Note: This document has been translated from a part of the Japanese original for reference purposes only.
In the event of any discrepancy between this translated document and the Japanese original, the original
shall prevail. The Company assumes no responsibility for this translation or for direct, indirect or any otherforms of damages arising from the translation.
(Stock Exchange Code 4047)
June 11, 2021
To Shareholders with Voting Rights:
Jun’ichi Hasegawa
President
Kanto Denka Kogyo Co., Ltd.
3-2, Marunouchi 2-chome, Chiyoda-ku,
Tokyo, JapanNOTICE OF
THE 114TH ORDINARY GENERAL MEETING OF SHAREHOLDERS
Dear Shareholders:
We would like to express our appreciation for your continued support and patronage.
We are pleased to inform you that we will hold the 114th Ordinary General Meeting of Shareholders of Kanto
Denka Kogyo Co., Ltd. (the “Company”) as described below.
If you are unable to attend the meeting, you can exercise your voting rights in writing. Please review theattached Reference Documents for the General Meeting of Shareholders, indicate your vote for or against the
proposals on the enclosed Voting Rights Exercise Form and return it so that it is received by 5:30 p.m. on
Monday, June 28, 2021, Japan time.
1. Date and Time:
2. Place:

Tuesday, June 29, 2021, at 10:00 a.m. Japan time
5F Conference Room, Headquarters of the Company
Yusen Building 3-2, Marunouchi 2-chome, Chiyoda-ku, Tokyo, Japan

3. Meeting Agenda:
Matters to be reported: 1. The Business Report, Consolidated Financial Statements for the Company’s
114th Fiscal Year (April 1, 2020‒March 31, 2021) and results of audits by the
Accounting Auditor and the Audit & Supervisory Board of the Consolidated
Financial Statements
2. Non-consolidated Financial Statements for the Company’s 114th Fiscal Year
(April 1, 2020‒March 31, 2021)
Proposals to be resolved:<Company Proposals>
Policy toward Large-Scale Purchase of Share Certificates, Etc. of the Company
Proposal 1:(Takeover Defense Measures)Election of 9 Directors
Proposal 2:
Election of 2 Auditors
Proposal 3:<Shareholder Proposal>
Partial Amendments to the Articles of Incorporation
Proposal 4:
1. When attending the meeting, please submit the enclosed Voting Rights Exercise Form at the receptiondesk.
2. On the day of the meeting, the Company will adopt “Cool Biz” attire. Shareholders are also encouraged
to attend the meeting in light clothing.
3. Based on the provisions of laws and regulations as well as Article 14 of the Company’s Articles ofIncorporation, among the documents that should be provided along with this Notice, as the “Notes to theConsolidated Financial Statements” in the Consolidated Financial Statements and the “Notes to the Nonconsolidated Financial Statements” in the Non-consolidated Financial Statements are posted on the-1-Company’s website (https://www.kantodenka.co.jp/), they are not included in this Notice.
The above documents are, along with the other documents provided in this Notice, within the scope ofaudits of the Accounting Auditor and Auditors.
4. Should the Reference Documents for the General Meeting of Shareholders, the Business Report, theConsolidated Financial Statements and the Non-consolidated Financial Statements require revisions, therevised versions will be posted on the Company’s website (https://www.kantodenka.co.jp/).

-2-

Reference Documents for the General Meeting of Shareholders
Proposals and References<Company Proposal>
Proposal 1:
Policy toward Large-Scale Purchase of Share Certificates, Etc. of the Company (Takeover
Defense Measures)With the approval of shareholders at the Ordinary General Meeting of Shareholders held on June 28, 2018
pursuant to Article 17, Paragraph 1 of the Articles of Incorporation of the Company (Note 1), the Company
decided to continue the policy toward any purchase of Share Certificates, Etc. (Note 4) of the Company that is
intended to achieve or expected to result in a situation in which a particular Group of Shareholders (Note 2)
holds voting rights equivalent to a Voting Rights Ratio (Note 3) of 20% or more (hereinafter referred to as the“Current Policy”) (we do not make any distinction based on specific means of purchase, such as market
transactions or tender offers, but the purchases to which the Board of Directors of the Company has given priorconsent are not included; such a purchase shall be hereinafter referred to as a “Large-Scale Purchase” and aperson that conducts a Large-Scale Purchase shall be hereinafter referred to as a “Large-Scale Purchaser”). The
period of validity of the Current Policy expires at the close of this Ordinary General Meeting of Shareholders(hereinafter referred to as the “General Meeting”) and the Company has continually been assessing the role of
the Current Policy, including whether or not to extend its period of validity, from the perspective of enhancing
the corporate value and ultimately protecting the common interests of the shareholders of the Company whileat the same time considering subsequent changes in the circumstances.
As a result of these deliberations, at the meeting of the Board of Directors of the Company held on May 14,
2021, by the agreement of all Directors, the “Basic Policy Regarding What and How a Person Controlling
Decisions on the Company’s Financial and Business Policies Should Be” (hereinafter referred to as the “Basic
Policy”) provided for in Article 118, Item (iii) of the Ordinance for Enforcement of the Companies Act was
resolved. At the same meeting, the Board of Directors of the Company also decided to propose the continuationof the “Policy toward Large-Scale Purchase of Share Certificates, Etc. of the Company” after revising part of
the Current Policy at the General Meeting (the revised policy shall be hereinafter referred to as the “Policy”).
Therefore, we hereby request the approval of the shareholders for the Policy. For your information, all four
Auditors of the Company have expressed their opinions to the effect that they support the Policy on condition
that the specific operation of the Policy is properly carried out.
If the Policy is approved by the shareholders at the General Meeting, the Policy shall take effect immediately
upon approval and the period of validity of the Policy shall be through the close of the Ordinary General Meetingof Shareholders of the Company scheduled to be held in June 2024.
There has been no substantial change in the contents from the Current Policy to the proposed Policy.
Note 1: Article 17, Paragraph 1 of the Articles of Incorporation of the Company prescribes that “theintroduction of takeover defense measures shall be decided by the General Meeting of Shareholders.”
The “introduction of takeover defense measures” is defined by Paragraph 2 of the same Article as“the establishment by the Company of rules and procedures that must be observed, in relation to thepurchase of shares and other rights issued by the Company, by the person who intends to undertakesuch a purchase, as part of efforts to prevent the Company’s financial and business policies from being
controlled by an inappropriate party in accordance with the Basic Policy Regarding What and How a
Person Controlling Decisions on the Company’s Financial and Business Policies Should Be.”
Note 2: A Particular Group of Shareholders means:(i) a Holder (including a person deemed as a holder pursuant to Article 27-23, Paragraph 3 of the
Financial Instruments and Exchange Act; the same shall apply hereinafter) and any Joint Holders-3-

(provided in Article 27-23, Paragraph 5 of the Financial Instruments and Exchange Act, including
a person deemed as a Joint Holder pursuant to Paragraph 6 thereof; the same shall apply
hereinafter) of Share Certificates, Etc. (provided in Article 27-23, Paragraph 1 of the Financial
Instruments and Exchange Act) of the Company; and a person who has a certain relationship withsuch a Holder or its Joint Holder that is similar to the relationship between a Holder and a Joint
Holder (hereinafter referred to as a “Quasi-Joint Holder”); or(ii) a person who makes purchases, etc. (provided in Article 27-2, Paragraph 1 of the Financial
Instruments and Exchange Act, including any purchase, etc. made on a Financial Instruments
Exchange Market) of the Share Certificates, Etc. (provided in Article 27-2, Paragraph 1 of the
Financial Instruments and Exchange Act) and any Specially Related Parties (provided in Article
27-2, Paragraph 7 of the Financial Instruments and Exchange Act).
Note 3: Voting Rights Ratio means:(i) in the case of Note 2 (i) above, the sum of 1) the Share Holding Ratio (provided in Article 27-23,
Paragraph 4 of the Financial Instruments and Exchange Act; in this case, the number of Share
Certificates, Etc. Held (the number of Share Certificates, Etc. Held as provided in the same
Paragraph; the same shall apply hereinafter) of the Joint Holders in respect of the holder shall be
added) of the holder of the Share Certificates, Etc. of the Company and 2) the Share Holding Ratioof the Quasi-Joint Holders of such a holder (provided, however, that in the calculation of the sumof 1) and 2), the number of any redundant Share Certificates, Etc. Held shall be deducted) or(ii) in the case of Note 2 (ii) above, the sum of the Shareholding Ratio (provided in Article 27-2,
Paragraph 8 of the Financial Instruments and Exchange Act) of the Large-Scale Purchaser and its
Specially Related Parties.
In calculating the Shareholding Ratio, the annual report, the quarterly report or the treasury stock
purchase report of the Company, whichever document has been most recently submitted to theauthorities, may be referred to in deciding the Total Number of Voting Rights (provided in Article
27-2, Paragraph 8 of the Financial Instruments and Exchange Act) or Total Number of Issued
Shares (provided in Article 27-23, Paragraph 4 of the Financial Instruments and Exchange Act).
Note 4: Share Certificates, Etc. mean Share Certificates, Etc. as provided in Article 27-23, Paragraph 1 of the
Financial Instruments and Exchange Act.
I. Basic Policy Regarding What and How a Person Controlling Decisions on the Company’s Financial andBusiness Policies Should Be
As a public company, the Company permits the shares of the Company to be traded freely. Accordingly,
we believe that the intent of shareholders should ultimately be reflected in “who the person controlling
decisions on the Company’s financial and business policies should be” and that any Large-Scale Purchase of
Share Certificates, Etc. of the Company should not be denied unless it is inappropriate or insufficient fromthe perspective of protecting and improving the corporate value of the Company, and in turn, the common
interests of the shareholders of the Company over the medium- to long-term.
However, there is a possibility that a Large-Scale Purchaser is unwilling to provide the Board of Directorsof the Company and shareholders with sufficient information and time to determine whether the Large-Scale
Purchaser is appropriate as a “person controlling decisions on the Company’s financial and business policies.”
There is also a possibility that the proposed Large-Scale Purchase is inappropriate or insufficient from theperspective of protecting and improving the corporate value of the Company, and in turn, the common
interests of the shareholders of the Company over the medium- to long-term, including the one that is clearly
detrimental to the corporate value of the Company, and in turn, the common interests of the shareholders of
the Company given the purpose, etc. of the Large-Scale Purchase and the one that will effectively force theshareholders to sell the Share Certificates, Etc. of the Company.

