[Translation]
January 25, 2021
For immediate release
Name of company:

Japan Systems Co., Ltd.

Representative:

Tomohiro Kawada
President & Representative Director(Code No.: 9758, TSE JASDAQ)

Contact:

Jun Maejima
Corporate Planning Section Manager(Tel: 03-5309-0385)

Announcement of Change to Opinion regarding the Tender Offer for Our Shares to be
Conducted by JSL Holdings LLC
Japan Systems Co., Ltd. (the “Company”) hereby announces that there is a partial change tothe “Announcement of Opinion regarding the Tender Offer for Our Shares to be Conducted by
JSL Holdings LLC” released by the Company on December 24, 2020 (the “Company’s Press
Release Dated December 24, 2020”).
The Company announced that it resolved at its board of directors meeting held on December
24, 2020 to express its opinion in favor of a tender offer (the “Tender Offer”) for its commonshares (the “Company Shares”) to be conducted by JSL Holdings LLC (the “Tender
Offeror”) and to take a neutral position regarding whether its shareholders tender their sharesin the Tender Offer, thereby leaving that decision to the judgment of its shareholders. The
Company decided to refrain from recommending that its shareholders tender shares in theTender Offer and to leave the decision on whether its shareholders tender their shares in theTender Offer to the judgment of its shareholders because (i) the MBO Proposal (for details,
please refer to “(C) Process of and Reasons for the Decision by the Company” of “(2) Grounds
and Reasons for the Opinion on the Tender Offer” in the Company’s Press Release Dated
December 24, 2020) presented by Mr. Tomohiro Kawada, the president and representative
director of the Company, implied the possibility of implementing a competitive tender offerwith the tender offer price being 615 yen per share, and (ii) Mr. Tomohiro Kawada has implied
the possibility of implementing a competitive tender offer in the event of the implementationof the Tender Offer (however, the Company did not express its opinion on the probability ofsuch tender offer actually being implemented).
Subsequently, while the market value of the Company Shares has remained above 590 yen,which is the tender offer price in the Tender Offer, Mr. Tomohiro Kawada has not implemented
a competitive tender offer; accordingly, the Company sent a letter to Mr. Tomohiro Kawada on
January 12, 2021 requesting a response by January 18, 2021 regarding whether he intends to1

implement a competitive tender offer for the Company Shares, the specific conditions andtiming of such tender offer, and other matters. In response to this, the Company received a
response from Mr. Tomohiro Kawada on January 18, 2021 indicating that there were no decided
matters to be disclosed regarding the terms and conditions and details of a competitive tender
offer for the Company Shares as of January 18, 2021, so the Company examined the details of
the response and carefully considered whether it was necessary to change the Company’s
opinion stated in the Company’s Press Release Dated December 24, 2020 from the perspectiveof the interests of the Company’s minority shareholders. As a result, the Company determinedat the meeting of the board of directors held today that in light of the matters reported by the
special committee, there is a considerably lower possibility compared to December 24, 2020
that Mr. Tomohiro Kawada will implement a competitive tender offer within the tender offer
period of the Tender Offer (the “Tender Offer Period”) and resolved to maintain its opinion
in support of the Tender Offer and recommend that the shareholders of the Company tendershares in the Tender Offer.
Therefore, the Company hereby changes the Company’s Press Release Dated December 24,
2020 as follows. Changes are indicated in underlined text.
3.

Details of Opinion on the Tender Offer and Grounds and Reasons Therefor(1)

Details of the Opinion on the Tender Offer

Before Change
The Company resolved at its board of directors meeting held on December 24, 2020
to express its opinion in favor of the Tender Offer and to take a neutral position
regarding whether its shareholders tender shares in the Tender Offer, thereby leavingthat decision to the judgment of its shareholders, based on the grounds and reasonsstated in “(2) Grounds and Reasons for the Opinion on the Tender Offer” below. As
stated in “(C) Process of and Reasons for the Decision by the Company” in “(2)Grounds and Reasons for the Opinion on the Tender Offer” below, in order for theCompany to take advantage of the chance to dramatically expand the domains to whichit contributes as a company promoting innovation amid the recent acceleration of thetrend towards digitalization, since the Company can expect to make aggressive
investments and expeditious business decisions using the management resources of theLongreach Group (as defined below) by reviewing the Company’s previous capital
structure and cooperating with the Longreach Group, the Company has determinedthat the Tender Offer will contribute to the enhancement of Company’s corporate valueand has expressed its opinion in support of the Tender Offer. 590 yen, which is thetender offer price in the Tender Offer, is reasonable from the perspective of providing
the general shareholders of the Company with an opportunity to recover theirinvestments and can be determined to have been sufficiently valuated. However, (i)as stated in “(C) Process of and Reasons for the Decision by the Company” in “(2)Grounds and Reasons for the Opinion on the Tender Offer” below, since the New
MBO Proposal (for details, please refer to “(C) Process of and Reasons for theDecision by the Company” of “(2) Grounds and Reasons for the Opinion on the Tender
Offer” below) presented by Mr. Tomohiro Kawada, the president and representative
director of the Company, implied the possibility of implementing a competitive tender
offer with the tender offer price being 615 yen per share (however, because whether
such tender offer will actually be implemented or not will be determined by the party2

