This document has been translated from the Japanese original for the convenience of non-Japanese shareholders. In the event ofany discrepancy between this translation and the Japanese original, the original shall prevail.

Securities identification code: 5451
May 31, 2017

To our shareholders:
Takaaki Kawamoto

President and Representative Director

Yodogawa Steel Works, Ltd.
4-1-1 Minami-honmachi, Chuo-ku, Osaka

NOTICE OF THE 118TH ORDINARY GENERAL MEETING OF SHAREHOLDERS
You are cordially invited to attend the 118th Ordinary General Meeting of Shareholders of Yodogawa Steel Works, Ltd.
(the “Company”) which will be held as described below.
Moreover, if you are unable to attend on the day, you may exercise your voting rights either by postal mail (votingform) or electronically (via the Internet). Please review the ‘Reference Documents for the General Meeting of
Shareholders’ attached below and kindly peruse the ‘4. Exercise of voting rights’ on the following page. We requestthat you exercise your rights no later than 5:00 p.m., Wednesday, June 21, 2017 (Japan Standard Time).
Meeting Details
1.

Date and time:Thursday, June 22, 2017, at 10:00 a.m. (Japan Standard Time)

2.

Venue:

Head office of Yodogawa Steel Works, Ltd.
4-1-1 Minami-honmachi, Chuo-ku, Osaka

3.

Purposes:
Items to be reported:
1. Business Report and Consolidated Financial Statements for the 118th Term (from April 1, 2016 to March 31,2017), as well as the results of audit of the Consolidated Financial Statements by the Accounting Auditor andthe Audit & Supervisory Board.
2. Non-Consolidated Financial Statements for the 118th Term (from April 1, 2016 to March 31, 2017)
Items to be resolved:
Proposal 1:

Election of six (6) Directors

Proposal 2:

Election of one (1) Audit & Supervisory Board Member

Proposal 3:

Election of one (1) substitute Audit & Supervisory Board Member

Proposal 4:

Continuation of the Company's Policy for Responding to Large-Scale Acquisitions of theCompany's Shares (Takeover Defense Measures)1

4. Exercise of voting rights:(1) Exercise of Voting Rights by Postal Mail
Please indicate your approval or disapproval of the proposals on the enclosed voting form after reviewing theattached Reference Documents for the General Meeting of Shareholders, and return it by postal mail to reach us nolater than 5:00 p.m., Wednesday, June 21, 2017 (Japan Standard Time).
(2) Exercise of Voting Rights via the Internet)
Please exercise your voting rights by accessing the Company’s designated website (http://www.it-soukai.com/) withthe “Voting Code” and “Password” provided on the enclosed voting form, and enter your approval or disapproval
for each proposal no later than 5:00 p.m., Wednesday, June 21, 2017 (Japan Standard Time).
Moreover, we request that you kindly refer to the ‘Guide to the Exercise of Voting Rights on the Internet’ to confirm
all other details about this process.
(3) Duplicate Exercises of Voting Rights
i. In cases of duplicate exercise of voting rights both by using the voting form and by using the Internet, the exerciseof the voting rights via the Internet shall be treated as valid.
ii. In cases in which multiple exercises of voting rights have been made via the Internet, the most recent exercise of
voting rights shall be treated as valid.

2Reference Documents for the General Meeting of Shareholders
Items to Be Resolved and Reference Documents
Proposal 1:

Election of six (6) Directors

The term of office of all six (6) Directors will expire at the conclusion of this General Meeting of Shareholders.
Accordingly, the Company proposes the election of six (6) Directors.
The candidates for Directors are as follows:
No.

Name
(Date of birth)

Career summary, position, responsibilities, andsignificant concurrent positions outside the Company
August 1972
June 2001
July 2003

Yoshitsugu Kokubo(December 12, 1945)

June 2004
June 2005
June 2006
April 2012

1

Joined the Company
Director and General Manager Kure Plant of the Company
Director of the Company and Chairman of the Board,
Sheng Yu Steel Co., Ltd.
Senior Executive Officer of the Company and Chairman of
the Board, Sheng Yu Steel Co., Ltd.
Director and Managing Executive Officer of the Company,
and Chairman of the Board, Sheng Yu Steel Co., Ltd.
President and Representative Director of the Company
Chairman and Representative Director of the Company(Current Position)

Number of theCompany’s
shares owned

27,911

Reasons for selection as a candidate for Director
Yoshitsugu Kokubo has worked mainly in the production department of steel-coil and sheet-related operations. Since
he also has considerable operational experience relating to the management of overseas subsidiary companies, werequest that he continue to be appointed as a Director to utilize his extensive experience and knowledge as a member ofthe Board of Directors of the Company.
April 1973
June 2004
June 2006
June 2007
Takaaki Kawamoto(April 6, 1950)
2

June 2009
April 2010

April 2012

Joined the Company
Executive Officer, General Manager Kure Plant, and General
Manager of Manufacturing Dept. Kure Plant of the Company
Senior Executive Officer, General Manager Kure Plant, andGeneral Manager of Manufacturing Dept. Kure Plant of theCompany
Senior Executive Officer and General Manager Ichikawa
Plant of the Company
Director, Managing Executive Officer, Senior General
Manager Corporate Planning Division, and Supervisor of
Steel Coil & Sheet Plants of the Company
Director, Managing Executive Officer, Senior General
Manager Corporate Planning Division, General Manager ofCorporate Planning Dept., General Manager of Logistics
Dept., General Manager of Overseas Business Planning Dept.,
and Supervisor of Steel Coil & Sheet Plants of the Company
President and Representative Director of the Company(Current Position)

15,718

Reasons for selection as a candidate for Director
Takaaki Kawamoto has worked mainly in the production and corporate planning department of steel-coil and sheetrelated operations. Since he also has considerable operational experience relating to the management of overseas
subsidiary companies, we request that he continue to be appointed as a Director to utilize his extensive experience andknowledge as a member of the Board of Directors of the Company.

3

No.

Career summary, position, responsibilities, andsignificant concurrent positions outside the Company

Name(Date of birth)
April 1973
June 2000
June 2004
June 2006
June 2009
October 2009
June 2011
Toyomi Omori(September 4, 1948)

April 2012
June 20123

April 2015

June 2016

Number of theCompany’s
shares owned

Joined the Company
General Manager of Steel Sheet Sales Dept. of Tokyo Branchof the Company
Executive Officer and General Manager of Steel Sheet Sales
Dept. of Tokyo Branch of the Company
Senior Executive Officer of the Company and Chairman of
the board, Sheng Yu Steel Co., Ltd.
Senior Executive Officer, General Manager Sales Division, incharge of Steel Sheet Sales Division, and Branch Manager ofTokyo of the Company
Senior Executive Officer, General Manager Sales Division, incharge of Sales Dept. – 1 and 2, General Manager of Sales
Dept. - 1, and Branch Manager of Tokyo of the Company
Managing Executive Officer, General Manager Sales
Division, in charge of Sales Dept. – 1 and 2, and BranchManager of Tokyo of the Company
Managing Executive Officer and Senior General Manager
Sales Division of the Company
Director, Managing Executive Officer, and Senior General
Manager Sales Division of the Company
Director, Senior Managing Executive Officer, Senior General
Manager Sales Division, Branch Manager of Tokyo of theCompany, and in charge of YODOKO SHOJI CO., LTD. andRoll Dept.
Director, Senior Managing Executive Officer, Senior General
Manager Sales Division, Branch Manager of Tokyo of theCompany, and in charge of Roll Dept. (Current Position)

