement obligations
Long-term accounts payable-otherTotal long-term liabilities
Total liabilities(Unit: millions of yen)Amount2,462
50,066
24,72016,986959
9,749
17,263
403
1,318
3,688
65
31
3
127,720
43,931
3,147
5,873
11,151
27,644888
7,326
99,963
227,683(Net Assets)
Shareholders’ equity
Capital stock
Additional paid-in capital
Capital reserve
Other additional paid-in capital
Retained earnings
Other retained earnings
Retained earnings carriedforwardTreasury stock, at cost
Total shareholders’ equity

44,00021,55315,0006,553
33,83033,83033,830

Valuation, translation adjustments andothers617
Net unrealized holding gain/loss onother securities
3,250
Loss on deferred hedges

7,301

115
6,275
6,390

30,38068,440(440)
98,943

89

730
36
3,147
305
(191)
106,805
141,393
333,934- 34 -

Total valuation, translation
adjustments and others
Subscription rights to shares
Total net assets

Total liabilities and net assets

(72)
7,228

79
106,251

333,934

(Translation)

Non-Consolidated Statement of Operations(From April 1, 2014 to March 31, 2015)(Unit: millions of yen)Account title

AmountNet sales

258,260

Cost of sales

200,750

Gross profit

57,509Selling, general and administrative expenses

40,784

Operating income

16,725Non-operating income
Interest income

717

Interest income on securities

6

Dividend income

2,641Royalty income from corporate brand

784

Foreign exchange gain, net

6,014

Other

561

10,725Non-operating expenses
Interest expenses

1,769

Commission for syndicate loan

723

Other

1,195

Ordinary income

3,688
23,763Extraordinary profit
Gain on sales of shares of subsidiaries and associates

223

Gain on liquidation of subsidiaries and associates

75

298

479

479

Extraordinary loss
Loss on sale and disposition of property, plant and equipment
Income before income taxes

23,582

Income taxes

552

Income taxes deferred(1,184)

Net income(632)
24,215- 35 -

(Translation)

Non-Consolidated Statement of Changes in Net Assets(Year ended March 31, 2015)(Unit: millions of yen)
Shareholders’ equity
Additional paid-in capital
Capitalstock

Balance at April 1,
2014

Capitalreserve

44,00015,000Retained earnings

Other
additional
paid-in
capitalTotal
additional
paid-in capital

6,553

21,553

Other retained
earnings
Retained earnings
carried forward

Total
retainedearnings

Treasurystock,
at costTotal
shareholders’equity(419)

82,60917,475

17,475(2,898)(2,898)

14,577

14,577

Dividends fromsurplus(4,962)(4,962)(4,962)

Net income

24,21524,21524,215

Cumulative effects
of changes inaccounting policies
Restated balance atApril 1, 2014

44,00015,0006,553

21,553(2,898)(419)

79,711

Changes during theterm under review

Purchases oftreasury stock

(21)

(21)

Net changes in
items other thanshareholders’equity during theterm under review
Net changes during
the term underreview
Balance at March
31, 2015

-

-

-

-

19,252

19,252(21)

19,23144,00015,0006,553

21,553

33,83033,830(440)

98,943

Valuation, translation adjustments and others

Balance at April 1, 2014

Net unrealized holding
gain/loss on othersecurities

Loss / Gain on deferredhedgesTotal valuation,translation adjustments
and others

3,486

(411)

3,074

Subscription
rights tosharesTotal net
assets79

85,763Cumulative effects of changes inaccounting policies
Restated balance at April 1,
2014(2,898)
3,486

(411)

3,074

79

82,865

Changes during the term
under review
Dividends from surplus(4,962)

Net income

24,215(21)

Purchases of treasury stock
Net changes in items otherthan shareholders’ equity
during the term under review

3,815

339

4,154

-

4,154

Net changes during the term
under review

3,815

339

4,154

-

23,385

Balance at March 31, 2015

7,301

(72)

7,228

79

106,251- 36 -

(Translation)

Note to Non-consolidated Financial Statements
Significant Accounting Policies
1.

Standards and valuation methods for negotiable securities
Shares of subsidiaries and affiliated companies:
Stated at cost based on the moving average method
Other negotiable securities:
Marketable securities:
Stated at fair value based on the market price at the end of the fiscal year
(The difference between book value and fair value is included in net assets.
The sale cost is calculated by using the moving average method.)
Non-marketable securities: Stated at cost based on the moving average method

2.

Standards and valuation methods for derivatives
Derivatives: Stated at fair value

3.

Standards and valuation methods for inventories
Finished goods:
Stated at cost based on the moving average method (Balance sheet
values are measured by the method of devaluing the book price toreflect declines in profitability.)Work in process:Stated at cost based on the specific identification method (Balance
sheet values are measured by the method of devaluing the book priceto reflect declines in profitability.)
Raw materials and supplies:
Stated at cost based on the moving average method (Balance sheet
values are measured by the method of devaluing the book price toreflect declines in profitability.)

4.

Depreciation and amortization
Property, plant and equipment (excluding lease assets): Declining-balance method
The straight-line method is applied to buildings, excluding annexed structures,acquired on or after April 1, 1998.
Intangible assets (excluding lease assets)
Software for sale in the market:
Amortization method based on the estimated amounts of sales in the estimatednumber of years for sales (3 years)
Software for internal use:
Straight-line method based on the estimated durable years (5 years)
Others:Straight-line method
Lease assets(Lease assets relating to finance lease transactions without transfer of ownership):
They are depreciated over the lease contract’s lifetime by the straight-line- 37 -

(Translation)
method, assuming the residual value is zero.
In addition, out of the finance lease transactions that do not transfer ownership,lease transactions whose lease transaction commencement date was on or prior
to March 31, 2008 are accounted for on a basis similar to ordinary rental
transactions.
5.

Basis for provision of reserves
Allowance for doubtful receivables
To prepare for any losses on accounts receivable and loans, the Company calculates theamount of potential loss by using the historical loss ratio in the case of non-classified
loans/receivables and by individual assessment in the case of classified loans/receivables.
Provision for loss on construction contracts
To prepare for any losses on construction contracts, the estimated amount of losses forthe following fiscal years are calculated for some of the orders backlog as of the end of the
fiscal year under review, which are likely to incur losses and for which the amounts thereof
can be reasonably estimated.
Retirement benefits
To prepare for payment of retirement benefits to employees, the Company records theamount recognized to accrue at the end of the fiscal year based on the estimated values ofretirement benefit obligations and pension assets.
Differences for changes in accounting standards are amortized over 15 years.
Prior service cost is amortized by the straight-line method over a certain number of years(13 years) within the average remaining years of service of employees.
The actuarial difference is amortized proportionately using the straight-line method overa certain number of years (13 years) within the average remaining service period of theemployees from the fiscal year after the one in which it arises.
Provision for loss on business of subsidiaries and affiliates
To prepare for any losses on business of subsidiaries and affiliates, the estimated amountof loss on business is calculated in consideration of the financial position and operating
results of the relevant subsidiaries and affiliates.

6.

Hedge accounting methods(1) Method of hedge accounting
Deferred hedging is applied. Allocation treatment is applied for currency swap
contracts eligible for allocation treatment. Special treatment is applied to interest rate
swaps that meet the requirements for special treatment.
(2) Means of hedging and hedged item
Currency swap contracts are used to hedge fluctuations of exchange rates on credits anddebts in foreign currencies. Interest rate swaps are employed to hedge fluctuations ofmarket interest rates on variable-rate short-term borrowings and long-term debt.
(3) Hedging policy
Derivative instruments are used to hedge fluctuations of market rates on credits and debts.
(4) Assessment method of hedging effectivenessTo determine the effectiveness, the Company compares the accumulated total of the- 38 -

(Translation)market fluctuations or the cash flow fluctuations for the hedged item and that of themarket fluctuations or the cash flow fluctuations for the means of hedging, during theperiod from the start of hedging to the assessment. The Company then makes adecision based on the changes of the two.
7.

Other important matters in preparation of non-consolidated financial statements(1) Accounting for retirement benefits
The methods of accounting for unappropriated amounts of differences caused by changes
in accounting standards for retirement benefits, unrecognized prior service costs, andunrecognized actuarial gains and losses differ from those in the consolidated financial
statements.
(2) Accounting processing of consumption tax
The tax-exclusion approach is applied for accounting of consumption tax and local
consumption tax.
(3) Application of consolidated tax payments
Consolidated tax payments are applied.