making the MBO Proposal, the Company does not express its opinion on theprobability thereof; in addition, DXC (as defined below) has expressed its intention
not to support or tender shares in such tender offer even if it is actually implemented)
and (ii) although the Company does not express its opinion on the probability of the
MBO Proposal being implemented, because the Company thought that if it
recommends that its shareholders tender shares in the Tender Offer under the present
circumstances where Mr. Tomohiro Kawada has implied the possibility of
implementing a competitive tender offer in the event of the implementation of theTender Offer, it is likely that such recommendation could invite a misunderstandingthat the Company has made a decision regarding the case of the implementation of acompetitive tender offer despite the fact that the Company has not made any decisionon whether or not to support the MBO Proposal as of today, and therefore the Company
cannot recommend that its shareholders tender shares in the Tender Offer and leaves
the decision on whether or not to tender shares in the Tender Offer to the judgment of
the shareholders.
The above board of directors’ resolution was made by the method stated in “(E)Approval of All Disinterested Directors of the Company” of “(6) Measures to Ensure
Fairness of the Tender Offer, Including Measures to Ensure Fairness of the Tender
Offer Price and Measures to Avoid Conflicts of Interest” below.
After Change
The Company resolved at its board of directors meeting held on December 24, 2020
to express its opinion in favor of the Tender Offer and to take a neutral position
regarding whether its shareholders tender shares in the Tender Offer, thereby leavingthat decision to the judgment of its shareholders, based on the grounds and reasonsstated in “(2) Grounds and Reasons for the Opinion on the Tender Offer” below. As
stated in “(C) Process of and Reasons for the Decision by the Company” in “(2)Grounds and Reasons for the Opinion on the Tender Offer” below, in order for theCompany to take advantage of the chance to dramatically expand the domains to whichit contributes as a company promoting innovation amid the recent acceleration of thetrend towards digitalization, since the Company can expect to make aggressive
investments and expeditious business decisions using the management resources of theLongreach Group (as defined below) by reviewing the Company’s previous capital
structure and cooperating with the Longreach Group, the Company has determinedthat the Tender Offer will contribute to the enhancement of Company’s corporate valueand has expressed its opinion in support of the Tender Offer. 590 yen, which is thetender offer price in the Tender Offer, is reasonable from the perspective of providing
the general shareholders of the Company with an opportunity to recover theirinvestments and can be determined to have been sufficiently valuated. However, asof December 24, 2020, (i) as stated in “(C) Process of and Reasons for the Decisionby the Company” in “(2) Grounds and Reasons for the Opinion on the Tender Offer”
below, since the New MBO Proposal (for details, please refer to “(C) Process of andReasons for the Decision by the Company” of “(2) Grounds and Reasons for theOpinion on the Tender Offer” below) presented by Mr. Tomohiro Kawada, thepresident and representative director of the Company, implied the possibility of
implementing a competitive tender offer with the tender offer price being 615 yen per
share (however, because whether such tender offer will actually be implemented or
not will be determined by the party making the MBO Proposal, the Company had not3expressed its opinion on the probability thereof; in addition, DXC (as defined below)
had expressed its intention not to support or tender shares in such tender offer even if
it is actually implemented) and (ii) although the Company had not expressed its
opinion on the probability of the MBO Proposal being implemented, because theCompany thought that if it recommended that its shareholders tender shares in theTender Offer under the circumstances where Mr. Tomohiro Kawada had implied thepossibility of implementing a competitive tender offer in the event of theimplementation of the Tender Offer, it was likely that such recommendation could
invite a misunderstanding that the Company had made a decision regarding the caseof the implementation of a competitive tender offer despite the fact that the Company
had not made any decision on whether or not to support the MBO Proposal as ofDecember 24, 2020, and therefore the Company could not recommend that its
shareholders tender shares in the Tender Offer and left the decision on whether or not
to tender shares in the Tender Offer to the judgment of the shareholders.
Subsequently, the Company resolved at the meeting of the board of directors held on
January 25, 2021 to maintain its opinion in support of the Tender Offer andrecommend that the shareholders of the Company tender shares in the Tender Offer on
the grounds and for the reasons set out in “(C) Process of and Reasons for the Decisionby the Company” of “(2) Grounds and Reasons for the Opinion on the Tender Offer”
below. In addition, as stated in “(C) Process of and Reasons for the Decision by theCompany” of “(2) Grounds and Reasons for the Opinion on the Tender Offer” below,
the Company determined that there is a considerably lower possibility compared to
December 24, 2020 that Mr. Tomohiro Kawada will implement a competitive tender
offer within the Tender Offer Period.
The above board of directors’ resolution was made by the method stated in “(E)Approval of All Disinterested Directors of the Company” of “(6) Measures to Ensure
Fairness of the Tender Offer, Including Measures to Ensure Fairness of the Tender
Offer Price and Measures to Avoid Conflicts of Interest” below.
(2)