-4-For these reasons, the Board of Directors of the Company believes that a Large-Scale Purchaser should
provide the Board of Directors of the Company with necessary and sufficient information regarding sharepurchases in advance and should only be allowed to commence a Large-Scale Purchase after a certain
assessment period for the Board of Directors of the Company elapses, in accordance with certain rules that
the Company established and disclosed in advance (hereinafter referred to as the “Large-Scale Purchase
Rules”). The Board of Directors of the Company also believes that for the protection of the common interestof the shareholders of the Company, it is necessary to take measures that are considered to be appropriate inaccordance with certain reasonable rules established and disclosed in advance by the Company and, inprinciple, after seeking the judgment of shareholders, against any Large-Scale Purchase that may beinappropriate or insufficient from the perspective of protecting and improving the corporate value of theCompany, and in turn, the common interests of the shareholders of the Company over the medium- to longterm.
II. Efforts to Realize the Basic Policy
The Company has established the following management principles: “Through the quest for constantcorporate growth and acquisition of optimum profits, Kanto Denka is working with all its shareholders, users
and employees to create a successful company and a prosperous society. To achieve this goal, we areendeavoring to ensure our unique technologies and superior services meet the requirements of our users andbuild a trusted company based on the principles of sincerity, creativity, prompt response and harmony withnature.” In other words, our corporate goal is to “contribute to the realization of a prosperous society while
enhancing its corporate value” and to realize this goal, we are working to establish a good relationship withstakeholders including shareholders, local communities, users, and employees.
We believe that the source of our corporate and social value is our “unique proprietary technology”
developed through steady research activities, and our “human resources,” which support this technology andcreate new creative technologies. Since its foundation in 1938 to date, the Company’s core technologies havebeen electrolysis, fluorination, chlorination, and organic/inorganic synthesis, and in particular, it has
accumulated the knowledge of hydrofluoric acid electrolysis technologies to efficiently generate a large
quantity of high purity fluorine and fluorine-related technologies that can be applied widely to battery
materials, pharmaceuticals, agricultural chemicals, etc.
In the area of specialty gas products, we utilize our unique fluorination technology to supply fluorinatedgas products such as etching gas, cleaning gas, and wiring material gas, which are essential for the
manufacture of semiconductors and liquid crystals. Although fluorine is a dangerous and extremely difficult
substance to handle, we produce and supply a variety of fluorine gas products stably and efficiently bygenerating fluorine through electrolysis of anhydrous hydrofluoric acid and reacting it with elements such as
nitrogen and tungsten. In addition, our core technology of hydrofluoric acid electrolysis is also a technologythat can be used for military purposes, and we are included as a listed company that operates in one of thedesignated core industries in the Act for Partial Revision of the Foreign Exchange and Foreign Trade Act andrelated government ordinances and announcements, which came into effect on May 8, 2020, for the purposeof appropriately responding to investments that may have an impact on national security from a security
perspective.
As for battery material products, we are the only manufacturer in Japan that manufactures and sells highpurity electrolytes for lithium-ion secondary batteries. With the urgent need for environmental reforms tocurb global warming worldwide, Japanese society is also accelerating the movement toward electrification
with the declaration of carbon neutrality by 2050 and the banning of new gasoline and diesel vehicles by mid2030. The Company is the only manufacturer in Japan that manufactures and sells high-purity electrolytes
for lithium-ion secondary batteries, a market that is expected to grow as a focus point for electrification. We
supply world-class, high-grade products that meet the stringent needs of our customers, support the high-5-

performance and long life of lithium-ion secondary batteries, and play an important role in the supply chain
toward the achievement of a decarbonized society. The Company will continue to create its “uniqueproprietary technologies” by improving the skills of its human resources and leveraging the accumulated
expertise and strive thereby to enhance its corporate value and contribute to the realization of a prosperous
society.
In accordance with our medium-term management plan and with an eye on our vision for the future, we
aim to be a “creative development-oriented company” that contributes to society by providing a safe andrewarding work environment based on a stable management foundation and by supporting the world’s mostadvanced technologies with products that are unique and superior. At the same time, based on the CSRconscious management principles and code of conduct, the Company aims to realize the strengthening of the
management structure and the establishment of a corporate culture and to become a company that is trusted
by the society and employees as a company for which they are proud to work. Based on the basis recognition
that a company is a member of the society, the Company strictly enforces legal compliance and corporate
ethics to build a good relationship with stakeholders. In addition, as a company that handles chemicals, theCompany will focus on the collection and communication of information relevant to safety and the protectionof environment as well as the improvement of the technological strength to implement carefully thought-out
safety and environmental measures.
III. Efforts to Prevent Decisions on the Company’s Financial and Business Policies from Being Controlled by
Inappropriate Parties in the Context of the Basic Policy
1. Purpose of the Policy
The purpose of the Policy is to protect and improve the corporate value of the Company, and in turn, thecommon interests of the shareholders of the Company over the medium- to long-term in accordance with the
Basic Policy described in I. above.
We believe that, in the event of a Large-Scale Purchase, the Large-Scale Purchaser should provide theBoard of Directors of the Company with necessary and sufficient information regarding share purchases inadvance and should only be allowed to commence a Large-Scale Purchase after a certain assessment period
for the Board of Directors of the Company elapses, in accordance with the Large-Scale Purchase Rules that
the Company established and disclosed in advance. After such information is provided, the Board of Directorsof the Company will immediately start to consider its opinion on the Large-Scale Purchase and shallsubsequently form and disclose such opinion on the proposed Large-Scale Purchase after carefulconsideration with advice from outside experts, etc. In addition, the Board of Directors of the Company may
negotiate with the Large-Scale Purchaser in order to improve the proposal of the Large-Scale Purchaser oroffer the shareholders alternative plans developed by the Board of Directors of the Company, if deemednecessary. Such process shall enable the shareholders of the Company to examine the proposal of the LargeScale Purchaser and the alternative plans (in the case that any alternative plans are proposed by the Board of
Directors of the Company) with reference to the opinion of the Board of Directors of the Company, and thus,
the shareholders of the Company shall be given the opportunity to make the final decision as to whether or
not to accept the proposal of the Large-Scale Purchaser.
In addition, the Board of Directors of the Company established a certain policy to be applied depending onwhether or not the Large-Scale Purchaser Rules are observed, and determined to establish the Policy as efforts
in the case of a Large-Scale Purchase by an inappropriate party according to the Basic Policy.
The Policy is in compliance with the three principles set forth in “Guidelines With Respect To Takeover
Defense Measures for Securing And Enhancing Corporate Value and Common Interests of Shareholders”
made by Ministry of Economy, Trade and Industry and Ministry of Justice and dated May 27, 2005 and has
been drafted in reference to “Role of Takeover Defense Measures Based on Recent Changes of Environments”-6-made by Corporate Value Study Group and dated June 30, 2008 and “Principle 1-5 Takeover Defense
Measures” of the “Japan’s Corporate Governance Code” published by the Tokyo Stock Exchange on June 1,2015 (revised version released on June 1, 2018).
For the avoidance of doubt, the Company has not recognized any indication of a specific Large-Scale
Purchase regarding Share Certificates, Etc. of the Company at this point. The status of major shareholders of
the Company as of March 31, 2021 is as shown in [Exhibit 1].
2. Details of the Large-Scale Purchase Rules(1) Outline of the Large-Scale Purchase Rules
The Large-Scale Purchase Rules that the Board of Directors of the Company hereby wishes to establish
require that 1) a Large-Scale Purchaser provide necessary and sufficient information regarding the LargeScale Purchase, that 2) a certain assessment period for the Board of Directors of the Company be secured,that 3) the Board of Directors of the Company present the plans, alternatives, etc., of the management of theCompany to shareholders and conduct negotiations with the Large-Scale Purchaser, 4) the establishment of
the procedure for, in principle, holding a General Meeting of Shareholders, etc. to confirm the shareholders’intent as to whether to take countermeasures against the Large-Scale Purchase, and that the Large-Scale
Purchaser commence the Large-Scale Purchase only after the completion of the procedures described in 1)
through 4) above to secure the opportunity to confirm the shareholders’ intent.
(2) Provision of Information
More specifically, first, a Large-Scale Purchaser is required to provide the Board of Directors of theCompany with necessary and sufficient information (hereinafter referred to as the “Necessary Information”)
to allow shareholders of the Company to make their decision and the Board of Directors of the Company toform its opinion. Part of the general items of the Necessary Information is as set forth below, although specificdetails of the Necessary Information may differ according to the characteristics of the Large-Scale Purchaser
and the details of the Large-Scale Purchase:
1) An outline (including information relating to the substance of the business of the Large-Scale Purchaser,
capital structure and experience in businesses similar to the Company’s business or the Group’sbusiness) of the Large-Scale Purchaser and its group (including Joint Holders, Quasi-Joint Holders,and Specially Related Parties);
2) The purpose and substance of the Large-Scale Purchase (including amounts/type of the considerationof the purchase, etc., timing of the purchase, etc., structure of related transactions, and legality of themeans of purchase, etc., feasibility of purchase, etc. and related transactions);
3) The basis for the calculation of the value of the Company’s shares and financial resources backing thepurchase (including specific names of the financial backers (including substantial backers), financing
methods, and substance of related transactions);
4) The candidates for the management team (including information regarding experience at businesses
similar to business of the Company and the Group), management policy, business plan, financial plan,
capital policy, distribution policy, policy of utilization of assets, etc. (hereinafter referred to as the“Management Policy after Purchase”) expected after the Large-Scale Purchaser participates in the
management of the Company’s business; and
5) The possibility and substance of any change of the Company’s and the Group’s relationship withstakeholders, such as business partners, customers, employees, etc., as planned after the completion of
the Large-Scale Purchase.
Any Large-Scale Purchaser intending to undertake a Large-Scale Purchase is required first to submit to theRepresentative Director of the Company a “letter of intent” to comply with the Large-Scale Purchase Rules,-7-