Changes in Accounting Policies
From the fiscal year under review, the Company has applied the “Accounting Standard
for Retirement Benefits” (ASBJ Statement No. 26, May 17, 2012; the “Retirement Benefits
Accounting Standard”) and the “Guidance on Accounting Standard for Retirement Benefits”(ASBJ Guidance No. 25, March 26, 2015; the “Guidelines for Retirement Benefits”)
concerning the main clause stipulated in Paragraph 35 of the Retirement Benefits AccountingStandard and that of Paragraph 67 of the Guidelines for Retirement Benefits. Accordingly,
the Company has revised its method of calculating retirement benefit obligations and service
costs and changed from the point system or the straight-line method to the benefit formulabasis in attributing expected benefit to periods. Moreover, the Company has changed themethod of determining the discount rate from a rate based on a period that approximates theaverage remaining years of service of the eligible employees to the use of a single weighted
average discount rate reflecting the expected timing and amount of benefit payments.
In applying the Retirement Benefits Accounting Standard, etc., in accordance with theprovisions for transitional treatment specified in paragraph 37 of the Retirement Benefits
Accounting Standard, the Company recognized the effect of the changes in the calculation
methods of retirement benefit obligations and service costs as an adjustment to retained
earnings carried forward at the beginning of the fiscal year under review.
As a result, at the beginning of the fiscal year under review, assets for retirement benefits
increased by ¥2,898 million and retained earnings carried forward decreased by ¥2,898
million. There were no material effects on operating income and income before income
taxes for the fiscal year ended March 31, 2015.

- 39 -

(Translation)
Notes to Non-consolidated Balance Sheets
1. Assets provided as collateral
Investments in securities
Liabilities collateralized by the above assets
Short-term borrowings
2.

¥19,148 million¥3,500 million

Guarantee liabilities:
The Company provides guarantees for bank borrowings made by employees, andsubsidiaries and affiliates as shown below.
Oki Data Corporation
Oki Data Americas, Inc.

¥3,273 million¥3,608 million($30,000 thousand)Oki Data Manufacturing (Thailand) Co., Ltd.
¥1,291 million(350,000 thousand baht)
Oki Europe Ltd. and its subsidiaries¥912 million(4,847 thousand pounds sterling, 375 thousand euro)
Four other entities:¥854 million
Total:¥9,939 million
3.

Monetary claims receivable from and payable to subsidiaries and affiliates
Short-term monetary claims receivable from subsidiaries and affiliates: ¥67,314 million
Long-term monetary claims receivable from subsidiaries and affiliates: ¥1,161 million
Short-term monetary claims payable to subsidiaries and affiliates:¥25,652 million- 40 -

(Translation)
Notes to Non-consolidated Statement of Operations
Transactions with subsidiaries and affiliates
Sales:
Purchases:
Non-operating transactions:¥44,252 million¥61,451 million¥6,268 million

Notes to Non-consolidated Statement of Changes in Net Assets
Type and number of treasury stock as of the end of the fiscal year
Common stock: 3,432 thousand shares

Notes to Deferred Tax Accounting
Major factors giving rise to deferred tax assets and liabilities
Deferred tax assets
Nondeductible provision for loss on business of subsidiaries andaffiliates
Nondeductible retirement benefits
Loss carry forwards
Nondeductible write-downs of shares of subsidiaries and affiliates
Adjustments of losses on transfers among consolidated subsidiaries
Nondeductible accounts payable-other due to changes in retirement
benefit plans
Nondeductible accrued bonuses
Nondeductible loss on impairment of fixed assets
Nondeductible write-downs of inventories
Nondeductible bad debts expenses
OthersSubtotal deferred tax assets
Valuation allowance
Total deferred tax assets
Deferred tax liabilities
Nondeductible unrealized gain on contribution of securities to thepension trust
Net unrealized holding gain/loss on other securities
OthersTotal deferred tax liabilities
Net deferred tax assets- 41 -¥8,846 million¥7,702 million¥7,099 million¥5,556 million¥3,564 million¥2,882 million¥1,500 million¥861 million¥738 million¥369 million¥1,792 million¥40,913 million¥(36,769) million¥4,143 million¥(3,405) million¥(3,308) million¥(117) million¥(6,830) million¥(2,687) million

(Translation)

Notes to Leased Fixed Assets
Finance lease transactions that do not transfer ownership whose lease transaction commencement
date was on or prior to March 31, 2008 are accounted for on a basis similar to ordinary rental
transactions.
1.
2.
3.

Amount equivalent to acquisition cost of leased assets as of the end of the term under review¥28 million
Amount equivalent to accumulated depreciation of leased assets as of the end of the term
under review¥20 million
Amount equivalent to unexpired lease payment of leased assets as of the end of the term
under review¥8 million- 42 -

(Translation)
Notes to Related Party Transactions
Subsidiaries, etc.
Attribute

Subsidiary

Subsidiary

Subsidiary

Company name

OKI Software Co.,Ltd.

Oki Hong Kong, Ltd.

Oki Data Corporation

Location

Warabi,
Saitama Pref.

Hong Kong

Minato-ku,
Tokyo

CapitalBusiness¥400 million

Development, design,
manufacture andmaintenance ofsoftware, systembuilding services,
SI/solution services,
consulting outsourcing
and sales of
information equipment

HK$80,000
thousand

Voting right
ratio(Direct)
100%

Holdings company,
material procurement(Direct)
100%

Relationship withrelated party

Production ofsoftware on a contract
basis, etc.,
lending of funds

Supply products etc.,
lending of funds,
concurrent
assumption of officeof officer

Description oftransactions

Purchase ofservices

Transaction
amount(mil. yen)Account item

Endingbalance(mil. yen)Accounts
payable,
trade

6,512

Other
accruedexpenses572

22,415

Sales ofproducts

25,584

Accounts
receivable,
trade

9,079

Lending of
funds

9,485

Short-term
loans
receivable

14,432Development,
manufacture and salesof printing equipment
and related solutions(Direct)
100%

Purchase of products,
lending of funds,
concurrent
assumption of officeof officer

Lending offunds

21,384

Short-term
loans
receivable

18,500Equipment work,
designing, construction
and maintenance of¥2,001 million
telecommunication,
firefighting and otherfacilities(Direct)
100%

Supply products etc.,
purchase of services,concurrent
assumption of officeof officer

Sales ofproducts, etc.

6,172

Accounts
receivable,
trade

3,486

¥29,000
millionSubsidiary

Oki Wintech Co., Ltd.

Shinagawaku, Tokyo

Subsidiary

Oki Data Americas,
Inc.

U.S.A.

US$10,000
thousand

Sales and services ofprinters and multipurpose printers(Indirect)
100%

Guarantee forborrowings

Debt guarantee

3,608

-

-

Subsidiary

OKI Brasil Indústria eComércio de Produtos
e Tecnologia em
Automação S.A.

Brazil

BRL251,598
thousand

Design, manufacture,sales and maintenanceand services ofautomation equipment(Direct)
70%

Supply products etc.,
lending of funds,
concurrent
assumption of officeof officer

Lending of
funds

2,705

Short-term
loans
receivable

3,456

Notes:
1. The transactions amount excludes consumption tax, while the ending balance includes consumption tax.
2. Conditions of transactions and policy in determining conditions(1) The Company determines conditions regarding purchase of services and sales of products based on market
prices.
(2) The Company determines the interest rate for the lending of funds by taking the market rate of interest into
consideration. Transaction amount shows the average balance during the fiscal year because the transactions
are repetitive.
(3) The Company provided a debt guarantee for bank borrowings of OKI DATA AMERICAS, INC. and received aguarantee commission of 0.1% p.a.
3. For the loans to one subsidiary, the Company recorded an allowance for doubtful receivables of ¥89 million. In
addition, the Company recorded a reversal of allowance for doubtful receivables of ¥76 million and a reversal of
appropriated allowance for doubtful receivables of ¥840 million associated with liquidation of subsidiaries.