11,566[Significant concurrent position outside the Company]
Chairman of the Board, YODOGAWA-SHENGYU (HEFEI)HIGH-TECH STEEL CO., LTD.
Reasons for selection as a candidate for Director
Toyomi Omori has worked mainly in the sales department of steel-coil and sheet-related operations. Since he also
has considerable operational experience relating to the management of overseas subsidiary companies, we requestthat he continue to be appointed as a Director to utilize his extensive experience and knowledge as a member of theBoard of Directors of the Company.
April 1980
November 2009
September 2010
April 2012
* Satoshi Nitta(March 26, 1956)
April 2014
4

Joined the Company
Was seconded to Sheng Yu Steel Co., Ltd.
Was treated as General Manager of Sheng Yu Steel Co., Ltd.
Senior Executive Officer, Senior General Manager Corporate
Planning Division, General Manager of Overseas Business
Planning Dept., and Supervisor of Steel Coil & Sheet Plantsof the Company
Senior Executive Officer of the Company, and President of
YODOGAWA-SHENGYU (HEFEI) HIGH-TECH STEEL
CO., LTD. (Current Position)

Reasons for selection as a candidate for Director
Satoshi Nitta has worked mainly in the production and corporate planning department of steel-coil and sheetrelated operations. Since he also has considerable operational experience relating to the management of overseas
subsidiary companies, we request that he be appointed as a Director to utilize his extensive experience andknowledge as a member of the Board of Directors of the Company.

4

4,542

No.

Name
(Date of birth)

Career summary, position, responsibilities, andsignificant concurrent positions outside the Company
April 1970
June 2001
June 2002

Toshikazu Saeki(March 1, 1948)
5

June 2011
April 2012
June 2015
December 2016

Number of theCompany’s
shares owned

Joined Kobe Steel, Ltd.
Administration Officer and General Manager Osaka branch of
Kobe Steel, Ltd.
President and Representative Director of Shinko Care Life
Co., Ltd.
Advisor of Shinko Care Life Co., Ltd.
Specially Appointed Professor and Assistant to the Presidentof Kobe University
Director of the Company (Current Position)
Director (Audit & Supervisory Committee Member) of
LOCKON CO,.LTD. (Current Position)0

Reasons for selection as a candidate for Outside Director
Toshikazu Saeki has extensive experience as a manager and a wide range of knowledge, and so we request that hecontinue to be appointed as an Outside Director so that such abundance of experience and knowledge can be reflectedin the management of the Company.
April 1976
June 2006
June 2008
June 2009
June 2011
Hiroshi Okamura(April 13, 1952)
6

June 2011
June 2012
June 2012
June 2013
June 2015

Joined The Daiwa Bank, Ltd. (currently Resona Bank,
Limited. ）Representative Director, Vice President and Executive Officer
of Resona Bank, Limited.
President and Representative Director of Resona ResearchInstitute Co., Ltd.
Director of The Kinki Osaka Bank, Ltd.
Part-time Auditor-secretary of Osaka Cosei Shinkin Bank
(Current Position)
Part-time Auditor of Japan Foundation Engineering Co., Ltd.
(Current Position)
President and Representative Director of Shikishima Printing
Co., Ltd. (Current Position)
Part-time Director of Koyubusiness Co., Ltd.
(Current Position)
Auditor of Osaka International Convention Center
Corporation (Current Position)
Director of the Company (Current Position)0

Reasons for selection as a candidate for Outside Director
Hiroshi Okamura has extensive experience as a manager and a wide range of knowledge, and so werequest that he continue to be appointed as an Outside Director so that such abundance of experience andknowledge can be reflected in the management of the Company.
Notes:
1.

Asterisk ( * ) indicates a new candidate for Director.

2.

Director candidate Yoshitsugu Kokubo will retire the President and Representative Director of Keiyo Tekko Futo Co., Ltd. at theconclusion of its general meeting of shareholders to be held on June 19, 2017, and Director candidate Takaaki Kawamoto isplanned to be appointed as the Director of Keiyo Tekko Futo Co., Ltd. at the same general meeting of shareholders and to beappointed as and accept appointment of the President and Representative Director at its board of directors meeting. The Company
has transactional relationship with the company such as storage and transportation services of the Company’s products and so on.

3.

Other than the above, there is no particular business or other relationship between any of the candidates and the Company.

4.

Number of Years since the Candidates for Outside Directors were appointed as Outside Directors of the Company
Director candidates Toshikazu Saeki and Hiroshi Okamura have both, as of the date of the conclusion of this General Meeting of
Shareholders, served as Outside Directors of the Company for a period of two years.

5.

Director candidates Toshikazu Saeki and Hiroshi Okamura are candidates for election as Outside Directors. A notice has been
submitted to the Tokyo Stock Exchange that these two candidates are designated as Independent Officers in accordance with theregulations of this exchange.

6.

The Company has agreements with Toshikazu Saeki and Hiroshi Okamura respectively that limit their liability as prescribed in
Article 423, Paragraph 1 of the Companies Act, in accordance with Article 427, Paragraph 1 of the Companies Act and theCompany’s Articles of Incorporation. The liability limit in these agreements is the higher of 8 million yen or the minimum limit on5liability in Article 425, Paragraph 1 of the Companies Act, and in case they are re-elected, the Company plans to continue suchagreements with them.

6Proposal 2:

Election of one (1) Audit & Supervisory Board Member

An Audit & Supervisory Board Member, Katsumi Sakaiguchi, will resign at the conclusion of this General Meetingof Shareholders. Accordingly, the Company proposes the election of one (1) Audit & Supervisory Board Member as
his substitute. The term of office of an elected Audit & Supervisory Board Member shall be the same as theremaining term of the resigning member pursuant to the Company’s Articles of Incorporation.
The Audit & Supervisory Board has given its consent to this proposal.
The candidates for an Audit & Supervisory Board Member is as follows:
Name(Date of birth)

Career summary,position,and significant concurrent position
outside the Company
August 1972
September 2006
September 2007
June 2009
June 2011
April 2012

Maomi Hayashi(October 25, 1949)
June 2012

September 2013

Joined the Company
General Manager of General Affairs Dept. ofKure Plant of the Company
General Manager of Finance & Accounting
Dept. of the Company
Executive Officer and General Manager of
Accounting & Finance Dept. of the Company
Senior Executive Officer and Senior Manager ofFinance & Accounting Dept. of the Company
Managing Executive Officer, Senior General
Manager Administration Division, General
Manager of Finance & Accounting Dept., and in
charge of Affiliates of the Company
Director, Managing Executive Officer, Senior
General Manager Administration Division,
General Manager of Finance & Accounting
Dept., and in charge of Affiliates of theCompany
Director, Managing Executive Officer, Senior
General Manager Administration Division, andin charge of Affiliates of the Company (Current
Position)

Number of theCompany’s
shares owned

9,473

Reasons for selection as a candidate for Audit & Supervisory Board Member
Maomi Hayashi has extensive knowledge of general affairs, finance and accounting from his many years ofexperience in these areas, and consequently we request that he be appointed as an Audit & Supervisory Board
Member.
Notes:
1.