which shall specify the name, address, law governing the incorporation, name of the representative, contact
details in Japan of the Large-Scale Purchaser and an outline of the proposed Large-Scale Purchase. Withinten (10) business days after receipt of such letter of intent, the Company will deliver to the Large-Scale
Purchaser a list of the Necessary Information to be initially provided by the Large-Scale Purchaser. If theinformation initially provided by the Large-Scale Purchaser is deemed less than as the Necessary Information
as a result of the Board of Directors’ examination, the Board of Directors of the Company will require theLarge-Scale Purchaser to provide additional information until the Company has received all of the Necessary
Information.
We will disclose at the time the Board of Directors of the Company deems appropriate all or part of thefact that a Large-Scale Purchase was proposed and the Necessary Information provided to the Board of
Directors of the Company, if such disclosure is considered necessary for the shareholders of the Company tomake their decisions. When the Board of Directors of the Company determines that the provision of theNecessary Information has been completed, it will notify the Large-Scale Purchaser to that effect and also
discloses to that effect to the shareholders of the Company in a timely and appropriate manner.
(3) Assessment Period for the Board of Directors
Next, depending on the difficulty of the assessment, etc. of the proposed Large-Scale Purchase, subsequent
to the completion of the Necessary Information to the Board of Directors of the Company, the Board of
Directors of the Company shall be given a period of 60 days (in the case of a purchase of all shares of theCompany by way of a tender offer in exchange for cash (in yen) as consideration) or 90 days (in the case of
any other type of Large-Scale Purchase) to assess, examine, negotiate, form an opinion, and develop
alternative plans (hereinafter referred to as the “Board Assessment Period”). The Board of Directors of theCompany shall thoroughly assess and examine the Necessary Information it receives, in consultation with theSpecial Committee, and receiving advice from independent outside experts during the Board Assessment
Period as needed, and shall carefully form and disclose its opinion on the Large-Scale Purchase. In addition,
the Board of Directors of the Company may negotiate with the Large-Scale Purchaser in order to improve theterms of the proposed Large-Scale Purchase or may offer alternative plans to shareholders of the Company,
as necessary.
Furthermore, in cases where the Board of Directors of the Company cannot reach a resolution determining
whether to take the countermeasures within the Board Assessment Period under unavoidable circumstances,for example, due to the failure of the Special Committee to make recommendations as to whether to take thecountermeasures within the Board Assessment Period, the Board of Directors, based on a recommendationof the Special Committee, may extend the Board Assessment Period up to 30 days to the extent necessary. If
the Board of Directors of the Company decides to extend the Board Assessment Period, it shall disclose thespecific period of extension decided and the reason for the necessity of such specific period to shareholders,in accordance with the applicable laws and regulations and financial instruments exchange regulations.
(4) Special Committee
In the same manner as under the Current Policy, the Special Committee is established as a body to ensurethat the Policy is properly applied and to prevent arbitrary decisions by the Board of Directors of the Company.
The Special Committee shall have at least three members and in order to be able to judge fairly and neutrally,
its members shall be elected from Outside Directors of the Company and Outside Auditor of the Company oroutside knowledgeable persons such as attorneys-at-law, who are independent from the executive membersof the management of the Company. The names and personal histories of those who are scheduled to beelected as Special Committee Members at the meeting of the Board of Directors to be held immediately after
the General Meeting are shown in [Exhibit 2]. The outline of the Special Committee is given in [Exhibit 3].
In making a significant determination pertaining to the Policy, including whether the Large-Scale-8-