Grounds and Reasons for the Opinion on the Tender Offer(C)

Process of and Reasons for the Decision by the Company(ii)

Establishment of a structure for review and process of review

Before Change(Omitted)
On November 30, 2020, the Company indicated to Mr. Tomohiro Kawada that there
was doubt regarding the feasibility of the New MBO Proposal because it is conditional
on DXC selling to Mr. Tomohiro Kawada (expected to be the company for purchaseto be established by Mr. Tomohiro Kawada) the Company Shares in order to acquire
100% of the Company Shares based on the New MBO Proposal, meaning that the New
MBO Proposal is conditional on approval by DXC, and requested him to reconsider
the New MBO Proposal by December 7, 2020. On December 7, 2020, the Company
received another proposal from Mr. Tomohiro Kawada indicating the possibility that
although DXC did not approve the New MBO Proposal before December 7, 2020,
while the terms of the proposal described above, which is conditional on approval by
DXC, remain unchanged, if another tender offeror commences a tender offer before
4DXC approves the New MBO Proposal, he would implement a tender offer with thepurchase price per Company Share being 615 yen irrespective of whether the board of
directors of the Company supports the New MBO Proposal. Whether Mr. Tomohiro
Kawada or parties connected to him will actually implement such tender offer or not
is left to the judgment of the party making the New MBO Proposal, and the Company
does not express its opinion on the probability thereof.
(Omitted)
After Change(Omitted)
On November 30, 2020, the Company indicated to Mr. Tomohiro Kawada that there
was doubt regarding the feasibility of the New MBO Proposal because it is conditional
on DXC selling to Mr. Tomohiro Kawada (expected to be the company for purchaseto be established by Mr. Tomohiro Kawada) the Company Shares in order to acquire
100% of the Company Shares based on the New MBO Proposal, meaning that the New
MBO Proposal is conditional on approval by DXC, and requested him to reconsider
the New MBO Proposal by December 7, 2020. On December 7, 2020, the Company
received another proposal from Mr. Tomohiro Kawada indicating the possibility that
although DXC did not approve the New MBO Proposal before December 7, 2020,
while the terms of the proposal described above, which is conditional on approval by
DXC, remain unchanged, if another tender offeror commences a tender offer before
DXC approves the New MBO Proposal, he would implement a tender offer with thepurchase price per Company Share being 615 yen irrespective of whether the board of
directors of the Company supports the New MBO Proposal. Whether Mr. Tomohiro
Kawada or parties connected to him will actually implement such tender offer or not
is left to the judgment of the party making the New MBO Proposal, and the Company
had not expressed its opinion on the probability thereof as of December 24, 2020.
(Omitted)(iii)