There is no particular business or other relationship between the candidate as above and the Company.

7

Proposal 3:

Election of one (1) substitute Audit & Supervisory Board Member

The Company proposes that one (1) substitute Audit & Supervisory Board Member be elected to prepare for a casewhere the number of the members of Audit & Supervisory Board falls below the number stipulated by laws andregulations.
The Audit & Supervisory Board has given its consent to this proposal.
The candidate for substitute Audit & Supervisory Board Member is as follows:
Name(Date of birth)

Career summary and significant concurrent position
outside the Company
November 1976

Ichiro Inui
(March 2, 1952)

September 1980
June 2000
June 2008
September 2010
July 2014

Number of theCompany’s
shares owned

Joined Asahi & Co.
(currently KPMG AZSA LLC)
Registered as Certified Public Accountant
Appointed as Partner
Appointed as Board Member
Appointed as Internal Auditor
Opened Inui Certified Public Accountant Office
Position which he continues to hold0

Reasons for selection as a candidate for substitute Audit & Supervisory Board Member
Ichiro Inui has considerable knowledge of finance and accounting from his many years of experience as a
Certified Public Accountant. He was asked to become a substitute Outside Audit & Supervisory Board Member
candidate in order to utilize this knowledge in the Company’s auditing activities. He has not been directly
involved with the management of a company. However, he has considerable expertise involving finance, andaccounting matters as a Certified Public Accountant. Since he has sufficient knowledge to deal with thesematters, the Company believes that he will be able to properly perform the duties of an Outside Audit &Supervisory Board Member.
Notes:
1.

There is no particular business or other relationship between the candidate as above and the Company.

2.

Ichiro Inui is a candidate for election as a substitute Outside Audit & Supervisory Board Member.

3.

Ichiro Inui fulfills the requirements as an Outside Audit & Supervisory Board Member.

4.

If Ichiro Inui is elected as Outside Audit & Supervisory Board Member, in accordance with Article 427, Paragraph 1 of theCompanies Act and the Company’s Articles of Incorporation, the Company plans to establish an agreement with this individualthat limit his liability as prescribed in Article 423, Paragraph 1 of the Companies Act. The liability limit in this agreement will be
the higher of 8 million yen or the minimum limit on liability in Article 425, Paragraph 1 of the Companies Act.

8

Proposal 4:

Continuation of the Company's Policy for Responding to Large-Scale Acquisitions of theCompany's Shares, etc. (Takeover Defense Measures)
The Company introduced "The Company's Policy for Responding to Large-Scale Acquisitions of the Company's
Shares, etc." (Takeover Defense Measures) at the Board of Directors meeting held on May 23, 2006. Subsequently, we
continued to consider the policy as one of the initiatives to protect and increase the Company's corporate value and thecommon interests of shareholders, including whether or not to continue it and its form if it were to continue, based onsocial and economic changes, various developments surrounding takeover defense measures, the unfolding of various
discussions, and the Corporate Governance Code, and so on.
At the 115th annual general meeting of shareholders held on June 25, 2014, the shareholders approved a partial
amendment to update "The Company's Policy for Responding to Large-Scale Acquisitions of the Company's Shares,etc." (Takeover Defense Measures) (hereinafter referred to as the "Current Plan"). Further, prior to the expiry of theCurrent Plan, at the Company's Board of Directors meeting held on April 27, 2017, it was resolved that the Takeover
Defense Measures would be continued subject to the approval of the shareholders at the general shareholders meeting(hereinafter, the Takeover Defense Measures after continuation will be referred to as the "Plan").
Accordingly, the shareholders’ approval of the Plan shareholders is requested.
The main points of difference between the Plan from the Current Plan are as follows:(1) It clarifies that it is envisioned that no money will not be offered as consideration for the acquisition of the shareacquisition rights possessed by the Large-Scale Buyer in the event share acquisition rights are allotted without
contribution as a countermeasure against a Large-Scale Acquisition.
(2) It limits the types of exceptional instances where a decision can be made by the Board of Directors to approve or rejectcountermeasures, in the event a Large-Scale Buyer has complied with the Large-Scale Acquisition Rules.
(3) Additionally, some amendments of words and phrases, and some edition of expressions have been made.
1. Purpose of the Plan
The environment surrounding the Company's primary business, the manufacture and sale of surface-treated steel sheet,
has increasingly changing and is becoming more difficult. Under such circumstances, the company group has madeefforts to expand businesses that take advantage of our strengths, such as management that focuses on flexibility only
available to companies that are independent with respect to their management policies, raw material procurement, and soon, an optimal balance of geographical locations in Asia, our customer base and reputation which we have built up
through over 80 years of operations, and our strong financial structure. In conjunction with this, we are also taking
measures to improve corporate value, such as enhancement of fundamental earning power primarily on sheet steel
segment, and reforms to our corporate management structure. In terms of the Company's management, we believe that,in order to have a proper appreciation of corporate value, it is indispensable to understand not only our technology andexperience in relation to surface finishing for steel sheet, casting rolls, etc., which we have accumulated over many
years, and the relationships of trust which we have been built not only with stakeholders such as the Company's trade
partners and employees, but also with business partners and their employees in countries and regions where the company
group has conducts business. Further, we believe that, for manufacturing businesses in particular, which require a
considerable amount of time in order to research and develop new base technologies and commercialize them,
management that takes initiatives to improve medium to long-term growth in corporate value rather than short-term
profit would contribute to the interests of the shareholders overall.
On the other hand, due to the current state of Japan's capital markets and legal system, we cannot deny the possibility
that there will be a Large-Scale Acquisition that damages such strength of the company group and clearly harms

9corporate value of the company group and eventually the common interests of shareholders.
Under the Financial Instruments and Exchange Act, while tender offers are mandatory for certain large-scaleacquisitions, and rules pertaining to disclosure and procedures are prescribed, in principle, it is only applicable to offmarket transactions, not to market transactions. Further, in the event of a sudden hostile large-scale acquisition, , it isconsidered that there is a risk that shareholders may not be able to secure necessary information and sufficient time forconsiderations, since the buyer may refuse to answer the questions of the target company as long as it provides a clear
reason and it is highly possible that the actual maximum tender offer period becomes 30 business days.
Having considered the points above, the Company's Board of Directors has, believing that securing necessary
information and time for shareholders’ appropriate decision making, and securing negotiations with buyers to be made inaccordance with certain reasonable rules would lead to enhancement of our corporate value and the common interests ofshareholders, set forth certain rules below in relation to securing of information provision and consideration time in caseof a large-scale acquisition (hereinafter referred to as the “Large-Scale Acquisition Rules”). And the Board of Directors
has decided to keep a takeover defense measures subject to the approval of the shareholders at the general shareholders
meeting, that includes countermeasures in the event of a large-scale acquisition by an unsuitable buyer, in accordancewith “The Company’s Basic Policy in Relation to Those Who Controls its Finances and Business Policy Decisions.”
2. The Targets of the Plan
The Plan is applied to an acquisition of the Company's shares, etc. (note 3), for the purpose of making the ratio ofvoting rights (note 2) of the specific shareholder group (note 1) 20% or more, or any acquisition of the Company's
shares, etc., where as a result the ratio of voting rights of a specific shareholder group becomes 20% or more (withrespect to both cases, acquisitions where the Company's Board of Directors has given its consent in advance areexcluded and the method of acquisition, market transaction or tender offer, does not matter. Hereinafter, such acquisition
is referred to as a "Large-Scale Acquisition" and the entity making such acquisition is referred to as the 'Large-Scale
Buyer").