Purchaser has observed Large-Scale Purchase Rules (see III 3. (1) below), whether to extend the Board
Assessment Period (see III 2. (3) above), and whether the Large-Scale Purchase is inappropriate or
insufficient from the perspective of protecting and improving the corporate value of the Company, and in
turn, the common interests of the shareholders of the Company over the medium- to long-term (see III 3. (1)Note 5 below), the Board of Directors of the Company shall always consult with the Special Committee andrespect the recommendations of the Special Committee to the utmost extent.
(5) Procedure for Confirming the Shareholders’ Intent
Subsequent to the expiration of the Board Assessment Period, the Company shall, in accordance with theprovisions of III 3. (1) (2) below, confirm the intent of the shareholders of the Company as to whether to takecountermeasures against the Large-Scale Purchase before deciding whether to take such countermeasures.
However, in the cases described below, the Board of Directors of the Company may determine whether totake countermeasures without confirming the shareholders’ intent. In such cases, the Board of Directors of
the Company shall also consult with the Special Committee and determine whether to take countermeasuresby respecting the recommendations of the Special Committee to the utmost extent:
1) Where it is considered that the Large-Scale Purchase will seriously damage the common interests ofthe shareholders of the Company, including the case where the Large-Scale Purchaser does notsincerely pursue rational management and its gaining control of the Company will likely cause
irreparable damage to the Company or will in fact likely coerce shareholders to sell their shares(specific examples of such cases are described in III 3. (1) Note 5 (i) and (ii) below); and
2) Where the Large-Scale Purchaser does not observe the Large-Scale Purchase Rules.
The intent of the shareholders of the Company shall be confirmed by voting at a General Meeting of
Shareholders under the Companies Act or a similar proceeding (hereinafter referred to as “General Meeting,etc.”) in accordance with the procedure prescribed below. If the Board of Directors of the Company holds a
General Meeting, etc., it shall take or shall not take countermeasures against the Large-Scale Purchase inaccordance with the result of the voting at the General Meeting, etc. In determining the shareholders who can
exercise voting rights at a General Meeting, etc., the Board of Directors of the Company establishes a record
date (hereinafter referred to as the “Record Date”) and give public notice of the Record Date in a way that is
stipulated in the Articles of Incorporation of the Company at least two (2) weeks before the Record Date.
(However, in the case where the General Meeting, etc. is an Ordinary General Meeting of Shareholders, theRecord Date shall be the record date of the Ordinary General Meeting of Shareholders prescribed in the
Articles of Incorporation of the Company and the public notice of it will not be given.):1) The shareholders who can exercise voting rights at a General Meeting, etc. shall be the shareholders
recorded in the shareholder register as at the end of the Record Date.
2) If a General Meeting, etc. is held, the notice of convocation shall be sent to the shareholders who can
exercise voting rights at least two (2) weeks before the date of the General Meeting, etc.
3) A resolution at a General Meeting, etc. shall be passed by a majority vote of the attending shareholders
who can exercise voting rights.
In the case where there has been, for example, a significant change in the information, etc. for shareholders
to vote at a General Meeting, etc., the Board of Directors of the Company may change the Record Date or
postpone or cancel the General Meeting, etc. by respecting the recommendations of the Special Committee
to the utmost extent even after it has established the Record Date of the General Meeting, etc.
3. Policy toward Large-Scale Purchases(1) In the Event a Large-Scale Purchaser Observes the Large-Scale Purchase Rules
If a Large-Scale Purchaser observes the Large-Scale Purchase Rules, the Board of Directors of the-9-Company, even if it disagrees with the proposed Large-Scale Purchase, will not, in principle, takecountermeasures against the Large-Scale Purchase, while it may present its views to the shareholders of theCompany by expressing an objection to the proposal of the Large-Scale Purchase or by offering alternativeplans. The Board of Directors of the Company believes that the shareholders of the Company should maketheir own decision as to whether or not they accept the proposal of the Large-Scale Purchaser upon
consideration of such proposal and the opinion on such proposal and alternative plans provided by theCompany.
However, if the Board of Directors of the Company determines that the Large-Scale Purchase isinappropriate or insufficient from the perspective of protecting and improving the corporate value of theCompany, and in turn, the common interests of the shareholders of the Company over the medium- to longterm (Note 5) (the Board of Directors shall make such a determination by consulting with the Special
Committee and by respecting the recommendations of the Special Committee to the utmost extent (see III 2.
(4) above)), it may take measures that it considers appropriate for the protection of the interest of theshareholders of the Company based on the Directors’ duty of due care of prudent manager. If the Board of
Directors of the Company carries out a gratuitous allotment of stock acquisition rights as a specificcountermeasure, the outline of such allotment shall be as described in [Exhibit 4].
As stated in III 2. (5) above, in determining whether to take countermeasures in an exceptional casementioned above, the Board of Directors of the Company shall, in principle, hold a General Meeting, etc. toseek the judgment of the shareholders in order to secure the objectivity and reasonableness of its
determination. When the Board of Directors of the Company has determined that the Large-Scale Purchasein question is inappropriate or insufficient from the perspective of the protection/improvement of thecorporate value of the Company, and in turn, the common interests of shareholders over the medium- to longterm, the Board of Directors may hold a General Meeting, etc. to seek the judgment of the shareholders as towhether the Large-Scale Purchase is inappropriate or insufficient from the perspective of theprotection/improvement of the corporate value of the Company, and in turn, the common interests ofshareholders over the medium- to long-term and countermeasures should be taken against it.
However, in the case where it is considered that the Large-Scale Purchase will seriously damage thecommon interests of the shareholders of the Company, including the case where the Large-Scale Purchaser
does not sincerely pursue rational management and its gaining control of the Company will likely cause
irreparable damage to the Company or will in fact likely coerce shareholders to sell their shares (specificexamples of such cases are described in Note 5 (i) and (ii) below), the Board of Directors of the Company
may determine whether to take countermeasures against it without confirming the shareholders’ intent. In
making such a determination, the Board of Directors of the Company shall assess the specific details of theLarge-Scale Purchaser and the Large-Scale Purchase and the influence of the Large-Scale Purchase on thecommon interests of the shareholders of the Company by taking into account the Necessary Information,
including the Management Policy after Purchase, provided by the Large-Scale Purchaser, and obtaining theadvice of outside experts, etc., as necessary, and consult with the Special Committee and give utmost respect
to its recommendations.
Note 5: A Large-Scale Purchase is inappropriate or insufficient from the perspective of theprotection/improvement of the corporate value of the Company, and in turn, the common interests ofshareholders over the medium- to long-term if, for example, the Large-Scale Purchaser falls under
any of the following cases:(i) Where the Large-Scale Purchaser proposes a purchase that is clearly detrimental to the corporate
value/common interest of shareholders as in the cases listed in 1) through 4) below:
1) Where the Large-Scale Purchaser, while not having any intention to participate in corporate
management in good faith, is purchasing shares of the Company solely for the purpose of- 10 -

selling the shares to related parties of the Company at a high price after driving the stock pricehigher;2) Where the Large-Scale Purchaser is purchasing shares of the Company for the purpose of socalled “scorched management” by, for example, temporarily controlling the management of theCompany and having the intellectual property, know-how, confidential business information,
major business partners and customers, etc., which are necessary for the management ofCompany, transferred to the Large-Scale Purchaser or its group companies;
3) Where the Large-Scale Purchaser is purchasing shares of the Company with the intention to
use the assets of the Company as a security for or to fund the repayment of the obligations of
the Large-Scale Purchase or its group companies after gaining control of the management of
the Company; and
4) Where the Large-Scale Purchaser is purchasing shares of the Company for the purpose of
temporarily controlling the management of the Company and having the Company sell orotherwise dispose of expensive assets such as real estate and securities to pay high dividends
temporarily out of the gain on such disposal, thereby taking the opportunity of a rapid increasein stock price due to temporarily high dividends and selling the shares of the Company at ahigh price.
(ii) Where the Large-Scale Purchaser proposes a purchase of shares through, for example, a tender
offer in which the purchase of all the shares is not induced in the first stage of purchase and thepurchasing conditions in the second stage of purchase are set unfavorably, or not stated clearly(so-called coercive two-tier purchase);(iii) Where the Large-Scale Purchaser’s gaining control of the Company will impair the interest of
stakeholders such as employees, customers, and business partners and the corporate value and thecommon interest of shareholders of the Company will be impaired as a result; and(iv) Where the terms and conditions of the purchase, etc. (including the amount and type of
consideration, timing of the purchase, etc., legal compliance of the purchase method, and thepolicy on the treatment after the purchase, etc. of the Company’s stakeholders such as its
employees, customers, and business partners and other management policies) are inappropriate or
insufficient in view of the protection/improvement of the corporate value of the Company, and in
turn, the common interests of shareholders over the medium- to long-term and/or the intrinsic
value of the Company.
(2) In the Event a Large-Scale Purchaser Does Not Observe the Large-Scale Purchase Rules
If a Large-Scale Purchaser does not observe the Large-Scale Purchase Rules, regardless of the specificmethod of purchase, the Board of Directors of the Company may take countermeasures against the LargeScale Purchase to prevent the interest of the Company and the common interests of the shareholders of theCompany from being impaired. Countermeasures include the issuance of stock acquisition rights or any othermeasures that the Board of Directors of the Company is permitted to take under the Companies Act or otheracts and the Articles of Incorporation of the Company. In this case, as stated in III 2. (5) above, the Board of
Directors of the Company may determine whether to take countermeasures without confirming theshareholders’ intent. The Board of Directors of the Company will select the specific countermeasures that it
deems most appropriate at that time and adopt such countermeasures. In relation to this judgment, the Boardof Directors of the Company shall determine whether or not a Large-Scale Purchaser observes the LargeScale Purchase Rules and whether it is appropriate to take countermeasures by taking into account theopinions of outside experts, etc. and by giving the utmost respect to the recommendations of the Special
Committee. In the event the Board of Directors of the Company elects to issue stock acquisition rights by
way of gratuitous allotment as a specific countermeasure, the outline of such stock acquisition rights shall be- 11 -

