Note: This document has been translated from a part of the Japanese original for reference purposes only. In the event ofany discrepancy between this translated document and the Japanese original, the original shall prevail.

Securities identification code: 9076
June 6, 2017
To our shareholders:
Yoshitaka Taguchi
President and Chief Operating Officer
SEINO HOLDINGS CO., LTD.
1, Taguchi-cho, Ogaki, Gifu

NOTICE OF THE 96TH ORDINARY GENERAL MEETING OF
SHAREHOLDERS
You are cordially invited to attend the 96th Ordinary General Meeting of Shareholders of SEINO
HOLDINGS CO., LTD. (the “Company”), which will be held as described below.
If you are unable to attend the meeting in person, you may exercise your voting rights by postal mailor electronically (via the internet, etc.). Please exercise your voting rights no later than 5:00 p.m.,
Tuesday, June 27, 2017 (Japan Standard Time) after reviewing the attached Reference Documents
for the General Meeting of Shareholders.
1. Date and Time

Wednesday, June 28, 2017 at 10:00 a.m. (Japan Standard Time)

2. Venue:

Sopia Hall, 3F, Softpia Japan Center Building
4-1-7, Kagano, Ogaki, Gifu

3. Purposes:
Items to be reported:
1.

Business Report and Consolidated Financial Statements for the 96th 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 and the Audit & Supervisory Board

2. Non-Consolidated Financial Statements for the 96th Term (from April 1, 2016 to March 31,
2017)
Items to be resolved:
Proposal 1:

Appropriation of Surplus

Proposal 2:

Election of Nine (9) Directors

Proposal 3:

Determination of Compensation for Granting of Restricted Shares to theCompany’s Directors

Proposal 4:

Payment of Retirement Benefits to a Retired Director

Proposal 5:

Gratis Allotment of Stock Acquisition Rights for Plan forCountermeasures to Large-Scale Acquisitions of the Company’s Shares

1Reference Documents for the General Meeting of Shareholders

Proposal 1:

Appropriation of Surplus

The Company positions profit of shareholders as an important management policy. It has abasic policy of implementing interim dividends, paying annual dividends of 11 yen per share or
higher in principle and maintaining a consolidated payout ratio of around 30% while enhancing
shareholder capital with a mid-to-long term view and improving profitability.
Based on this policy, the Company proposes to pay 16 yen per common share as the year-end
dividends for this fiscal year. As such, the total annual dividends for this fiscal year, including thealready implemented interim dividends of 11 yen, will be 27 yen per share.
(1) Type of dividend property
Cash(2) Allocation of dividend property to shareholders and total amount thereof
16 yen per common share of the Company
Total amount of dividends: 3,155,848,912 yen(3) Effective date of distribution of dividends of surplus
June 29, 20172

Proposal 2:

Election of Nine (9) Directors

The terms of office of all nine (9) Directors will expire at the conclusion of this meeting. In
that regard, the Company proposes that nine (9) Directors be elected, increasing the number ofIndependent Outside Directors by one (1), bringing the total to three (3), to further enhance thecorporate governance system.
The candidates for Directors are as follows:

No.

Name

1

Yoshitaka Taguchi

2

Attendance atBoard ofDirectors
meetings

Current position, etc.

President and Chief Operating Officer

Reelection

100%(12 out of 12
times)

Takao Taguchi

Representative Director in charge ofBusiness Promotion Department (Vehicle
Sales and Related Services)

Reelection

92%(11 out of 12
times)

3

Masahiro Kamiya

Director in charge of Business Promotion
Department(Transportation
Services),
Information Systems Department, and Real
Estate Development Department

Reelection

100%(12 out of 12
times)

4

Hidemi Maruta

Director in charge of International Strategies
OfficeReelection

100%(12 out of 12
times)

5

Harumi Furuhashi

Director in charge of General Affairs
Department, Human Resources Department,
and Corporate Promotion Department

Reelection

100%(12 out of 12
times)

6

Nobuyuki Nozu

Director in charge of Finance & IR
Department and Accounting Department

Reelection

100%(9 out of 9times)

7

Yuji Tanahashi

Outside Director
Independent Officer

Reelection
OutsideIndependent100%(12 out of 12
times)

8

Kenjiro Ueno

Outside Director
Independent Officer

Reelection
OutsideIndependent92%(11 out of 12
times)New
election
OutsideIndependent－

9

Notes:

Meyumi Yamada

1. Candidate for Director Nobuyuki Nozu was elected at the 95th Ordinary General Meeting of
Shareholders that was held on June 28, 2016 and assumed office. Accordingly, the number of his
attendance at the Board of Directors meetings differs from that of the other candidates.
2. Refer to the following pages for details on the candidates.

3

No.

1

Name
(Date of birth)

Yoshitaka Taguchi(April 20, 1961)

Career summary, position and responsibilities(significant concurrent positions outside the Company)
Mar. 1985

Joined the Company

May 1985

Temporary assignment to Seino America Inc.

Jan. 1988

President of the same company

May 1989

General Manager and Assistant to the
President of the Company

July 1989

Director of the Company in charge ofCorporate Secretariat, General Manager ofGeneral Affairs Department, General
Manager of Group Planning Office, andGeneral Manager of Seino General ResearchInstitute

July 1991

Managing Director of the Company in chargeof the East Area and the Tohoku Area

June 1996

Senior Managing Director of the Company incharge of Labor Department

Oct. 1998

Representative Director and Vice Presidentof the Company in charge of Sales
Headquarters and Accounting Department

June 1999

Representative Director and Vice Presidentof the Company in charge of Management
and Accounting Department

June 2001

Representative Director and Vice Presidentof the Company in charge of Management

June 2003

President and Chief Operating Officer of theCompany (present position)[Significant concurrent positions outside the Company]
Representative Director and Chairman of Kanto Unyu Co.,
Ltd. and Representative Director of Seino Transportation
Co., Ltd., Hokkaido Seino Transportation Co., Ltd., Kanto
Seino Transportation Co., Ltd., Seino Super Express Co.,
Ltd., Tokai Seino Transportation Co., Ltd., Nohi Seino
Transportation Co., Ltd., Shikoku Seino Transportation Co.,
Ltd., Kyushu Seino Transportation Co., Ltd., Seino Customs
Clearance Service Co., Ltd., Gifu Hino Motor Co., Ltd.,Netz Toyota Gifu Co., Ltd., Seino Engineering Co., Ltd.,
Seino Trading Co., Ltd., and Seino Information Service Co.,
Ltd.

4

Number of theCompany’s
shares owned

615,644

No.

2

Name
(Date of birth)

Career summary, position and responsibilities(significant concurrent positions outside the Company)
Apr. 1984

Joined Nisshin Flour Milling Inc.

July 1992

Joined Gifu Hino Motor Co., Ltd.

June 1995

Director and Assistant General Manager ofSales Department of the same company

Apr. 1998

Senior Managing Director of the same
company

June 1999

Director and Assistant to Director in chargeof Sales Headquarters of the Company

Apr. 2000

Managing Director of the Company in chargeof Sales Headquarters

June 2003

Senior Managing Director of the Company incharge of Sales Control

Oct. 2005

Director of the Company in charge ofTransportation Services Planning Department

Oct. 2005

Senior Managing Director of Seino
Transportation Co., Ltd. in charge ofManagement

June 2006

Director of the Company in charge of Sales

June 2007

Director of the Company in charge of Vehicle
Sales and Related Services Planning
Department

Takao Taguchi(February 2, 1962)
Apr. 2011

Director of the Company in charge ofBusiness Promotion Department (Vehicle
Sales and Related Services)

June 2015

Representative Director of the Company incharge of Business Promotion Department(Vehicle Sales and Related Services)

Aug. 2015

Representative Director of the Company incharge of Business Promotion Department(Vehicle Sales and Related Services),
Accounting Department and Finance & IR
Department

June 2016

Representative Director of the Company incharge of Business Promotion Department(Vehicle Sales and Related Services) (present
position)[Significant concurrent positions outside the Company]
Representative Director and Chairman of Toyota Corolla
Gifu Co., Ltd., President of Gifu Hino Motor Co., Ltd., andRepresentative Director and President of Netz Toyota Gifu
Co., Ltd.

5

Number of theCompany’s
shares owned

371,853

No.