Determinations

Before Change(Omitted)
For details of the method of the resolution by the board of directors of the Company
described above, please refer to “(E) Approval of All Disinterested Directors of theCompany” in “(6) Measures to Ensure Fairness of the Tender Offer, Including
Measures to Ensure Fairness of the Tender Offer Price and Measures to Avoid
Conflicts of Interest” below.
After Change(Omitted)
For details of the method of the resolution by the board of directors of the Company
described above, please refer to “(E) Approval of All Disinterested Directors of the5Company” in “(6) Measures to Ensure Fairness of the Tender Offer, Including
Measures to Ensure Fairness of the Tender Offer Price and Measures to Avoid
Conflicts of Interest” below.
Subsequently, while the market price of the Company Shares has remained above 590
yen, which is the tender offer price in the Tender Offer, a competitive tender offer has
not been made by Mr. Tomohiro Kawada even though a considerable period of time
has passed since the commencement of the Tender Offer. Accordingly, on January
12, 2021, the Company sent a letter to Mr. Tomohiro Kawada requesting a response
by January 18, 2021 regarding whether he intended to implement a competitive tender
offer for the Company Shares, the specific conditions and timing of such tender offer,and other matters. In response, the Company received a letter from Mr. Tomohiro
Kawada and his sponsor on January 18, 2021 including the statement that, although
they had continued to engage in various reviews and preparations, there were no
decided matters to be disclosed as of January 18, 2021 regarding the terms andconditions and details thereof, so the Company delegated the special committee toconsider whether it was necessary to change the opinion of the Company’s board of
directors regarding the Transactions, including the Tender Offer, and to provide its
opinion to the Company’s board of directors. In addition, the Company carefully
discussed and considered whether it was necessary to change the opinion of theCompany’s board of directors regarding the Tender Offer from the perspective of theinterests of the minority shareholders of the Company. Specifically, the Company
and the special committee examined the content of the letter dated January 18, 2021
received from Mr. Tomohiro Kawada and his sponsor and confirmed with DXC thechanges in the status of the Transactions since December 24, 2020. On January 20,
2021, DXC responded that it had not received an offer of discussion on the MBO
Proposal or any other contact from Mr. Tomohiro Kawada or his sponsor since
December 24, 2020, and that there was no change in DXC’s intention not to support acompetitive tender offer by Mr. Tomohiro Kawada or tender shares in such tender offer
even if it is implemented by Mr. Tomohiro Kawada.
The Company then received a written report (the “Report (2)”) from the special
committee on January 25, 2021 amending the content of the Report and including thestatement that the special committee believes that (i) the board of directors of theCompany should maintain its opinion in support of the Tender Offer and recommendthat the shareholders of the Company tender shares in the Tender Offer, and (ii)
deciding to maintain its opinion in support of the Tender Offer and recommend thatthe shareholders of the Company tender shares in the Tender Offer at the meeting of
the board of directors of the Company would not be disadvantageous to the minority
shareholders of the Company (for details of the Report (2), please refer to “(C)
Establishment by the Company of an Independent Special Committee” in “(6)Measures to Ensure Fairness of the Tender Offer, Including Measures to Ensure
Fairness of the Tender Offer Price and Measures to Avoid Conflicts of Interest” below).
In light of the background described above, the Company carefully discussed andconsidered at the meeting of its board of directors held on January 25, 2021 whether it
was necessary to change the opinion of the Company’s board of directors regarding
the Tender Offer, based on legal advice from Nagashima Ohno & Tsunematsu andadvice from a financial point of view from Mizuho Securities, giving the highest
degree of respect to the determinations by the special committee presented in the6Report (2). As a result, as stated below, the Company came to the conclusion that itshould maintain its opinion in support of the Tender Offer and recommend that theshareholders of the Company tender shares in the Tender Offer.
The resolution at the meeting of the Company’s board of directors held on December
24, 2020 in which the Company did not go so far as to recommend that its shareholders
tender shares in the Tender Offer but instead left the decision on whether or not totender shares in the Tender Offer to the judgment of the shareholders was based on thefact that the MBO Proposal had implied the possibility of implementing a tender offerwith the tender offer price being 615 yen per share and that Mr. Tomohiro Kawada had
implied the possibility of implementing a competitive tender offer in the event of theimplementation of the Tender Offer. However, in the circumstances where there had
been no specific activity by Mr. Tomohiro Kawada, such as offering a new proposal toor discussions with the Company and DXC, even though approximately one month
had passed since December 24, 2020, the Company received a response that there were
no decided matters as of January 18, 2021 regarding the terms and conditions anddetails of a competitive tender offer for the Company Shares, and no specificexplanation was provided pertaining to specifically anticipated measures, expected
timing, or the like. In addition, DXC has stated that DXC US has entered into theTransaction Agreement dated December 24, 2020 with the Tender Offeror based on
the circumstances stated in “(i) Consultation between the Tender Offeror and theCompany and DXC and decision-making process of the Tender Offeror” in “(B)Background, Purpose, and Decision-Making Process with respect to the Tender
Offeror Conducting the Tender Offer, and Management Policy After the Tender Offer”
above, and that there was no change in DXC’s intention not to support a competitive
tender offer by Mr. Tomohiro Kawada or tender shares in such tender offer, and thus
even if a tender offer subject to DXC’s support is commenced, it would be unlikelythat that tender offer would be completed. While, as stated in “(i) Consultation
between the Tender Offeror and the Company and DXC and decision-making processof the Tender Offeror” in “(B) Background, Purpose, and Decision-Making Processwith respect to the Tender Offeror Conducting the Tender Offer, and Management
Policy After the Tender Offer” above, DXC has agreed to hold 21% of the equity
interests in DH Fund, which holds all of the equity interests of the Tender Offeror, andintends to continue its business relationship with the Company after the Transactions,the Company does not consider it particularly unreasonable that DXC’s judged that it
highly appraised the past investment results and experience of the Longreach Groupand networks held by the Longreach Group and that DXC decided to sell the Company
Shares with a price lower than the price offered to general shareholders on theassumption of the above transaction scheme and the relationship after the Transactions,and no circumstance requiring any change in that judgment has been found since thecommencement of the Tender Offer. Therefore, the Company does not consider that
DXC’s continued intention not to support a competitive tender offer by Mr. Tomohiro
Kawada or tender shares in such tender offer is unreasonable, either. In light of thesecircumstances, the Company considers that there is a significantly lower possibility
compared with December 24, 2020 that a competitive tender offer will be made by Mr.
Tomohiro Kawada during the Tender Offer Period and that there will thereby be an
opportunity for all of the Company’s minority shareholders to sell their Company
Shares at a price higher than the Tender Offer Price, and in such circumstances, theCompany believes there is no longer any reason why it cannot recommend that its
shareholders tender shares in the Tender Offer. Considering the fact that the closing
7