Note 1: Specific Shareholder Group means:(i) A holder (including a person included in a holder pursuant to Article 27-23, Paragraph 3 of the Financial
Instruments and Exchange Act, and hereinafter the same applies) of the Company’s shares, etc., (meaning securities,
etc., as defined in Article 27-23, Paragraph 1 of the Financial Instruments and Exchange Act) or a joint holder(meaning a joint holder as defined by Article 27-23, Paragraph 5 of the Financial Instruments and Exchange Act;
including those considered to be joint holders pursuant to Article 27-23, Paragraph 6) of the Company’s shares, etc.,
as well as a person having a certain relationship with said holders or their joint-holders, which is similar to thatamong holders or joint holders (hereinafter referred to as a “quasi-joint holder”; hereinafter the same applies);or(ii) A person engaged in purchase, etc., (meaning purchase, etc., as defined by Article 27-2, Paragraph 1 of the
Financial Instruments and Exchange Act, including conducts made on financial instruments exchange markets) of
the Company’s shares, etc., (meaning securities, etc., as defined by Article 27.3.1 of the Financial Instruments andExchange Act) and persons in special relationships with such person (meaning persons in special relationships as
defined by Article 27-2, Paragraph 7 of the Financial Instruments and Exchange Act; hereinafter the same applies).
Note 2: Ratio of voting rights means(i) In the case of a specific shareholder group noted in (i) of note 1, the combined ratio of (1) the holding ratio of suchholder (meaning the holding ratio of shares, etc., as defined by Article 27-23, Paragraph 4 of the Financial
Instruments and Exchange Act; in such case, the number of shares, etc., held by the joint holders of such holder

10(meaning the number of shares, etc., held as defined in the same Paragraph; hereinafter the same applies) shall also
be included) and (2) the holding ratio of shares, etc., of quasi-joint holders of such holder (however, in respect of theaddition of (1) and (2), the number of shares, etc., held that overlaps between (1) and (2) shall be subtracted);or(ii) In the case of a specific shareholder group noted in (ii) of note 1, the total of the ratio of shares, etc., held (meaning
the ratio of shares held as defined in Article 27-2, Paragraph 8 of the Financial Instruments and Exchange Act) by
the large-scale buyer and the persons in a special relationship with it. For the calculation of the holding ratio ofshares, etc., the most recently calculated figures in securities reports, quarterly financial statements, and sharebuyback reports may be referred to in terms of the total number of voting rights (as defined by Article 27-2,
Paragraph 8 of the Financial Instruments and Exchange Act) and the total number of issued shares (as defined in
Article 27-23, Paragraph 4 of the Financial Instruments and Exchange Act).
Note 3: Shares, etc. means securities, etc., as defined in Article 27-23, Paragraph 1 and 27-2, Paragraph 1 of the
Financial Instruments and Exchange Act.
3. Establishment of an Independent Committee
The Company's Board of Directors will, under the Plan, just like under the Current Plan, establish an independent
committee composed of persons independent of the Company (hereinafter referred to as the “Independent Committee”)
in order to eliminate arbitrary decision-making by the Company's Board of Directors.
The Independent Committee will be composed of three members or more to be elected by the Board of Directors fromamong the Company's outside directors, outside auditors, or other outside experts (the names and career summaries ofIndependent Committee members are attached as Appendix 1).
The Independent Committee will, within the Board of Directors Evaluation Period, conduct evaluations andconsiderations of Large-Scale Acquisitions pursuant to the necessary information provided via the Board of Directors
and, based on that result, it will make recommendations to the Board of Directors whether or not the countermeasures
should be taken with the reasons for their decision. Further, an outline of the Independent Committee is attached as
Appendix 2.
4. Details of Large-Scale Acquisition Rules(1) Submission of Letter of intent to the Company
When a prospective Large-Scale Buyer intends to carry out a Large-Scale Acquisition, prior to the Large-Scale
Acquisition or proposal of the Large-Scale Acquisition, it is firstly requested that such Large-Scale Buyer shall submit to
our representative directors a legally binding affidavit to comply with the Large-Scale Acquisition Rules and a letter ofintent stating, in Japanese, the name of the Large-Scale Buyer, their address or location of headquarter or branch office,the governing law of their incorporation, names of representatives, domestic contacts, and an outline of the proposed
Large-Scale Acquisition (to be signed or affixed with the name and seal of the representative(s) of the Large-Scale
Buyer).
In the event the Company receives an letter of intent from the prospective Large-Scale Buyer, we will promptly
make public announcement of such fact and, if necessary, the details of the letter of intent.

(2) Request to the Large-Scale Buyer to Provide Information
The Company's Board of Directors will, within ten business days of receiving the letter of intent in (1) above,
submit a list of necessary and sufficient information (hereinafter referred to as the "Necessary Information") that should
be submitted by the Large-Scale Buyer to the Company's Board of Directors in order to allow the Company's

11

shareholders to make a decision and the Company's Board of Directors to form an opinion. The Large-Scale Buyer shallprovide the Necessary Information in writing and in Japanese to the Company's Board of Directors in accordance withthe list of Necessary Information. Matters that will generally be part of the Necessary Information are as per the below.
Although their specific contents will differ depending on the type of Large-Scale Buyer and the details of the LargeScale Acquisition, in any cases, the scope of the Necessary Information will be limited to the extent which is necessary
and sufficient to allow shareholders to make a decision and the Company's Board of Directors to form an opinion.
(1) Details (including name, business details, capital composition, financial details, and career or company
history, details of past transactions similar to the Large-Scale Acquisition, the result and the impact on thecorporate value of the target company of such past transaction; and information relating to their experience,
etc., with regard to the Company's business or similar businesses) of the Large-Scale Buyer and its group(including joint holders, persons in special relationships with it, and other constituent members).
(2) The purpose and details of the Large-Scale Acquisition (including the amount and type of consideration for
the Large-Scale Acquisition, purchase period, related transaction mechanisms, legality of purchase method,and feasibility of such Large-Scale Acquisition and related transactions).
(3) The basis for the calculations of the purchase price for the Company's shares and substantiation of thepurchasing funds with respect to the Large-Scale Acquisition (including facts assumed in the calculations,calculation method, the specific name of the fund provider (including the actual provider), funding method,and details of related transactions).
(4) Management candidates (including information relating to their experience, etc., in the Company's industry
and similar industries), management policy, business plan, finance plan, capital policy, dividend policy, capitalutilization policy, etc., envisioned after they become involved in the Company's management (hereinafterreferred to as the "Post-Acquisition Management Policy, etc.").
(5) The expected Company's stakeholders after the completion of the Large-Scale Acquisition (customers, trade
partners, employees, regional companies, etc.), and whether or not there will be any changes regarding theCompany's relationships with them and the details thereof.
(6) Other information reasonably deemed to be necessary by the Company's Board of Directors.