3

Name
(Date of birth)

Masahiro Kamiya(August 13, 1953)

Career summary, position and responsibilities(significant concurrent positions outside the Company)
Mar. 1979

Joined the Company

Jan. 1981

Temporary Assignment to Chubu Economic
Federation

Apr. 1982

Manager of the Yokkaichi Branch of theCompany

July 1984

Associate Director of Accounting
Department of the Company

July 1987

Director of Dotsu Seino Transportation Co.,
Ltd. (currently Hokkaido Seino
Transportation Co., Ltd.), General Manager
of Corporate Planning Department

Aug. 1991

General Manager of Sales Department ofNohi Seino Transportation Co., Ltd.

Aug. 1992

Director and General Manager of Sales
Headquarters of the same company

June 2003

Managing Director and General Manager ofSales Department of the same company

June 2007

Senior Managing Director and General
Manager of Sales Department of the same
company

Apr. 2011

Representative Director and President of thesame company

June 2013

Senior Managing Director of Seino
Transportation Co., Ltd. in charge of Sales
Headquarters

June 2015

Director of the Company in charge of Real
Estate Development Department

Apr. 2016

Director of the Company in charge of New
Business Development Department, Business
Promotion Department (Transportation
Services), Information Systems Department,
and Real Estate Development Department

Apr. 2016

Representative Director and President of
Seino Transportation Co., Ltd. (present
position)

June 2016

Director of the Company in charge ofBusiness Promotion Department(Transportation Services), Information
Systems Department, and Real Estate
Development Department (present position)[Significant concurrent positions outside the Company]
Representative Director and President of Seino
Transportation Co., Ltd.

6

Number of theCompany’s
shares owned

5,742

No.

4

Name
(Date of birth)

Career summary, position and responsibilities(significant concurrent positions outside the Company)
Apr. 1985

Joined the National Tax Agency

July 1992

Superintendent of Monbetsu Tax Office

July 1995

Director of Co-ordination Department,
Sapporo Regional Taxation Bureau

May 1996

Consul, Consulate-General of Japan in Hong
Kong

Oct. 1997

Joined the Company as General Manager ofCorporate Planning Office

June 2001

Director of the Company in charge of
Accounting Department and Employee’s
Pension Fund

Mar. 2002

Director of the Company in charge of
Accounting Department and Finance & IR
Department

Dec. 2004

Director of the Company in charge of
Accounting Department, Finance & IR
Department, Loan Management Department,Group Management Department, andAccounting and Auditing Office

Oct. 2005

Director of Seino Transportation Co., Ltd. incharge of Accounting Department, Finance
Department, and Loan Management
Department

Hidemi Maruta(March 4, 1963)
Oct. 2005

Director of the Company in charge of
Accounting Department, Finance & IR
Department, and Loan Management
Department

Apr. 2012

Director of the Company in charge of
Accounting Department, Finance & IR
Department, and Real Estate Development
Department.

June 2013

Director of the Company in charge of
Accounting Department and Finance & IR
Department

Apr. 2014

Director of the Company in charge of
Accounting Department, Finance & IR
Department, and International Strategies
OfficeJune 2014

Director of the Company in charge ofInternational Strategies Office (present
position)[Significant concurrent positions outside the Company]
Audit & Supervisory Board Member of Seino Super Express
Co., Ltd.

7

Number of theCompany’s
shares owned

1,000

No.

5

6

Name
(Date of birth)

Harumi Furuhashi(April 13, 1957)

Nobuyuki Nozu
(May 24, 1961)

Career summary, position and responsibilities(significant concurrent positions outside the Company)
Mar. 1981

Joined the Company

July 2003

General Manager of Eco Business
Department of the Company

Oct. 2005

General Manager of Operations Department
of Seino Transportation Co., Ltd.

Apr. 2007

General Manager of Sales Department
stationed in the Chubu Area of the same
company

Apr. 2009

Executive Officer of the same company,
General Manager in charge of Shizuoka
Mikawa Area

Apr. 2011

Executive Officer of the same company,
General Manager in charge of Meito Area

Apr. 2012

Director of the same company in charge of
Human Resources Department (present
position)

Apr. 2012

General Manager of Human Resources
Department of the Company

June 2013

Director of the Company in charge ofGeneral Affairs Department, Human
Resources Department, and Corporate
Promotion Department (present position)

Apr. 1985

Joined the Tokai Bank, Ltd. (currently the
Bank of Tokyo-Mitsubishi UFJ, Ltd.)

Jan. 2014

Joined the Company as General Manager ofCorporate Planning Office

July 2014

Executive Manager of the Accounting
Department and Finance & IR Department of
the Company

July 2014

General Manager of Finance Department of
Seino Transportation Co., Ltd.

Apr. 2015

Executive Officer and General Manager ofFinance Department at the same company

Apr. 2016

Director in charge of the Accounting
Department and Finance Department of thesame company (present position)

June 2016

Director of the Company in charge ofFinance & IR Department and Accounting
Department (present position)

8

Number of theCompany’s
shares owned

8,000

100

No.

7

Name
(Date of birth)

Yuji Tanahashi(October 13, 1934)

Career summary, position and responsibilities(significant concurrent positions outside the Company)
Apr. 1958

Joined the Ministry of International Tradeand Industry

June 1991

Vice-Minister of International Trade andIndustry

June 1993

Special Advisor to the Ministry ofInternational Trade and Industry, Executive
Advisor to the Research Institute ofInternational Trade and Industry

Feb. 1995

Executive Advisor to the Industrial Bank ofJapan, Limited.

Apr. 1997

Professor of Faculty of Law and Graduate
School of Law at Doshisha University

Aug. 1997

Chairman of New Energy Foundation

June 2001

President and Chief Executive Officer ofJapan Petroleum Exploration Co., Ltd.

June 2002

Outside Director of SMK Corporation

June 2005

Outside Director of the Company (present
position)

June 2008

Chairman of Japan Petroleum Exploration
Co., Ltd.

Feb. 2009

Admission as a Lawyer (Daiichi Tokyo Bar
Association) (present position)

Feb. 2009

Attorney at law of City-Yuwa Partners(present position)

Apr. 2013

Dean and Professor of Graduate School of
Innovation Management, Kanazawa Instituteof Technology (present position)

Jan. 2014

Outside Director of K&O Energy Group Inc.
(present position)

June 2015

Director and Chairman of Japan Petroleum
Exploration Co., Ltd.

June 2016

Senior Advisor of Japan Petroleum
Exploration Co., Ltd. (present position)[Significant concurrent positions outside the Company]
Outside Director of K&O Energy Group Inc.

9

Number of theCompany’s
shares owned

5,000

No.

8

Name
(Date of birth)

Kenjiro Ueno
(January 1, 1939)

Career summary, position and responsibilities(significant concurrent positions outside the Company)
Apr. 1961

Joined Showa Denko K.K.

Apr. 1966

Joined Haruhiko Kusano Law Office

Apr. 1984

Opened Ueno Law Office

Apr. 1987

Executive Governor of Japan Federation of
Bar Associations

June 1994

Outside Audit & Supervisory Board Memberof Tokyo Toyota Co., Ltd.

July 2001

Commission Chair of Equity Commission at
the Supreme Court

June 2005

Outside Director of the Company (present
position)

June 2007

Outside Audit & Supervisory Board Memberof Oji Paper Co., Ltd.

Mar. 2012

Representative of Ueno & Hanasato Law
Office (present position)

Oct. 2012

Outside Audit & Supervisory Board Memberof Oji Holdings Corporation

Number of theCompany’s
shares owned

0[Significant concurrent positions outside the Company]
Representative of Ueno & Hanasato Law Office9*
Meyumi Yamada(August 30, 1972)

Apr. 1995

Joined KOEI KOGYO Co., Ltd.

May 1997

Joined Kiss Me Cosmetics Co., Ltd.
(currently ISEHAN Co., Ltd.)

July 1999

Co-founding Representative Director of
I-Style Co., Ltd.

Apr. 2000

Co-founding Representarive Director of
istyle Inc.

Dec. 2009

Director of istyle Inc. (present position)

May 2012

Representative Director of CyberStar Inc.
(currently istyle Beauty Solutions Inc.)