price of the Company Shares on December 23, 2020, which is the Business Day
immediately preceding the announcement date of the Tender Offer, was 409 yen, andthat the market price of the Company Shares had remained around the Tender Offer
Price for a certain period of time after the announcement of the Tender Offer, theCompany considers that one of the factors contributing to the range of changes in themarket price of the Company Shares being above 590 yen, which is the tender offer
price in the Tender Offer, is that there are expectations that a competitive tender offer
might be actually implemented by Mr. Tomohiro Kawada. However, in light of theabove background, since the Company considers that the possibility that Mr. Tomohiro
Kawada will implement a competitive tender offer during the Tender Offer Period issignificantly lower compared with December 24, 2020, the Company has determinedthat it is necessary to appropriately disclose information to its shareholders.
Based on the above judgment, the Company resolved at the meeting of its board of
directors held on January 25, 2021 to maintain its opinion in support of the Tender
Offer and to recommend that the shareholders of the Company tender shares in theTender Offer.
For details of the method of the resolution by the board of directors of the Company
described above, please refer to “(E) Approval of All Disinterested Directors of theCompany” in “(6) Measures to Ensure Fairness of the Tender Offer, Including
Measures to Ensure Fairness of the Tender Offer Price and Measures to Avoid
Conflicts of Interest” below.
(6)

Measures to Ensure Fairness of the Tender Offer, Including Measures to Ensure
Fairness of the Tender Offer Price and Measures to Avoid Conflicts of Interest(C)

Establishment by the Company of an Independent Special Committee

Before Change(iii)

Determinations

Following the process described above, the special committee submitted the Reportmainly stating the matters set out below on December 24, 2020 to the Company’sboard of directors with the unanimous approval of all members of the special
committee as a result of careful and repeated discussions and examination of theDelegated Matters based on the legal advice from Nagashima Ohno & Tsunematsu,
advice from Stand by C from a financial perspective, and the matters stated in the
Share Price Valuation Report (Mizuho Securities) submitted on December 24, 2020
and in the Share Price Valuation Report (Stand by C) submitted on December 23, 2020.
(Omitted)
After Change(iii)