Notes to Per-share Information
1. Net assets per share: ¥122.21
2. Net income per share: ¥29.26- 43 -

(Translation)

Transcript of Accounting Auditors’ Report

Independent Auditors’ Report
May 21, 2015
To: Board of Directors
Oki Electric Industry Co., Ltd.
Ernst & Young ShinNihon LLC
Yoshimi Kimura,Engagement Partner, Certified Public Accountant
Akira Sato,Engagement Partner, Certified Public Accountant
Makoto Usui,
Engagement Partner, Certified Public Accountant
Yukiyasu Yamakawa,Engagement Partner, Certified Public Accountant
We have audited the non-consolidated financial statements – the non-consolidated balance sheets, the nonconsolidated statement of operations, the non-consolidated statement of changes in shareholders equity and notes tothe non-consolidated financial statements – and its supporting schedules of Oki Electric Industry Co., Ltd. for the
91st term from April 1, 2014 to March 31, 2015 in accordance with Article 436 Paragraph 2 Item 1 of theCompanies Act.
Responsibility of management for preparing non-consolidated financial statements and its supporting schedules
Oki Electric Industry’s management is responsible for preparing and presenting fairly these non-consolidated
financial statements and its supporting schedules in accordance with corporate accounting standards generally
accepted in Japan. This includes designing and operating internal control that the management determines
necessary to prepare and fairly present these non-consolidated financial statements and its supporting schedules thatare without material misstatement due to fraud or errors.
Responsibility of auditors
Our responsibility is to express our independent opinion regarding these non-consolidated financial statements andits supporting schedules based on audits by Ernst & Young ShinNihon LLC. We conducted our audit inaccordance with auditing standards generally accepted in Japan. These auditing standards require that we prepare
audit plans and implement audit based on them to obtain reasonable assurance as to whether the non-consolidated
financial statements and its supporting schedules are without material misstatement.
The audit requires procedures to obtain audit evidence about amounts and disclosure of these non-consolidated
financial statements and its supporting schedules. The audit procedures are selected and applied based on
evaluation of risks about material misstatement of these non-consolidated financial statements and its supporting
schedules due to fraud or errors. Although the purpose of the audit is not to express our opinion about theeffectiveness of internal control, we consider the internal control associated with preparation and fair presentation ofthese non-consolidated financial statements and its supporting schedules, in order to plan appropriate audit
procedures in line with actual situations at the time of risk evaluation. Also, our audit includes reviews ofaccounting policies, and methods that the management adopts, and an evaluation of management estimates and thepresentation of the non-consolidated financial statements and its supporting schedules as a whole.
We believe we have obtained enough and appropriate audit evidence as the basis for our opinion.
Audit opinion
We concluded that the non-consolidated financial statements and its supporting schedules fairly present in all
aspects Oki Electric Industry’s assets and income or loss in accordance with corporate accounting standards
generally accepted in Japan.
Conflict of interest
No conflict of interest as defined by the Accounting Law exists between Oki Electric Industry, our firm (Ernst &Young ShinNihon LLC) and the respective engagement partners.

- 44 -

(Translation)

Transcript of Audit & Supervisory Board’s Report

Audit & Supervisory Board’s Report
We, the Audit & Supervisory Board, have prepared upon consultation this Audit Report based on reports compiled by each
Audit & Supervisory Board Member with respect to Directors’ performance of their duties during the 91st fiscal year from
April 1, 2014 to March 31, 2015, as follows:
1. Auditing methods used by Audit & Supervisory Board Members and the Audit & Supervisory Board, and details ofaudit
The Audit & Supervisory Board specified an audit policy, compiled audit plans and received reports from each Audit &Supervisory Board Member on the status of implementation and results of audits and also received reports from Directors andaccounting auditors on the status of the execution of their duties and asked them for explanations as needed.
Each Audit & Supervisory Board Member, according to the audit standards, policy and plans set up by the Audit &Supervisory Board, has maintained good communications with Directors, the internal audit division and other employees andstrived to collect information and improve the audit environment as well as attending meetings of the Board of Directors andother meetings as deemed important, received from Directors and employees reports on the execution of their duties, asked
for explanations as necessary, perused the documents whereby the important decisions were made, and examined businessand financial conditions at the head office and principal operating offices. In addition, we have periodically received reports
from Directors and employees, among others, required explanation when necessary, and made opinions with regard to thestatus of operations and the systems established thereon (internal control systems) made by the Board of Directors concerning
the establishment of systems defined in Article 100, Paragraph 1 and Paragraph 3 of the Regulations for Enforcement of theCompanies Act as necessary for ensuring compliance with laws and the Company’s Articles of Incorporation in theperformance of duties by Directors, described in the Business Report, and for ensuring appropriateness of duties of a joint
stock company. Also, we have maintained good communications and exchanged information with Directors, Audit &Supervisory Board Members and others of the subsidiaries of the Company, and received from the subsidiaries reports on
their business conditions as needed. Based on the methods mentioned above, we have reviewed the business report for thesaid fiscal year and their supplementary schedules.
We have also monitored and verified whether the accounting auditors maintained their independence and properly
implemented audits, received from the auditors reports on the performance of their duties and asked them for explanations asnecessary. The accounting auditors reported to us that “systems for ensuring proper execution of duties” (listed in each itemof Article 131 of the Corporate Calculation Regulations) have been established in accordance with the quality control
standards concerning audits (Business Accounting Council, October 28, 2005), and asked them for explanations as necessary.
Based on the methods mentioned above, we have reviewed financial statements for the said fiscal year (balance sheet,statement of operations, statement of changes in shareholders’ equity, and notes to non-consolidated financial statements),
their supplementary schedules and consolidated financial statements (consolidated balance sheet, consolidated statement ofoperations, consolidated statement of changes in shareholders’ equity, and notes to consolidated financial statements).
2. Results of Audit(1) Results of audit of the business report
1) We consider that the business report and its supplementary schedules fairly present the situation of the Company
in accordance with relevant laws and regulations and the Company’s Articles of Incorporation.
2) With respect to the Directors’ performance of their duties, we have found neither undue transactions nor material
facts that violate relevant laws and regulations or the Company’s Articles of Incorporation.
3) We consider that the details of the resolution made by the Board of Directors concerning internal control
procedures are proper. With respect to the details described in the Business Report and the Directors’
performance of their internal control duties, we have found no issues to be pointed out. As stated in theBusiness Report, the Company underwent an on-site inspection by the Japan Fair Trade Commission on
suspicion of violating the Antimonopoly Act. As the Audit & Supervisory Board, we will continue to checkthe OKI Group’s overall efforts to thoroughly comply with laws and regulations and to strengthen internal
control.
(2) Results of audit of financial statements and their supplementary schedules
We consider that the auditing methods and results of the Company’s Accounting Auditors, Ernst & Young ShinNihon
LLC, are proper.
(3) Results of audit of consolidated financial statements
We consider that the auditing methods and results of the Company’s Accounting Auditors, Ernst & Young ShinNihon
LLC, are proper.
May 21, 2015
The Audit & Supervisory Board, Oki Electric Industry Co., Ltd.
Shuichi Kawano, Standing Audit & Supervisory Board Member
Tsutomu Tai, Standing Audit & Supervisory Board Member
Kuninori Hamaguchi, Outside Audit & Supervisory Board Member
Kaoru Yoshida, Outside Audit & Supervisory Board Member- 45 -

(Translation)

Reference Documents for the General Meeting of Shareholders
Agenda and Reference Matters
Agenda 1: Appropriation of Surplus
The Company has determined to pay the following year-end dividend for the fiscal year
under review with the emphasis on continuing stable distribution of profits to shareholders bygiving consideration to its business results and business developments, etc. for the period underreview.
1.

Type of dividend asset
Cash

2.

Allocation of dividend assets and total amount of dividends
Common stock of the Company¥3 per share
Total dividends¥2,606,231,631

3.

Effective date of dividend of surplus
June 25, 2015

- 46 -

(Translation)

Agenda 2: Partial Amendment of the Articles of Incorporation
1.

Reasons for the Amendment(1) To delete the description related to Preferred Shares and Preferred Shareholders’Meeting in line with the retirement of all the Class A Preferred shares.
(2) To shorten Director’s term of the office from two years to one year and to clarify
management responsibility to respond promptly to the change of the business environment,
as well as to set up a supplementary provision stipulating the existing rules on this matter tobe applied to Directors who were elected at the 90th Ordinary General Meeting of
Shareholder held on June 25, 2014.
(3) Following the enforcement of the “Act for Partial Revision of the Company Act” (ActNo. 90, 2014), which allows a company to have a liability limitation agreement with also
non-executive officers and Outside Audit & Supervisory Board Members. The Company
will make a necessary amendment to support their role fully exhibited. The Company has
obtained the consent of all Audit & Supervisory Board Members.

2.

Details of the Proposed Changes
The details of the proposed amendments are as follows.

Current Articles of Incorporation
Chapter 1 General Provisions
Articles 1 to 5 (provisions omitted)
Chapter 2 Shares
Article 6 (Total Number of Authorized Shares and Total
Number of Authorized Class Shares)
The total number of shares authorized to be issued by theCompany shall be 2,400,000,000 shares, and the total
number of class shares authorized to be issued shall be, forcommon shares, 2,400,000,000 shares, and, for Class A
Preferred Shares, 30,000 shares.
Article 7 (provisions omitted)
Article 8 (Number of Shares Constituting One Unit)
The number of shares constituting one unit of shares of theCompany shall be 1,000 shares for common shares andshall be one share for Class A Preferred Shares.
Articles 9 to 11 (provisions omitted)
Chapter 2-2 Preferred Shares
Article 11-2 (Preferred Shares)
The contents of the Class A Preferred Shares issued by theCompany shall be as follows.
1. Class A Preferred Dividend(1) Class A Preferred Dividend(Underlined portions indicate the proposed changes)
Proposed Amendment
Chapter 1 General Provisions
Articles 1 to 5 (unchanged)
Chapter 2 Shares
Article 6 (Total Number of Authorized Shares)
The total number of shares authorized to be issued by theCompany shall be 2,400,000,000 shares.