Sept. 2015

Director of MEDIA GLOBE Co., Ltd.
(present position)

Mar. 2016

President and Representative Director of
ISPartners Inc. (present position)

Sept. 2016

Director of Eat Smart, Inc. (present position)[Significant concurrent positions outside the Company]
Director of istyle Inc., Representative Director and Presidentof ISPartners Inc. and Outside Director of JAPAN POST
INSURANCE Co., Ltd. (scheduled to assume the position inJune 2017)
Notes:

1. An asterisk (*) indicates a new candidate for Director.
2. When nominating candidates for Director, an impartial and strict review is carried out by the Human
Resources Department based on the Company’s basic policy for corporate governance, which states that“a candidate be an individual that has excellent character, insight, ability and extensive experience, as
well as a strong sense of ethics” and “a candidate for Outside Director be an individual that fulfills therequirements for independence established by the Tokyo Stock Exchange.”
3. Special interest between the candidates for Directors and the Company are as follows:(1) Candidate for Director Yoshitaka Taguchi also has a post as Representative Director and Chairman
at Kanto Unyu Co., Ltd. and Representative Director at Shikoku Seino Transportation Co., Ltd.,
with which the Company has a competitive relationship in terms of operational consignment and thelike.
(2) Candidate for Director Yoshitaka Taguchi also has a post as Chairman at the Taguchi Fukujukai
Foundation, which is the largest shareholder holding 12.58% of the total equity of the Company.

100(3) There are no other special interests between the Company and other candidates.
4. Among candidates for Directors, Yuji Tanahashi, Kenjiro Ueno, and Meyumi Yamada are candidates for
Outside Directors.
(1) The reason for selecting Yuji Tanahashi as a candidate for Outside Director is that he has
demonstrated great success over many years as national government official, and still successfully
holds many important positions including his position at JAPEX. He has also obtained qualifications
as a lawyer; thus, together with his experience and insight, he is expected to provide oversight andmonitoring on management based on the law. In the event that Proposal 5 is approved, he will
become a member of the Independent Committee.
(2) The reason for selecting Kenjiro Ueno as a candidate for Outside Director is that he is a lawyer
working as a Representative at the Ueno & Hanasato Law Office and is expected to advise andmonitor the Board of Directors with his rich knowledge and experience based on his own legal
insight. While he does not have any direct experience in the management of a company, he iswell-versed in corporate legal affairs through his many years of experience as a legal specialist.
Furthermore, based on his past record as Outside Director of the Company, it has been judged that
he will be able to appropriately execute his duties as an Outside Director in the future as well. He
will also become a member of the Independent Committee, the same as Yuji Tanahashi.
(3) The reason for selecting Meyumi Yamada as a candidate for Outside Director is that the Company
judges that she will contribute to the Company’s sustainable growth because she further diversifies
values utilizing a woman’s perspective, and her selection is in line with “ensuring diversity,
including active participation of women,” a part of the Company’s basic policy for corporate
governance. She will also become a member of the Independent Committee, the same as Yuji
Tanahashi and Kenjiro Ueno.
(4) The Company has concluded limited liability agreements with both Yuji Tanahashi and Kenjiro
Ueno limiting their liabilities specified in Article 423, Paragraph 1 of the Companies Act, based on
the provisions of Article 427, Paragraph 1 of the Companies Act. Their maximum amount ofliability shall be 20 million yen or the amount stipulated by laws and regulations, whichever ishigher. If their reelection is approved, the Company plans to continue these agreements.
Furthermore, if the election of Meyumi Yamada is approved, the Company plans to enter into thesame limited liability agreement with her.
5. The Company has registered Yuji Tanahashi and Kenjiro Ueno as Independent Officers with the Tokyo
Stock Exchange, Inc. and the Nagoya Stock Exchange, Inc. as stipulated by provisions of the said
Exchanges. If their reelection is approved, the Company plans for their appointment as independent
officers to continue. Furthermore, Meyumi Yamada satisfies the requirements for an independent officer
as provided for by the Tokyo Stock Exchange, Inc. and the Nagoya Stock Exchange, Inc. If the electionof Meyumi Yamada is approved, the Company plans to register her as an Independent Officer with thesaid Exchanges.
6. The terms of office of Yuji Tanahashi and Kenjiro Ueno, candidates for Outside Directors, as Outside
Directors of the Company will be twelve years at the conclusion of this meeting.
7. Meyumi Yamada is well-known by the name Yamada, and that name is therefore presented here, but her
name as recorded in the official family register is Meyumi Hara.

11

Proposal 3:

Determination of Compensation for Granting of Restricted Shares to
the Company’s Directors

Compensation for the Company’s Directors of up to 25 million yen per month (excluding theemployment salary of Directors who concurrently serve as employees) was approved at the 68th
ordinary general meeting of shareholders held on July 28, 1989.

As part of the revision of the Director compensation plan, with the objectives of offering
incentives to the Company’s Directors to achieve sustained improvement of the corporate value of
the Company and sharing more of that value with its shareholders, the Company proposes that, witha separate limit from the said existing limit of compensation, the Company will create acompensation plan that will newly pay compensation in order to grant restricted shares to theCompany’s Directors.

The compensation to be paid in order to grant restricted shares to the Directors under this
Proposal shall be monetary claims (“Monetary Compensation Claims”), and the total amount shallbe 600 million yen or less per year (of which 100 million yen or less shall be for Outside Directors;
excluding the employment salary of Directors who concurrently serve as employees), which is theamount considered appropriate based on the above objectives.

However, that compensation

amount is, in principle, based on the assumption of paying in a lump sum an amount substantiallyequivalent to consideration for execution of duties for three fiscal years, and the Company considers
that this is substantially equivalent to paying less than 200 million yen per fiscal year.

Furthermore,

the specific payment timing and amount allocated for each of the Directors shall be decided by the
Board of Directors.

Currently there are 9 Directors (including 2 Outside Directors), but if Proposal 2 “Election of
9 Directors” is approved and passed as proposed, there will be 9 Directors (including 3 Outside
Directors).

Furthermore, based on a resolution of the Company’s Board of Directors, the Directors shallmake in-kind contributions of all of the Monetary Compensation Claims paid under this Proposal
and shall, in return, receive the issuance or disposal of the common shares of the Company, and thetotal number of common shares of the Company to be issued or disposed of through this process
shall be 360,000 shares or less per year (however, in the case that the Company conducts stock splits(including gratis allocations of its common shares) or reverse stock splits of its common shares on orafter the date of the approval of this Proposal, or that any other event that requires adjustment of thetotal number of common shares of the Company to be issued or disposed of as restricted shares

12occurs, the total number of shares can be adjusted to the reasonable extent according to the split ratio,
reverse split ratio, or the like).

However, as described above, the Monetary Compensation Claims

to be paid in order to grant restricted shares are, in principle, based on the assumption of paying in alump sum an amount substantially equivalent to consideration for execution of duties for three fiscal
years, and the Company considers that this is substantially equivalent to granting less than 120,000
shares per fiscal year.

Note that the amount paid in per share shall be the amount determined by the Board of
Directors within the extent that is not particularly advantageous to the Directors who subscribe forthose common shares, based on the closing price of the common shares of the Company on theTokyo Stock Exchange on the business day immediately prior to the date of each resolution of theBoard of Directors (in the case that the transaction has not been executed on that day, the closing
price on the most recent trading day preceding that day).

Furthermore, when issuing or disposingof the common shares of the Company through this process, a restricted stock allotment agreement(the “Allotment Agreement”) containing the following terms and conditions in summary shall beconcluded between the Company and the Directors.

(1)

Transfer Restriction Period

The Directors must not transfer the common shares of the Company allotted to them under the
Allotment Agreement (the “Allotted Shares”), create a security interest on the Allotted Shares, ordispose of the Allotted Shares in any other way (“Transfer Restrictions”) during the period stipulated
in advance by the Board of Directors of the Company that is between three and six years (“Transfer
Restriction Period”).

(2)

Treatment on retirement from office

In the case that Directors leave their posts as Directors of the Company or any of its subsidiaries
before the expiration of the duty execution period during the Transfer Restriction Period, theCompany shall automatically acquire the Allotted Shares at no cost except in the case of expirationof term of office, death, or any other reasonable grounds for the Directors to leave their posts.

(3)

Cancellation of the Transfer Restrictions

Notwithstanding the provisions in (1) above, the Company shall cancel the Transfer Restrictions for
the Allotted Shares as of the time when the Transfer Restriction Period expires, on the condition thatthe Directors have maintained their status as Directors of the Company or any of its subsidiaries
continuously during the duty execution period during the Transfer Restriction Period.

However, inthe case that said Directors leave the posts stipulated in (2) above before the duty execution period
during the Transfer Restriction Period expires due to expiration of term of office, death, or any other13

reasonable grounds stipulated in (2) above, the number of the Allotted Shares for which the Transfer
Restrictions are cancelled and the timing of the cancellation of the Transfer Restrictions shall bereasonably adjusted as necessary.