Determinations

Following the process described above, the special committee submitted the Reportmainly stating the matters set out below on December 24, 2020 to the Company’sboard of directors with the unanimous approval of all members of the special
committee as a result of careful and repeated discussions and examination of the8Delegated Matters based on the legal advice from Nagashima Ohno & Tsunematsu,
advice from Stand by C from a financial perspective, and the matters stated in the
Share Price Valuation Report (Mizuho Securities) submitted on December 24, 2020
and in the Share Price Valuation Report (Stand by C) submitted on December 23, 2020.
(Omitted)(iv)

Changes in Determinations

As stated in “(C) Process of and Reasons for the Decision by the Company” of “(2)Grounds and Reasons for the Opinion on the Tender Offer” above, on January 18, 2021,
the Company received from Mr. Tomohiro Kawada a written document to the effectthat as of that day, there were no decided matters to be disclosed with regard to theterms and conditions and details of a competitive tender offer for the Company Shares,
so the special committee carefully discussed and examined whether it is necessary tochange the opinion of the Company’s board of directors regarding the Transactions,
including the Tender Offer.
The special committee received explanations from the Company’s outside directors
about the process of the Transactions from December 24, 2020, carefully reviewed thematters stated in the written document that the Company’s board of directors received
from Mr. Tomohiro Kawada, and received information shared by the Company’s boardof directors regarding the details of questions and answers exchanged between the
Company and DXC.
Based on the above, the special committee submitted the Report (2) mainly stating thematters set out below on January 25, 2021 to the Company’s board of directors withthe unanimous approval of all members of the special committee as a result of careful
and repeated discussions and examination of the above matters based on the legal
advice from Nagashima Ohno & Tsunematsu and advice from Stand by C from afinancial perspective.
(a)Matters reported-

The Company’s board of directors should maintain its opinion in support of theTender Offer and recommend that the shareholders of the Company tender sharesin the Tender Offer.

-

The special committee believes that the Company’s board of directors’ resolution
to maintain its opinion in support of the Tender Offer and to recommend that theshareholders of the Company tender shares in the Tender Offer would not bedisadvantageous to the minority shareholders of the Company. There is nochange in the special committee’s belief that the determination of the board of
directors of the Company as to making the Company a wholly-owned subsidiaryof the Tender Offeror after the completion of the Tender Offer would not bedisadvantageous to the minority shareholders of the Company.

(b)-

Reasons for giving the above opinions in the Report (2)The special committee does not find any particular circumstances based on
which it should be determined that there have been changes in the matters thatwere used as the underlying assumptions when it determined that theTransactions are likely to contribute to the enhancement of the Company’s
corporate value, that the process of negotiations leading to the Transactions andother related procedures are likely to be fair, and that the Tender Offer Price andother terms and conditions for the Tender Offer are fair.
9

(E)

-

However, based on the circumstances described in “(C) Process of and Reasonsfor the Decision by the Company” of “(2) Grounds and Reasons for the Opinion
on the Tender Offer” above, the special committee believes that the possibility
that Mr. Tomohiro Kawada will actually implement a competitive tender offer
during the Tender Offer Period is significantly lower than it was when the special
committee submitted the Report on December 24, 2020.

-

In light of the changes in the market price of the Company Shares, the special
committee believes that one of the factors contributing to the range of changes
in the market price of the Company Shares being above the Tender Offer Priceis that there are expectations that a competitive tender offer will be actually
implemented by Mr. Tomohiro Kawada. However, as stated above, thepossibility that all of the minority shareholders of the Company would be able
to sell the Company Shares at a price higher than the Tender Offer Price may beevaluated as being lower than it was when the special committee submitted theReport on December 24, 2020 and, for this reason, the special committee
determined that it is reasonable to recommend that the Company’s shareholders
tender shares in the Tender Offer from the standpoint of disclosing informationnecessary for the minority shareholders to make appropriate decisions onwhether or not to tender shares in the Tender Offer.