as described in [Exhibit 4] attached hereto; however, if the Board of Directors of the Company actually elects
to issue stock acquisition rights as a countermeasure, it may determine the exercise period and the conditions
for exercise of the stock acquisition rights considering the effectiveness thereof as a countermeasure,including, for instance, the condition that a person belonging to a particular Group of Shareholders with acertain percentage or more Voting Rights Ratio may not exercise stock acquisition rights.
4. Influence, etc. on Shareholders and Investors(1) Influence, etc. of the Large-Scale Purchase Rules on Shareholders and Investors
The purpose of the Large-Scale Purchase Rules is to provide the shareholders of the Company with theinformation necessary for them to determine whether or not to accept a Large-Scale Purchase in addition tothe opinion of the Board of Directors of the Company that is actually in charge of the Company’s management,
and to ensure that the shareholders of the Company have opportunities to receive any alternative plans. The
Board of Directors of the Company believes that under the Large-Scale Purchase Rules, the shareholders of
the Company, with sufficient information, will be able to make appropriate decisions as to whether or not to
accept the Large-Scale Purchase, whereby the common interests of the shareholders of the Company shall beprotected. Accordingly, the Board of Directors of the Company believes that the establishment of the LargeScale Purchase Rules is a prerequisite for appropriate investment decisions of the shareholders of theCompany and investors and contributes to the interest of the shareholders of the Company and investors.
The Board of Directors of the Company hereby advises the shareholders of the Company and investors to
observe carefully any actions by a Large-Scale Purchaser as well as any related timely disclosures from theCompany, because the policy of the Company will differ depending on whether or not a Large-Scale
Purchaser complies with the Large-Scale Purchase Rules, as described in 3. above.
(2) Influence, etc. of Countermeasures on Shareholders and Investors
In cases where the Large-Scale Purchaser has not observed the Large-Scale Purchase Rules or where a
Large-Scale Purchase is inappropriate or insufficient from the perspective of the protection/improvement of
the corporate value of the Company, and in turn, the common interests of shareholders over the medium- tolong-term, the Board of Directors of the Company may take countermeasures described in 3. above. However,given the structure of the countermeasures, the Board of Directors of the Company does not expect that taking
such countermeasures will cause any legal or economic damage or loss to the shareholders of the Company
other than the Large-Scale Purchaser. When the Board of Directors of the Company elects to take any specificcountermeasure, the Board of Directors of the Company will make an appropriate disclosure in a timely
manner in accordance with the relevant laws and regulations and financial instruments exchange regulations.
It should be noted that, in the event the Board of Directors of the Company ceases to issue stock acquisitionrights or acquire issued stock acquisition rights gratuitously, the share value will not be diluted, so thatshareholders and investors, who purchased or sold shares after the date of the expiration of the gratuitous
allotment of stock acquisition rights on the assumption that the stock value of the Company would be diluted
may suffer unexpected losses because of movements in share price.
(3) Procedure that Shareholders Need to Follow After Countermeasures are Taken
A. Procedure for exercising stock acquisition rights
If the Board of Directors of the Company passes a resolution for the gratuitous allotment of stockacquisition rights as countermeasures, the Company shall give public notice of the date of such allotment andallot stock acquisition rights gratuitously to the shareholders who are recorded in the Company’s shareholder
register as at the end of the specified date of such allotment. After that, the Company shall, in principle, send
to these shareholders the stock acquisition rights exercise request form (which shall be in a format prescribed- 12 -

by the Company that is to provide the details and the number of the stock acquisition rights to be exercised,other necessary matters including the information necessary for the transfer to the account of the shareholders
to which shares of the Company will be allotted, and the statement to confirm, among others, that therequesting shareholder does not belong to a particular Group of Shareholders) and other documents necessary
for the exercise of stock acquisition rights. After the gratuitous allotment of stock acquisition rights, bysubmitting these necessary documents by the end of the exercise period and paying a certain amount, whichshall be determined as an amount, in principle, not less than one yen per stock acquisition right by the
resolution of the Board of Directors of the Company approving the gratuitous allotment of stock acquisitionrights, to the specified payment handling place, the shareholders shall be entitled to the newly issued sharesof the Company. The specific number of the shares to be issued for each stock acquisition right shall be
determined separately by the Board of Directors of the Company.
B. Procedure for the Acquisition of Stock Acquisition Rights by the Company
In the case where the Board of Directors of the Company approves the acquisition of the stock acquisitionrights by the Company, the Company shall, in accordance with the procedure prescribed by laws, acquire thestock acquisition rights upon the arrival of the day separately determined by the Board of Directors of theCompany. In cases where the Company delivers the shares of the Company to shareholders in exchange forthe acquisition of stock acquisition rights, it shall do so promptly. In this case, the Company may require suchshareholders to separately submit a document providing the information necessary for the transfer to theaccount of the shareholders to which shares of the Company will be allotted and the statement to confirm,among others, that the submitting shareholder does not belong to a particular Group of Shareholders, using
the form prescribed by the Company.
After a resolution of the Board of Directors of the Company concerning countermeasures are passed, theCompany shall disclose or notify to shareholders, and the shareholders are requested to note, the details of
the methods of allotment and exercise of stock acquisition rights as well as the method of acquisition by theCompany,
5. Revision, etc. in the Large-Scale Purchase Rules
Any revision or abolition of the Large-Scale Purchase Rules shall be subject to the decision of the General
Meeting of Shareholders of the Company. However, in cases where the Board of Directors of the Company
has determined that there is an objective need for revising the Large-Scale Purchase Rules due to a revisionof laws and regulations or rules prescribed by financial instruments exchanges and the like or a change in theinterpretation thereof or under other circumstances, the Large-Scale Purchase Rule may be revised based on
the decision by the Board of Directors.
6. Start of the Application and the Period of Validity of the Large-Scale Purchase Rules
The Policy shall take effect immediately upon the resolution of the General Meeting and its period ofvalidity shall expire at the close of the Ordinary General Meeting of Shareholders pertaining to the last fiscal
year among the fiscal years ending within three years from the date of the resolution of the General Meeting.
However, in cases where the General Meeting of Shareholders of the Company has resolved to abolish the
Policy, the Policy may be abolished even before the expiration of the period of validity mentioned above. If
it is resolved at the Ordinary General Meeting of Shareholders pertaining to the last fiscal year among the
fiscal years ending within three years from the date of the resolution of the General Meeting that the Policy
be continued, its period of validity shall be extended until the close of the Ordinary General Meeting of
Shareholders pertaining to the last fiscal year among the fiscal years ending within three years from the dateof said general meeting of shareholders.
IV. The Policy Will Comply with the Basic Policy, So As Not to Damage the Common Interests of Shareholders- 13 -

of the Company and Not to Pursue the Maintenance of the Status of Directors of the Company and Reasons
Therefor1. The Policy Will Comply with the Basic Policy
The Policy sets forth matters such as the substance of the Large-Scale Purchase Rules, the policy toward a
Large-Scale Purchase, the establishment of the Special Committee, the procedure for confirming the intentionof shareholders, and the influence on shareholders and investors.
In the Policy, it is stipulated that a Large-Scale Purchaser is required to provide the Board of Directors of
the Company with all necessary and sufficient information concerning the Large-Scale Purchase in advanceand that it is required to commence the Large-Scale Purchase only after a certain assessment period for the
Board of Directors of the Company has elapsed and the intention of shareholders as to whether the Board of
Directors should take countermeasures has been confirmed directly, in principle, at a General Meeting, etc.,
and that the Board of Directors of the Company may take countermeasures against any Large-Scale Purchaser
who does not observe these rules.
In addition, it is stipulated that, even if the Large-Scale Purchaser observes the Large-Scale Purchase Rules,in the event that the Board of Directors of the Company judges that the Large-Scale Purchase by the LargeScale Purchaser are inappropriate or insufficient from the perspective of protecting and improving thecorporate value of the Company , and in turn, the common interests of the shareholders of the Company overthe medium- to long-term, the Board of Directors of the Company may take countermeasures against theLarge-Scale Purchaser that are considered appropriate in order to protect the common interests of theshareholders of the Company.
Furthermore, the Policy stipulates that whether to take countermeasures against the Large-Scale Purchaseshall be determined, in principle, based on the judgment of the shareholders at a General Meeting, etc. andthat countermeasures shall not be taken unless a resolution approving them is passed.
As set forth above, the Policy is consistent with the Basic Policy.
2. The Policy Will Not Damage the Common Interests of Shareholders of the Company
As described in I, the Basic Policy is based on the assumption that the common interests of shareholdersof the Company should be respected. The Policy is consistent with the Basic Policy and intended to ensurethat shareholders of the Company are provided with the information necessary to decide whether or not to
accept a Large-Scale Purchase, the opinion of the Board of Directors of the Company, and the opportunity toreceive alternative plans and ultimately to provide the shareholders as at the time the Company has received
the proposal for a Large-Scale Purchase with the opportunity to decide whether countermeasures should betaken. Because the shareholders of the Company and investors can make proper investment judgments
through the Policy, it does not damage the common interests of the shareholders of the Company, but rather
contributes to their interests.
3. The Policy Will Not Pursue the Maintenance of the Status of Directors
The Policy has a broad principle that leaves the final decision whether or not a Large-Scale Purchase shallbe accepted to the judgment of the shareholders of the Company, requires compliance with the Large-Scale
Purchase Rules and allows countermeasures to the extent necessary to protect the common interests of theshareholders of the Company. The Policy discloses reasonable and objective requirements for the Board of
Directors of the Company to take countermeasures in advance and in detail, and any countermeasures by the
Board of Directors of the Company will be taken in accordance with the provisions of the Policy.
In addition, the Policy prescribes that when the Board of Directors of the Company intends to takecountermeasures against a Large-Scale Purchase, it shall, in principle, hold a General Meeting, etc. to seek
the judgment of the shareholders and in an exceptional situation in which the Board of Directors makes a- 14 -

decision to take such countermeasures or any other important judgment concerning the Policy without holding
a General Meeting, etc., the Board of Directors shall request advice from outside experts, etc., as necessary,and consults with the Special Committee consisting of members who are independent of the management
team operating businesses of the Company and gives utmost respect to the recommendation of the Special
Committee. As mentioned above, the Policy includes procedures through which the appropriate operations
by the Board of Directors of the Company are ensured.
As described above, we believe that it is clear that the Policy is not designed arbitrarily to pursue themaintenance of the status of Directors.