The Company shall automatically acquire at no cost the Allotted

Shares for which the Transfer Restrictions have not been cancelled pursuant to the above provisions
at the time the Transfer Restriction Period expires.

(4)

Treatment in the event of organizational restructuring, etc.

Notwithstanding the provisions in (1) above, in the case that matters regarding merger agreements
under which the Company becomes the disappearing company, share exchange agreements or sharetransfer plans under which the Company becomes a wholly owned subsidiary of another company,or any other organizational restructuring, etc. are approved at a general meeting of shareholders of
the Company (or at a meeting of its Board of Directors in the case that approval by the general
meeting of shareholders of the Company is not required regarding the said organizational
restructuring, etc.) during the Transfer Restriction Period, the Company shall cancel, based on the
resolution of the Board of Directors of the Company, the Transfer Restrictions before the effective
date of the said organizational restructuring, etc. with regard to the number of the Allotted Sharesreasonably determined in consideration of the period from the commencement date of the Transfer
Restriction Period to the day on which the said organizational restructuring, etc. is approved.
Furthermore, in the case provided for above, the Company shall automatically acquire at no cost the
Allotted Shares for which the Transfer Restrictions have not been cancelled at the time immediately
after the cancellation of the Transfer Restrictions.

14

Proposal 4:

Payment of Retirement Benefits to a Retired Director

In recognition of his contribution during his time in office, the Company wishes to pay
retirement benefits to Shizutoshi Otsuka, whose term is expiring and who will retire at theconclusion of this meeting, according to the rules on retirement benefits of the Company.
The specific amount, timing, method, etc. shall be decided by the Board of Directors.
Additionally, in regards to the retirement benefits for Director Yoshikazu Taguchi who passed
away on September 22, 2016, respecting both his and his family’s strong wishes, the Board of
Directors has decided not to pay retirement benefits.
The career summary of the retiring Director is as follows:
Name
Shizutoshi Otsuka

Career summary
June 2003

Director of the Company (present position)

15

Proposal 5:

Gratis Allotment of Stock Acquisition Rights for Plan forCountermeasures to Large-Scale Acquisitions of the Company’s
SharesFor the purpose of ensuring and enhancing the corporate value of the Company and, in turn,the common interests of its shareholders, the Company proposes to renew the plan for
countermeasures to large-scale acquisitions of the shares in the Company.

1.

Reason for Requiring Renewal of Plan for Countermeasures to Large-Scale Acquisitions of
the Company’s Shares

The effective period of the plan for countermeasures to large-scale acquisitions of the sharesin the Company (the “Former Plan”) that was renewed by the Company pursuant to a resolution at
the Company’s Board of Directors meeting held on May 14, 2014, and the Company’s 93rd ordinary
general meeting of shareholders held on June 26, 2014, expires at the conclusion of the Shareholders
Meeting.

Pursuant to the basic policy regarding the persons who control decisions on the Company’s
financial and business policies (defined in Item 3 of Article 118 of the Enforcement Regulations of
the Companies Act; the “Basic Policy”), the Company, prior to the expiration of the effective periodof the Former Plan, resolved at its Board of Directors meeting held on May 12, 2017, to renew theFormer Plan with necessary amendments (the “Renewal”; the amended plan, the “Plan”) as ameasure to prevent decisions on the Company’s financial and business policies from being
controlled by persons deemed inappropriate under the Basic Policy (Item 3(b)(ii) of Article 118, of
the Enforcement Regulations of the Companies Act).
approval at the Shareholders Meeting.

The Renewal will be subject to shareholder

This proposal seeks the shareholders’ opinion regarding

assignment to the Board of Directors of the authority to determine matters pertaining to the gratis
allotment of stock acquisition rights in accordance with the terms and conditions set out in the Planpursuant to Article 17-2 of the Articles of Incorporation of the Company.

The Renewal was unanimously approved and passed by all of the Directors, including theOutside Directors, at the abovementioned Board of Directors meeting, and all of the Audit &Supervisory Board Members, including the Outside Audit & Supervisory Board Members, statedtheir opinions to the effect that they do not object to the Renewal.

The contents of the Plan are substantially the same as the Former Plan, and there are no
particular amendments in the Renewal other than causing all three Independent Committee members

16

to be independent Outside Directors.

(1)

Basic Policy Regarding the Persons Who Control Decisions on the Company’s Financial andBusiness Policies

The Company believes that the persons who control decisions on the Company’s financial
and business policies need to be persons who understand the source of the Company’s corporate
value and who will make it possible to continually and sustainably ensure and enhance theCompany’s corporate value and, in turn, the common interests of its shareholders.

In consideration of the dissolution of cross-shareholding structures, the transformation of
corporate cultures in an era of international competition, changes in legal systems relating toacquisitions, and the like, it is anticipated that acquisitions conducted without obtaining the consent
of the board of directors of the target company, i.e., hostile acquisitions, will increase in the future.
Needless to say, if such an acquisition contributes to the corporate value of the Company and thecommon interests of its shareholders, the Company would not reject that acquisition unconditionally.
However, there are often inappropriate acquisitions: those that would obviously harm the corporate
value of the target company in light of the purpose of the acquisition, the management policy after
the acquisition, and the like; those that do not provide sufficient information or time for the target
company and its shareholders to consider the proposed details and other matters in relation to theacquisition; and those structured to coerce shareholders into accepting the acquisition.

In particular, since the Company has a large number of subsidiaries and affiliates anddevelops a broad range of businesses centered around the transportation business, it is notnecessarily easy for its shareholders to accurately understand the Company’s corporate value andmake proper judgments on the appropriateness of an acquisition proposal considering the series of
the Company’s measures to maintain and enhance its corporate value.

While the logistics industry

in which the Company operates is a labor-intensive industry, where it is essential to train employees
to provide high-quality transportation services and to build a relationship of trust between the
management and employees, there is no assurance that a person attempting to acquire the Company
would be qualified and capable in regard to these points.

Furthermore, while a large number of thebusinesses engaged in by the Company require permits and licenses under laws, ordinances, and thelike, some persons acquiring the control of the Company might not be able to maintain these permits
or licenses due to their characteristics or the like. In addition to the above, there is also thepossibility of an acquisition or the like that would be likely to harm the relationships that theCompany has built with its nationwide customers, distribution networks and drivers supporting them,business partners, and other interested parties or to harm other tangible or intangible management

17

resources.

In order to prevent acquisitions against the interests of the Company and its shareholders,
including the abovementioned acquisition types, the Company believes that it is necessary to ensure
the corporate value of the Company and, in turn, the common interests of its shareholders by taking
necessary and reasonable countermeasures against such acquisition.

(2)

Purpose of the Plan

The Plan is in accordance with the Basic Policy set out in (1) above for the purpose of
ensuring and enhancing the corporate value of the Company and the common interests of its
shareholders.

As set out in the Basic Policy, the Company’s Board of Directors believes that persons who
would propose a large-scale acquisition of the shares in the Company in a manner that does notcontribute to the corporate value of the Company and the common interests of its shareholders
would be inappropriate as persons who control decisions on the Company’s financial and business
policies.

The Company’s Board of Directors has decided that, in order to prevent decisions on the

Company’s financial and business policies from being controlled by persons deemed inappropriate
and to deter large-scale acquisitions that are detrimental to the corporate value of the Company andthe common interests of its shareholders, for occasions when it receives a large-scale acquisition
proposal for the shares in the Company, it is necessary to introduce a mechanism that enables theCompany’s Board of Directors to present alternative proposals to the shareholders, or that ensuresnecessary time and information for the shareholders to decide whether or not to accept such proposal,
and for the Board of Directors to negotiate for the benefit of the shareholders.

2.

Plan Details(1)

Plan Outline
The Plan sets out procedures necessary to achieve the purpose stated above, including

requirements for acquirers to provide information in advance in the case that an acquirer intending to
make an acquisition of 20% or more of the Company’s share certificates, etc. emerges.

If theprocedures for the Plan are commenced, the acquirer must not effect an acquisition until and unlessthe Company’s Board of Directors resolves not to trigger the Plan.

