These documents have been translated from Japanese originals for reference purposes only.
In the event of any discrepancy between these translated documents and the Japanese originals, the originals
shall prevail. The Company assumes no responsibility for this translation or for direct, indirect or any otherforms of damages arising from the translations.

NOTICE OF THE 197TH ANNUAL GENERAL MEETING OF SHAREHOLDERS

Date and Time:

Tuesday, June 27, 2017 at 10 a.m. Japan time

Place:

Fourth floor hall in the Chuo-ku NIHONBASHI KOUKAIDO, located at 1-31-1
Nihonbashikakigara-cho, Chuo-ku, Tokyo, Japan(Please see the map to the meeting at the hall at the end of this document for
directions.)

Proposals to be resolved:
Proposal : Election of Four (4) Directors (Excluding Directors Serving as Audit andSupervisory Committee Members)Contents:
Convocation Notice ...................................................................................................................... 3
Reference Documents for the General Meeting of Shareholders ................................................. 5
Consolidated Financial Statements ............................................................................................... 9
Non-Consolidated Financial Statements ..................................................................................... 12

Daitobo Co., Ltd.
(Securities Code 3202)

1

Dear Shareholders,
We would like to give our utmost gratitude to our shareholders for their daily support.
We present this notice of convocation for our 197th Annual General Meeting of Shareholders for yourperusal.
Performance for the Company Group’s 197th term ended with year-on-year growth at all levels of profit
from operating income onwards, supported by the textile and apparel business where operating income wasachieved for the first time in ten years, thanks to improvement in gross margin rate and reduction in selling,
general, and administrative expenses, despite a decrease in revenue associated with structural reforms in theprevious term, and also supported by the solid performance of the commercial facility business. These
outcomes have been achieved by implementing the management strategy in accordance with our new
mid-term management plan commenced on the occasion of the 120th anniversary milestone, “Bridge to the
Future.”Furthermore, the Company renamed itself to Daitobo Co., Ltd. as a part of its 120th anniversary project andintroduced various new reforms including a special benefit plan for shareholders from the viewpoint ofenhancing attractiveness of the Company’s shares, etc.
We deeply appreciate our shareholders once again since they are entirely due to your understanding andsupport.
Moving forward, we continue to make company-wide efforts to undertake managerial initiatives and strive
to further improve our corporate value.
We appreciate our shareholders’ continued encouragement and support.
May 2017
Kazuhiro Yamauchi
President and Representative Director
Daitobo Co., Ltd.

2

(Securities Code 3202)
June 6, 2017
To Shareholders with Voting Rights:
Kazuhiro Yamauchi
President and Representative Director
Daitobo Co., Ltd.
1-6-1 Nihonbashihon-cho, Chuo-ku,
Tokyo, JapanNOTICE OF
THE 197TH ANNUAL GENERAL MEETING OF SHAREHOLDERS
We would like to express our appreciation for your continued support and patronage.
You are cordially invited to attend the 197th Annual General Meeting of Shareholders of Daitobo Co., Ltd.
(the “Company”) and its subsidiaries (collectively, the “Group”). The meeting will be held for the purposes as
described below.
If you are unable to attend the meeting, you can exercise your voting rights in writing or via theInternet. Please review the Reference Documents for the General Meeting of Shareholders (describedhereinafter), indicate your vote for or against the proposal on the enclosed Voting Rights Exercise Form,and return it so that it is received by 5 p.m. on Monday, June 26, 2017 Japan time, or, please review the“Instructions for Exercising Voting Rights via the Internet” (on pages 3 to 4, in Japanese) and vote via
the Internet.
1. Date and Time:

Tuesday, June 27, 2017 at 10 a.m. Japan time

2. Place:

Fourth floor hall in the Chuo-ku NIHONBASHI KOUKAIDO, located at 1-31-1
Nihonbashikakigara-cho, Chuo-ku, Tokyo, Japan(Please see the map to the meeting at the hall at the end of this document for
directions.)