Article 7 (unchanged)
Article 8 (Number of Shares Constituting One Unit)
The number of shares constituting one unit of shares of theCompany shall be 1,000 shares.
Articles 9 to 11 (unchanged)(deleted)(deleted)- 47 -(deleted)(Translation)
Current Articles of Incorporation
When distributing dividends of surplus at the end of eachfiscal year commencing with the fiscal year beginning
April 1, 2011, for the record date provided in Article 35
hereof, the Company shall pay as dividends toshareholders of Class A Preferred Shares (“Class A
Preferred Shareholders”) recorded or noted in the latest
shareholders register for the record date or to registered
Class A Preferred Share pledgees on such register(“Registered Class A Preferred Share Pledgees”), prior to
making payments to shareholders of common shares(“Common Shareholders”) or to registered common sharepledgees (“Registered Common Share Pledgees”), for eachClass A Preferred Share a dividend in the amount (“Class A
Preferred Dividend”) calculated by multiplying the Class A
Preferred Shares amount to be paid per share by the annual
dividend rate (“Class A Preferred Shares Annual DividendRate”) for the fiscal year to which the record date for the
distribution of dividends of surplus belongs, as stipulatedin (2) below; provided, however, that if in the relevant
fiscal year a Class A Preferred Interim Dividend asprovided in Paragraph 10 below is paid to Class A
Preferred Shareholders or Registered Class A Preferred
Share Pledgees, the amount of such interim dividend shallbe deducted. If the total amount of Class A Preferred
Dividends exceeds the Distributable Amount (this means
the Distributable Amount as defined in Article 461 (2) of
the Companies Act and the same shall apply hereinafter),the Company may pay an amount as decided by its boardof directors not exceeding the Distributable Amount toClass A Preferred Shareholders or Registered Class A
Preferred Share Pledgees prior to making payments to
Common Shareholders and Registered Common Share
Pledgees. The Company shall not distribute dividends ofsurplus for the record date which belong to the fiscal year
ending March 31, 2011 as dividends for Class A Preferred
Shares.
(2) Class A Preferred Shares Annual Dividend RateClass A Preferred Shares Annual Dividend Rate for the
fiscal year ending March 31, 2012.
Class A Preferred Shares Annual Dividend Rate = Initial
Class A Preferred Dividend ÷ the amountto be paid per share for Class A Preferred Shares
In the above formula, “Initial Class A Preferred Dividend”
means the amount obtained when the amount to be paid
per share of the Class A Preferred Shares is multiplied by
the rate obtained by adding 3.00% to the 6-month Japanese
yen TIBOR, then is further multiplied by 466, which is theactual number of days from the Payment Date (inclusive)
through March 31, 2012, and then divided by 365 (to be
calculated to the first decimal place and then rounding up
to the nearest whole yen).
Class A Preferred Shares Annual Dividend Rate for fiscal
years beginning on or after April 1, 2012
Class A Preferred Shares Annual Dividend Rate = 6-month
Japanese yen TIBOR + 3.00%
The Class A Preferred Shares Annual Dividend Rate forfiscal years beginning on or after April 1, 2012 shall becalculated to the fourth decimal place, and rounded off to
the third decimal place.

- 48 -

Proposed Amendment

(Translation)
Current Articles of Incorporation
The “6-month Japanese Yen TIBOR” is the figuresannounced at 11:00 AM on April 1 (in the event that April
1 is a bank holiday, then the immediately precedingbanking business day) of each year (the “Class A Preferred
Shares Annual Dividend Rate Determination Date”) as the
6-month Tokyo Interbank Offered Rate (Japanese Yen
TIBOR) by the Japanese Bankers Association. In the eventthat the 6-month Japanese Yen TIBOR is not announced on
the Class A Preferred Shares Annual Dividend Rate
Determination Date, the figures announced by the British
Bankers Association as the London Interbank Offered Rate
(6-month Euroyen LIBOR (360 day basis) published on
Reuters Page 3750 ( this means Reuters Page 3750, whichdisplays the British Bankers Association’s LIBOR rates foryen deposits) at 11:00 AM London time on the Class A
Preferred Shares Annual Dividend Rate Determination
Date (in the event that day is a London banking holiday,
then the immediately preceding banking business day) or
another figure reasonably determined by the Company as
equivalent to that number shall be used in lieu of the 6month Japanese Yen TIBOR.
(3) Accumulation Provisions
If in any given fiscal year the amount of dividends ofsurplus distributed to Class A Preferred Shareholders orRegistered Class A Preferred Share Pledgees falls below
the amount of Class A Preferred Dividends, the shortfall
will not be carried over to the following or subsequentfiscal years.
(4) Non-Participation Provisions
The Company will not distribute dividends of surplus toClass A Preferred Shareholders or Registered Class A
Share Pledgees in excess of the Class A Preferred
Dividends.
2. Class A Preferred Interim Dividends
When paying interim dividends pursuant to Article 36, theCompany will pay an amount up to a maximum of half of
the Class A Preferred Dividend per Class A Preferred Sharein the fiscal year in which the interim dividend record datefalls (“Class A Preferred Interim Dividend”) as dividend of
surplus to Class A Preferred Shareholders or Registered
Class A Preferred Share Pledgees noted or recorded in thelatest shareholders register on the Interim Dividend
Reference Date prior to making payments to Common
Shareholders and Registered Common Share Pledgees
noted or recorded in the latest shareholders register on that
Interim Dividend Reference Date.
3. Residual Assets(1) When delivering residual assets, the Company will
distribute to Class A Preferred Shareholders or Registered
Class A Preferred Share Pledgees per Class A Preferred
Share an amount equal to the amount to be paid for eachClass A Preferred Share prior to distribution of residual
assets to Common Shareholders and Registered Common
Share Pledgees.
(2) Non-Participation Provisions
The Company will not deliver residual assets to Registered
Class A Preferred Shareholders andClass A Preferred Share Pledgees in addition to thosespecified in (1) above.
4. Voting Rights
Class A Preferred Shareholders will not have voting rights
at shareholders meetings.

- 49 -

Proposed Amendment(deleted)(deleted)(deleted)(Translation)
Current Articles of Incorporation
5. Right to Request Redemption for Cash
(1) Right to Request Redemption for CashClass A Preferred Shareholders may request that theCompany deliver money for all or part of their Class A
Preferred Shares (“Redemption for Cash Request(s)”) on
the last day of each month (in the event such day is a bankholiday, then the immediately preceding banking businessday) in the period from April 1, 2016 through March 31,
2024 (“Redemption for Cash Request Date”). If the total
amount of the redemption price (as defined in (2) below) in
respect to Redemption for Cash Request on a Redemption
for Cash Request Date exceeds the lower of the maximum
redemption amount (as defined in (3) below) and theDistributable Amount, on such Redemption for Cash
Request Date the Company will determine the number ofClass A Preferred Shares it will redeem using proportional
allocation based on the number of shares for which
Redemption for Cash Requests are made.
(2) Redemption Price
The redemption price per Class A Preferred Share when a
Redemption for Cash Request is made shall be an amountequal to the amount to be paid per Class A Preferred Shareplus an amount equal to the amount obtained throughmultiplying the amount of Class A Preferred Dividends ofthe relevant fiscal year in which Redemption for Cash
Request Date falls by the number of days from April 1(inclusive) to the Redemption for Cash Request Date(inclusive), and then calculated by dividing that amount by
365 (calculated to the first decimal place, and rounded up
to the nearest whole yen); provided, however, that theamount of a Class A Preferred Interim Dividend paid in thefiscal year in which the Redemption for Cash Request Datefalls shall be deducted from the amount calculated as per
the above.
(3) Maximum Redemption Amount“Maximum Redemption Amount” shall mean the amountequal to shareholders equity less 20% of total assets, as
disclosed by the Company in the full-year earnings reportor quarterly earnings report, whichever is latest (“Latest
Earnings Report etc.”), prepared in accordance with Rule
404 of the Securities Listing Regulations of the Tokyo
Stock Exchange, Inc. (‘Tokyo Stock Exchange”); provided,
however, that if the Maximum Redemption Amount is anegative number it shall be zero.
“Shareholders equity” shall mean the amount obtained bydeducting the amounts related to share options and theitem on minority interests from the total amount in the net
assets section of the consolidated balance sheet or thequarterly consolidated balance sheet (“Consolidated
Balance Sheet etc.”) included in the Latest Earnings
Report etc.
“Total assets” shall mean the total amount of the assets
section of the Consolidated Balance Sheet etc.
(4) Adjustments to the Maximum Redemption AmountIf subsequent to the day of the Consolidated Balance Sheetetc., the Company takes any actions corresponding to anyof the following, such action will be deemed to have beentaken on the day of the Consolidated Balance Sheet etc.,
and the maximum redemption amount will be adjusted.