In the event that an acquirer does not follow the procedures set out in the Plan, or alarge-scale acquisition of Company’s share certificates, etc. threatens to cause harm to the corporate

18

value of the Company and the common interests of its shareholders, and if the acquisition satisfies
the triggering requirements prescribed in the Plan, the Company will allot the Stock Acquisition
Rights (defined in (2)(a) below, hereinafter the same) with conditions, such as (a) an exercise
condition that does not, as a general rule, allow the acquirer, etc. to exercise the rights and (b) an
acquisition provision to the effect that the Company may acquire the stock acquisition rights in
exchange for the Company’s shares and/or properties from persons other than the acquirer, etc., bymeans of a gratis allotment of stock acquisition rights (shinkabu yoyakuken mushou wariate) to allshareholders, except the Company, at that time.

If a gratis allotment of Stock Acquisition Rights

were to take place in accordance with the Plan and all shareholders other than the acquirer, etc.
receive the shares in the Company as a result of those shareholders exercising, or the Company
acquiring, those Stock Acquisition Rights, the ratio of voting rights in the Company held by theacquirer, etc. may be diluted by a maximum of approximately 50%.

In order to eliminate arbitrary decisions by Directors, the Company determines that decisions
with respect to matters such as the implementation or non-implementation of the gratis allotment ofStock Acquisition Rights or the acquisition of Stock Acquisition Rights under the Plan will be madethrough the objective judgment of the Independent Committee, which is composed of independent
members such as Outside Directors of the Company.

In addition, the Company’s Board of Directors may, if prescribed in the Plan, convene ashareholders meeting and confirm the intent of the Company’s shareholders.

Transparency with respect to the course of those procedures will be ensured throughdisclosure to all of the Company’s shareholders.

(2)
(a)

Procedures for Triggering the Plan
Targeted Acquisitions
The Plan will apply in cases where there is a purchase or any other acquisition of theCompany’s share certificates, etc. that falls under (i) or (ii) below or any similar acts (including a
proposal1 for such acts) (except for such acts as the Company’s board of Directors separately
determines not to be subject to the Plan; the “Acquisition”).

The party effecting the Acquisition(the “Acquirer”) shall follow the procedures set out in the Plan, and the Acquirer shall not effect theAcquisition until and unless the Company’s Board of Directors passes a resolution not to implement
the gratis allotment of stock acquisition rights (the “Stock Acquisition Rights”; see (4) below,“Outline of the Gratis Allotment of Stock Acquisition Rights,” for an outline of these stock
1“Proposal” includes solicitation of third parties.

19

acquisition rights) in accordance with the Plan.

(i)

A purchase or other acquisition that would result in the holding ratio of share certificates,etc. (kabuken tou hoyuu wariai)2 of a holder (hoyuusha)3 amounting to 20% or more of
the share certificates, etc. (kabuken tou)4 issued by the Company; orA tender offer (koukai kaitsuke) 5 that would result in the owning ratio of share(ii)

certificates, etc. (kabuken tou shoyuu wariai)6 of a person conducting the tender offer andthe owning ratio of share certificates, etc. of persons in a special relationship (tokubetsu
kankei-sha)7 totaling at least 20% of the share certificates, etc. (kabuken tou)8 issued by
the Company.

(b)

Submission of the Acquirer’s Statement
The Acquirer will submit to the Company in the form separately prescribed by the Company

a legally binding document which includes an undertaking that the Acquirer will comply with theprocedures set out in the Plan (affixed with the signature, or the name and seal, of the representativeof the Acquirer and to which no terms or conditions or reservations are attached) and a qualification
certificate of the person whose signature, or whose name and seal, is placed on the document(collectively, the “Acquirer’s Statement”) before commencing or effecting the Acquisition.

The

Acquirer’s Statement must include the Acquirer’s name and address (location of headquarters, incase of a corporation), location of offices, the governing law for establishment, name of therepresentative, contact information in Japan and an outline of the intended Acquisition.

The

Acquirer’s Statement and the Acquisition Document set out in (c) below and other materials
submitted by the Acquirer to the Company or the Independent Committee must be written in
Japanese.

(c)Request to the Acquirer for the Provision of Information

2
Defined in Article 27-23.4 of the Financial Instruments and Exchange Act of Japan. The same is applied
throughout this document.
3
Including persons described as a holder under Article 27-23.3 of the Financial Instruments and Exchange Act ofJapan (including persons who are deemed to fall under the above by the Board of Directors of the Company). The
same is applied throughout this document.
4
Defined in Article 27-23.1 of the Financial Instruments and Exchange Act of Japan. The same is applied
throughout this document unless otherwise provided for in this document.
5
Defined in Article 27-2.6 of the Financial Instruments and Exchange Act of Japan. The same is applied
throughout this document.
6
Defined in Article 27-2.8 of the Financial Instruments and Exchange Act of Japan. The same is applied
throughout this document.
7
Defined in Article 27-2.7 of the Financial Instruments and Exchange Act of Japan (including persons who are
deemed to fall under the above by the Board of Directors of the Company), provided, however, that persons provided
for in Article 3.2 of the Cabinet Office Regulations concerning Disclosure of a Tender Offer by an Acquirer otherthan the Issuing Company are excluded from the persons described in Article 27-2.7(i) of the Financial Instruments
and Exchange Act of Japan. The same is applied throughout this document.
8
Defined in Article 27-2.1 of the Financial Instruments and Exchange Act of Japan.

20

The Company will provide the Acquirer with the format for the Acquisition Document(defined below), including a list of information that the Acquirer should provide to the Company, no
later than ten business days after receiving the Acquirer’s Statement.

The Acquirer shall submit to

the Company’s Board of Directors, in accordance with the format delivered by the Company, adocument (the “Acquisition Document”) which includes the information described in each item of
the list below (the “Essential Information”).

If it receives the Acquisition Document, the Company’s Board of Directors will promptly
send it to the Independent Committee (career summaries and other matters regarding members of the
Independent Committee at the time of the Renewal will be as described in Attachment 1, “Profiles ofthe Members of the Independent Committee”). If the Company’s Board of Directors and theIndependent Committee determine that the Acquisition Document does not include sufficient
Essential Information, they may set a reply period and request the Acquirer to additionally provide
information. In such case, the Acquirer should additionally provide such information to both of theCompany’s Board of Directors and the Independent Committee within the relevant time limit.

(i)

Details (including name, capital relationship, financial position, operation results (if there
has been any violation of laws and ordinances, or if guidance or the like has been received
from a supervisory authority in connection with compliance with laws and ordinances,
this includes the specific details and the like in regard thereto), other accounting status,and details of previous transactions by the Acquirer similar to the Acquisition) of theAcquirer and its group (including Joint Holders,9 persons in a special relationship andpersons in a special relationship with a person in relation to whom the Acquirer is thecontrolled corporation10).11(ii)

The purpose, method and specific terms of the Acquisition (including the amount andtype of consideration, the timing, the scheme of any related transactions, the legality of
the Acquisition method, and the probability that the Acquisition will be effected).

(iii)

The amount of and basis for consideration of the Acquisition.

(iv)

Information relating to any previous acquisition of the Company’s share certificates, etc.
by the Acquirer.

(v)

Financial support for the Acquisition (including the specific names of the fund providers

9“Joint Holders” are as defined in Article 27-23.5 of the Financial Instruments and Exchange Act of Japan, including
persons regarded as a Joint Holder under Article 27-23.6 of the Financial Instruments and Exchange Act of Japan(including persons who are deemed to fall under the above by the Company’s Board of Directors). The same isapplied throughout this document.
10
Defined in Article 9.5 of the Order for Enforcement of the Financial Instruments and Exchange Act.
11
If the Acquirer is a fund, information relating to the matters described in (i) about each partner and otherconstituent members shall be included.

21

for the Acquisition (including all indirect fund providers), financing methods, and theterms of any related transactions).
(vi)

Whether there is any communication of intention between the Acquirer and a third party
regarding the Acquisition and the details of the communication.

(vii) Post-Acquisition management policy, business plan, capital and dividend policies for theCompany Group.
(viii) Post-Acquisition policies dealing with the Company’s shareholders (excluding theAcquirer), the Company Group’s employees, business partners, customers, any otherstakeholders in the Company Group, and the like.
(ix)

Specific measures to avoid any conflict of interest with other shareholders in the
Company if the Acquirer intends to carry out any measures that may give rise to suchconflict of interest.

(x)

Information regarding any relationship with an anti-social force.

(xi)

Any other information that the Company’s Board of Directors or the Independent
Committee reasonably considers necessary.