Approval of All Disinterested Directors of the Company

Before Change(Omitted)
Of the eight directors of the Company (Mr. Takatsugu Ebi resigned from his position
as a director on December 20, 2020), Mr. Nozomu Nishikawa, Mr. Lilian FurnoSchneider, and Mr. Dai Kirisawa serve as the representative director, the CFO, and theManager of the Delivery Management Division of DXC’s Japanese corporations
respectively, Mr. Eizo Takami had a position as an executive officer of DXC’s Japanese
corporations, and Mr. Tomohiro Kawada made a separate proposal for privatizing theCompany Shares; therefore, from the standpoint of eliminating the possibility of thedeliberations and resolutions at the board of directors meeting being affected byproblems with structural conflicts of interests and problems with asymmetric
information in the Transactions, the Company’s board of directors meeting held on
December 24, 2020 stated above was two-tiered: first, (i) the three directors other than
Mr. Nozomu Nishikawa, Mr. Lilian Furno-Schneider, Mr. Dai Kirisawa, Mr. Eizo
Takami, and Mr. Tomohiro Kawada participated in deliberations and passed a
resolution as stated above by unanimous approval; and further, in order to exercise theutmost prudence, (ii) five directors (those three directors participating in (i) above plus
Mr. Dai Kirisawa and Mr. Eizo Takami) once again passed a resolution as stated above
by unanimous approval.
After Change(Omitted)10

Of the eight directors of the Company (Mr. Takatsugu Ebi resigned from his position
as a director on December 20, 2020), Mr. Nozomu Nishikawa, Mr. Lilian FurnoSchneider, and Mr. Dai Kirisawa serve as the representative director, the CFO, and theManager of the Delivery Management Division of DXC’s Japanese corporations
respectively, Mr. Eizo Takami had a position as an executive officer of DXC’s Japanese
corporations, and Mr. Tomohiro Kawada made a separate proposal for privatizing theCompany Shares; therefore, from the standpoint of eliminating the possibility of thedeliberations and resolutions at the board of directors meeting being affected byproblems with structural conflicts of interests and problems with asymmetric
information in the Transactions, the Company’s board of directors meeting held on
December 24, 2020 stated above was two-tiered: first, (i) the three directors other than
Mr. Nozomu Nishikawa, Mr. Lilian Furno-Schneider, Mr. Dai Kirisawa, Mr. Eizo
Takami, and Mr. Tomohiro Kawada participated in deliberations and passed a
resolution as stated above by unanimous approval; and further, in order to exercise theutmost prudence, (ii) five directors (those three directors participating in (i) above plus
Mr. Dai Kirisawa and Mr. Eizo Takami) once again passed a resolution as stated above
by unanimous approval.
After that, as stated in “(C) Process of and Reasons for the Decision by the Company”
of “(2) Grounds and Reasons for the Opinion on the Tender Offer” above, theCompany’s board of directors resolved at its meeting held on January 25, 2021 tomaintain its opinion in support of the Tender Offer and recommend that theshareholders of the Company tender shares in the Tender Offer with the unanimous
approval of the Company’s directors who participated in the deliberations andresolution.
The Company’s board of directors meeting held on January 25, 2021 stated above was
two-tiered in the same manner as the Company’s board of directors meeting held on
December 24, 2020 stated above: first, (i) the three directors other than Mr. Nozomu
Nishikawa, Mr. Lilian Furno-Schneider, Mr. Dai Kirisawa, Mr. Eizo Takami, and Mr.
Tomohiro Kawada participated in deliberations and passed a resolution as stated above
by unanimous approval; and further, in order to exercise the utmost prudence, (ii) five
directors (those three directors participating in (i) above plus Mr. Dai Kirisawa and Mr.
Eizo Takami) once again passed a resolution as stated above by unanimous approval.
10.

Matters Relating to Transactions, Etc. with a Controlling Shareholder

Before Change(Omitted)(3)

Outline of Opinion Obtained from a Party Who Has No Interest in the Controlling
Shareholder that Conducting the Transactions (Including the Company’s Board of
Directors Expressing Its Opinion in Favor of the Tender Offer and Taking a Neutral
Position Regarding Whether its Shareholders Tender Shares in the Tender Offer,
Thereby Leaving that Decision to the Judgment of its Shareholders) Would Not be
Disadvantageous to the Minority Shareholders
On December 24, 2020, the Company received the Report from the special committeethat includes a statement that the special committee believes that the board of directorsof the Company expressing an opinion in support of the Tender Offer and11

recommending that the shareholders of the Company tender the Company Shares in
the Tender Offer would not be disadvantageous to the minority shareholders of theCompany. Please refer to “(C) Establishment by the Company of an Independent
Special Committee” of “(6) Measures to Ensure Fairness of the Tender Offer, Including
Measures to Ensure Fairness of the Tender Offer Price and Measures to Avoid
Conflicts of Interest” in “3. Details of Opinion on the Tender Offer and Grounds andReasons Therefor” above for details.
After Change(Omitted)(3)