3. Meeting Agenda:
Matters to be reported: The Business Report, Non-Consolidated Financial Statements, and Consolidated
Financial Statements for the Company’s 197th Fiscal Year (April 1, 2016 March 31, 2017) and results of audits by the Accounting Auditor and the Audit
and Supervisory Committee of the Consolidated Financial Statements
Proposals to be resolved:
Proposal: Election of Four (4) Directors (Excluding Directors Serving as Audit andSupervisory Committee Members)End○ When attending the meeting, please submit the enclosed Voting Rights Exercise Form at the reception
desk.
○ Although the Company has prepared small gifts as souvenirs, only one gift will be provided to eachshareholder regardless of the number of Voting Rights Exercise Forms presented. We appreciate yourunderstanding.
○ Of the documents to be provided with this Convocation Notice, Notes to the Consolidated Financial
Statements and Notes to the Non-Consolidated Financial Statements are posted on the Company’s website on
the Internet (http://www.daitobo.co.jp/) pursuant to provisions of laws and regulations as well as Article 16 of
the Articles of Incorporation of the Company.
○ Any updates to the Reference Materials for the General Meeting of Shareholders, the Business Report, the3Consolidated Financial Statements, and the Non-Consolidated Financial Statements will be posted on the
Company’s website on the Internet (http://www.daitobo.co.jp/).

4Reference Documents for the General Meeting of Shareholders
Proposal:

Election of Four (4) Directors (Excluding Directors Serving as Audit and Supervisory
Committee Members)

The terms of office of all four (4) incumbent Directors (excluding Directors serving as Audit andSupervisory Committee Members) will expire at the conclusion of this year’s General Meeting of
Shareholders. Accordingly, the election of four (4) Directors (excluding Directors serving as Audit andSupervisory Committee Members) is proposed.
The candidates for Directors (excluding Directors serving as Audit and Supervisory Committee
Members) are as follows.
Additionally, the nomination of candidates for Directors (excluding Directors serving as Audit andSupervisory Committee Members), is made via resolution of the Board of Directors with reference to theopinions on the selection of candidates contained in reports from the Advisory Committee, composed
primarily of Independent Outside Directors and the President and Vice President, which comprehensively
consider factors such as experience, insight, and abilities as managers.
Furthermore, the Audit and Supervisory Committee has judged that the election of each candidate for
Director is appropriate as they can be expected to contribute to improving corporate value when taking into
account each candidate’s possession of deep specialized knowledge, wealth of experience, and suitability as
Director, in addition to other factors such as the state of business execution and business results for the fiscal
year under review.
No.

Name
(Date of birth)

Career summary, positions, responsibilities at the Company
and significant concurrent positions

Number ofshares of theCompany held

April 1979

1

Joined Mitsui Trust and Banking Company, Limited(currently Sumitomo Mitsui Trust Bank, Limited)
February 2002 General Manager, Personnel Planning Dept. of Chuo
Mitsui Trust and Banking Company, Limited (currently
Sumitomo Mitsui Trust Bank, Limited)
January 2004 General Manager, Osaka Branch Business Dept. II
January 2007 General Manager, Shinjuku Nishiguchi Branch
June 2009
Director and General Manager, Corporate Planning
Division of the Company
August 2010
Managing Director and General Manager, Business
Management Headquarters, General Manager, Corporate
Kazuhiro Yamauchi
Planning Division(January 5, 1957)
June 2012
Senior Managing Director and General Manager, Business
Management Headquarters, Deputy General Manager, Real
Estate Headquarters, in charge of internal control
July 2013
Director and Senior Managing Executive Officer, General
Manager, Business Management Headquarters, General
Manager, Personnel Division, in charge of businessstrategy and internal control
June 2015
President and Representative Director (current post)
Chairman of DAITOBOSHOKU (SHANGHAI)CORPORATION (current post)(to the present)

5

44,000sharesNo.

Name(Date of birth)

Career summary, positions, responsibilities at the Company
and significant concurrent positions
March 1974
April 2002
April 2004
May 2005
May 2007
October 2011