(d)Consideration of Acquisition Terms, Negotiation with the Acquirer, and Consideration of
Alternative Proposals(i)Request to the Company’s Board of Directors for the Provision of Information
If the Acquirer has submitted the Acquisition Document and any additional information that

the Company’s Board of Directors or the Independent Committee had requested (if any), theIndependent Committee may set a reply period (the “Board Consideration Period”) and request theCompany’s Board of Directors to present an opinion (including an opinion to refrain from givingsuch opinion; hereinafter the same) on the Acquirer’s Acquisition terms, materials supporting such
opinion, alternative proposals (if any), and any other information that the Independent Committee
considers necessary.

(ii)

Independent Committee Consideration

If the Independent Committee determines that the Acquirer has submitted the information(including any information requested to be additionally provided), the Independent Committee willconsider the Acquisition terms, collect information on materials such as the management plans andbusiness plans of the Acquirer and the Company’s Board of Directors and compare such materials,
consider any alternative proposals presented by the Company’s Board of Directors (if any), and22

perform other such acts until 90 days,12 as a general rule, have passed (such period will not exceed
90 days together with the Board Consideration Period) after the Independent Committee hasreceived the information (including any information requested to be additionally provided) from theAcquirer (the period necessary for the collection of information and consideration by the
Independent Committee is referred to as the “Independent Committee Consideration Period”).

The Independent Committee may obtain advice from financial advisors, certified public
accountants, attorneys, tax accountants, consultants or any other experts at the Company’s expense.

Further, if it is necessary in order to improve the terms of the Acquisition from the standpointof ensuring and enhancing the corporate value of the Company and the common interests of its
shareholders, the Independent Committee may directly or indirectly discuss and negotiate with theAcquirer.

If the Independent Committee directly or indirectly requests the Acquirer to provide

materials for consideration or any other information, or to discuss and negotiate with the
Independent Committee, the Acquirer must promptly respond to such request.

The Independent Committee may, to the reasonable extent that is considered necessary foracts such as consideration of the terms of the Acquirer’s Acquisition, consideration of alternative
proposals (if any), and discussion and negotiation with the Acquirer, extend the Independent
Committee Consideration Period (for a maximum of 30 days, as a general rule).

(e)Recommendations by the Independent Committee
Based on the procedures set out above, if the Independent Committee determines that theAcquisition by the Acquirer falls under either of the trigger events (the “Trigger Events”) set out
below in (3), “Requirements for the Gratis Allotment of Stock Acquisition Rights,” the Independent
Committee will recommend to the Company’s Board of Directors that the gratis allotment of Stock
Acquisition Rights be implemented, except in any specific case where further information disclosure
by the Acquirer or discussion or negotiation with the Acquirer is necessary.

If it is concerned that

the Acquisition may fall under the second Trigger Event (“Trigger Event 2”), the Independent
Committee may recommend implementation of the gratis allotment of Stock Acquisition Rights
subject to confirming the intent of the shareholders.
Notwithstanding the foregoing paragraph, even after the Independent Committee has alreadymade a recommendation for the implementation of the gratis allotment of Stock Acquisition Rights,
if the Independent Committee determines that either of the events below applies, it may make a newrecommendation that (on or before the second business day prior to the ex-rights date with respect to
12

The ninety-day period of the Independent Committee Consideration Period is established as a period necessary forthe collection of information, consideration, and the like by the Independent Committee described above to beappropriately conducted.

23

the gratis allotment of Stock Acquisition Rights) the Company should suspend the gratis allotmentof Stock Acquisition Rights or that (from the effective date of the gratis allotment of Stock
Acquisition Rights and until the day immediately prior to the commencement date of the exercise
period of the Stock Acquisition Rights) the Company should acquire Stock Acquisition Rights for no
consideration.

(A)

The Acquirer withdraws the Acquisition or the Acquisition otherwise ceases to exist after
the recommendation.

(B)

There are no longer any Trigger Events due to a change in the facts or otherwise uponwhich the recommendation decision was made.

On the other hand, if the Independent Committee determines that the Acquisition does not fallunder either of the Trigger Events, the Independent Committee shall not recommend theimplementation of the gratis allotment of Stock Acquisition Rights to the Company’s Board of
Directors.

However, even after that, if there is a change in the facts or otherwise upon which thatdecision was made and either of the Trigger Events exist, the Independent Committee may make a
new recommendation that the Company should implement the gratis allotment of Stock Acquisition
Rights.

In addition to the above, if the Acquisition threatens to harm the corporate value of theCompany and, in turn, the common interests of its shareholders, the Independent Committee may
recommend convocation of a meeting of shareholders to confirm the intent of the shareholders
regarding the Acquisition by the Acquirer or make other recommendations, along with the reasons
therefore.

(f)Resolutions by the Board of Directors
The Company’s Board of Directors, in exercising its role as an organ under the Companies

Act, will pass a resolution relating to the implementation or non-implementation of a gratis allotmentof Stock Acquisition Rights respecting any recommendation made by the Independent Committee
described above to the maximum extent.

However, if the Shareholders Meeting for Confirmation of Shareholder Intent is convened inaccordance with (g) below, the Company’s Board of Directors will make a decision in accordancewith the resolution at the meeting.

(g)Convocation of the Shareholders Meeting for Confirmation of Shareholder Intent

24

If (i) the Independent Committee recommends implementation of the gratis allotment ofStock Acquisition Rights subject to confirming the intent of the shareholders in accordance with (e)above or recommends confirmation of the intent of shareholders regarding the Acquisition by the
Acquirer, or (ii) the applicability of Trigger Event 2 becomes an issue with respect to the Acquisition
and the Company’s Board of Directors determines it appropriate to confirm the intent ofshareholders, taking into consideration the time required to convene a general meeting ofshareholders and other matters pursuant to the duty of care as a Director, then the Company’s Boardof Directors may convene a meeting of shareholders (the “Shareholders Meeting for Confirmation of
Shareholder Intent”) and confirm the intent of the Company’s shareholders.

(h)Information Disclosure
When operating the Plan, the Company will disclose information in a timely manner onmatters that the Independent Committee or the Company’s Board of Directors considers appropriate
including the progress of each procedure set out in the Plan (including the fact that the Acquirer’s
Statement and Acquisition Document have been submitted, the fact of whether the Acquirer has
fully provided information, the fact that the Independent Committee Consideration Period hascommenced, and the fact that the Independent Committee Consideration Period has been extended,
as well as the extended period and reason for the extension if such extension has taken place), an
outline of recommendations made by the Independent Committee, an outline of resolutions by theCompany’s Board of Directors and an outline of resolutions at the Shareholders Meeting for
Confirmation of Shareholder Intent, in accordance with the relevant laws and ordinances or the
regulations, rules, and the like of the financial instruments exchange.

(3)

Requirements for the Gratis Allotment of Stock Acquisition Rights
The requirements to trigger the Plan to implement a gratis allotment of Stock Acquisition

Rights are as follows. As described above in (e) of (2), “Procedures for Triggering the Plan,” theCompany’s Board of Directors will make a determination as to whether any acts by the Acquirer
falls under a requirement below after receiving a recommendation by the Independent Committee.

Trigger Event 1
The Acquisition is not in compliance with the procedures prescribed in the Plan (including
cases where reasonable time and information necessary to consider the details of theAcquisition is not offered) and it is reasonable to implement the gratis allotment of Stock
Acquisition Rights.

Trigger Event 2
The Acquisition falls under any of the requirements below and it is reasonable to implement the25

gratis allotment of Stock Acquisition Rights.

(a)Acquisitions that threaten to cause obvious harm to the corporate value of the Company andthe common interests of its shareholders through acts including:①

A buyout of share certificates, etc. to require the Company or its affiliates to purchasesuch share certificates, etc. at a high price.

②

Management that achieves an advantage for the Acquirer to the detriment of theCompany, such as temporary control of the Company’s management for the low-costacquisition of material assets of the Company Group.

③

Diversion of the Company Group’s assets to secure or repay debts of the Acquirer or
its group company.

④

Temporary control of the Company’s management to bring about a disposal ofhigh-value assets that have no current relevance to the Company Group’s businessand paying temporarily high dividends from the profits of the disposal, or selling theshares at a high price taking advantage of the opportunity from the sudden rise inshare price created by the temporarily high dividends.

(b)Acquisitions that threaten to have the effect of coercing shareholders into selling shares,
such as coercive two-tiered tender offers (meaning acquisitions of shares including tender
offers that do not offer to acquire all shares in the initial acquisition, and set acquisition
terms for the second stage that are unfavorable or do not set clear terms for the second
stage).

