Note:
This English translation is made for reference purposes only, and in the event of any
discrepancies between the English version and the Japanese version, the Japaneseversion prevails.

Notice of the Tenth Ordinary
General Meeting of Shareholders

Date and time

Wednesday, June 26, 2024 at 10:00 a.m. (JST)(Reception begins at 9 a.m.)Venue

3-4 Shin-Yokohama, Kohoku-ku, Yokohama, Kanagawa"Chidori" on the fourth floor of Shin-Yokohama Prince Hotel
Matters to be resolved
Proposal 1:
Election of Seven (7) Directors (Excluding Directors Who Are Audit & Supervisory
Committee Members)
Proposal 2:
Election of One (1) Director Who Is a Substitute Audit & Supervisory Committee Member

Socionext Inc.
Securities Code: 6526

-1-

Contents
To Our Shareholders

1

Notice of the Tenth Ordinary General Meeting of Shareholders

2

Reference Documents for the General Meeting of Shareholders
Proposal 1: Election of Seven (7) Directors (Excluding directors
who are Audit and Supervisory Committee Members.)
Proposal 2: Election of One (1) Director who is a Substitute Audit
and Supervisory Committee Member

6

Business Report

19

Consolidated Financial Statements

46

Non-consolidated Financial Statements

48

Audit Reports

50[Reference]
The Group's Business Model
Initiatives for Sustainability
Description of Key Terms Used in the Semiconductor Industry

58
60
61

-2-

6
17

Dear Our Shareholders
We would like to express our gratitude for our shareholders’ continued support.
We hereby inform you that the Tenth Ordinary General Meeting of Shareholders will be held on June 26,
2024.
For the tenth business period (from April 1, 2023, to March 31, 2024), net sales, operating income,ordinary income and profit attributable to owners of parent all reached record highs.
At the meeting of the Board of Directors held on May 17, 2024, the Company resolved to set the yearend dividend for shareholders at 25 yen per share, with a payment commencement date of June 5, 2024.
As a result, the annual dividend, including the interim dividend of 23 yen per share, is 48 yen per share*,an increase of 6 yen from the previous fiscal year.
We strive to achieve medium- to long-term profit expansion and sustainable improvement in corporate
value. Therefore, we would highly appreciate having our shareholders’ further support.
June 2024
Masahiro Koezuka, Representative Director, Chairman, President and CEO*

The Company implemented a stock split on January 1, 2024, at a ratio of 1 common stock to 5 shares.
Therefore, the annual dividend is calculated based on an assumption that a stock split was implemented at the beginning of
the previous fiscal year.

-1-Securities Code: 6526
June 4, 2024
(Commencement date of electronic provision measures: May 31, 2024)

To Our Shareholders:
10-23, Shin-Yokohama 2-Chome, Kohoku-ku, Yokohama City, Kanagawa Prefecture
Socionext Inc.
Masahiro Koezuka, Representative Director, Chairman, President and CEO

