The 48th Shareholders Meeting

1. DateJune 29th 2016

AM 10:00

2. Location

Tamagawa Electronics 3rd floor conference room
3-11-23 Kamitsuchidananaka Ayase-city,
Kanagawa prefecture Japan

3. Purpose matter
Report matter(1) The 48th Consolidated financial statement and business report(2) The 48th financial and business report
Resolution matter(1) Partial Amendments to the Articles of Incorporation(2) The election of 7 directors(3) The election of 1 substitute auditor

(Provided document)

Business Report(

From April 1st,)2015
to March 31st, 2016

1. Current situation of corporate group(1) Business condition of the current business year
① Progress and achievement of business
Analysis concerning management performance
Our group’s reporting segments were classified as “electronics / communication device
business,” “solar power system sales business,” “solar power station business” and“geothermal power station” until the previous consolidated accounting year, but from thecurrent consolidated accounting year, “solar power system sales business” was changed to“renewable energy system sales business.” Comparison and analysis of the current
consolidated accounting year are based on the classification after change.
As for Japan’s economy in the current consolidated accounting year, facility investment
and export are continuously increasing, and although there is some improvement indemands inside and outside the country and of employment and income environment, it
made transition with sense of uncertainty about the future due to slowdown of Chinese
economy, etc.
Under such management circumstances, for our important business, electronics andcommunication device business, we have elaborated to acquire orders from new domains
by focusing on new markets and customer exploration in addition to sales expansion
mainly in 3.9 generation mobile phone facility related market and public related market.
We also have tried to enhance proposals of our own products while continuously
promoting “attempt for high added value of products,” “expansion and exploration ofbusiness domains” and “joint development with business alliance.”
As a result, inquiries are increasing from newly explored customers and new markets
including wireless optic related products for professional use, digital signal processing
device essential for high-speed signal processing, etc. in addition to the existing analog
high frequency products.
In terms of electronics / communication device business, demands are drastically
dropping in mobile communication industry due to rapid facility investment control byreview of base station construction plan. It has currently no prospect of recovery in the
future, having continuous sense of uncertainty for the future.
Even under such condition, in the public industry, demands for optic transmission
devices and digital signal devices, etc. are increasing for disaster measures, professionalwireless and surveillance system. Therefore, we will work on further demand expansion
in the public work industry as well as activities focusing on the future trend of next
generation mobile related market.
Order situation in general is improving. We will continue to promote expansion of ourgroup’s business domains and activities for profit expansion by enhancing the proposals of
our self-developed products in order to establish stable business base.
In renewable energy business, we have actively promoted solar power station business inparticular. Under the recent strict circumstances surrounding the solar power station
business such as alert by the Ministry of Economy, Trade and Industry concerning powerbusiness and notification on the review, etc. of operation of facility certification regarding
the feed-in tariff, our group has previously sought, investigated and reviewed the powerbusiness by wind power, geothermal power, small hydroelectric, biomass, etc. and in orderto establish other renewable energy as the mainstay of profit in addition to solar power
station business for further expansion of such business.
As a result of the above, the amount of orders received in the current consolidated
accounting year was 7,091 million yen (43.6% increase compared to the same period of theprevious year) and the amount of proceeds of the same year was 7,259 million yen (42.5%
increase compared to the same period of the previous year). In regard to profit and loss,
operating profit was 279 million yen (47.4% decrease compared to the same period of theprevious year), current profit was 211 million yen (58.9% decrease compared to the same
period of the previous year) and current net profit belonging to the parent company’s
shareholders was 165 million yen (61.3% decrease compared to the same period of theprevious year).
In electronics / communication device business, we are focusing on sales expansion
activity mainly in the public related market as well as new customers in order to recover
the decreased amount of orders received and amount of proceeds due to facility
investment control in the communication infrastructure market.
Especially in the public industry, demands are stably increasing and expected to continue
to transit steadily. We will promote expansion of our group’s business domain and will
also keep our activities for profit expansion by enhancement of proposal of selfdevelopment products.
Concerning renewable energy system sales business, we could have excellent
achievement as a result of activating sales activities of subdivision sales of solar power
stations in the current consolidated accounting year. We will from now continuously aim
for acquirement of excellent profit in the following period by preparing the company
structure and further enhancing the sales activities in order to expand all over Japan thesales channel of the generation system using renewable energy other than solar powerwith focus on it.