(c)

Acquisitions whose terms (including amount and type of consideration, the schedule, thelegality of the method, and the feasibility) are inadequate or inappropriate in light of theCompany’s intrinsic value.

(d)Acquisitions that materially threaten to be against the corporate value of the Company and,in turn, the common interests of shareholders, by destroying relationships with theCompany’s employees, customers, business partners, and the like, which are indispensable
to generate the Company’s corporate value, or for other reasons.

(4)

Outline of the Gratis Allotment of Stock Acquisition Rights13
An outline of the gratis allotment of Stock Acquisition Rights to be implemented under the13

The description in “Outline of the Gratis Allotment of Stock Acquisition Rights” is based on the premise that theCompany issues only one type of common stock (meaning the same type of shares as those the Company has actually
issued at the time the Shareholders Meeting is held; the same is applied throughout this document).

26

Plan is described below.

(a)Number of Stock Acquisition Rights
The Company will implement a gratis allotment of Stock Acquisition Rights in the same

number as the final and total number of issued and outstanding shares in the Company (excluding
the number of shares in the Company held by the Company at that time) on a certain date (the“Allotment Date”) that is separately determined by the Company’s Board of Directors in a resolution
relating to the gratis allotment of Stock Acquisition Rights (the “Gratis Allotment Resolution”).

(b)

Shareholders Eligible for Allotment
The Company will allot the Stock Acquisition Rights to the shareholders, other than the

Company, who are recorded in the Company’s register of shareholders as of the Allotment Date (the“Entitled Shareholders”), at a ratio of one Stock Acquisition Right for each share in the Company
held by each shareholder.

(c)

Effective Date of Gratis Allotment of Stock Acquisition Rights
The date of the gratis allotment of Stock Acquisition Rights will be determined separately in

the Gratis Allotment Resolution.

(d)Number of Shares to be Acquired upon Exercise of the Stock Acquisition Rights
The number of shares to be acquired upon exercise of each Stock Acquisition Right (the“Applicable Number of Shares”) will, in principle,14 be the number separately determined in theGratis Allotment Resolution by the Company’s Board of Directors in the range not exceeding one
share.

If there are any resulting fractional shares in the number of shares to be delivered to Stock

Acquisition Right holders who exercise the Stock Acquisition Rights, the Company will dispose of
the fractional shares in accordance with the applicable laws and ordinances.

(e)Amount of Contribution upon Exercise of the Stock Acquisition Rights
Contributions upon exercise of the Stock Acquisition Rights are to be in cash, and the amount

per share in the Company to be contributed upon exercise of the Stock Acquisition Rights will be an
amount separately determined in the Gratis Allotment Resolution within the range of a minimum of
one yen and a maximum of any amount equivalent to one-half of the fair market value of one sharein the Company.

“Fair market value” means the amount equivalent to the average closing price(including quotations) for regular transactions of the common stock of the Company on the Tokyo
Stock Exchange on each day during the ninety-day period prior to the Gratis Allotment Resolution(excluding days on which trades are not made), with any fraction of a yen after such calculation
14

In case of a stock split, etc., the Company will adjust the Applicable Number of Shares as necessary.

27

rounded up to the nearest whole yen.

(f)

Exercise Period of the Stock Acquisition Rights
The commencement date will be a date separately determined in the Gratis Allotment

Resolution (this commencement date of the exercise period shall be referred to as the “Exercise
Period Commencement Date”), and the period will be a period from one month to six months long as
separately determined in the Gratis Allotment Resolution.

(g)

Conditions for the Exercise of the Stock Acquisition Rights
Except when an exceptional event15 occurs, the following parties may not exercise the Stock

Acquisition Rights (the parties falling under (I) through (VI) below will collectively be referred to as“Non-Qualified Parties”):(I)

Specified Large Holders;16(II)

Joint Holders of Specified Large Holders;(III)

Specified Large Purchasers;17(IV)

Persons having a special relationship with Specified Large Purchasers;

15

Specifically, the Company intends to set out that an “exeptional event” means when (x) the Acquirer cancels or
revokes the Acquisition, or promises that it will not conduct any subsequent Acquisition, after the Gratis Allotment
Resolution and the Acquirer or other Non-Qualified Parties dispose of their shares in the Company through asecurities firm appointed and authorized by the Company to do so and (y) the Acquirer’s shareholding ratio
determined by the Company’s Board of Directors (when calculating the shareholding ratio, Non-Qualified Parties
other than the Acquirer and its Joint Holders are deemed to be the Acquirer’s Joint Holders, and Stock Acquisition
Rights held by Non-Qualified Parties, the conditions of which have not been satisfied, are excluded) (the“Non-Qualified Parties’ Shareholding Ratio”) falls below the lower of (i) the Non-Qualified Parties’ Shareholding
Ratio before the Acquisition or (ii) 20%, the Acquirer or other Non-Qualified Parties making the disposal may
exercise Stock Acquisition Rights to the extent that the number of shares to be issued or delivered upon exercise of
the Stock Acquisition Rights is up to the number of shares disposed of and to the extent of the ratio under either (i) or(ii) above. Detailed conditions and procedures for exercise of Stock Acquisition Rights by Non-Qualified Parties
will be determined separately by the Company’s Board of Directors.
16“Specified Large Holder” means, in principle, a party who is a holder of share certificates, etc. issued by theCompany and whose holding ratio of share certificates, etc. in respect of such share certificates, etc. is at least 20%(including any party who is deemed to fall under the above by the Company’s Board of Directors), provided, however,that a party that the Company’s Board of Directors recognizes as a party whose acquisition or holding of sharecertificates, etc. of the Company is not contrary to the Company’s corporate value or the common interests ofshareholders or a certain other party that the Company’s Board of Directors determines separately in the Gratis
Allotment Resolution is not a Specified Large Holder. The same is applied throughout this document.
17“Specified Large Purchaser” means, in principle, a person who makes a public announcement of purchase, etc. (asdefined in Article 27-2.1 of the Financial Instruments and Exchange Act; the same is applied throughout this Note) of
share certificates, etc. (as defined in Article 27-2.1 of the Financial Instruments and Exchange Act; the same isapplied throughout this Note) issued by the Company through a tender offer and whose ratio of owning of sharecertificates, etc. in respect of such share certificates, etc. owned by such person after such purchase, etc. (including
similar owning as prescribed in Article 7.1 of the Order for Enforcement of the Financial Instruments and ExchangeAct) is at least 20% when combined with the ratio of owning of share certificates, etc. of a person in a special
relationship (including any party who is deemed to fall under the above by the Company’s Board of Directors),
provided, however, that a party that the Company’s Board of Directors recognizes as a party whose acquisition or
holding of share certificates, etc. of the Company is not contrary to the Company’s corporate value or the common
interests of shareholders or a certain other party that the Company’s Board of Directors determines in the Gratis
Allotment Resolution is not a Specified Large Purchaser. The same is applied throughout this document.

28

(V)

Any transferee of or successor to the Stock Acquisition Rights of any party fallingunder (I) through (IV) without the approval of the Company’s Board of Directors; or(VI)

Any Affiliated Party of any party falling under (I) through (V).18

Further, nonresidents of Japan who are required to follow certain procedures under foreignlaws and ordinances to exercise the Stock Acquisition Rights may not, as a general rule, exercise theStock Acquisition Rights (provided, however, that the Stock Acquisition Rights held by nonresidents
will be subject to acquisition by the Company in exchange for shares in the Company as set out initem ② under (i), “Acquisition of the Stock Acquisition Rights by the Company,” below subject tocompliance with applicable laws and ordinances).

In addition, anyone who fails to submit a written

undertaking, in a form prescribed by the Company and including representations and warranties
regarding matters such as the fact that he or she satisfies the exercise conditions of the Stock
Acquisition Rights, indemnity clauses and other covenants may not exercise the Stock Acquisition
Rights.

(h)Assignment of the Stock Acquisition Rights
Any acquisition of the Stock Acquisition Rights by assignment requires the approval of theCompany’s Board of Directors.

(i)Acquisition of the Stock Acquisition Rights by the Company①

At any time on or before the day immediately prior to the Exercise Period
Commencement Date, if the Company’s Board of Directors recognizes that it isappropriate for the Company to acquire the Stock Acquisition Rights, the Company
may, on a day that falls on a date separately determined by the Company’s Board of
Directors, acquire all of the Stock Acquisition Rights for no consideration as
determined in the Gratis Allotment Resolution.