The Company's Board of Directors may set a time limit for the Large-Scale Buyer to provide information, if
necessary, in light of prompt management of the Large-Scale Acquisition rules. However, in the case that the LargeScale Buyer makes an application for an extension based on reasonable grounds, the time limit may be extended.
Further, in the event that, as a result of careful examination of the information that is initially provided, theCompany's Board of Directors finds that the information itself is insufficient, the Company's Board of Directors may
request the Large-Scale Buyer to provide with additional information, setting an appropriate time limit. In the event theCompany's Board of Directors determines that the provision of Necessary Information by the Large-Scale Buyer has
been completed, it will send the Large-Scale Buyer a notification to such effect and make a public announcement.
Further, in the event part of the corresponding information is not provided by the Large-Scale Buyer, despite therequest of an additional information by the Company’s Board of Directors, there may be instances where our negotiations,etc., with the Large-Scale Buyer pertaining to information provision are concluded without obtaining all of the Necessary
Information requested by the Company's Board of Directors and a public announcement is made to such effect along withthe commencement of the evaluation and consideration by the Company's Board of Directors in (3) below, as long as
reasonable explanation is given by the Large-Scale Buyer regarding the reason why such information has not been
provided.
The Necessary Information provided to the Company's Board of Directors will be submitted to the Independent

12

Committee and, if it is deemed to be necessary for the shareholders to make a decision, it will be publicly announced inwhole or in part at the point in time determined to be appropriate by the Company's Board of Directors.

(3) Evaluation and Consideration by the Board of Directors
After the Large-Scale Buyer has completed providing the Necessary Information, the Company's Board of Directors will
set a period for the evaluation, consideration, negotiation, formation of opinions and alternate proposals by the Board of
Directors (hereinafter referred to as "Board of Directors Evaluation Period"), which will be a maximum of 60 days in casewhere all of the shares of the Company are acquired through a tender offer using cash only remuneration (yen), and amaximum of 90 days in case of any other Large-Scale Acquisition. The Large-Scale Acquisition may only commence after
the Board of Directors Evaluation Period.
During the Board of Directors Evaluation Period, the Company's Board of Directors will, taking advice from external
experts (financial advisers, lawyers, CPAs, etc.) as necessary, thoroughly evaluate and consider the Necessary Information
provided, to prudently form an opinion as the Company's Board of Directors, respecting the recommendations of the
Independent Committee to the fullest extent, from the point of view of whether or not it contributes to the Company's
corporate value and the common interests of shareholders, and then publicly announce the outcome. Also, as necessary, theCompany's Board of Directors may negotiate with the Large-Scale Buyer to improve the details of the Large-Scale
Acquisition and offer alternative proposals.
Further, in the event the Company's Board of Directors cannot reach a decision as to whether or not countermeasures areto be taken during the Board of Directors Evaluation Period, due to unavoidable reasons such as the Independent
Committee not reaching a decision as to whether or not countermeasures are to be taken or not during the Board of
Directors Evaluation Period, the Company's Board of Directors may, pursuant to the recommendations of the Independent
Committee, extend the Board of Directors Evaluation Period within the scope necessary by up to 30 days. In the event theCompany's Board of Directors resolves to extend the Board of Directors Evaluation Period, the specific period of extension
and the reason such specific extension is required will be publicly announced.
5. Response Policy in the Event of a Large-Scale Acquisition(1) In the Event the Large-Scale Buyer Has Complied with the Large-Scale Acquisition Rules
In the event the Large-Scale Buyer has complied with the Large-Scale Acquisition Rules, even if the Company's
Board of Directors has an opinion against the Large-Scale Acquisition, it will not, in principle, take countermeasuresagainst the Large-Scale Acquisition, but will only try persuading the Company's shareholders by providing dissenting
opinions against the Large-Scale Acquisition or making alternate proposals. As for whether or not to accept the offer ofthe Large-Scale Acquisition, the shareholders will make decision upon consideration of the acquisition proposal, etc., andthe opinion of the Company regarding such acquisition proposal and alternate proposals of the Company.
Even in the event the Large-Scale Acquisition Rules are complied with, however, if it is decided by the Company's
Board of Directors that the Company's corporate value and the common interests of shareholders will be significantly
harmed by the Large-Scale Acquisition, for example, in the cases that the Large-Scale Acquisition falls in any of (a)through (e) below where it is clearly foreseeable that irreparable harm will be done to the Company, the Company's
Board of Directors may, pursuant to their fiduciary duty as a Board of Directors, take exceptional countermeasuresagainst the Large-Scale Acquisition, to the extent necessary and reasonable, in order to protect the interests of theCompany's shareholders.
(a) In case that, despite having no real intention to participate in the Company's management, the Large-Scale Buyer
is acquiring the shares only for the purpose increasing the share price and causing the Company's related parties topurchase the shares at an overstated price (so-called greenmail case);13

(b) In case that the Large-Scale Buyer is acquiring the shares for the purpose of conducting so-called scorched earth
management, such as temporarily taking control of the Company's management in order to cause the transfer ofintellectual property, know-how, trade secrets, key trading partners or key customers, etc., that are necessary for the
management of the Company's business to the buyer or its group company, etc.;(c) In case that the Large-Scale Buyer is acquiring the shares with a plan to use the assets as collateral for or source offunds for repayment of the debts of the buyer or its group company after it takes control of the company's
management;(d) In case that it is acquiring the shares for the purpose of temporarily taking control of the company's management inorder to dispose of, such as by selling, the high value assets of the Company which are not directly related to theCompany's business for the time being, such as real estate and marketable securities, and, with the profits from suchdisposal, temporarily distributing high dividends or aiming to cause the share price to suddenly increase throughhigh dividends in order to sell the shares at higher price;(e) In case that the method of acquisition of the Company's shares proposed by the Large-Scale Buyer may restrain theshareholder's opportunities or freedom to make a decision, having a risk to substantially force the shareholders tosell the Company’s shares, such as in the cases of so-called “coercive two-tiered tender offers” (meaning
conducting a tender offer, setting more unfavorable acquisition conditions for the second stage than the first stage,or not setting clear conditions for the second stage).
(2) In the Event the Large-Scale Buyer Does Not Comply with the Large-Scale Acquisition Rules
In the event the Large-Scale Buyer has not complied with the Large-Scale Acquisition Rules, regardless of thespecific acquisition method, the Company's Board of Directors may take countermeasures against the Large-Scale
Buyer for the purpose of protecting the Company's corporate value and the common interests of shareholders.
(3) Procedures for Taking Countermeasures
In the event the Company's Board of Directors determines whether or not to take countermeasures against a LargeScale Buyer in cases of (1) or (2) above, in order to ensure the objectivity and reasonableness of such determination, theCompany's Board of Directors shall make the decision, considering and respecting the recommendations of the
Independent Committee to the fullest extent.
In regard to what measures will be taken in particular, the Company's Board of Directors will select the measure,which it deems to be the most appropriate at the time, from the measures authorized by the Companies Act, other laws
and the Company's articles of incorporation. As for the specific countermeasures taken by the Company's Board of
Directors, for example, an overview of the allotment of share acquisition rights without contribution is as per Appendix
3, while, in the event of an actual allotment of share acquisition rights without contribution, some conditions may be
added in light of the effectiveness of the countermeasure, such as a condition that shareholder shall not belong to a
specific shareholder group having certain ratio or more of voting rights for exercise of the share acquisition rights, or
adding the condition to share acquisition right that the Company shall be entitled to acquire such share acquisition rightin exchange for the Company's shares. In such an event, however, the Company will not offer monetary consideration
for the acquisition of share acquisition rights held by a Large-Scale Buyer.
Further, depending on the details of the countermeasure selected, there may be procedures in order to confirm theintentions of the shareholders, such as seeking for the resolution of the general shareholders meeting pursuant to thelaws and the articles of incorporation, or seeking for the approval of the shareholders at the general shareholders
meeting according to the recommendations of the Independent Committee. Once procedures have been taken to confirm
the intention of the shareholders, the Large-Scale Acquisition shall not be commenced until a resolution of whether or