- 15 -

[Exhibit 1]
Major shareholders of the Company (as of March 31, 2021)

Shareholder nameShareholding status
Number of shares
Shareholding ratio
In thousands of%sharesThe Master Trust Bank of Japan, Ltd. (Trust
Account)
Custody Bank of Japan, Ltd. (Trust Account)
Asahi Mutual Life Insurance Company
Zeon Corporation
GOLDMAN SACHS INTERNATIONALThe Gunma Bank, Ltd.
J.P. MORGAN SECURITIES PLC FOR AND ON
BEHALF OF ITS CLIENTS JPMSP RE CLIENTASSETS-SEGR ACCTThe Chugoku Bank, Ltd.
GOVERNMENT OF NORWAY
Custody Bank of Japan, Ltd. (Trust Account 9)

5,123

8.91

3,631
3,570
3,550
2,770
1,600

6.31
6.21
6.17
4.82
2.78

1,526

2.65

1,400
1,372
1,272

2.43
2.39
2.21

(Note) The total number of issued shares is 57,546,050. The shareholding ratios are calculated after deducting
treasury stock (22,574 shares).

- 16 -

[Exhibit 2]
Names and experience of Special Committee Members
Hideki Matsui
Experience April 1987
April 1987
October 2006
September 2011
June 2015

Admitted as Attorney-at-Law
Joined Marunouchi Sogo Law OfficeOutside Auditor, Kanebo Cosmetics Inc.
Co-Representative Attorney-at-law, Marunouchi Sogo
Law Office (to present)
Outside Director of the Company (to present)

Masaharu Sugiyama
Experience November 1979
August 1983
May 2002
August 2010
August 2013
June 2016

Joined Daiichi Audit Corporation (current Ernst & Young
ShinNihon LLC)
Registered as Certified Public Accountant (CPA)
Representative Partner (current Senior Partner), Ernst &Young ShinNihon LLC
Audit Commissioner, Ernst & Young ShinNihon LLC
Chairman of Audit Committee, Ernst & Young ShinNihon
LLC
Outside Director of the Company (to present)

Naozumi Furukawa
Experience April 1967
June 1997
June 2003
June 2006
June 2013
March 2014
June 2015
June 2020

Joined Zeon Corporation
Director, Zeon Corporation
President, Zeon Corporation
Outside Auditor, The Yokohama Rubber Co., Ltd.
Chairman, Zeon Corporation
Outside Director, The Yokohama Rubber Co., Ltd.
Outside Auditor of the Company (to present)
Honorary Chairman, Zeon Corporation (to present)

Kenichi Ikeda
Experience April 1986
April 2017
June 2020
July 2020
April 2021

Joined Asahi Mutual Life Insurance Company
Executive Officer, Asahi Mutual Life Insurance Company
Outside Auditor of the Company (to present)
Director and Executive Officer, Asahi Mutual Life
Insurance Company
Director and Managing Executive Officer, Asahi MutualLife Insurance Company (to present)- 17 -

[Exhibit 3]
Outline of the Special Committee
1. Establishment
The Special Committee shall be established by the resolution of the Board of Directors of the Company.
2. Members
The Special Committee shall consist of three or more persons who are commissioned by the Board of
Directors of the Company from among Outside Director of the Company, Outside Auditor of the Company,
and outside knowledgeable persons such as attorneys-at-law, who are independent from the executive
members of the management of the Company.
3. Term of Office
The term of office of Special Committee Members shall expire at the earlier of the close of the Ordinary
General Meeting of Shareholders pertaining to the last fiscal year among those ending within three years fromtheir appointment or the abolishment of the Policy toward Large-Scale Purchase of Share Certificates, Etc.
of the Company. When a Special Committee Member has been, but is no longer, an Outside Director or
Outside Auditor, the term of office of that person as a Special Committee Member expires at the same time,
unless otherwise prescribed by a resolution of the Board of Directors of the Company.
4. Requirements for passing a resolution
A resolution of the Special Committee shall be passed by a majority of the votes of the Special Committee
Members present at the meeting, provided that a majority of Special Committee Members are present.
Committee Members can attend a meeting of the Special Committee by means of, for example, a conferencecall.
5. Matters to be resolved, etc.
When advice is requested by the Board of Directors of the Company, the Special Committee shall makedeterminations on the matters listed below in principle and recommend its conclusions to the Board of
Directors of the Company by stating the grounds therefor. Each Special Committee Member shall make suchdeterminations from the viewpoint of whether or not the subject matter contributes to the corporate value of
the Company, and in turn, the common interests of shareholders, and shall not make such determinations inpursuit solely of personal interests of him/herself or any of the Directors of the Company:
1) Whether the large-scale purchase in question is seriously damaging to the common interests of theshareholders of the Company;
2) Whether the large-scale purchase in question is inappropriate or insufficient from the perspective of theprotection/improvement of the corporate value of the Company, and in turn, the common interests ofshareholders over the medium- to long-term;3) Whether the Large-Scale Purchase Rules have been observed;- 18 -

4) Whether it is necessary to submit the decision on whether to take countermeasures to the General Meetingof Shareholders, etc. for its decision;5) Whether countermeasures should be taken, should not be taken, should be changed, or should be
discontinued; and6) Other matters for which the advice of the Special Committee is sought by the Board of Directors of theCompany among those on which the Board of Directors of the Company should make decisions inaccordance with the Large-Scale Purchase Rules.

- 19 -

[Exhibit 4]
Outline of Stock Acquisition Rights
1. Shareholders Who are Entitled to Receive Stock Acquisition Rights and Conditions of Issuance Thereof
One (1) stock acquisition right shall be allotted, for no new payment in return, to a shareholder for eachshare of common stock of the Company held by such shareholder (excluding the Company’s common stocks
held by the Company), whose name is recorded in the register of shareholders as of the end of the record date
to be specified by the Board of Directors of the Company.
2. Class and Number of Shares to be Acquired upon Exercise of the Stock Acquisition Right
The class of shares to be acquired upon exercise of the stock acquisition right shall be common stock of
the Company, and the total number of such shares shall be up to the total number of authorized shares lessthe total number of issued shares (excluding the Company’s common stocks held by the Company) as of therecord date to be specified by the Board of Directors of the Company. The number of shares to be acquired
upon exercise of one (1) stock acquisition right shall be separately determined by the Board of Directors of
the Company; provided, however, that such number shall be adjusted to the extent necessary if the Company
performs a stock split or a stock consolidation.
3. Total Number of Stock Acquisition Rights to be Issued
The total number of stock acquisition rights to be allotted shall be separately determined by the Board of
Directors of the Company. The Board of Directors of the Company may allot stock acquisition rights ininstallments.
4. Issuance Price of Stock Acquisition Rights (Amount to be Paid)
The issuance price of the stock acquisition right is nil.
5. Value of Property to be Contributed (Amount to be Paid) upon Exercise of Stock Acquisition Rights
The value of property to be contributed (amount to be paid) upon exercise of a stock acquisition right shallbe an amount to be determined by the Board of Directors of the Company which shall be at least one (1)Japanese yen.
6. Restriction on Transfer of Stock Acquisition Rights
Stock acquisition rights may not be acquired by way of transfer without the approval of the Board of
Directors of the Company.
7. Conditions of Exercise of Stock Acquisition Rights
Certain conditions of exercise shall be provided, including a condition that a person belonging to aparticular Group of Shareholders that holds at least 20% of the Voting Rights Ratio (excluding persons
approved by the Board of Directors of the Company in advance) may not exercise stock acquisition rights.
Further details will be decided separately by the Board of Directors of the Company.

- 20 -

8. Exercise Period, etc. of Stock Acquisition Rights
The effective date of the allotment of stock acquisition rights, exercise period, acquisition clause, and othernecessary subject matter of the stock acquisition rights shall be separately determined by the Board of
Directors of the Company. As a matter of acquisition clause, the Company may provide a clause that theCompany may acquire stock acquisition rights from persons other than those who are not permitted toexercise their stock acquisition rights due to the conditions of exercise in 7. above in exchange for the delivery
of a certain number (to be separately determined by the Board of Directors of the Company) of shares of theCompany for each stock acquisition right.

- 21 -

<Company Proposal>
Proposal 2:
Election of 9 Directors
The terms of office of all 9 Directors will expire at the conclusion of this year’s Ordinary General Meetingof Shareholders. Accordingly, the Company proposes the election of 9 Directors (including 3 Outside Directors).
The candidates for Director are as follows:
No.