Outline of Opinion Obtained from a Party Who Has No Interest in the Controlling
Shareholder that Conducting the Transactions (Including the Company’s Board of
Directors Expressing Its Opinion in Favor of the Tender Offer and Recommending that
its Shareholders Tender Shares in the Tender Offer) Would Not be Disadvantageous to
the Minority Shareholders
On December 24, 2020, the Company received the Report from the special committeethat includes a statement that the special committee believes that the board of directorsof the Company expressing an opinion in support of the Tender Offer and taking aneutral position regarding whether its shareholders tender the Company Shares in theTender Offer, thereby leaving that decision to the judgment of its shareholders, would
not be disadvantageous to the minority shareholders of the Company. After that, onJanuary 25, 2021, the Company received the Report (2) from the special committeethat includes a statement that the special committee believes that the board of directorsof the Company maintaining its opinion in support of the Tender Offer andrecommending that the shareholders of the Company tender the Company Shares in
the Tender Offer would not be disadvantageous to the minority shareholders of theCompany. Please refer to “(C) Establishment by the Company of an Independent
Special Committee” of “(6) Measures to Ensure Fairness of the Tender Offer, Including
Measures to Ensure Fairness of the Tender Offer Price and Measures to Avoid
Conflicts of Interest” in “3. Details of Opinion on the Tender Offer and Grounds andReasons Therefor” above for details.
End

12US Regulations
The Tender Offer will be conducted in compliance with the procedures and information
disclosure standards provided under the Financial Instruments and Exchange Act of Japan, andthose procedures and standards are not always the same as those applicable in the United States.
In particular, neither Section 13(e) nor Section 14(d) of the U.S. Securities Exchange Act of1934 (as amended, the “U.S. Securities Exchange Act of 1934”) or the rules under these sections
apply to the Tender Offer; therefore, the Tender Offer is not conducted in accordance with those
procedures or standards. The financial information included in this press release do notconform to the U.S. accounting standards and may not be equivalent to the financial statementsof a company in the United States. Also, because the Tender Offeror and the Company arecorporations incorporated outside the United States and some or all of their directors are nonU.S. residents, it may be difficult to exercise rights or demands against them under the U.S.
securities laws. It also may be impossible to bring an action against a company that is basedoutside of the United States or its directors in a court outside of the United States on the groundsof a violation of the federal securities laws of the United States. There is also no guarantee thata company that is based outside of the United States or its subsidiaries or affiliates may becompelled to submit themselves to the jurisdiction of a U.S. court.
All procedures regarding the Tender Offer will be conducted in Japanese unless specifically set
forth otherwise. All or part of the documents regarding the Tender Offer will be prepared in
English. However, if there is any discrepancy between the documents in English and those inJapanese, the documents in Japanese shall prevail.
Before the commencement of the Tender Offer or during the purchase period of the Tender
Offer, the Tender Offeror and its affiliate, and the affiliates of the financial advisor of each of
the Tender Offeror and the Company might purchase by means other than the Tender Offer or
conduct an act aimed at such a purchase of the Company Shares on their own account or theaccount of their client to the extent permitted by Japanese laws and regulations related tofinancial instruments transactions and other applicable laws and regulations in the scope of theirordinary business and in accordance with the requirements of Rule 14e-5(b) of the U.S.
Securities Exchange Act of 1934. If information regarding such a purchase is disclosed inJapan, that information will also be disclosed in the English language on a website of the personthat conducted that purchase.
Prediction of the FutureThis press release includes forward-looking statements as defined in Section 27A of the U.S.
Securities Act of 1933 (as amended, the “U.S. Securities Exchange Act of 1933”) and Section
21E of the U.S. Securities Exchange Act of 1934. The actual results may be significantly
different from the predictions expressly or impliedly indicated in the forward-looking
statements, due to known or unknown risks, uncertainty, or other factors. The Tender Offeror
or its affiliates do not guarantee that the predictions expressly or impliedly indicated as theforward-looking statements will turn out to be correct. The forward-looking statements
included in this press release were prepared based on the information held by the Tender Offeror
as of the date hereof, and unless obligated by laws or regulations or the rules of a financial
instruments exchange, the Tender Offeror, the Company or their affiliates shall not be obligatedto update or revise the statements to reflect future incidents or situations.
13