ETIC to Provide Support to Murosaki Shoten

September 29th, 2011
Enterprise Turnaround Initiative Corporation of JapanThe Enterprise Turnaround Initiative Corporation of Japan (“ETIC”), has decided to provide
support to Murosaki Shoten Co., Ltd. under Article 25, Clause 4 of the Enterprise Turnaround
Initiative Corporation of Japan Act (Act 63, of 2009, hereafter “the ETIC Act”),

1. Name of persons or companies concerned
Murosaki Shoten Co., Ltd. (hereafter “Murosaki Shoten”)

2. Name of financial institutions jointly applying for rehabilitation support with Murosaki Shoten
The San-In Godo Bank, Ltd; Nihonkai Shinyo Bank

3. Outline of business revitalization plan
Please see appendix.

4. Comments from State Ministers in charge of ETIC
Prime Minister, Minister of Internal Affairs, Minister of Finance, Minister of Economy, Tradeand Industry: No opinion expressed
Minister of Health, Labour and Welfare: ““I have no objection to the decision to support
Murosaki Shoten. However, I ask that after reaching the decision to support, ETIC should
encourage Murosaki Shoten to discuss the situation with employees as soon as possible. Ialso ask that in advising on and guiding the implementation of the corporate revitalization plan,
ETIC should aim to ensure that Murosaki Shoten complies with related laws and regulations,and that the company also provides adequate opportunities for substantive discussions withthe workforce with due consideration of employment stability and other such factors.””

5. Comment from state minister supervising business activities
Minister of Agriculture, Forestry and Fisheries: “I have no objection to the decision to
support Murosaki Shoten. Given the regional importance of this fishing operation, I ask thatin implementing the business revitalization plan, appropriate consultations take place with
regional stakeholders with regard to supply stability and employment security.”

6. Debt purchase application period
From Thursday, September 29th, 2011 for receipt by ETIC no later than Friday November 18th,
2011.

7. Request for temporary suspension
Under Article 27, Clause 1 of the ETIC Act, the financial institutions have been requested not
to recover loans or exercise any other rights they may have as creditors, other than thosepermitted under the corporate revitalization plan, before the end of the debt purchase period
as per item 6 above.

8. Treatment of trade creditors
The decision by ETIC to provide support involves requesting the waiver of debt only from thefinancial institutions providing loans to Murosaki Shoten. No request for support will be madewith regard to trade debt. Therefore there will be no impact on trade creditors.

9. Basis for decision to support
ETIC‟s basis for deciding to provide support is as follows.

9.1 Rationale
Murosaki Shoten operates from Hamada Fishing Port, the largest fishing base in Shimane
Prefecture, and with a fleet of multiple vessels is unique among the companies that participate
in the offshore trawling operations that are the core fishing activity in the region. In theHamada region, salt-cured flounder, black-throat sea perch and other such species caught intrawling operations are a local specialty, supporting multiple seafood processing businesses
around Hamada Port, which together with the trawling industry are a key driver of the regionaleconomy.

Murosaki Shoten has significant management resources, as outlined above, and plays acentral role in the regional economy. Failure of the company would bring considerable
disruption to Hamada Fishing Port, while having a negative affect on the entire region. ETIC
believes that supporting the revitalization of Murosaki Shoten can contribute to themaintenance and development of the regional economy.

To address the issue of aging vessels in the Murosaki Shoten fleet, a plan has beenformulated by the Hamada Regional Fisheries Structural Reform Project Committee, which
comprises fisheries stakeholders from Shimane Prefecture and Hamada City. Under the plan,
the existing fleet will undergo a large-scale overhaul, greatly reducing the investment requiredcompared to constructing new vessels. This will contribute to business performance bystabilizing operations and reducing maintenance costs, and should also provide a fishingindustry revitalization model that can be applied not only to Hamada Fishing Port‟s aging fleet
but also to fleets in other fishing ports.

9.2 Role of ETICIn deciding to support Murosaki Shoten, ETIC‟s planned role is as follows:(1) Act as a coordinator among the financial institutions involved(2) Provide capital(3) Supply management personnel.
With regard to (1) above, ETIC will reduce excessive interest-bearing debt and improve thefinancial condition of Murosaki Shoten by requesting debt forgiveness from financial
institutional creditors. With regard to (2), ETIC will provide capital for structural reform
initiatives by underwriting ¥6,100,000 of ordinary shares to be issued by a new company thatwill receive the continuing operations of Murosaki Shoten. With regard to (3), ETIC will place
management staff within the new company after it has been capitalized in line with (2) above,to support steady implementation of the business revitalization plan.