14not to take countermeasures is made as confirmation of shareholders’ intention. In the event the Company's Board of
Directors and general shareholders meeting have decided to take specific countermeasures, such will be appropriately
disclosed at a proper time in accordance with laws and listing regulations of financial instruments exchanges.
(4) Suspension, etc., of Countermeasures
Even in the event the Company's Board of Directors has decided to take specific countermeasures in case of (1) or (2)above, the countermeasures may be suspended or changed in the cases below, respecting the opinions andrecommendations of the Independent Committee to the fullest extent. For example, in the event share acquisition rights
without contribution are allotted as a countermeasure, even if the Company's Board of Directors has passed a resolution
for allotment without contribution or even after allotment without contribution has taken place, in the event theCompany's Board of Directors decides that taking such countermeasures is not appropriate due to the withdrawal oramendment of the Large-Scale Acquisition by the Large-Scale Buyer, the countermeasures may be suspended by
revoking the allotment of the share acquisition rights without contribution on or prior to the day immediately before theeffective date of the share acquisition rights, or, after the share acquisition rights have been allotted without contribution,by having the Company acquire the share acquisition rights without consideration on or prior to the date immediately
before the commencement date of the exercise period.
(a) In case that the Large-Scale Buyer changes the acquisition proposal and the Company's Board of Directors has
determined that such alternate proposal is reasonable and appropriate;(b) In case that the Company's Board of Directors and the Large-Scale Buyer reaches an agreement not to take thecountermeasures or suspend the countermeasures;(c) In case that the Large-Scale Buyer has withdrawn from the acquisition or the acquisition no longer exists for someother reasons;(d) In case that there are changes in the facts on which the taking of countermeasures is premised and the acquisition by
the Large-Scale Buyer no longer fulfills the requirements for such countermeasures, or in the event the Company's
Board of Directors reaches a decision that the taking of such countermeasures is not appropriate despite the fact thatthe requirements for such countermeasures are fulfilled.
In such cases of suspensions, etc., of countermeasures, such will be appropriately disclosed at a proper time inaccordance with laws and listing regulations of financial instruments exchanges.
6. Effective Period, Abolition, and Amendment of the Plan
The Plan shall become effective on the same day of and subject to the resolution at this annual general meeting ofshareholders, and its effective period ends upon conclusion of the regular shareholders meeting of the final business inthe business year concluding within three years of the effective date (the annual general meeting of shareholders
scheduled to be held in June 2020).
However, even prior to the expiration of the effective period of the Plan, in the event the Company's shareholders passa resolution to abolish the Plan or the Company's Board of Directors passes a resolution to abolish the plan (the period of
appointment of the Company's directors is one year and it is possible that the intention of the shareholders will bemanifested through the election of directors each year), the Plan shall be abolished at such time.
Further, it is possible that the Company's Board of Directors may change the Plan, upon obtaining consent of the
Independent Committee, to the extent it is reasonably deemed to be necessary due to changes to the Companies Act,
Financial Instruments and Exchange Act, or other laws or changes to the rules of financial instruments exchanges, orchanges to their interpretation or application, or changes to the taxation system, judicial precedent, etc.
In the event the Company's Board of Directors abolishes or changes the Plan, prompt disclosure will be made with15

respect to the such abolition or change, and the details of the change (in the event of change), and other matters recognized
to be appropriate by the Company's Board of Directors.
<For Your Reference>
While the details of the Plan are as described in 1. to 6. above, the impact on shareholders and investors and thereasonableness of the plan are as follows.
1. Impact, etc., on Shareholders and Investors(1) The Impact, etc., of the Plan on Shareholders and Investors
The purpose of the plan is to secure an opportunity for the Company's shareholders to determine whether or not to
accept a Large-Scale Acquisition, by providing necessary information and the views of the Board of Directors incharge of the management of the Company at the time, and, further, an opportunity for the Company's shareholders tohave alternative proposals. This makes it possible for the Company's shareholders to appropriately determine whether
or not to accept the Large-Scale Acquisition based on appropriate information, which we believe will contribute to theprotection of the overall interests of the Company's shareholders. The establishment of the Plan, therefore, is aprerequisite for the Company's shareholders and investors to make appropriate investment decisions, and we believethat it will contribute to the interests of the Company' shareholders and investors.
Further, as the way the Company handles Large-Scale Acquisitions may vary, depending on whether or not theLarge-Scale Buyer complies with the Large-Scale Acquisition Rules, we would like to advise shareholders andinvestors to pay closer attention to actions and movements of the Large-Scale Buyer.
(2) The Impact, etc., of Execution of Countermeasures on Shareholders and Investors
In the event a Large-Scale Buyer does not comply with the Plan or the acquisition proposal of a Large-Scale Buyer
is recognized to be harmful to the Company's corporate value and the common interests of shareholders, there may beinstances where the Company may take the countermeasures described in 5. above against the Large-Scale Buyer.
We do not envision, however, that execution of such countermeasures will bring any significant losses to theCompany's shareholders (excluding the Large-Scale Buyer) in terms of the legal rights or economic aspects.
Further, in the event that the allotment of share acquisition right without contribution is executed as one of thecountermeasures, allotment will be made for shareholders who are registered on the shareholder registry on the date ofallotment of share acquisition right. Shareholders will be allotted share acquisition rights without any application
procedure for subscriptions and, in case that the Company takes procedures to acquire share acquisition rights,
shareholders do not need to take any procedures such as applications or payments, since shareholders will receive sharesof the Company consideration for the Company's acquisition of the share acquisition rights without paying an amountequivalent to the exercise price of the share acquisition rights. In such cases, however, it is possible that the Company
may request shareholders to submit prescribed forms, including representations and warranties, supplementary terms,
and other affidavits with respect to the shareholder themselves fulfilling the conditions for the exercise of shareacquisition rights, etc. The details of relevant procedures will be appropriately disclosed at a proper time in accordancewith laws and listing regulations of financial instruments exchanges. Further, the Company's Board of Directors, uponrecommendations of the Independent Committee, may suspend the allotment of share acquisition rights or cause theCompany to acquire the share acquisition rights without consideration, even after the date of allotment of shareacquisition rights or after the share acquisition rights have come into effect, due to circumstances such as withdrawal of
the Large-Scale Acquisition by the Large-Scale Buyer. In such cases, there may be a possibility that shareholders orinvestors who have conducted sales, etc., assuming that there will be dilution of per share price will suffer unexpected16