- 50 -

Proposed Amendment(deleted)(Translation)
Current Articles of Incorporation(i) Dividends of surplus (including passing an interim
dividend at a board of directors meeting or resolving at aboard of directors meeting to submit a proposal for
distribution of dividends of surplus to a generalshareholders meeting (provided, however, that, if thedividends of surplus is rejected at the shareholders
meeting, such decision by the board of directors on
distribution of dividends of surplus shall not be taken into
account in the adjustment to the maximum redemption
amount made subsequent to the day of that meeting))(ii) Redemption of the Company’s shares (including but
not limited to redemptions based on a request for purchaseof shares and request for redemption of shares constituting
less than one share unit made pursuant to laws andregulations and redemptions of Class A Preferred Sharespursuant to this Section and Section 7 made prior to such
Redemption for Cash Request Date)(iii) Business transfer, merger, company split, stock
exchange, stock transfer or issuance of shares (including
disposal of treasury shares)(iv) In addition to Items (i) through (iii) above, any action
under the Companies Act that increases or decreases theamount of assets or net assets on the consolidated balance
sheet or the quarterly consolidated balance sheet
6. Right to Request Redemption for Common Shares(1) Particulars of the right to request redemption forcommon shares Subject to the conditions set forth inParagraphs (3) through (6) below, at any time during theperiod stipulated in Paragraph below, a Class A Preferred
Shareholder may request that the Company redeem Class A
Preferred Shares in whole or in part and in exchangedeliver common shares of the Company.
(2) Redemption Request Period
This refers to the period from April 1, 2014 to March 31,
2024 (“Redemption Request Period”).
(3) Property to be delivered in exchange for redemption
In its redemption of the Class A Preferred Shares, theCompany shall deliver common shares in the number
obtained through multiplying the number of Class A
Preferred Shares for which the Class A Preferred
Shareholder has demanded redemption by the amount to be
paid per one Class A Preferred Share, and then dividingthat amount by the redemption price stipulated in
Paragraphs (4) through (6) below. In a case where there isa fractional share of less than one share in the number ofcommon shares to be delivered in the redemption of Class
A Preferred Shares, such fractional share shall bediscarded, and no delivery of money as stipulated in
Article 167, Paragraph 3 of the Companies Law will be
made.
(4) Initial Redemption Price- 51 -

Proposed Amendment(deleted)(Translation)
Current Articles of Incorporation
The Initial Redemption Price shall be the higher of (x) theamount obtained through multiplying the average amountof the daily closing prices (including indicative prices) of
the Company’s common shares on the Tokyo Stock
Exchange for the 30 consecutive trading days (excluding
the number of days where there was no closing price)
starting on the forty-fifth trading day before the first day of
the Redemption Request Period by 0.9 (to be calculated to
the first decimal place, and then rounded down to thenearest whole number), or (y) 75 Yen (such higher amount,the “Initial Redemption Price”). In the event that in the
period between the initial day of the above 30 consecutive
trading days (inclusive) until the Decision Date (inclusive;
defined in Paragraph (5) below), a redemption priceadjustment event as stipulated in Paragraph (6) below
arises, the Initial Redemption Price will be adjusted to an
amount that the Company’s board of directors determines
to be appropriate in accordance with Paragraph (6) below.
(5) Revision of Redemption Price
During the Redemption Request Period, on each March 31
and September 30 (“Decision Date(s)”), the redemption
price will be revised to the amount obtained by multiplying
the average amount of the daily closing prices (including
indicative prices) of the Company’s common shares on theTokyo Stock Exchange for the 30 consecutive trading days
(excluding the number of days where there was no closing
price) starting on the forty-fifth trading day before therelevant Decision Date by 0.9 (to be calculated to the firstdecimal place, and then rounded down to the nearest whole
number; “Adjusted Redemption Price”); provided,
however, that in a case where as a result of suchcalculation the Adjusted Redemption Price is below theamount equivalent to 50% of the Initial Redemption Pricestipulated in Paragraph (4) above (“Minimum Redemption
Price”), the Adjusted Redemption Price will be revised tobe the Minimum Redemption Price. Further, in a casewhere the Adjusted Redemption Price is greater than theamount to equivalent to 100% of the Initial Redemption
Price stipulated in Paragraph (4) above (“Maximum
Redemption Price”), the Adjusted Redemption Price will
be revised to be the Maximum Redemption Price. In theevent that in the period between the initial day of the above
30 consecutive trading days (inclusive) until the Decision
Date (inclusive), a redemption price adjustment event as
stipulated in Paragraph (6) below arises, the adjusted
redemption price will be adjusted to an amount that theCompany’s board of directors determines to be appropriate
in accordance with Paragraph (6) below.
(6) Adjustments to Redemption Price
A. After issuance of the Class A Preferred Shares, in any of
the cases set forth in Items (i) through (vi) below, theredemption price (including the Initial Redemption Price,
Minimum Redemption Price and Maximum Redemption
Price) will be adjusted using the formula below(“Redemption Price Adjustment Formula,” the adjusted
redemption price will be referred to as the “Adjusted
Redemption Price”). In the calculation of the Adjusted
Redemption Price, calculation will be made to the firstdecimal place, and the result will be rounded down to thenearest whole number.

- 52 -

Proposed Amendment

(Translation)
Current Articles of Incorporation

Adjusted
Redemption
Price

Preadjustment=
redemption
price

Proposed Amendment

Number ofAmount toNo. of be paid per
outstanding + delivered
commonsharessharecommonsharesMarket price per share
No. of outstanding common shares+ No. of delivered common shares(i) In a case where common shares are to be issued orcommon shares that are treasury shares are to be disposedof at an amount to be paid below the market price used in
the Redemption Price Adjustment Formula (as defined in C
below. hereinafter the same) (including cases of gratis
allocation, but excluding cases where shares with put
options, share options (here and hereinafter in thisParagraph (6), including share options attached to bonds
with share options) or other securities enabling demandthat the Company deliver common shares (“Shares with
Put Option”), or shares subject to call, share options
subject to call, or other securities enabling delivery ofcommon shares in the Company in exchange forredemption by the Company (“Shares Subject to Call”) areredeemed or exercised, and common shares areaccordingly delivered).The Adjusted Redemption Pricewill apply starting on the day following the payment date
(if there is a payment period, the day following the last dayof such payment period; hereinafter the same; in a case ofgratis allocation, the day following the effective datethereof); provided, however, that in cases where there is arecord date for granting common shareholders of theCompany the right to receive allocation of offered sharesto, or for making a gratis allocation, the Adjusted
Redemption Price will apply on the day following suchrecord date.
(ii) Cases of share split
It will be deemed that on the record date for share split ofcommon shares, the additional number of common shares
resulting from the split (excluding additional commonshares that arose in respect to common shares that are
Company treasury shares as of the record date) weredelivered, and the Redemption Price Adjustment Formula
will be applied and the Adjusted Redemption Price will becalculated and will apply starting on the day following
such record date.