With regard to solar power station business and geothermal power station business, ourgroup as a whole will aim for expansion of profit by constructing the constant system fromsecurement of land for power stations and starting of electricity sales so that we cancontribute to the community and society by aiming for stable energy supply.
We are also focusing on hydrogen-related business to generate and store electricity
without emit CO2 as new clean energy besides the above renewable energy business, andhave newly established “hydrogen power business preparation room” and areinvestigating and reviewing such business.

Achievements of the segments are as follows.
① Electronic / communication device business
Facility investment for base station by mobile carriers was affected by rapid investment
control and resulted in 2,155 million yen of amount of orders received (33.1% decrease
compared to the same period of the previous year), 2,108 million yen of amount ofproceeds (38.1% decrease compared to the same period of the previous year), and 11
million yen of segment loss (the same period of the previous year; 467 million yen of
segment profit).
② Renewable energy businessAs a result of active sales activities for subdivision sales of solar power stations, theamount of orders received was 4,936 million yen (187.9% increase compared to the same
period of the previous year), amount of proceeds was 4,964 million yen (176.4% increase
compared to the same period of the previous year) and segment profit was 286 million yen(155.9 increase compared to the same period of the previous year).
③ Solar power station business
Since mega solar power stations in Shimonoseki City, Tateyama City and Sodegaura City
are selling electricity in a good condition as scheduled, the amount of proceeds was 230
million yen (161.8% increase compared to the same period of the previous year) andsegment profit was 56 million yen (155.2% increase compared to the same period of theprevious year).
④ Geothermal power station business
The amount of proceeds is not currently allocated and segment loss was 20 million yen(segment loss was 0 in the same period of the previous year) due to expenditure of
expenses.

Financial report
1. Consolidated balance sheet（As of March,31 2016 ）Current assets
Cash and deposits(Thousands JPY)
4,220,891
2,736,869

Current liabilities

2,048,500

Notes and accounts payable - trade

321,042

Notes and accounts receivable-trade984,590

Short-term loans payable

974,176

Merchandise and finished goods

57,814Current portion of bonds

20,000Work in process

147,522

Current portion of long-term loans payable

400,940

Raw materials and supplies

112,786

Lease obligations

49,367

Deferred tax assets

54,664

Accounts payable-other

100,642

Other

126,643

Income taxes payable

28,165

Advance received

12,2102,941,538

Reserve for bonuses

37,241

2,463,909

Other

104,714

156,901

Non-current liabilities

1,820,355

Non-current assets
Property, plant and equipment
Buildings
Machinery, equipment and other

1,407,431

Bonds payable

20,000Tools, furniture and fixtures

88,157Long-term loans payable

592,004

Land

652,400

Lease obligations

925,239

Construction in progress

159,018

Deferred tax liabilities

320

Net defined benefit liability

145,592

Intangible assets

309,088

Asset retirement obligations

37,024

Goodwill

231,694

Other

100,173

Software77,393

Other

0

Total liabilities

3,868,855

Shareholders' equity

3,283,336

Investments and other assets

168,540

Capital stock

1,677,088

Investment securities

16,601

Capital surplus

1,057,014

Deferred tax assets

39,678Retained earnings

610,512

Other

120,960

Treasury stock

Allowance for doubtful accounts△8,700

Valuation and translation adjustments△61，279△4,910

Deferred assets

1,177

Valuation difference on available-for-sale

677

Stock issuance expenses

1,177

Foreign currency translation adjustment△5,587

Subscription rights to shares

Total assets

7,163,607

16,326

Total Net Assets

3,294,752

Total liabilities and net assets

7,163,607

2. Consolidated income statement（Fiscal year ended March 31,2016）(Thousands JPY)

Net sales

7,259,803

Cost of sales

5,710,166

Gross profit

1,549,637

Selling, general and administrative expenses

1,269,938

Operating income

279,699

Non-operating income
Interest income

361

Dividend income

976

Settlement received

1,700

Other

12,86015,898Non-operating expenses
Interest expenses
Loss on sales of operational receivable