losses due to fluctuations in the share price.
2. Regarding the Reasonableness of the Plan
For the reasons below, we believe that the Plan is in line with the Company’s Basic Policy in Relation to Those who
Controls its Finances and Business Policy Decisions and contributing to the Company's corporate value and the common
interests of shareholders, and does not have the purpose of maintaining the positions of the Board members of the Company.
(1) Satisfying the Requirements of the Guideline regarding Takeover Defense Measures
The Plan satisfies the three principles prescribed by the "Guideline regarding Takeover Defense Measures in Order toProtect and Improve Corporate Value and the Common Interests of Shareholders" published by the Ministry of Economy,
Trade and Industry and the Ministry of Justice on May 27, 2005 ( (1) the principle of protecting and improving corporate
value and the common interests of shareholders; (2) the principle of disclosure in advance and respect for shareholders’intention; and (3) the principle of securing necessity and reasonableness). Further, it also takes into consideration the contentsof the report, "Takeover Defense Measures in Light of Recent Environmental Changes," published by the Corporate Value
Research Group established within the Ministry of Economy, Trade and Industry, on June 30, 2008, and "Principle 1-5. SoCalled Takeover Defense Measures" in the "Corporate Governance Code" published by the Tokyo Stock Exchange on June
1, 2015.
(2) Continued with the Purpose of Securing and Improving the Common Interests of Shareholders
The Plan makes it possible, when a Large-Scale Acquisition is being conducted for the Company's shares, to secure thenecessary time and information for shareholders to decide whether or not they should agree to the Large-Scale Acquisition
as well as an opportunity to have alternative proposals from the Company's Board of Directors, etc., and will be continued
with the purpose of securing and improving the Company's corporate value and the common interests of shareholders.
(3) Reflecting the Intention of Shareholders
The Company will confirm the intention of the shareholders in relation to the continuation of the plan at this annual general
meeting of shareholders. Further, even during the effective period of the Plan, in the event a resolution is passed to abolishthe Plan in a Board of Directors composed of directors elected by the Company's general shareholders meeting, the Plan will
be abolished at the time, which duly reflects the intention of the shareholders.
(4) Exclusion of Arbitrary Decision-Making by the Board of Directors
Under the Plan, an Independent Committee is established as a separate organization independent of the Company's Boardof Directors and, in case the Company's Board of Directors decides whether or not to take countermeasures, it must respect
the recommendations of the Independent Committee to the fullest extent, in order to assure the transparency, objectivity,
fairness, and reasonableness of its decisions and to exclude arbitrary decision-making by the Company's Board of Directors.
It is stipulated that an overview of the decision of the Independent Committee shall be disclosed to shareholders, in order toensure establishment of a structure for transparent operation of the Plan that conforms to the Company's corporate value andthe common interests of shareholders.
(5) Setting Reasonable and Objective Requirements for the Execution of the Plan
The countermeasures in the plan are designed in the way that they cannot be executed without fulfilling reasonable andobjective requirements in order to ensure that there is a structure that prevents arbitrary execution of the countermeasures by
the Company's Board of Directors.

17(6) No Dead-Hand or Slow-Hand Takeover Defense Measure
The Plan may be abolished by a Board of Directors composed of directors elected by the Company's general shareholders
meeting. Accordingly, the Plan is not a dead-hand takeover defense measure (a takeover defense measure the taking of whichcannot be prevented even if a majority of the members of the Board of Directors are replaced).
Further, as the period of appointment of the directors at the Company is one year with no staggered terms, the Plan is nota slow-hand takeover defense measure (a takeover defense measure the prevention of which requires a period of time dueto the members of the Board of Directors not being capable of being replaced all at once).
Further, there is no addition requirement for resolution, such as special resolution, regarding dismissal of directors.
End

18

Appendix 1
Names and Career Summaries of Independent Committee Members

The six persons below are planned to be members of the Independent Committee after the Plan is implemented.
1. Toshikazu Saeki
Career Summary April 1970 Joined Kobe Steel Ltd.
June 2001 Director and Osaka Branch Company President of Kobe Steel, Ltd.
June 2002 Representative Director and President of Shinko Care Life, Ltd.
June 2011 Consultant at Shinko Care Life Ltd.
April 2012 Special Professor and Assistant President at Kobe University (Current Position)
June 2015 Outside Director of the Company (Current Position)
June 2015 Member of the Company's Independent Committee (Current Position)
December 2016 Lockon Co., Ltd. Member of the Board of Directors and Auditors*Toshikazu Saeki is an outside director as provided by Article 2.15 of the Companies Act.
Further, Toshikazu Saeki is registered as an independent officer in accordance with the regulation of the Tokyo Stock Exchange.
2. Hiroshi Okamura
Career Summary April 1976 Joined The Daiwa Bank Limited (currently Resona Bank, Limited)
June 2006 Resona Bank, Limited Representative Director and Vice President and Executive
OfficerJune 2008 Resona Research Institute Co., Ltd. Representative Director and President
June 2009 Kinki Osaka Bank, Limited Director
June 2011 Osaka co-sei Shinkin Bank, Ltd. Part-time inspector (Current Position)
June 2011 Japan Foundation Engineering Co., Ltd. Part-time Auditor (Current Position)
June 2012 Shikishima Printing Co., Ltd. Representative Director and President (Current Position)
June 2012 Koyubusiness Co., Ltd. Part-time Director (Current Position)
June 2013 Osaka International Convention Center Corp. Auditor (Current Position)
June 2015 Outside Director of the Company (Current Position)
June 2015 Member of the Company's Independent Committee (Current Position)*Hiroshi Okamura is an outside director as provided by Article 2.15 of the Companies Act.
Further, Hiroshi Okamura is registered as an independent officer in accordance with the regulation of the Tokyo Stock Exchange.

19

3. Osamu Utsuro
Career Summary April 1995 Registered as an Attorney, Joined Utsuro Yusho Law Office(currently Hommachi Chuo Law Office) (Current Position)
June 2012 Outside Audit & Supervisory Board Member of the Company (Current Position)
June 2012 Member of the Company's Independent Committee (Current Position)*Osamu Utsuro is an outside Audit & Supervisory Board Member as prescribed by Article 2.16 of the Companies Act.
Further, Osamu Utsuro is registered as an independent officer in accordance with the regulation of the Tokyo Stock Exchange.
4. Tomotaka Iwata
Career Summary October 1996 Joined Chuo Audit Corporation
April

2000 Registered as a Certified Public Accountant

August 2002 Joined KPMG FAS Ltd.
December 2012 Registered as an attorney
January 2013 Joined Fujikishinsei Law OfficeFebruary 2015 Opened Showa Law Office (Current Position)
June 2016 Outside Audit & Supervisory Board Member of the Company (Current Position)
June 2016 Member of the Company's Independent Committee (Current Position)*Tomotaka Iwata is an outside Audit & Supervisory Board Member as provided by Article 2.16 of the Companies
Act.
Further, Tomotaka Iwata is registered as an independent officer in accordance with the regulation of the Tokyo Stock
Exchange.
5. Hidetaka Tomita
Career Summary January 1965 Tomijima Certified Public Accountant Office(currently Ernst & Young ShinNihon LLC)
October 1965 Registered as a Certified Public Accountant
July 2004 Opened Tomita Certified Public Accountant Office (Current Position)
May 2006 Member of the Company's Independent Committee (Current Position)
6. Yasuhiro Kawaguchi
Career Summary April 1999 Professor of the Faculty of Law, Kobe Gakuin University
April 2000 Professor of the Faculty of Law, Doshisha University(Current Position)