- 53 -

(Translation)
Current Articles of Incorporation(iii) Cases where the Company issues Shares with Put
Option allowing demand that the Company delivercommon shares at a price below the market price to be
used in the Redemption Price Adjustment Formula(defined in D. below; the same applies in this Item (iii),
Items (iv) and (v) and C., Item (iv) below) (including casesof gratis allocation) It will be deemed that on the payment
date of the relevant Shares with Put Option (on the
allocation date in the case of share options, and on theeffective date in the case of gratis allocation), or, in a casewhere there is a record date for granting shareholders theright to receive allocation of Shares with Put Option or for
making a gratis allocation, on such record date, all such
Shares with Put Option were redeemed or exercised under
the initial conditions and common shares thus delivered,and the Redemption Price Adjustment Formula will beapplied accordingly, and the Adjusted Redemption Pricewill be calculated and will apply starting the day following
such payment date (the day following the allocation date in
the case of share options, and the day following theeffective date in the case of gratis allocation) or starting the
day following such record date.
Notwithstanding the foregoing, in a case where the pricehas not been determined on a day on which commonshares are deemed to have been delivered, and Shares with
Put Option for which the price will be decided on a certain
subsequent date (“Pricing Date”) are issued, if the decided
price is lower than the market price to be used in the
Redemption Price Adjustment Formula, it will be deemedthat all Shares with Put Option existing on such Pricing
Date were redeemed or exercised under the conditions
determined on the Pricing Date, and the Redemption Price
Adjustment Formula will be applied accordingly, and the
Adjusted Redemption Price will be calculated and will
apply from the day following such Pricing Date.
(iv) Cases where Shares with Put Option issued by theCompany with the condition that the price will be revisedon or after their issuance date (excluding adjustments toprevent dilution similar to this Section A. or B. below), andthe revised price (“Revised Price”) on the day such
revisions take place (“Revision Date”) is lower than themarket price to be used in the Redemption Price
Adjustment Formula.
It will be deemed that on the Revision Date, all such
Shares with Put Option that are existing were redeemed or
exercised at the Revised Price and common sharesdelivered accordingly, and the Redemption Price
Adjustment Formula will be applied accordingly, and the
Adjusted Redemption Price will be calculated and will
apply starting the day after such Revision Date.
In such application of the Redemption Price Adjustment
Formula, in response to the cases set forth in (a) through(c) below, the amount obtained through when theredemption price valid on the day prior to the day the
Adjusted Redemption Price is to be applied, is multipliedby the percentage stipulated in each relevant case(“Adjustment Coefficient”) shall be deemed the preadjustment redemption price.
(a) In a case where in regards to the relevant Shares with
Put Option, prior to the relevant Revision Date, noadjustment pursuant to Item (iii) above or this Item (iv) has
been made.

- 54 -

Proposed Amendment

(Translation)
Current Articles of Incorporation
The Adjustment Coefficient shall be 1.
(b) In a case where in regards to the relevant Shares with
Put Option, prior to the relevant Revision Date, anadjustment pursuant to Item (iii) above or this Item (iv) has
been made, and in the period between such adjustment andsuch Revision Date, redemption price revision pursuant toParagraph (5) above has taken place.
The Adjustment Coefficient shall be 1.
However, in the calculation of the Minimum Redemption
Price, the Adjustment Coefficient shall be the fraction
obtained by dividing the Minimum Redemption Price prior
to the immediately prior adjustment pursuant to Item (iii)
above or this Item (iv) by the Minimum Redemption Priceafter such adjustment.
(c) In a case where in regards to the relevant Shares with
Put Option, prior to the relevant Revision Date, anadjustment pursuant to Item (iii) above or this Item (iv) has
been made, and in the period between such adjustment andsuch Revision Date, no redemption price revision pursuant
to Paragraph (5) above has taken place
The Adjustment Coefficient shall be the fraction obtainedby dividing the Minimum Redemption Price prior to theimmediately prior adjustment pursuant to Item (iii) aboveor this Item (iv) by the Minimum Redemption Price after
such adjustment.
(v) Cases where in exchange for redemption of Shares
Subject to Call, common shares are delivered at a pricebelow the market price to be used in the Redemption Price
Adjustment Formula.
The Adjusted Redemption Price will apply starting the day
following the redemption date. However, in a case where
in regards to the relevant Shares Subject to Call,redemption price adjustment pursuant to Item (iii) or (iv)above has taken place, provided that the number of fully
diluted common shares (defined in E. below) following thedelivery of common shares in exchange for redemption
exceeds the number of outstanding common shares
immediately prior to such redemption, common shares in a
number equal to such excess will be deemed to have beendelivered, and the Redemption Price Adjustment Formula
will be applied accordingly, and the Adjusted Redemption
Price will be calculated and, if the number of outstanding
common shares immediately prior to redemption is notexceeded, no adjustment will be made pursuant to this Item(v).
(vi) Cases of share consolidation
Starting from the effective date of the share consolidation,
the number by which the number of common shares will
decrease because of consolidation (excluding the decreasein the number of common shares that are Company
treasury shares on the effective date) will be expressed as anegative number and will be deemed the number ofdelivered common shares, and the Redemption Price
Adjustment Formula will be applied accordingly, and the
Adjusted Redemption Price will be calculated and will
apply.

- 55 -

Proposed Amendment

(Translation)
Current Articles of Incorporation
B. In addition to the cases set forth above in A., Items (i)through (vi), in cases where because of merger, company
split, stock exchange, stock transfer or similar reason, it
becomes necessary to adjust the redemption price(including Initial Redemption Price, Minimum
Redemption Price and Maximum Redemption Price), theredemption price will be changed to the redemption pricethat the board of directors of the Company judges to beappropriate.
C. (i) The “market price” to be used in the Redemption
Price Adjustment Formula shall be the average of the daily
closing prices (including indicative prices) of theCompany’s common shares on the Tokyo Stock Exchange
for the 30 consecutive trading days (excluding the numberof days where there was no closing price) starting on theforty-fifth trading day before the day on which the
Adjusted Redemption Price is applied. In the calculation of
the average price, the price will be calculated to the firstdecimal place, and then rounded down to the nearest whole
number. In cases where in the period between the first dayof the above 30 consecutive trading days (inclusive) andthe Decision Date (inclusive) an event of redemption priceadjustment has arisen, the Adjusted Redemption Price will
be adjusted pursuant to this Paragraph (6).
(ii) The “pre-adjustment redemption price” to be used in
the Redemption Price Adjustment Formula shall be theredemption price effective as of the day prior to the day on
which the Adjusted Redemption Price is applied.
(iii) The “No. of outstanding common shares” in the
Redemption Price Adjustment Formula shall be thenumber of outstanding common shares of the Company(excluding common shares that are treasury shares) on therecord date in a case where there is a record date (notincluding the number of common shares deemed to havebeen delivered on such record date pursuant to the above
A., Items (i) through (iii)), or on the day one month prior
to day on which the Adjusted Redemption Price is appliedin a case where there is no record date, plus the number ofcommon shares that have been deemed to be “No. ofdelivered common shares” pursuant to the above A. and B.
prior to adjustment of such redemption price and that have
yet to be delivered (but starting from the day on which,with respect to certain Shares etc. with Put Option,
adjustment pursuant to A., Item (iv)(b) or (c) was first
applied (inclusive of such day), the number of commonshares deemed to be the “No. of delivered common shares”
pursuant to adjustment pursuant to A., Item (iii) or (iv)applied prior to the most recent adjustment of such Sharesetc. with Put Option pursuant to A., Item (iv) (b) or (c)).
(iv) The “Amount to be Paid per share” used in the
Redemption Price Adjustment Formula shall be, in the caseof A., Item (i), the relevant amount to be paid (0 yen
in the case of gratis allocation; in the case of payment inkind, the appropriate evaluation amount); in the case of A.,
Item (ii) and Item (vi), 0 yen; and in the case of A., Items(iii) through (v), the price (but in the case of Item (iv), theadjusted price).

- 56 -

Proposed Amendment

(Translation)
Current Articles of Incorporation
D. The term “price” as used above in A., Items (iii)through (v) and C., Item (iii) refers to the amount obtained,
through deducting the price of the property other thancommon shares to be delivered to the holder of such of
Shares with Put Option or Shares Subject to Call at thetime of their redemption or exercise from the amount paid
in at the time of issue of Shares with Put Option or Shares
Subject to Call (in the case of share options, the amountincluding the price of the in-kind contribution made on theexercise thereof), and then divided such amount by the
number of common shares delivered at the time of such
redemption or exercise.
E. The term “number of fully diluted common shares” usedin A., Item (v) above shall mean the number of outstanding
common shares as of the day on which the Adjusted
Redemption Price is applied, less the number of commonshares that are included in the No. of outstanding commonshares in accordance with A., Item (iii) but have yet to bedelivered and that are related to such Shares Subject toCall, plus the number of common shares to be delivered
through the redemption of such Shares Subject to Call.
F. In a case of A., Items (i) through (iii), where a record
date for the relevant act has been stipulated, and such
relevant act is subject to the suspensive condition of
approval of certain matters at the Company’s general
meeting of shareholders to be held on or after such record
date, notwithstanding the provisions of A., Items (i)through (iii), the Adjusted Redemption Price will apply
starting the day following the day of completion of theshareholders general meeting where such approval was
given.
G. When the difference between the Adjusted Redemption
Price computed using the Redemption Price Adjustment
Formula and the pre-adjustment redemption price is lessthan one yen, the redemption price will not be adjusted;
provided, however, that in a case where an event
subsequently arises necessitating adjustment of theredemption price using the Redemption Price Adjustment
Formula and the redemption price is to be computed, inplace of the pre-adjustment redemption price in the
Redemption Price Adjustment Formula, the amountobtained when this difference is deducted from the preadjustment redemption price will be used.
7. Conditions for Redemption for Cash
(1) Conditions for Redemption for Cash
At any time from April 1, 2016 through March 31, 2024,
on a date to be separately determined (“Compulsory
Redemption for Cash Date”) by its board of directors, theCompany may deliver money to Class A Preferred
Shareholders or Registered Class A Preferred Share
Pledgees in an amount not exceeding the Distributable
Amount in exchange for redeeming all or part of the Class
A Preferred Shares (“Compulsory Redemption for Cash”).
The number of Class A Preferred Shares redeemed in apartial redemption will be based on a proportional
allocation or other reasonable method as determined by theboard of directors of the Company.
(1) Conditions for Redemption for Cash