69,406654

Foreign exchange losses

3,158

Guarantee commission

848

Amortization of share issuance cost
Other

9,528
701

Ordinary income

84,270211,327

Extraordinary income
Gain on sales of non-current assets

57,605Gain on reversal of subscription rights to shares

2,914

60,520Extraordinary loss
Loss on valuation of investment securities
Other

2,318
378

Income before income taxes

269,150

Income taxes-current

64,105

Income taxes-deferred

39,716

Income before minority interests
Minority interests in income
Net income

2,696

103,821
165,329－
165,329

3. Balance sheet（As of March,31 2016 ）Current assets(Thousands JPY)
1,260,444

Current liabilities

678,452

Cash and deposits

718,207

Short-term loans payable

49,600Accounts receivable-trade

15,770Current portion of long-term loans payable

283,400

Merchandise and finished goods
Current portion of long-term loans
receivable from subsidiaries and associates

1,203
391,889

Short-term loans payable to subsidiaries andassociates
Current portion of long-term loans payable tosubsidiaries and associates

250,000
32,040Prepaid expenses

4,091

Accounts payable - other

50,354

Accounts receivable - other

70,254

Accrued expenses

2,638

Deferred tax assets

27,506

Advances received

3,666

Other

31,521

Deposits received

1,075

Provision for bonuses

2,493

655,579

Other

3,184

Buildings

4,681

Non-current liabilities

491,187

Machinery, equipment and other

13,863Long-term loans payable

298,529

Tools, furniture and fixtures

4,853

Long-term loans payable to subsidiaries andassociates

191,499

Non-current assets
Property, plant and equipment

2,590,410

Land579,332

Provision for retirement benefits

837

Construction in progress

52,848Deferred tax liabilities

320

Intangible assets

130,186

2,665,388

130,000

Capital stock

1,677,088

1,804,644

Capital surplus

1,057,014

186

Goodwill

Investment securities
Shares of subsidiaries and associates
Investments in other securities ofsubsidiaries and associates
Investments in capital

1,169,640

Shareholders' equity

SoftwareInvestments and other assets

Total liabilities

16,601

Legal capital surplus

898,431

1,601,000

Other capital surplus

158,583

Retained earnings△7,434

Other retained earnings△7,434900
1,000

Long-term loans receivable fromsubsidiaries and associates

111,252

Retained earnings brought forward△7,434

Other

82,590Treasury shares△61,279

Allowance for doubtful accounts△8,700

Valuation and translation adjustments

677

Valuation difference on available-for-salesecurities

677

Deferred assets
Stock issuance expenses

Total assets

1,177

Subscription rights to shares
1,177
3,852,032

16,326

Net assets

2,682,392

Total liabilities and net assets

3,852,032

4. Income statement（Fiscal year ended March 31,2016）(Thousands JPY)

Net sales

245,754

Cost of sales

43,561Gross profit

202,192

Selling, general and administrative expenses

248,657

Operating income△46,464

Non-operating income
Interest income

10,665

Dividend income

448

Settlement received

1,700

Other

731

13,545Non-operating expenses
Interest expenses

14,412

Amortization of share issuance cost

9,528

Other

85

Ordinary income

24,026△56,944

Extraordinary income
Gain on sales of non-current assets

57,605Gain on reversal of subscription
rights to shares

2,914

60,520Extraordinary loss
Loss on valuation of investment
securities
Other

2,318
378

Income before income taxes

878

Income taxes-current△41,841

Income taxes - deferred

80,661

Net income

2,696

38,819△37,941

Referential Materials for General Meeting of Shareholders
Agenda No. 1 Partial Changes in the Articles of Incorporation
1. Reason for a proposal
To add business purpose stipulated in Article 2 of the current Articles of Incorporation inorder to prepare for expansion and diversion of businesses.
2.Detail of amendment
Detail of amendment(The underlined are amended items.)