April 2009 Dean of the Faculty of Law, Doshisha University

End

20

Appendix 2
Overview of the Independent Committee

1. The Independent Committee is established by the resolution of the Company's Board of Directors.
2. The Independent Committee shall have three or more members and, in order to make it possible for their decisionmaking to be fair and neutral, they are to be elected by the Board of Directors from among the outside directors, outside
auditors, and other outside qualified experts who are independent from the management team that engages in theexecution of the company's operations.
3. Even before the expiry of the effective period of the Plan, the Company's Board of Directors may change the Plan, uponconsent of the Independent Committee, to the extent it is reasonably recognized to be necessary due to changes to theCompanies Act, Financial Instruments and Exchange Act, or other acts or changes to the regulations of financial
instruments exchanges, or changes to their interpretation or application, or changes to the taxation system, or judicial
precedent, etc.
4. With regard to the resolutions of the Independent Committee, a quorum shall be established by a majority of themembers being present and resolutions shall be passed by a majority vote of attending members.
5. In the event the Independent Committee have been consulted by the Board of Directors, it shall decide on the mattersbelow and make recommendations of the contents of such decision with reasons and grounds to the Board of Directors.
(1) Whether to take or not to take countermeasures authorized by the Companies Act, other laws or the articles ofincorporation, such as the issuance of share acquisition rights in order to resist a Large-Scale Buyer;(2) Whether to suspend the acquisition of share acquisition rights without consideration, issuance of share acquisitionrights, and other countermeasures based on the withdrawal, etc., of the Large-Scale Acquisition by the Large-Scale
Buyer;(3) Any other matters that should be decided by the Board of Directors, and that the Board of Directors consulted theIndependent Committee among.
6. The Independent Committee will perform the following matters and will make recommendations of the contents withreasons and grounds to the Board of Directors.
(1) Deciding whether or not the Large-Scale Buyer has complied with the Large-Scale Acquisition Rules(2) Deciding the Necessary Information that should be provided by the Large-Scale Buyer to the Board of Directors;(3) Deciding whether the Necessary Information provided has sufficient detail and whether the submission of theNecessary Information is complete;(4) Examining and considering the details of the Large-Scale Acquisition of the Large-Scale Buyer;(5) Deciding whether or not the Large-Scale Acquisition leads to doing significant harm to corporate value and thecommon interests of shareholders;(6) Deciding whether to extend the Board of Directors Evaluation Period;(7) Other matters, prescribed by the Board of Directors, that the Independent Committee may be entitled to do.
7. The Independent Committee may obtain advice from investment banks, securities companies, lawyers, and other external
experts at the cost of the Company.
End

21

Appendix 3
Overview of the Allotment of Share Acquisition Rights Without Contribution

1.

Shareholders to be Allotted Share Acquisition Rights Without Contribution
Share acquisition rights will be allotted without payment to shareholders registered on the final shareholder
registry as of the record date determined by the Company's Board of Directors and at a ratio of one right per one
ordinary share of the Company (excluding ordinary shares of the Company held by the Company).

2.

Class and Number of Shares Subject to Share Acquisition Rights
The class of shares that is subject to share acquisition rights is the ordinary share of the Company, and the total
number of shares subject to share acquisition rights shall be limited to the total number of issuable shares of theCompany as of the record date determined by the Board of Directors less the number of outstanding ordinary
shares of the Company (excluding ordinary shares of the Company held by the Company). The number of shares
to be acquired upon exercise of a share acquisition right shall be separately determined by the Company's Board of
Directors; provided, however, that necessary adjustments shall be made in case of share split or shareconsolidation by the Company.

3.

Total Number of Share Acquisition Rights to Be Issued
The total number of share acquisition rights to be issued shall be a number that is separately determined by theCompany's Board of Directors. The Company's Board of Directors may make allotment of the share acquisitionrights over multiple times.

4.

Value of Property to be Contributed Upon Exercise of Each Share Acquisition Right (Price to be Paid)
The value of property to be contributed upon exercise of each share acquisition right (price to be paid) shall be an
amount of one yen or more determined by the Company's Board of Directors.

5.

Restrictions on Transfer of Share Acquisition Rights
Any acquisition of share acquisition rights by transfer shall be subject to approval of the Company's Board of
Directors.

6.

Conditions for Exercise of Share Acquisition Rights
Conditions for exercise of share acquisition rights is that shareholder shall not belong to a specific shareholder
group having 20% or more of the voting rights, excluding the case that the Company’s Board of Directors has
given prior consent. The details shall be separately determined by the Company's Board of Directors. Monetaryconsideration shall not be offered for the acquisition of share acquisition rights owned by a shareholder who is notallowed to exercise the share acquisition rights.

7.

Exercise Period, etc., of Share Acquisition Rights
The Company's Board of Directors shall separately determine the effective date of allotment of share acquisitionrights, exercise period, terms of acquisition, and other necessary matters. Further, terms of acquisition may be set
forth in a way that the Company may acquire the share acquisition rights from shareholders except those who are
not allowed to exercise share acquisition rights due to the conditions for exercise provided in 6. above, and may
deliver ordinary shares of the Company at certain ratio per each share acquisition right as separately determined by
the Company's Board of Directors.
End

22

Guide to the Exercise of Voting Rights via the Internet
1. Regarding Exercise of Voting Rights via the Internet
1) Instead of voting by mail, you may vote via the Internet by accessing the designated “Exercise of
Voting Rights Website” (refer to the URL below). To use this website, you need to log in with the“Exercise of Voting Rights Code” and the “Password” printed on the right-hand side of the enclosed
Voting Form, and enter information in accordance with the instructions on the screen. For security
reasons, it is necessary for you to change your password when you log in for the first time.

http://www.it-soukai.com/
2) The deadline for voting is 5 p.m. on Wednesday, June 21, 2017 (Japan Standard Time). The
Company kindly requests that you exercise your voting rights well in advance.
3) If you exercise your voting rights by both sending the Voting Form and using theInternet, only your vote via the Internet shall be deemed effective. If you exercise your voting rights
more than once via the Internet, only your final vote shall be deemed effective.
4) Your password (including the password after you have changed it) shall be effective only for thisOrdinary General Meeting of Shareholders. At the time of the next Ordinary General Meeting of
Shareholders, a new password will be issued.
5) You shall bear your own expenses for connection to the Internet.
(Notes)・ The password is a means to confirm that the person voting is the relevant shareholder. Please benoted that the Company will not contact you to ask for your password.
・ If you enter your password incorrectly for a certain number of times, the password will be locked
and you will no longer be able to use it. If this occurs, please complete the procedures indicated in
the guidance on the screen.
・ Although operational checks have been carried out for the Exercise of Voting Rights Website forcommon Internet connection devices, there is a possibility that you may be unable to access the site
due to the device you are using.
2. For your inquiries
If you have any inquiries, please contact the Securities Agent Dept. of Mizuho Trust & Banking
Co., Ltd., which is the Company’s shareholder registry administrator, as shown below.
1) Inquiries regarding operation of the Exercise of Voting Rights Website:
Tel: 0120－768－524 (toll free only from Japan) (Business hours: 9 a.m. to 9 p.m. on weekdays)
2) Inquiries regarding share handling matters other than the above:Tel: 0120－288－324 (toll free only from Japan) (Business hours: 9 a.m. to 5 p.m. on weekdays)

23