- 57 -

Proposed Amendment(deleted)(Translation)
Current Articles of Incorporation
At any time from April 1, 2016 through March 31, 2024,
on a date to be separately determined (“Compulsory
Redemption for Cash Date”) by its board of directors, theCompany may deliver money to Class A Preferred
Shareholders or Registered Class A Preferred Share
Pledgees in an amount not exceeding the Distributable
Amount in exchange for redeeming all or part of the Class
A Preferred Shares (“Compulsory Redemption for Cash”).
The number of Class A Preferred Shares redeemed in apartial redemption will be based on a proportional
allocation or other reasonable method as determined by theboard of directors of the Company.
(2) Redemption Price
The redemption price per Class A Preferred Share in theevent a Compulsory Redemption for Cash is made shall bean amount equal to 110% of the amount to be paid perClass A Preferred Share plus the amount obtained throughmultiplying the amount of Class A Preferred Dividends ofthe relevant fiscal year in which Compulsory Redemption
for Cash Date falls by the number of days from April 1(inclusive) to the Compulsory Redemption for Cash Date(inclusive), and then calculated by dividing that amount by
365 (calculated to the first decimal place, and rounded up
to the nearest whole yen); provided, however, that theamount of the Class A Preferred Interim Dividend paid in
the fiscal year in which the Compulsory Redemption for
Cash Request Date falls shall be deducted from the amountthus calculated.
8. Conditions for Redemption for Common Shares(1) Conditions for redemption for common shares
The Company will redeem all Class A Preferred Sharesthat have not been redeemed by the Company by the last
day of the Redemption Request Period on the day
following the last day of the Redemption Request Period(“Collective Redemption Date”) and, in exchange for such
redemption, will deliver common shares. In this case, theCompany will redeem such Class A Preferred Shares, andin exchange shall deliver to the relevant Class A Preferred
Shareholders common shares in a number obtained bymultiplying the number of Class A Preferred Shares a
Class A Preferred Shareholder owns by an amountequivalent to the amount to be paid per one such Class A
Preferred Share, and then dividing that amount by the pricestipulated in Paragraph (2) below (“Collective Redemption
Price”). Fractions of less than one share arising in thenumber of common shares to be delivered in exchange forredemption of the Class A Preferred Share will be handledin accordance with Article 234 of the Companies Law.
(2) Collective Redemption Price- 58 -

Proposed Amendment(deleted)(Translation)
Current Articles of Incorporation
The Collective Redemption Price shall be the amountobtained when the average of the daily closing prices(including indicative prices) of the Company’s commonshares on the Tokyo Stock Exchange for the 30
consecutive trading days (excluding the days where no
closing price was computed) starting on the forty-fifth
trading day before the Collective Redemption Date ismultiplied by 0.9 (to be calculated to the first decimal
place, and then rounded down to the nearest whole
number); provided, however, that in a case where as aresult of such calculation the Collective Redemption Priceis below the Minimum Redemption Price, the Collective
Redemption Price shall be the Minimum Redemption
Price.
9. Restrictions on Transfer
The acquisition of Class A Preferred Share by assignment
requires the approval of the Company.
10. Consolidation of Shares and Share Splits andAllocation of Offered Shares(1) The Company shall not consolidate or split Class A
Preferred Shares.
(2) The Company shall not grant Class A Preferred
Shareholders the right to receive allocation of offeredshares or the right to receive allocation of offered shareoptions(3) The Company shall not make a gratis allocation ofshares or a gratis allocation of share options to Class A
Preferred Shareholders.
11. Limitation Period for the Preferred Dividends, etc.
Article 37 hereof shall be applied to the payment of the
Dividend and Interim Dividend of the Class A
Preferred Shares.

Proposed Amendment(deleted)(deleted)(deleted)

Chapter 3 General Shareholder’s Meeting
Articles 12 to 17 (provisions omitted)
Articles 17-2 (Class Meeting of the Class-A Shareholders)
Article 16, Paragraph 1 hereof shall be applied a resolutionof Preferred Shareholders’ Meeting under Article 324 andParagraph 1 of the Companies Act.
2. Article 16, Paragraph 2 hereof shall be applied aresolution of Preferred Shareholders’ Meeting under
Article 324 and Paragraph 1 of the Companies Act.
3. Articles 14, 15 and 17 hereof shall be applied toPreferred Shareholders’ Meeting.
4. Article 13 shall be applied to Preferred Shareholder’sMeeting to be held on the same day with Ordinary General
Shareholders’ Meeting.

Chapter 3 General Shareholder’s Meeting
Articles 12 to 17 (unchanged)(deleted)

Chapter 4 Directors and the Board of Directors
Articles 18 to 19 (provisions omitted)
Article 20 (Tenure of Office of Directors)
1. The tenure of office of Directors shall expire at the closeof the Ordinary General Meeting of Shareholders held withrespect to the last of the fiscal years that end within two (2)years after they are elected.
2. The tenure of office of any Director elected as a
substitute shall expire at the time when the tenure of officeof incumbent Directors is scheduled to expire.

Chapter 4 Directors and the Board of Directors
Articles 18 to 19 (unchanged)
Article 20 (Tenure of Office of Directors)
1. The tenure of office of Directors shall expire at the closeof the Ordinary General Meeting of Shareholders held withrespect to the last of the fiscal years that end within one (1)years after they are elected.
2. The tenure of office of any Director elected as a
substitute shall expire at the time when the tenure of officeof incumbent Directors is scheduled to expire.

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(Translation)
Current Articles of Incorporation
Article 21 to 25 (provisions omitted)

Proposed Amendment
Article 21 to 25 (unchanged)

Article 26 (Exemption of liabilities for outside directors)
The Company may conclude with outside directors
agreements to limit liabilities for compensation fordamages due to any negligence of their duties, inaccordance with provision of Paragraph 1, Article 427 of
the Companies Act; Provided, however, that the amount oflimit for such liabilities for compensation based on suchagreements shall be the minimum amount provided for bylaws and regulations.

Article 26 (Exemption of liabilities for Directors)
The Company may conclude with Directors (excluding
executive officer, etc.) agreements to limit liabilities forcompensation for damages due to any negligence of theirduties, in accordance with provision of Paragraph 1,
Article 427 of the Companies Act; Provided, however, thatthe amount of limit for such liabilities for compensation
based on such agreements shall be the minimum amountprovided for by laws and regulations.

Chapter 5 Audit & Supervisory Board Members andthe Audit & Supervisory Board
Articles 27 to 32 (provisions omitted)
Article 33 (Exemption of liabilities for Outside Audit &Supervisory Board Members)
The Company may conclude with Outside Audit &Supervisory Board Members agreements to limit liabilities
for compensation for damages due to any negligence of
their duties, in accordance with provision of Paragraph 1,
Article 427 of the Companies Act; Provided, however, thatthe amount of limit for such liabilities for compensation
based on such agreements shall be the minimum amountprovided for by laws and regulations.
Chapter 6 Calculation
Article 34 to 37 (provisions omitted)(Newly established)

Chapter 5 Audit & Supervisory Board Members andthe Audit & Supervisory Board
Articles 27 to 32 (unchanged)
Article 33 (Exemption of liabilities for Audit &Supervisory Board Members)
The Company may conclude with Audit & Supervisory
Board Members agreements to limit liabilities forcompensation for damages due to any negligence of theirduties, in accordance with provision of Paragraph 1,
Article 427 of the Companies Act; Provided, however, thatthe amount of limit for such liabilities for compensation
based on such agreements shall be the minimum amountprovided for by laws and regulations.
Chapter 6 Calculation
Article 34 to 37 (unchanged)
Supplementary provision
Regardless of the provisions of Article 20, the tenure of
office of Directors elected at the 90th Ordinary General
Meeting of Shareholders held on June 25, 2014 shall
expire at the close of the Ordinary General Meeting of
Shareholders to be held in 2016.
The supplementary provision shall be deleted after such
effective date.