Number ofshares of theCompany held

Joined the Company
General Manager, Functional Textile Business Division
Deputy General Manager, Textile Business Headquarters
President and Director of Niigata Daitobo Co., Ltd.
President and Director of Daitobo Shinso Co., Ltd.
General Manager, Functional Textile Sales Division, Sales
Headquarters
June 2012
Director and General Manager, Functional Textile Sales
Division, Sales Headquarters
Toshiyasu Nomura
36,0002
June 2013
Vice President and Director
shares(February 27, 1952)
February 2014 Vice President and Director
General Manager, Health Care Business Headquarters
June 2014
Vice President and Representative Director
General Manager, Health Care Business Headquarters
April 2015
Vice President and Representative Director
Supervising health care business, textile and apparelbusiness
June 2015
Vice President and Representative Director (current post)(to the present)
April 1990
Joined the Company
September 2010 Accounting Group Leader, Administration Division
June 2012
General Manager, Corporate Planning Division, Business
7,000
Shogo Mieda
Management Headquarters
3
shares(February 12, 1969) June 2015
Director and Executive Officer, General Manager,
Business Management Headquarters, in charge of internal
control (current post)(to the present)
April 1976
Joined the Ministry of Labour (currently Ministry of
Health, Labour and Welfare)
January 1989 Joined A.T. Kearney, Inc. (currently A.T. Kearney K.K.),
assigned to Tokyo Office
October 1997 Director of Practice Management
0
Yasunobu Sawada
4
April 2002
Executive Director of Enterprise IG Japan K.K. (currently
shares(January 9, 1953)
Brand Union/WPP Group)
July 2003
Representative Director of VieBrand Consulting Inc.
(current post)
June 2015
Outside Director of the Company (current post)(to the present)(Notes) 1. No special interest exists between the Company and any of the candidates for Directors(excluding Directors serving as Audit and Supervisory Committee Members).
2. The Company has entered into an agreement with Mr. Yasunobu Sawada, to limit his liability fordamages, as stipulated in Article 423, Paragraph 1 of the Companies Act. The limit of liability
under this agreement is the minimum liability amount set forth in Article 425, Paragraph 1 of theCompanies Act. In the event his election is approved, the Company plans to conclude anagreement to limit liability for damages with him.
3. Reasons for selecting the candidates for Directors (excluding Directors serving as Audit andSupervisory Committee Members) are as follows:(1) Candidate No. 1
As President and Representative Director of the Company, Mr. Kazuhiro Yamauchi hasachievements in leading the overall group with strong leadership for the past two fiscal years,
and since he possesses advanced insights and a wealth of experience regarding overallmanagement, he is an essential person for the Company’s future management. Thus, theCompany has determined that he is appropriate as a candidate for Director of the Company.

6

(2) Candidate No. 2
As Vice President and Representative Director of the Company, Mr. Toshiyasu Nomura hasachievements in undertaking management as supervisor of overall sales and manufacturing
divisions, in addition to a wealth of operational experience since joining the company and awide network of contacts both inside and outside of the company. Thus, the Company has
determined that he is appropriate as a candidate for Director of the Company.
(3) Candidate No. 3
As Director of the Company, Mr. Shogo Mieda has achievements in supervising overall
administration divisions such as business management and internal control, and has deep
knowledge regarding accounting and corporate planning. Thus, the Company has determinedthat he is appropriate as a candidate for Director of the Company.
(4) Candidate No. 4
Mr. Yasunobu Sawada has served as the chairperson of the Outside Executive Committee as
the Company’s lead Outside Director, and has fulfilled a central role in strengthening thesupervisory functions on the Company’s management execution through opinions and advice
from various viewpoints regarding the Company’s management, utilizing his broad
knowledge and advanced insights backed by a wealth of experience in his current position as
representative of a consulting firm. Thus, the Company has determined that he is appropriate
as a candidate for Outside Director of the Company.
Mr. Yasunobu Sawada is a candidate for Outside Director. The Company has designated him
as an independent director stipulated by the Tokyo Stock Exchange and Nagoya Stock
Exchange, and registered him with the Exchanges.
Mr. Yasunobu Sawada is currently an Outside Director of the Company and his term of office
as an Outside Director will be two (2) years at the conclusion of this General Meeting of
Shareholders.

7[Criteria for Independence as Defined by the Company]
Candidates for Outside Directors are judged to be independent so long as they are judged not to fallunder any of the following categories.
1) An executing person of the Company or its subsidiaries
2) A party whose major business partner is the Company or an executing person thereof3) A party who is a major business partner of the Company or an executing person thereof4) A consultant, an accounting professional, or a legal professional receiving a significant amount ofmoney or other assets from the Company other than executive remuneration
5) A major shareholder of the Company (If the major shareholder is a corporation, an executing person
thereof)
6) An executing person of a business partner of the Company (who does not fall under any of criteria 2
through 4)7) An executing person of a party which has a mutual relationship with the Company through outside
officers
8) An executing person of a party who receives donations from the Company
9) An individual who has fallen under any of criteria 1 through 8 in the past10) A spouse or a relative within two degrees of kinship of an individual who has fallen under any ofcriteria 1 through 88Consolidated Balance Sheet(As of March 31, 2017)
Description