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Appendix: Outline of the Business Revitalization PlanSection 1: Overview of the companies receiving support
1.1 Names of companies
Murosaki Shoten Co., Ltd. (hereafter “Murosaki Shoten”)
1.2 Headquarters
1343 Gotsu-City, Gotsu-machi, Shimane Prefecture
1.3 Main businessFishing and refrigerated warehousing
1.4 Number of employees
Full-time employees: 62
Part time: 8Foreign work experience staff: 14
Total employees: 84
1.5 Main banks and other financing organizations
1. The San-In Godo Bank, Ltd
2. Nihonkai Shinyo Bank
3. Shimane Prefecture
4. Japan Finance Corporation
5. Shimane Guarantee

1.6 Financial overview (financial results for year ended March 31, 2011)
Sales
Operating loss

¥1,187 million¥4 million

Section 2: Background and circumstances leading to request for ETIC support
Since its establishment in 1924, Murosaki Shoten has developed its business in the Shimane
Prefecture cities of Hamada and Kotsu, firstly with trawling (from 1924), then canning (1954),

ceramics (manufacture and sale of slate roof tiles from 1969) and refrigerated warehousing(1992).

However, amid a worsening operating environment, the company had to withdraw from itscanning operations in 1991 and its ceramics operations in 2007. The withdrawal from thesebusinesses resulted in a significant debt burden.

The refrigerated warehousing business was impacted on opening by falling catches from Hamada
Fishing Port, compounded by a worsening economic environment after the collapse of theeconomic bubble, with the result that the business has not been able to secure sufficientrevenues.

In the trawling business, the company currently operates a total of three trawlers—two trawlers
out of Hamada Fishing Port and one trawler out of Shimoseki Fishing Port—and catch levels arestable. Nonetheless, all the vessels are around 20 years old, and with repair fees increasing it has
become necessary to take some form of remedial action. However, factors such as the debt
remaining from the withdrawal from canning and slate tile operations mean that the company isunable to retain sufficient earnings to construct new vessels.

Under these circumstances, carrying a high debt level and with no prospect of being able to repay
the funds, the company approached ETIC for support.

Section 3: Outline of business revitalization plan
1. Basic policy
Fishing operations will be positioned as the core business, and management resources will
be concentrated in this area. Specifically, a business transfer procedure will be used tocontinue the fishing operations and revitalize the business in a New Company (the „secondcompany‟ method).
The refrigerated warehousing business will be sold to a third party and revitalized under themanagement of the acquirer.

2. Request for financial support from financial institutions, etc.
Of the ¥1,350 million owed to financial institutions and others by Murosaki Shoten (currentestimated figure) financial support (effectively, debt forgiveness) will be requested forapproximately ¥1,110 million.

3. Financing
The New Company will secure funding necessary for revitalization under the business planfrom sources such as the San-In Business Revitalization Support #2 Limited Liability
Investment Partnership and from ETIC. Working capital will be provided through a new
financing framework established by The San-In Godo Bank, Ltd and Nihonkai Shinyo Bank.

Section 4. Conformance with standards for support
1. Main clauses in standards for support
1.1 Possession of effective management resources
Murosaki Shoten is a major supplier of flounder, black-throat sea perch and other suchspecies used in the local salt-cured seafood specialties of the Hamada City, Shimane
Prefecture, and as such contributes to the local seafood processing industry. The company is
an important operator of fishing trawlers, with two vessels (out of a total of five in Hamada
Port). Murosaki Shoten therefore has effective management resources.

1.2 Excessive indebtedness
Murosaki Shoten carries an excessive amount of debt compared to its revenues. Debt
forgiveness and financial support are essential to the revitalization of Murosaki Shoten.

2. Standards relating to decision to support
2.1 Agreement of main creditors
The application by Murosaki Shoten was made jointly with its main creditors, The San-In

Godo Bank, Ltd and Nihonkai Shinyo Bank.

2.2 Standards for productivity improvement
Implementation of this business revitalization plan is expected to meet all standards forproductivity improvement.

2.3 Standards for financial soundness
Implementation of this business revitalization plan is expected to meet the required
standards with respect to financial soundness.

2.4 Comparison with liquidation value
The value of Murosaki Shoten available through implementation of the businessrevitalization plan is estimated to be greater than the value available through debt recovery
on liquidation.

2.5 Potential to refinance within three years
Implementation of the business revitalization plan is expected to significantly improve thefinancial condition of Murosaki Shoten operating as the New Company, enabling it to securestable ongoing cash flow and making refinancing highly possible.
2.6 Connection with structural oversupply
Implementation of the business revitalization plan is not aimed at increasing the supply
capacity of Murosaki Shoten operating as the New Company. Accordingly, the plan has
been judged as „not hindering the resolution of structural oversupply‟ with reference toArticle 19 of the Act on Special Measures for Industrial Revitalization and IndustrialInnovation.

2.7 Status of consultations with workforce
As part of the revitalization process, it is planned that meetings with labor union
representatives and employees will be scheduled promptly after announcement of thedecision by ETIC to provide support, and opportunities provided to discuss aspects of thebusiness revitalization plan, along with employment and working conditions.

Section 5: Responsibility of management and governanceIn order to reflect management responsibility for the situation, the current representative directorof Murosaki Shoten will not be appointed to the board of the New Company.

Section 6: Responsibility of shareholders
After transfer of the fishing and refrigerated warehousing operations, unutilized real estate will besold and the company will be liquidated promptly under special liquidation procedures. Under
these procedures the shareholders of Murosaki Shoten will not receive any distribution ofremaining assets.

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