Name
(Date of birth)

Past experience, positions, area of responsibility
and significant concurrent positions
January 2000
July 2004
June 2007

1

2

Joined the Company
General Manager, Fine Chemicals Sales Dept.-II
Executive Officer; General Manager, Fine Chemicals Sales
Dept.-II
June 2009
Director and Executive Officer; General Manager, Sales Div.
Director and Executive Officer; General Manager, Sales Div.;
January 2011
General Manager, Fine Chemicals Sales Dept.-I
Director and Executive Officer of the Company; Chairman
June 2011
and Managing Director, Kanto Denka Kogyo (Shanghai) Co.,
Jun’ichi Hasegawa
Ltd.
(November 11, 1958)
President
June 2015
Reappointment
President; General Manager, Business Div.
June 2019
President; General Manager, Business Div. (to present)
June 2020(In charge of Internal Auditing Dept., Legal & General Affairs
Dept., Personnel Dept.)[Reasons for nomination of the candidate for Director]
The Company has nominated Jun’ichi Hasegawa as a candidate for Director
because Mr. Hasegawa has long experience in the sales division and at overseas
subsidiaries, experience as a Director and broad insights concerning the overallmanagement of the Company.
Joined the Company
April 1981
General Manager, Shibukawa Development Research Lab.
April 2002
General Manager, New Products Development Promotion Dept.,
June 2005
New Products Development Div.
Executive Officer; Representative Director, Kanto Denka Korea
June 2007
Co., Ltd.
Executive Officer; General Manager, Fine Chemicals Sales
June 2009
Dept.-II
Executive Officer; General Manager, Research & Marketing
April 2012Management Dept., New Products Development Div.
Executive Officer; General Manager, Development & Marketing
April 2014
Dept., New Products Development Div.
Fuyuhiko Ishii
Executive Officer; Chairman and Managing Director, Kanto
June 2015
Denka Kogyo (Shanghai) Co., Ltd.
(December 10, 1958)
Executive Officer; Chairman, Kanto Denka Kogyo (Shanghai)
April 2017
Reappointment
Co., Ltd.
June 2017
Director and Executive Officer; General Manager, TechnicalDiv.
June 2019
Director and Managing Executive Officer; General Manager,
Technical Div.; General Manager, New Products
Development Div. (to present)(In charge of Purchasing Dept.)[Reasons for nomination of the candidate for Director]
The Company has nominated Fuyuhiko Ishii as a candidate for Director because
Mr. Ishii has long experience in new products development and sales divisions andat overseas subsidiaries, experience as a Director and broad insights concerning
the overall management of the Company.

Number ofshares of theCompany held

- 22 -

34,800

9,400

No.

Name
(Date of birth)

Past experience, positions, area of responsibility
and significant concurrent positions
April 1990
April 2009

Number ofshares of theCompany held

Joined the Company
General Manager, Production Dept.-I, Shibukawa Plant

June 2013
June 2015
June 20193

Yasunari Yamaguchi(August 1, 1965)
Reappointment

Kazuki Niimi
4(September 22, 1960)
Reappointment

5(January 21, 1969)
Reappointment

Yuki Abe

General Manager, Corporate Planning Dept.
Executive Officer; Plant Manager, Mizushima Plant
Director and Executive Officer; Plant Manager, Shibukawa
Plant
November 2019
Director and Executive Officer; Plant Manager, Shibukawa
Plant; General Manager, Production Engineering Dept.,
Shibukawa Plant
June 2020
Director and Executive Officer; Plant Manager, Shibukawa
Plant (to present)[Reasons for nomination of the candidate for Director]
The Company has nominated Yasunari Yamaguchi as a candidate for Director
because Mr. Yamaguchi has long experience in engineering divisions, including
plant operations and corporate planning division, experience as a Director andbroad insights concerning the overall management of the Company.
Joined Asahi Mutual Life Insurance Company
April 1984
General Manager, Finance Unit, Asahi Mutual Life Insurance
April 2006
Company
General Manager, Accounting Unit, Asahi Mutual Life
April 2010
Insurance Company
General Manager, Bond Management Unit, Asahi Mutual Life
April 2013
Insurance Company
General Manager, Securities Management Dept., Asahi Mutual
April 2015
Life Insurance Company
General Manager, Financial Controller Dept., Asahi Mutual Life
April 2016
Insurance Company
General Manager, in charge of Financial Controller Dept., Asahi
April 2020
Mutual Life Insurance Company
Director and Executive Officer of the Company (to present)
June 2020(In charge of Accounting & Finance Dept., Information Systems
Dept.)[Reasons for nomination of the candidate for Director]
The Company has nominated Kazuki Niimi as a candidate for Director because
Mr. Niimi has long experience at a financial institution, experience as a Director,
considerable knowledge in finance and accounting and broad insights concerning
the overall management of the Company.
April 1991
Joined the Company
June 2009
Representative Director, Kanto Denka Korea Co., Ltd.
April 2012
General Manager, Fine Chemicals Sales Dept.-II, Sales Div.
of the Company
June 2018
Executive Officer; General Manager of Osaka Branch Office
June 2020
Director and Executive Officer; Deputy General Manager,
Business Div.; General Manager of Osaka Branch Office
January 2021
Director and Executive Officer; Deputy General Manager,
Business Div.; Representative Director, Kanto Denka Korea
Co., Ltd. (to present)[Reasons for nomination of the candidate for Director]
The Company has nominated Yuki Abe as a candidate for Director because Mr.
Abe has long experience in the Sales Div. and at an overseas subsidiary, experience
as a Director, and broad insights concerning the overall management of theCompany.

- 23 -

4,500

1,000

1,300

No.

Name
(Date of birth)

Past experience, positions, area of responsibility
and significant concurrent positions
April 1982
December 2002
April 2008
June 20116

7

8

Joined Asahi Mutual Life Insurance Co.
Joined the Company
General Manager, Personnel & General Affairs Dept.
Executive Officer; General Manager, Personnel & General
Affairs Dept.
Senior Executive Officer; General Manager, Legal & General
Kunihiko Uramoto June 2017
Affairs Dept.
(August 24, 1959)
New appointment
Full-time Auditor (to present)
June 2018[Reasons for nomination of the candidate for Director]
The Company has nominated Kunihiko Uramoto as a candidate for Director
because Mr. Uramoto has long experience at the personnel and legal & generalaffairs divisions of the Company, experience as an Auditor, and broad insights
concerning the overall management of the Company.
April 1987
Admitted as Attorney-at-Law
April 1987
Joined Marunouchi Sogo Law Office
October 2006
Outside Auditor, Kanebo Cosmetics Inc.
September 2011 Co-Representative Attorney-at-law, Marunouchi Sogo Law
Office (to present)
Hideki Matsui
June 2015
Outside Director of the Company (to present)(July 9, 1962)[Significant concurrent position]
Reappointment
Co-Representative Attorney-at-law, Marunouchi Sogo Law OfficeOutside[Reasons for nomination of the candidate for Outside Director]
Although Hideki Matsui has not been involved in corporate management other thanas an outside officer, the Company has nominated him as a candidate for Outside
Director because Mr. Matsui has engaged in corporate legal affairs as an attorneyat-law for many years, and the Company expects him to utilize his experience andbroad insights for the management of the Company
November 1979 Joined Daiichi Audit Corporation (current Ernst & Young
ShinNihon LLC)
August 1983
Registered as Certified Public Accountant (CPA)
May 2002
Representative Partner (current Senior Partner), Ernst &Young ShinNihon LLC
August 2008
Councilor of Employee Council, Ernst & Young ShinNihon
LLC
August 2010
Audit Commissioner, Ernst & Young ShinNihon LLC
Masaharu Sugiyama
August2013
Chairmanof Audit Committee, Ernst & Young ShinNihon(June 20, 1954)
LLC
Reappointment
August 2014
Vice-Chairman of Employee Council, Ernst & Young
OutsideShinNihon LLC
June 2016
Outside Director of the Company (to present)[Reasons for nomination of the candidate for Outside Director]
Although he has not been involved in corporate management other than as an
outside officer, the Company has nominated Masaharu Sugiyama as a candidate
for Outside Director because Mr. Sugiyama has engaged in corporate accounting
for many years as a Certified Public Accountant, and the Company expects him toutilize his experience and broad insights for the management of the Company.

Number ofshares of theCompany held

- 24 -

10,800

0

0

No.

Name
(Date of birth)

Past experience, positions, area of responsibility
and significant concurrent positions
April 1981
March 2000
April 2000

9

Hitoshi Habuka(March 25, 1957)
Reappointment
OutsideJoined Shin-Etsu Chemical Co., Ltd.
Retired from Shin-Etsu Chemical Co., Ltd.
Associate Professor, Department of Material Science andChemical Engineering, Faculty of Engineering, Yokohama
National University (current National University Corporation
Yokohama National University)
April 2002
Professor, Department of Chemical Engineering Science,
Faculty of Engineering, National University Corporation
Yokohama National University (to present)
April 2017
Vice Dean, College of Engineering Science, National
University Corporation Yokohama National University (topresent)
June 2019
Outside Director of the Company (to present)[Significant concurrent position]
Professor, Department of Materials Science and Chemical Engineering, Faculty ofEngineering, National University Corporation Yokohama National University
Vice Dean, College of Engineering Science, National University Corporation
Yokohama National University[Reasons for nomination of the candidate for Outside Director]
The Company has nominated Hitoshi Habuka as a candidate for Outside Director
because Dr. Habuka has worked at Shin-Etsu Chemical Co., Ltd. and has
experience as an engineering advisor and guest researcher, etc. at other companies.
Also, he has engaged in research and development for many years, and theCompany expects him to utilize his experience and broad insights for the
management of the Company.