AmountDescription(Assets)
Current assets(Liabilities)
3,022,133

Cash and deposits

1,678,627

Notes and accounts
receivable-trade

480,554

Inventories
Deferred tax assets

Current liabilities

1,523,259

Notes and accounts payable-trade384,203

Short-term loans payable

338,400

Income taxes payable

29,762461,982

Provision for bonuses

32,48160,785

Provision for shareholder benefit
program

16,338(1,110)

Other722,073

Other
Allowance for doubtful accounts(Thousands of yen)AmountNon-current assets

16,071,652

Non-current liabilities

Property, plant and equipment

15,701,243

Long-term loans payable

Buildings and structures

6,166,885

Lease obligations

Land

9,339,792

Guarantee deposits received

13,240,938
8,807,800
152,183
1,755,888

Leased assets

168,982

Deferred tax liabilities

Other

25,581Intangible assets

9,417

Deferred tax liabilities for land
revaluation

2,211,637

Investments and other assets

360,992

Net defined benefit liability

260,227

Investment securities

280,920

Asset retirement obligations

52,923Claims provable in bankruptcy,
claims provable in rehabilitationand other90,173

Total liabilities

Other

76,531(Net assets)

Allowance for doubtful accounts(86,632)

Shareholders’ equity(661,897)
1,500,000

Capital surplus

503,375

Treasury shares
Accumulated other comprehensive
incomeValuation difference on
available-for-sale securities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Subscription rights to shares
19,093,785

14,764,197

Capital stock
Retained earnings

Total assets

279(2,658,134)(7,138)4,990,863(8,352)445
4,993,002
5,767
622

Total net assets

4,329,588

Total liabilities and net assets

19,093,785

9

Consolidated Statement of Income(April 1, 2016 - March 31, 2017)(Thousands of yen)
Description

AmountNet sales

4,701,997

Cost of sales

3,432,247

Gross profit

1,269,750

Selling, general and administrative expenses

852,681

Operating income

417,068

Non-operating income
Interest income

80

Dividend income
Share of profit of entities accounted for using
equity method
Other

5,586
12,31355,48973,470Non-operating expenses
Interest expenses

123,640

Other

99,297

Ordinary income

222,937
267,602

Extraordinary income
Gain on sales of investments in capital

109,743

Extraordinary losses
Loss on sales of investments in capital ofsubsidiaries and associates
Settlement for prepayment

121,977
107,257

Profit before income taxes

109,743

229,234
148,111

Income taxes-current

57,143

Income taxes-deferred(65,112)(7,968)

Profit156,079

Profit attributable to owners of parent

156,07910

Consolidated Statement of Changes in Equity(April 1, 2016 - March 31, 2017)(Thousands of yen)
Shareholders' equity
Capital stock
Balance at beginning ofcurrent period
Changes of items during
periodProfit attributable toowners of parent
Purchase of treasury
shares
Reversal ofrevaluation reserve
for landNet changes of items
other thanshareholders' equity
Total changes of items
during period
Balance at end ofcurrent period

Capital surplus

1,500,000

Retained earnings

503,375

Treasury shares(2,812,168)

Total shareholders'equity(7,033)(815,826)

156,079

156,079
(104)

(104)

(2,046)(2,046)－－

154,033(104)

153,928

1,500,000

503,375(2,658,134)(7,138)(661,897)

Accumulated other comprehensive income
Valuationdifference on
available-forsale securities
Balance at beginning ofcurrent period
Changes of items during
periodProfit attributable toowners of parent
Purchase of treasury
shares
Reversal ofrevaluation reserve
for landNet changes of items
other thanshareholders' equity
Total changes of items
during period
Balance at end ofcurrent period(23,462)

Deferred
gains orlosses onhedges(484)

Revaluation
reserve forland

Foreigncurrencytranslation
adjustment

4,990,956

149,131

Total
Subscription
accumulated
rights toothersharescomprehensiv
e income
5,116,141－

Total net
assets4,300,315

156,079(104)(2,046)15,110929

2,046(143,364)(125,277)

622(124,655)

15,110929

2,046(143,364)(125,277)

622

29,273(8,352)445

4,993,002

5,767

4,990,863

622

4,329,588

11

Non-Consolidated Balance Sheet(As of March 31, 2017)
Description(Assets)
Current assets
Cash and deposits
Notes receivable-trade
Accounts receivable-trade
Inventories
Deferred tax assets
Other
Allowance for doubtful accounts
Non-current assets
Property, plant and equipment
Buildings and structures
Land
Leased assets
Other
Intangible assets
Investments and other assets
Investment securities
Shares and investments in capitalof subsidiaries and associates
Long-term loans receivable
Claims provable in bankruptcy,
claims provable inrehabilitation and other
Other
Allowance for doubtful accounts