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(Translation)
Agenda 3: Election of Three (3) Directors
The tenure of office of Directors Hideichi Kawasaki and Hisao Suzuki will expire at the endof this general meeting of shareholders.
Three candidates for directors are shown as follows.
Candidates for Directors (Three):CandidatenumberName(Date of birth)1

Hideichi Kawasaki(January 10, 1947)

2

3*Toshiya Hatakeyama(July 6, 1957)

Minoru Morio(May 20, 1939)

Brief personal profile, position andresponsibility in the Company and significant concurrent
positionsApr. 1970
Joined Oki Electric Industry Co., Ltd.
Apr. 2001
Executive Officer
Apr. 2004
Senior Vice President
Jun. 2005
Managing Director
Apr. 2009
Senior Executive Vice President and Member ofthe Board
Jun. 2009
President, Representative Director (incumbent)
Apr. 1980
Joined Oki Electric Industry Co., Ltd.
Oct. 2007
Manager, Accounting & Control Division
Apr. 2008
Executive Officer
Jun. 2009
Outside director, SAXA Holdings, Inc.
(incumbent)
Jan. 2013
Manager, Group Administration Division
Apr. 2015
Senior Vice President (incumbent)
Apr. 1963
Joined Sony Corporation
Jun. 1988
Director, Sony Corporation
Jun. 1993
Executive Deputy President, Sony Corporation
Jun. 2000
Director and Vice Chairman, Sony Corporation
Jun. 2001
Outside Director, Oki Electric Co., Ltd.
Jun. 2004
Advisor, Sony Corporation
Apr. 2006
Executive Alumnus, Sony Corporation(incumbent)
Jun. 2013
Outside Director, the Bank of Yokohama, Ltd.
(incumbent)
Jun. 2014
Outside Audit & Supervisory Board Member,
ZUKEN ELMIC, Inc. (incumbent)(Significant concurrent position)
Outside Director, the Bank of Yokohama, Ltd.

Number of Oki
shares held

Common stock
127,000 shares

Common stock
29,000 shares

Common stock
10,000 shares

Notes:
1.
* indicates a new candidate for a Director.
2.
Mr. Toshiya Hatakeyama is scheduled to resign from the position of Outside Director of SAXA Holdings,
Inc. at the conclusion of the Ordinary General Meeting of Shareholders of SAXA Holdings, Inc. to be heldon June 26, 2015. In addition, Mr. Minoru Morio is scheduled to resign from the position of Outside Audit& Supervisory Board Member of ZUKEN ELMIC, Inc. at the conclusion of the Ordinary General Meetingof Shareholders of ZUKEN ELMIC, Inc. to be held on June 24, 2015.
3.
Mr. Minoru Morio is a candidate for outside director. He was also an outside director of the Company from
June, 2001 to June, 2010.
4.
The reason Mr. Minoru Morio is being put forward as a candidate for outside director is as follows:
He has extensive experience in the electronics industry and excellent personality and insight, and theCompany judges that he would be able to provide appropriate advice on the Company’s businessenvironment and management issues and that his appointment would strengthen the supervisory function of
the Board of Directors to the business execution body.
5.
If the appointment of Mr. Minoru Morio is approved, the Company will enter into the liability limitationagreement with him.
Outline of liability limitation agreements is as follows:- In cases where Directors are liable for any damages arising from their negligence to the Company, theyshall compensate for such damages only to the extent of the minimum liabilities as stipulated in Article 427,
Paragraph 1 of the Companies Act.

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(Translation)

6.

- The above limitation of liability shall be applied only when the relevant Directors have executed theirduties that caused the liabilities in good faith and without gross negligence.
If the appointment of Mr. Minoru Morio is approved, the Company will notify the Tokyo Stock Exchange of
his status as an independent officer. This is because net sales to Sony Corporation account for less than 1%of the OKI Group’s total net sales and Mr. Minoru Morio meets the criteria for an independent officer basedon the terms of the Tokyo Stock Exchange.

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(Translation)
Agenda 4: Election of One (1) Audit & Supervisory Board Member
The tenure of office of Audit & Supervisory Board Member Shuichi Kawano will expire at
the end of this general meeting of shareholders. A candidate for Audit & Supervisory Board
Member is shown as follows.
This agenda has been approved by the Audit & Supervisory Board.
Audit & Supervisory Board Member (One):
Name(Date of birth)*Hisao Suzuki(April 14, 1952)

Brief personal profile, position andresponsibility in the Company and significant concurrent
positionsApr. 1975
Joined The Fuji Bank, Limited
May 2000
Manager, First Global Credit Department, The
Fuji Bank, Limited
Apr. 2002
Manager, Second Credit Department, Mizuho
Corporate Bank, Ltd.
Jun. 2004
Director, Oki Wintech Co., Ltd.
May 2005
Managing Director, Oki Wintech Co., Ltd.
Apr. 2008
Executive Officer, Oki Electric Industry Co.,Ltd.
Apr. 2009
Senior Vice President
Apr. 2012
Executive Vice President
Jun. 2013
Executive Vice President and Member of the
Board
Apr. 2015
Director (incumbent)

Number of Oki
shares held

Common stock
61,800 shares

Notes:
1.
* indicates a new candidate for an Audit & Supervisory Board Member.
2.
Mr. Hisao Suzuki has served in positions such as Officer in charge of the Accounting & Control Division andChief Financial Officer, and has extensive knowledge in finance and accounting.
3.
If the appointment of Mr. Hisao Suzuki is approved, the Company will enter into the liability limitationagreement with him, subject to the approval of Agenda 2 “Partial Amendment of the Articles ofIncorporation.”
Outline of liability limitation agreements is as follows:- In cases where Audit & Supervisory Board Members are liable for any damages arising from theirnegligence to the Company, they shall compensate for such damages only to the extent of the minimum
liabilities as stipulated in Article 427, Paragraph 1 of the Companies Act.
- The above limitation of liability shall be applied only when the relevant Audit & Supervisory Board
Members have executed their duties that caused the liabilities in good faith and without gross negligence.

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(Translation)
Appendix

Instructions for the Exercise of Voting Rights via the Internet

1.

Matters requiring your agreement concerning the exercise of voting rights via the Internet
We kindly request your consent to the following regarding exercise of voting rights via the Internet.
1) Exercise of voting rights via the Internet is only possible by accessing the voting site designated by theCompany (http://www.it-soukai.com/) via a PC or a mobile phone. When exercising the voting rightusing this site, you are requested to log in to the site using your voting rights exercise code and password
provided in the right corner of the voting rights exercise form, enclosed with the Notice, then follow theguidance on the screen. To ensure security, you are requested to enter the password when executing thefirst log-in.
2) You are requested to complete entries by 5:15 p.m., June 23 (Tuesday), 2015 (JST), which is the deadline
for execution. Please exercise your voting rights at your earliest convenience.
3) If you exercise your voting rights both in writing and via the Internet, we will regard the vote cast via theInternet to be effective.
4) If you exercise your voting rights more than once, we will regard the last vote you cast via the Internet tobe the effective one.
5) You will bear all connection charges for using the Internet (service provider access fees, communication
charges, etc.).

2.

Technical specifications
1) Internet environment: an environment, where the Internet can be used, such as conclusion of a contract
with an Internet provider, is required.
2) Browser: Internet Explorer 5.01 SP2 or above
3) Software
Adobe Acrobat Reader Ver. 4.0 or later, or Adobe Reader Ver. 6.0 or later4) Screen resolution
800x600 dots (SVGA) or more

3.

Notes on information security
Please rest assured that you will be able to use our systems safely as we use cryptographic technology (128-bitSSL) in order to prevent exercise-related information from being falsified or wiretapped.
The voting rights exercise code and password provided on your voting rights exercise form are an
important means of validating you as our shareholder. Please ensure that they are not disclosed to others.
The Company’s staff will never ask you to disclose your password.

4.

Contact
1) For information concerning the operation of personal computers for the electronic exercise of voting
rights:Internet Help Dial, Stock Transfer Agency Department, Mizuho Trust & Banking Co., Ltd.
Tel: 0120-768-524 (toll-free)
From 9:00 a.m. to 9:00 p.m. excluding Saturdays, Sundays and national holidays
2) For address changes and other matters other than (1) above:
Stock Transfer Agency Department, Mizuho Trust & Banking Co., Ltd.
Tel. 0120-288-324 (toll-free)
From 9:00 a.m. to 5:00 p.m. excluding Saturdays, Sundays and national holidays

Internet Explorer is registered trademarks of Microsoft Corporation (U.S.).
Adobe Acrobat Reader and Adobe Reader are registered trademarks or trademarks of Adobe Systems Incorporated.

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