Current Articles of Incorporation

Amendment draft

Article 2 (description omitted)

Article 2 (the same as the current)(1)①~⑤(description omitted)(1) ①～⑤ (the same as the current)(New construction)⑥Service concerning development, etc. of(2)~(3) (description omitted)

other energy and resources(4) Sale, lease, management and mediation of(2)~(3) (the same as the current)

real estate(4) Sale, lease, management, mediation and(5)~(6) (description omitted)

other services regarding real estate(5)~(6) (the same as the current)

2. The Company aims to operate the services
listed from ① to ⑤ of (1) of the previous

2. The Company aims to operate the services

clause and all services incidental thereto.

listed from ① to ⑥ of (1) of the previous
clause and all services incidental thereto.

Agenda No. 2 Election of 7 Directors.
The term of office of the current directors (6 people) will expire after this general
meeting. Therefore, please nominate seven directors.
The candidates for Director are as follows.
Mr. Toru Masuzawa
Date of Birth：May 11,1961
April,1985

Wako Securities (Mizuho Securities Co.,Ltd. of current)

June,1994

Commerz Bank South East Asia (Manager)

June,1998

Hongkong and Shanghai Banking Corporation Limited (Vice president)

December,1999

Private Bank of Barclays (Director)

January,2003

Times Square Pte,Ltd. (Managing Director)

July,2003

J.bridge Co.,Ltd. (Asia Development Capital Co. Ltd. of current/Executive officer)

July,2004

J.bridge Co.,Ltd. (CEO)April,2012

Tamagawa Holdings Co.,Ltd (Executive officer)

June,2012

Tamagawa Holdings Co.,Ltd (CEO/present post)

Mr. Masanori Kobayashi
Date of Birth：December 10,1956
April,1977

Fuji Keiki Co.,Ltd.

December,1981

Tamagawa Electronics Co.,Ltd.

April,1999

Tamagawa Electronics Co., Ltd.
(Manager of Measurement hardware Dept.)

June,2005

Tamagawa Electronics Co., Ltd. (Director and Procurement Dept.)

June,2006

Tamagawa Electronics Co.,Ltd. (Auditor)

June,2011

Tamagawa Electronics Co.,Ltd.(Director)

April,2012

Tamagawa Electronics Co.,Ltd. (CEO/present post)

June,2014

Tamagawa Holdings Co.,Ltd (CEO/present post)

Mr. Akihiro Ushiroda
Date of Birth：September 24,1981

July,2005

U-EN Corporation

February,2007

KDA Audit Corporation

January,2012

Tamagawa Holdings Co., Ltd (Manager of Administration Dept.)

June,2014

Tamagawa Holdings Co.,Ltd (General Manager ofCorporate Planning Dept. and Financial Control Dept.)

June,2015

Tamagawa Holdings Co., Ltd (Director)

Mr. Naruhito Kusaka
Date of Birth：January 15,1962
April,1989

Kusaka Co.,Ltd.

July,1999

Kusaka Co.,Ltd. (President/present post)

June,2009

Tamagawa Holdings Co.,Ltd. (Director/present post)

Mr. Kozaburo Miyauchi
Date of Birth：February 16,1949
April,1973

New Japan Securities Co.,Ltd.(Mizuho Securities Co.,Ltd. of current)

November,1984

New Japan securities. Co.,Ltd. (Hong Kong)(Sales Manager)

April,1989

New Japan Merchant Bank. (Singapore)(President)

May,1997

New Japan Securities Europe. (President)

May,2003

Started own Business

December,2011

Maruman Co.,Ltd. (Auditor/present post)

June,2014

Tamagawa Holdings Co.,Ltd.(Director)

Mr. Keita Masuyama
Date of Birth：October 3, 1975
April,2001

Angel Securities Co., Ltd.

October,2004

Phoenix Partners Co., Ltd.