Total assets

AmountDescription(Thousands of yen)Amount(Liabilities)
2,282,570 Current liabilities
1,079,584
Notes payable-trade
100,455
Accounts payable-trade276,398
Short-term loans payable452,395
Income taxes payable
58,111
Provision for bonuses
316,735
Provision for shareholder benefit
program(1,110)16,370,882
Other
15,917,920 Non-current liabilities
6,168,371
Long-term loans payable
9,549,562
Lease obligations
171,017
Guarantee deposits received
28,968Deferred tax liabilities
Deferred tax liabilities for land
9,053
revaluation
443,908
Provision for retirement benefits
243,368
Asset retirement obligations
104,629

1,068,952
148,423
208,695
338,400
20,34924,57016,338312,175
13,223,081
8,807,800
152,183
1,760,730
1,077
2,211,637
243,953
45,699Total liabilities

14,292,033(Net assets)
Shareholders’ equity
90,173
Capital stock
Capital surplus
72,887
Legal capital surplus(276,132)
Other capital surplus
Retained earnings
Legal retained earnings(624,299)
1,500,000
503,375
503,270104(2,620,536)
375,000

208,982

18,653,452

12

Other retained earnings
Retained earnings brought
forwardTreasury shares
Valuation and translation
adjustments
Valuation difference on
available-for-sale securities
Deferred gains or losses onhedges
Revaluation reserve for land
Subscription rights to shares
Total net assets
Total liabilities and net assets(2,995,536)(2,995,536)(7,138)4,985,095(8,352)445
4,993,002
622
4,361,418
18,653,452

Non-Consolidated Statement of Income(April 1, 2016 - March 31, 2017)(Thousands of yen)
Description

AmountNet sales

3,705,812

Cost of sales

2,525,277

Gross profit

1,180,535

Selling, general and administrative expenses

813,503

Operating income

367,031

Non-operating income
Interest income

1,194

Dividend income

5,586

Other

2,594

9,375

Non-operating expenses
Interest expenses

123,640

Other

99,265

Ordinary income

222,906
153,501

Extraordinary income
Gain on sales of investments in capital

109,743

Extraordinary losses
Loss on sales of investments in capital ofsubsidiaries and associates
Settlement for prepayment

81,150107,257

Profit before income taxes

109,743

188,408
74,836

Income taxes-current

42,504

Income taxes-deferred(61,639)

Profit(19,135)
93,97113

Non-Consolidated Statement of Changes in Equity(April 1, 2016 - March 31, 2017)(Thousands of yen)
Shareholders' equity

Capitalstock

Balance at beginning ofcurrent period
Changes of items during
periodCapital surplus

Retained earnings

Other
capitalsurplusOtherretainedearnings
Retainedearnings
brought
forwardLegalcapitalsurplus1,500,000

503,270

Total
capitalsurplus104

Total
retainedearnings

TreasurysharesTotalshareholders'equity375,000 (3,087,462) (2,712,462)(7,033)(716,119)

Legal
retainedearnings

503,375

ProfitPurchase of treasury
shares
Reversal ofrevaluation reserve
for landNet changes of items
other thanshareholders' equity
Total changes of items
during period
Balance at end ofcurrent period

93,971

93,971

93,971
(104)

－

－

－

－

1,500,000

503,270104

503,375(104)(2,046)(2,046)91,92591,925(104)

91,820375,000 (2,995,536) (2,620,536)(7,138)(624,299)－(2,046)

Valuation and translation adjustments
Valuationdifference on
available-forsale securities
Balance at beginning ofcurrent period
Changes of items during
period(23,462)

Deferred gains
Total valuation Subscription Total net assets
Revaluation
or losses on
and translation rights to shares
reserve for land
hedgesadjustments(484)

4,990,956

4,967,009－

ProfitPurchase of treasury
shares
Reversal ofrevaluation reserve
for landNet changes of items
other thanshareholders' equity
Total changes of items
during period
Balance at end ofcurrent period

4,250,889

93,971(104)(2,046)15,110929

2,046

18,086622

18,708

15,110929

2,046

18,086

622

110,529(8,352)445

4,993,002

4,985,095

622

4,361,418

14