②

On a day that falls on a date separately determined by the Company’s Board of
Directors, the Company may acquire all of the Stock Acquisition Rights that have notbeen exercised on or before the day immediately prior to such day determined by theCompany’s Board of Directors, that are held by parties other than Non-Qualified
Parties and, in exchange, deliver shares, etc. 19 in the Company in the number

18

An “Affiliated Party” of a given party means a person who substantially controls, is controlled by, or is undercommon control with such given party (including any party who is deemed to fall under the above by the Company’s
Board of Directors), or a party deemed by the Company’s Board of Directors to substantially act in concert with suchgiven party. “Control” means to “control the determination of the financial and business policies” (as defined in
Article 3.3 of the Enforcement Regulations of the Companies Act) of other corporations or entities.
19
For the purpose of the Plan, shares in the Company are to be delivered, in principle, as consideration for acquiring
the Stock Acquisition Rights. As stated in (d) of 2.(4). above, under this Plan, fractions in the Applicable Number of
Shares may result, in which case, property other than shares in the Company may be delivered to the extent necessary29equivalent to the Applicable Number of Shares20 for each Stock Acquisition Right.
Further, if, on or after the date upon which the acquisition takes place, theCompany’s Board of Directors recognizes the existence of any party holding Stock
Acquisition Rights other than Non-Qualified Parties, the Company may, on a day
falling on a date determined by the Company’s Board of Directors after the date uponwhich the acquisition described above takes place, acquire all of the Stock
Acquisition Rights held by that party that have not been exercised on or before theday immediately prior to such date determined by the Company’s Board of Directors(if any) and, in exchange, deliver shares, etc. in the Company in the number
equivalent to the Applicable Number of Shares for each Stock Acquisition Right.
The same will apply thereafter.

(j)

Delivery of the Stock Acquisition Rights in the Case of Merger, Absorption-type Demerger(kyuushuu bunkatsu), Incorporation-type Demerger (shinsetsu bunkatsu), Share Exchange(kabushiki koukan), and Share Transfer (kabushiki iten)
These matters will be separately determined in the Gratis Allotment Resolution.

(k)Issuance of Certificates Representing the Stock Acquisition Rights
Certificates representing the Stock Acquisition Rights will not be issued.

(l)Miscellaneous
In addition, the details of the Stock Acquisition Rights will be separately determined in theGratis Allotment Resolution.

(5)

Procedures for the Renewal
The Company will renew the Plan subject to shareholders’ approval at the Shareholders

Meeting of the proposal to assign the Company’s Board of Directors the authority to determine
matters pertaining to the gratis allotment of Stock Acquisition Rights in accordance with the terms
and conditions set out in the Plan pursuant to the provisions of Article 17-2 of the Articles ofIncorporation of the Company.

(6)

Effective Period, Abolition, Revision and Amendment of the Plan
The effective period of the Plan will be the period until the conclusion of the ordinary general

to dispose of the fraction.
20
The Company intends to properly dispose of any fraction in the Applicable Number of Shares in accordance withapplicable laws and ordinances. In that case, the number of shares of common stock in the Company to be deliveredfor each Stock Acquisition Right may differ from the Applicable Number of Shares.

30

meeting of shareholders relating to the last fiscal year ending within three years of the conclusion of
the Shareholders Meeting.

However, if, before the expiration of the effective period, a general meeting of shareholdersof the Company passes a resolution to withdraw the abovementioned assignment to the Company’s
Board of Directors of the authority to decide matters relating to the gratis allotment of Stock
Acquisition Rights, or the Company’s Board of Directors passes a resolution to abolish the Plan, thePlan will be abolished in accordance with that resolution.

Further, the Company’s Board of Directors may revise or amend the Plan even during theeffective period of the Plan in such cases as where any law, ordinance, financial instruments
exchange regulations, rules, or the like concerning the Plan is enacted, amended or abolished and it
is appropriate to reflect such enactment, amendment or abolition, cases where it is appropriate torevise the wording for reasons such as typographical errors and omissions, and cases where such
revision or amendment is not detrimental to the Company’s shareholders, if such revision oramendment is not against the purpose of the assignment by resolution at the Shareholders Meetingand subject to the approval of the Independent Committee.

If the Plan is abolished, revised, or amended, the Company will promptly disclose
information as necessary, including the fact that such abolition, revision, amendment or the like hastaken place, and (in the event of a revision or amendment) the details of the revision, amendment
and any other matters.

(7)

Revision Due to Amendment to Laws and Ordinances
The provisions of laws and ordinances referred to under the Plan are subject to the prevailingprovisions as of May 12, 2017.

If it becomes necessary after such date to amend the terms andconditions or definitions of terms set out in the paragraphs above due to the enactment, amendment
or abolishment of laws and ordinances, the terms and conditions or definitions of terms set out in theparagraphs above will be read accordingly as required to a reasonable extent, taking into
consideration the purposes of such enactment, amendment or abolishment.

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Attachment 1
Profiles of the Members of the Independent Committee
The following three persons are planned to be the members of the Independent Committee upon the
Renewal.
Yuji Tanahashi (Outside Director)
Profile:Born 1934
March 1958
Graduated from University of Tokyo, Faculty of Law
April 1958
Joined the Ministry of International Trade and Industry
June 1991
Vice-Minister of International Trade and Industry
June 1993
Special Advisor to the Ministry of International Trade and Industry, Executive
Advisor to the Research Institute of International Trade and Industry
February 1995
Executive Advisor to the Industrial Bank of Japan, Limited.
April 1997
Professor of Faculty of Law and Graduate School of Law at Doshisha University
August 1997
Chairman of New Energy Foundation
June 2001
President and Chief Executive Officer of Japan Petroleum Exploration Co., Ltd.
June 2002
Outside Director of SMK Corporation
June 2005
Outside Director of the Company (present position)
June 2008
Chairman of Japan Petroleum Exploration Co., Ltd.
April 2009
Admission as a lawyer (Daiichi Tokyo Bar Association) (present position)
April 2009
Of-Counsel of City-Yuwa Partners (present position)
January 2014
Outside Director, K&O Energy Group Inc. (present position)
June 2015
Director and Chairman, Japan Petroleum Exploration Co., Ltd.
June 2016
Senior Advisor of Japan Petroleum Exploration Co., Ltd. (present position)
Note:

Yuji Tanahashi is an Outside Director as defined in Article 2, item 15 of the Companies Act. He does nothave any special interest in the Company.

Kenjiro Ueno (Outside Director)
Profile:Born 1939
March 1961
Graduated from University of Tokyo, Faculty of Law
April 1961
Joined Showa Denko K.K.
April 1966
Joined Haruhiko Kusano Law Office
April 1984
Opened Ueno Law Office
April 1987
Executive Governor of Japan Federation of Bar Associations
June 1994
Outside Audit & Supervisory Board Member of Tokyo Toyota Co., Ltd.
July 2001
Commission Chair of Equity Commission at the Supreme Court (present
position)
June 2005
Outside Director of the Company (present position)
June 2007
Outside Audit & Supervisory Board Member of Oji Paper Co., Ltd.

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March 2012
October 2012
Note:

Representative of Ueno & Hanasato Law Office (present position)
Outside Audit & Supervisory Board Member of Oji Holdings Corporation

Kenjiro Ueno is an Outside Director as defined in Article 2, item 15 of the Companies Act.
have any special interest in the Company.

He does not

Meyumi Yamada (Outside Director)
Profile:Born 1972
March 1995
Graduated from Tokyo University of Science, Faculty of Industrial Science andTechnology
April 1995
Joined KOEI KOGYO Co., Ltd.
May 1997
Joined Kiss Me Cosmetics Co., Ltd. (currently ISEHAN Co., Ltd.)
July 1999
Co-founding Representative Director of I-Style Co., Ltd..
April 2000
Co-founding Representative Director of istyle Inc.
December 2009
Director of istyle Inc. (present position)
May 2012
Representative Director of CyberStar Inc. (currently istyle Beauty Solutions
Inc.)
September 2015
Director of MEDIA GLOBE Co., Ltd. (present position)
March 2016
President and Representative Director of ISPartners Inc. (present position)
September 2016
Director of Eat Smart Co., Ltd (present position)
Note:

Meyumi Yamada will take office as an Outside Director as defined in Article 2, item 15 of the Companies
Act on the condition that Proposal 2 is approved and passed by the Shareholders Meeting. She does nothave any special interest in the Company. Her name is stated above as “Meyumi Yamada” because thatname is well known, but her name as recorded in the family register is Meyumi Hara.

End

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