Number ofshares of theCompany held

0

(Notes)
1. Hideki Matsui, Masaharu Sugiyama and Hitoshi Habuka are all candidates for Outside Director and candidates forindependent officer as stipulated by the rules of the Tokyo Stock Exchange.
2. Although Hideki Matsui belongs to the Marunouchi Sogo Law Office, with which the Company has a legal advisory
retainer contract and to which it pays fees for legal services provided by attorneys, the Company paid only about ¥2
million for the fiscal year ended March 31, 2021, and this amount does not affect the independence of Mr. Matsui either
from the Company or from the law office.
3. Although Masaharu Sugiyama belonged to Ernst & Young ShinNihon LLC, which is the Company’s accounting auditor,
he retired from the audit firm in June 2016. Although the Company pays compensation for audits conducted by the firm,
the Company paid only ¥38 million (excluding additional compensation of ¥1 million for the previous fiscal year) for
the fiscal year ended March 31, 2021, and this amount does not affect the independence of Mr. Sugiyama either fromthe Company or from the audit firm. Mr. Sugiyama has not been in charge of audits of the Company.
4. Hitoshi Habuka belongs to National University Corporation Yokohama National University, with which the Company
has concluded a joint research agreement. Although the Company makes donations to the said university, the amount of
donations was only ¥1 million for the fiscal year ended March 31, 2021, and this amount does not affect the independenceof Mr. Habuka either from the Company or from the university.
5. The Company has an agreement with Hideki Matsui, Masaharu Sugiyama and Hitoshi Habuka to limit their liability as
Outside Director on the basis of the provisions of Article 427, Paragraph 1, of the Companies Act with the liability limit
set forth in the relevant law. In case Mr. Matsui, Mr. Sugiyama, and Mr. Habuka are elected as Outside Directors andassume office as such, the Company plans to continue to enter into a similar agreement with them.
6. The Company has entered into a directors and officers liability insurance agreement for Directors, Auditors, and certain
officers of subsidiaries of the Company as insureds, which is outlined below and plans to renew the agreement in October
2021. Each candidate is included as an insured under the said insurance, and when each candidate is elected and assumes
office, they will all be included as an insured under the said insurance.
1) Outline of events insured against
The agreement will cover damages that may arise due to the insured Directors, Auditors, and officers, etc. assuming
responsibility for the execution of his or her duties or receiving a claim related to the pursuit of such responsibility.
2) Insurance premiums will be fully borne by the Company.
7. The term of office of Hideki Matsui, Masaharu Sugiyama, and Hitoshi Habuka as Outside Directors of the Company
upon the conclusion of this General Meeting of Shareholders will be six years, five years, and two years, respectively.

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<Company Proposal>
Proposal 3:
Election of 2 Auditors
Auditors Takashi Suzuki and Kunihiko Uramoto will resign at the conclusion of this year’s Ordinary General
Meeting of Shareholders. Accordingly, the Company proposes the election of 2 Auditors. Takeaki Yajima andMasatomo Hayashi are nominated as substitute for Takashi Suzuki and Kunihiko Uramoto, respectively.
The candidates for Auditor are as follows. The Audit & Supervisory Board has previously given its approvalto this proposal.
No.

Past experience, positions,and significant concurrent positions

Number ofshares of theCompany held

Joined The Dai-Ichi Kangyo Bank, Ltd. (currently Mizuho
Bank, Ltd.)March 2003
General Manager of Tottori Branch, Mizuho Bank, Ltd.
April 2010
General Manager, Unit No. 8 of Branch Department, Mizuho
Bank, Ltd.
April 2012
General Manager of Tachikawa Branch, Mizuho Bank, Ltd.
April 2014
General Manager, Branch Banking Department No. 2, Mizuho
Bank, Ltd.
April 2015
General Manager, Tokyo Main Office Department No. 1,
Mizuho Bank, Ltd.
June 2018
Corporate Adviser of the Company
June 2018
Director and Executive Officer (to present)[Reasons for nomination of the candidate for Auditor]
The Company has nominated Takeaki Yajima as a candidate for Auditor because
Mr. Yajima has long experience at financial institutions, experience as a Directorof the Company, considerable knowledge in finance and accounting and broad
insights concerning the overall management of the Company.

2,900

Name
(Date of birth)
April 1987

1

Takeaki Yajima(April 20, 1963)
New appointment

April 1983
April 2002

2

Masatomo Hayashi(September 9, 1960)
New appointment

Joined the Company
General Manager, Recording Materials Development Research
Lab.
July 2004
General Manager, Recording Materials Development Research
Lab.; General Manager, Fine Chemicals Sales Dept.-I
April 2005
General Manager, Functional Materials Development Research
Lab.; General Manager, Fine Chemicals Sales Dept.-I
April 2009
General Manager, Functional Materials Development Research
Lab.; General Manager, Production Dept.-III, Shibukawa Plant
April 2010
General Manager, Production Dept.-III, Shibukawa Plant;
Research & Marketing Management Dept.
April 2014
General Manager, Production Engineering Dept., TechnicalDiv.
June 2015
Executive Officer; Plant Manager, Shibukawa Plant
June 2019
Senior Executive Officer; Plant Manager, Mizushima Plant (topresent)[Reasons for nomination of the candidate for Auditor]
The Company has nominated Masatomo Hayashi as a candidate for Auditor
because Mr. Hayashi has long experience in the engineering division, including
plant operations, and research and development division of the Company, and healso has broad insights concerning the overall management of the Company.

(Note)The Company has entered into a directors and officers liability insurance agreement for Directors, Auditors, and certain
officers of subsidiaries of the Company as insureds, which is outlined below and plans to renew the agreement in October
2021. When each candidate is elected and assumes office, they will all be included as an insured under the said insurance.
1) Outline of events insured against
The agreement will cover damages that may arise due to the insured Directors, Auditors, and officers, etc. assuming
responsibility for the execution of his or her duties or receiving a claim related to the pursuit of such responsibility.
2) Insurance premiums will be fully borne by the Company.

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0<Shareholder Proposal>
Proposal 4 is made by two shareholders. The number of voting rights held by the two shareholders is 332.
Proposal 4:
Partial Amendments to the Articles of Incorporation
1. The following article shall be provided in the Articles of Incorporation.
“The Company does not permit the abandonment of duties due to smoking during working hours, nor the
installation and maintenance of smoking facilities on the Company’s premises, as these activities are
detrimental to the interests of the Company and its shareholders.”
2. Reasons for proposal
In workplaces where smoking is allowed, there is currently the loss of working hours due to cigarette breaks,
the loss of profits due to the cost of installing smoking facilities on the premises, ventilation, cleaning, etc.,
and the risk of falling stock prices due to health hazards caused by cigarette smoke and the risk of fire andindustrial accidents.
Making workplaces completely smoke-free is a strategy to improve profits and is an appropriate responsethat should be promoted from the perspective of health management, SDGs, and ESGs.
Although the representative of this proposal has already submitted many documents to the Company,
unfortunately, the Company only complies with the minimum legal requirements, lacks the shareholder
perspective of maximizing profits, and is not fully fulfilling its corporate social responsibility.
The implementation of this proposal is nothing but a positive for the Company and many stakeholders,
including its shareholders. Even if there are smokers who insist on their so-called “right to smoke,” there would
be no problem at all in enforcing this policy, as you can see from the fact that many companies have already
implemented a policy of “no smoking on the premises and during working hours.”
In order to increase dividends through increased profits due to the elimination of cost burdens, and to reduce
the risk of a decline in the stock price due to health hazards, fires, and industrial accidents, we ask for the
support of as many shareholders as possible.
Opinion of the Company’s Board of Directors
The Company’s Board of Directors opposes this proposal.
The Group has set the “ESG shift and corporate value enhancement” as one of the goals in its new mediumterm management plan (Journey to 1000) covering the next three years starting from fiscal year ended March
31, 2019, and will promote management with an awareness of ESG and SDGs in order to enhance corporate
value and contribute to society, contribute to the realization of a sustainable society, and create a workplace
where employees can work with peace of mind.
Up until now, we have been implementing initiatives such as banning smoking in the office andencouraging employees who have quit smoking to take advantage of the subsidy system, and we will continue
to promote the health of our employees and create a comfortable workplace.
Furthermore, the Articles of Incorporation should set forth the basic principles for operating a company,
and we believe that it is not necessary to set forth matters such as those in this proposal in the Articles ofIncorporation.

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