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

April 28, 2017
Company name: Tokuyama Corporation
Representative: Hiroshi Yokota,President and Representative Director(Code No. 4043, First Section TSE)
Contact: Taro Kobayashi, General Manager
Corporate Communications & Investor Relations Dept.
TEL: +81-3-5207-2552

Notice concerning Acquisition and Cancellation of Class A Shares and Change in the Usage ofFunds Related to Issuance of Class A Shares
Tokuyama Corporation (hereinafter referred to as the “Company,” “Tokuyama” or “we”) hereby announcesthat the Board of Directors of the Company, at its meeting held on April 28, 2017, made a resolution toacquire all of the Class A shares issued by the Company (total paid-in amount: 20 billion yen) in exchange forcash in accordance with the provisions of Article 6-2, paragraph 5 of the Company’s Articles of Incorporation(call options, the consideration for which is cash) and cancel the shares on condition of the acquisition thereofin accordance with the provisions of Article 178 of the Companies Act. Furthermore, the Company alsoannounces that, in line with the acquisition of the Class A shares, it has determined to change the usage offunds procured in relation to the issuance of Class A shares, which was announced in “Notice concerning
Issuance of Class Shares by Third-Party Allotment, Partial Amendments to the Articles of Incorporation,Reduction of Amounts of Capital Stock, Legal Capital Surplus and Legal Retained Earnings, Appropriationof Surplus, and Reduction of Capital Stock and Legal Capital Surplus Concurrent with Issuance of Shares” asof May 12, 2016, as follows.

1.

Reason for Acquisition and Cancellation

We aimed to expand the polysilicon business at Tokuyama Malaysia Sdn. Bhd., our consolidated subsidiary,(hereinafter referred to as “Tokuyama Malaysia”). However, due to the failure to ensure the stabilization of
the quality and productivity of semiconductor-grade polysilicon and a worsening business environment
caused by a slump in the market of solar-grade polysilicon, we posted large impairment losses for themanufacturing facilities for both grades as a result of considering investment collectability. As a result,consolidated net assets decreased significantly. Hence, as described in “Notice concerning Issuance of Class
Shares by Third-Party Allotment, Partial Amendments to the Articles of Incorporation, Reduction of Amounts

of Capital Stock, Legal Capital Surplus and Legal Retained Earnings, Appropriation of Surplus, andReduction of Capital Stock and Legal Capital Surplus Concurrent with Issuance of Shares” as of May 12,
2016, to quickly restore the trust of our stakeholders, including business partners with whom we have had
close transactions for a long time, it is imperative for us to reinforce the deteriorated shareholders’ equity andstrengthen the financial platform. Accordingly, the Company issued a total of 20 billion yen of Class A sharesto Japan Industrial Solutions Fund I (hereinafter referred to as “JIS”) on June 27, 2016.
Then, the medium-term management plan beginning in FY2016 started with its highest-ever operating profit
recorded, largely thanks to lower prices of raw materials in addition to implementation of operational
measures in line with the positioning of each business, execution of cross-business measures forstrengthening the competitiveness of the Tokuyama Factory, promotion of cost reduction and others.
Consolidated profit attributable to owners of parent amounted to 52.1 billion yen, and is expected to be 13.0
billion yen for FY2017. Moreover, the Company now has the prospect of selling Tokuyama Malaysia, andexpects to accordingly recover and enhance consolidated net assets that were decreased, by further promoting
the medium-term management plan and steadily generating revenue.
Based on the above, the Company has judged that acquisition and cancellation of all of Class A shares have
now come into sight.
With this acquisition and cancellation of Class A shares, the Company can avoid increases in the futurefinancial burden associated with dividend payment on Class A shares and in the amount of redemption caused
by a rise in the redemption coefficient.

2.

Contents of Acquisition(1) Class of shares to be acquired

Class A shares(2) Counterparty to the acquisition (shareholder)JIS(3) Total number of shares to be acquired

20,000 shares(4) Acquisition price of shares

1,081,301.4 yen per share(Note) The above acquisition price is the amount determined by adding the Class A daily prorated
unpaid dividends (11,301.4 yen) to the amount that is calculated by multiplying the amountequivalent to the paid-in amount per Class A share (1,000,000 yen) by the redemption
coefficient of 1.07. This amount has been calculated on the assumption that there is no amountequivalent to Class A accumulated unpaid dividends, since preferred dividends for Class A for
the fiscal year ended March 31, 2017 (38,082.2 yen per Class A share) will be resolved at theCompany’s Ordinary General Meeting of Shareholders scheduled to be held in June 2017 andpaid.

(5) Total amount of acquisition price of shares

21,626,028,000 yen(6) Date of notification to the shareholder

April 28, 2017

(7) Acquisition dateJune 14, 20173.

Details of Cancellation(1) Class of shares to be cancelledClass A shares(2) Total number of shares to be cancelled

20,000 shares(3) Effective date of cancellation

June 14, 2017

This cancellation is subject to the condition that the Company acquires the Class A shares in accordance with
2. above.

4.

Change in the Usage of Funds(1) Reason for the change
Because the Company’s performance has improved considerably due to the implementation of businessmeasures and cost reduction and partly attributable to a change in the external environment, it will redeem
Class A shares earlier than initially assumed. Consequently, 15,647 million yen has not been appropriated.
With regard to this amount that has not yet been appropriated, the Company has decided to change the usageof the funds as of today and appropriate them to part of funds for the acquisition of Class A shares(hereinafter referred to as the “Change”).
In line with the Change, the Company will use funds in hand for purposes of funds to which the proceedsfrom the issuance of Class A shares will not be appropriated.

(2) Contents of the change[Before the change]
Specific usage

Amount (million yen)

Planned time ofspending(i)

Investment for introduction and expansion ofequipment to realize higher quality and improve
productivity toward increasing sales of advanced
materials

9,500

July 2016 to June
2018

(ii)

Investment for maintenance and renewal ofmachinery and equipment, etc., rationalization andothers to improve the competitiveness of theTokuyama Factory

4,800

July 2016 to June
2019

Strategic investment in M&A, etc. that will lead to(iii) the establishment of stable markets overseas andindustrial reorganization.

5,400

July 2016 to June
2019

Specific usage

Amount (million yen)

Planned time ofspending(i)

Investment for introduction and expansion ofequipment to realize higher quality and improve
productivity toward increasing sales of advanced
materials

1,989

July 2016 to April
2017

(ii)

Investment for maintenance and renewal ofmachinery and equipment, etc., rationalization andothers to improve the competitiveness of theTokuyama Factory

2,064

July 2016 to April
2017

Strategic investment in M&A, etc. that will lead to(iii) the establishment of stable markets overseas andindustrial reorganization.

0July 2016 to April
2017

15,647

June 2017 (Planned)[After the change](iv)

Funds for acquisition of Class A shares

5.

Impact on performance

The impact of the acquisition and cancellation of Class A shares and a change in the usage of funds on theCompany’s and its consolidated performance is immaterial.