December,2005

J-Bridge Corp. (Asia Development Capital Co. Ltd. of current)

June,2014

Top Accounting Firm & co.(Director/present post)

June,2015

Tamagawa Holdings Co.,Ltd. and Tamagawa Electronics
Co.,Ltd.
( Director/present post)

November,2015

Registry of Certified Public Tax Accountant

December,2015

Top Accounting Firm & co.( Firm member/Present post)

＊Mr. Yasuhiko Noguchi
Date of Birth：July 12,1965
April,1989

KOKUSAI Securities Co., Ltd.
( Mitsubishi UFJ Morgan Stanley Securities of current)

August,1996

Dai-ichi Securities Co., Ltd.,( Mitsubishi UFJ Morgan Stanley Securities of current)

July,1998

Alico Japan Co., Ltd.(MetLife,Inc. of current)

June,2014

Tamagawa Solar Systems Co., Ltd. (CEO/present post)（Tamagawa Energy Co., Ltd. of current）(Note)
The asterisk (*) means new candidates.
There is no relationship of special interests between each candidate and our company.
Naruhito Kusaka, Kozaburo Miyauchi are candidates of outside Directors.
The reasons why outside Directors are selected①The reason why Naruhito Kusaka is selected as a candidate for the outside director is because he has engaged in the
management of Kusaka Co., Ltd. for many years and has an excellent experience and discernment in corporate management.
Thus, it was judged that he will be able to execute responsibilities appropriately as an outside Director.
②The reasons why Kozaburo Miyauchi is selected as a candidate for the outside Director was because he has engaged in the
management of MARUMAN Co., Ltd. as a standing statutory Auditor and has an excellent experience and discernment incorporate management. Thus, it was judged that he will be able to execute responsibilities appropriately as an outside Director.
5.
Naruhito Kusaka is a current outside Director, and his tenure as an outside Director will be 7 years from the end of thisgeneral meeting. Kozaburo Miyauchi is a current outside Director, and his tenure as an outside Director will be 2 years fromthe end of this general meeting.
6.
In the case where Naruhito Kusaka and Kozaburo Miyauchi are re-elected to be outside Directors, our company will contract aliability limitation agreement with each of them for either of the higher amount of the limit of the liability of 10 million yen or theminimum liability amount prescribed in Item 1 of the Article 425. Further, our company does not have any liability limitationagreement with the current outside Directors, Naruhito Kusaka and Kozaburo Miyauchi.
1.
2.
3.
4.

Agenda No. 3 The election of 1 substitute auditor
Preparing for the case where the number of Auditors is less than the number provided in laws andordinances, the nomination of 1 substitute auditor are requested. In the above mentioned substitute
Auditor candidates, please nominate Kozo Narazaki as a substitute outside Auditor.
Further, this Agenda item was approved by the Board of Auditors.
The candidates of the substitute Auditor are as follows.

Mr. Kozo Narazaki
Date of Birth：July 19, 1948
April,1967

Ando Electric Co., Ltd.

April,1998

Division head for the Network business division at Telecommunications division HQ

July,2000

Sales manager of Telecommunications division HQ, Telecommunications marketing
division, Telecommunications solutions division
President and representative director of Kyushu Ando Electric Co., Ltd.

April,2005
September,2007

Division head of Telecommunications division HQ, Marketing planning division at
Yokogawa Electric Corporation(Note)
1. There is no relationship of special interests between each candidate and our company.
2. Kozo Narazaki is the candidate for substitute outside Auditor
3. The reasons why the candidates of the outside Auditor was selected
We believe that Kozo Narazaki could use his rich knowledge in manufacturing industry and excellent discernment in various
fields etc. for our Auditor system. Thus, the nomination of him to be the substitute outside Auditor is requested.
4. The reasons why the candidate is judged to be able to execute the responsibilities as an outside Auditor
It is judged that Kozo Narazaki will be able to execute the responsibilities as an outside Auditor appropriately because he hasrich knowledge in manufacturing industry and excellent discernment in various fields.
5. In the case where Kozo Narazaki is selected as a substitute Auditor and then becomes an outside Auditor, our company willcontract a liability limitation agreement with each of them for either of the higher amount of the limit of the liability of 10 million
yen or the minimum liability amount prescribed in Item 1 of the Article 425.