Notice of the Tenth Ordinary General Meeting of Shareholders
We would like to express our gratitude for your continued support.
We hereby inform you that the Tenth Ordinary General Meeting of Shareholders will be held as set forth
below.
For the convening of this General Meeting of Shareholders, information contained in the Reference
Documents for the General Meeting of Shareholders, etc. (matters to be electronically provided) has been
electronically provided, and the matters to be electronically provided have been posted on our company
website on the Internet in the form of “Notice of the Tenth Ordinary General Meeting of Shareholders,” soplease visit and confirm our company website below.
The Company website
https://www.socionext.com/jp/ir/meeting/In addition to the above website, the matters to be electronically provided are also posted on the website ofTokyo Stock Exchange (TSE). Please access the TSE website (TSE Listed Company Information Service)
below, enter and search “Socionext” in “Issue Name (Company Name)” or the Company Stock code “6526“ in “Code,” select “Basic Information,” and then “Documents for public inspection/PR information,” andthen click “Notice of General Shareholders Meeting /Informational Materials for a General Shareholders
Meeting” in “Filed information available for public inspection.”
TSE website (TSE-listed company information service)https://www2.jpx.co.jp/tseHpFront/JJK010010Action.do?Show=Show
If you do not attend the meeting, you may exercise your voting rights in writing (by mail) or via the Internet,
etc. Please refer to the “Instructions for Exercising Voting Rights” section below and exercise your voting
rights by 5:30 p.m. on Tuesday, June 25, 2024.
Date and Time:
Wednesday, June 26, 2024, at 10 a.m. (reception begins at 9 a.m.)
Venue:"Chidori" on the fourth floor of Shin-Yokohama Prince Hotel
3-4 Shin-Yokohama, Kohoku-ku, Yokohama City, Kanagawa Prefecture
Purposes:
Matters to be reported:
1. Business Report, Consolidated Financial Statements and Non-consolidated Financial Statements for theTenth Business Period (April 1, 2023 to March 31, 2024)
2. Auditing Reports from the Accounting Auditor and Audit & Supervisory Committee on the Results of the
Audit of the Consolidated Financial Statements for the Tenth Business Period
Matters to be resolved:
Proposal 1: Election of Seven (7) Directors (Excluding Directors Who Are Audit & Supervisory Committee
Members)
Proposal 2: Election of One (1) Substitute Director Who Is an Audit & Supervisory Committee Member* It became a general rule that matters to be provided electronically should be read by accessing the abovementioned the Company’s website or the TSE website and, exceptionally, documents are sent only toshareholders who request delivery of written documents by the record date. However, for this General
Meeting of Shareholders, this document contains the matters to be electronically provided and will be sent
to all shareholders regardless of whether or not they have requested written delivery.
In accordance with laws and regulations and the provisions of the Articles of Incorporation of the-2-Company, among the matters to be electronically provided, the following are omitted from the documents
sent to shareholders who request delivery of written documents, so they are not included in this document.
1) “Share Subscription Rights, etc. of the Company”, “Accounting Auditor” and “Systems to Ensure
Appropriateness of Business and Operational Status of Such Systems” in the Business Report2) Consolidated Statement of Changes in Net Assets and Notes to the Consolidated Financial
Statements
3) Non-consolidated Statement of Changes in Net Assets and Notes to the Non-consolidated Financial
Statements* The business report audited by the Audit & Supervisory Committee in preparing the audit report includes
each item of the business report mentioned above. In addition, the consolidated financial statements andnon-consolidated financial statements audited by the Accounting Auditor and Audit & Supervisory
Committee in the preparation of the accounting audit report and the audit report include the mattersdescribed above in the consolidated financial statements and the non-consolidated financial statements.
* If there are any amendments to the matters to be electronically provided, the above-mentioned company
website and the TSE website will be updated to state to such effect and the matters before and after theamendments will be posted there.
* The results of the resolutions of this General Meeting of Shareholders will be posted on the abovementioned Company website and the TSE website instead of sending a notice of resolutions.

-3-

Guide to Exercising Voting Rights
You may exercise your voting rights in the following three ways:

Attending the General Meeting of Shareholders
Please submit your Voting Rights Exercise Form to the receptionist at the meeting.
Date and Time: Wednesday, June 26, 2024, at 10 a.m. (reception begins at 9 a.m.)

Exercising voting rights in writing (by mail)Please indicate your approval or disapproval of the proposals on the Voting Rights Exercise Form and post it
without a stamp.
Due date for exercise
Receipt by the Company by 5:30 p.m. on Tuesday, June 25, 2024

Voting via the Internet, etc.
Please exercise your voting rights after reviewing the instructions on the next page for exercising your voting
rights via the Internet, etc.
Due date for exercise
Completion of entry by 5:30 p.m. on Tuesday, June 25, 2024***

If you exercise your voting rights more than once via the Internet, etc., the last vote cast will be treated as
the valid vote.
If you exercise your voting rights both in writing (by mail) and via the Internet, etc., only your vote via
the Internet, etc. will be valid.
If there is no indication of approval or disapproval of a proposal, we will treat it as an indication of
approval.

-4-

Guide to Exercising Voting Rights via the Internet
How to scan QR code “Smart Exercise”
You can log in to the voting website without entering your voting code and password.
1
Please scan the QR code at the bottom right of the Voting Rights Exercise Form.
*QR Code is a registered trademark of DENSO WAVE INCORPORATED.
2
Then follow the on-screen instructions to enter your approval or disapproval.
Exercising your voting rights by “Smart Exercise” is valid only once.
If you wish to change your vote after exercising your voting rights, please access the PC version of thewebsite, log in by entering your “voting code” and “password” on the voting form and then exercise yourvoting rights again.
*You can go to the PC site by scanning the QR code again.
How to enter your voting code and password
Voting website
https://www.web54.net
1
Please access the voting website.
2
Please enter the “Voting Rights Exercise Code” provided on the Voting Rights Exercise Form.
3
Please enter the password provided on the Voting Rights Exercise Form.
4
Then follow the on-screen instructions to enter your approval or disapproval.
Inquiries regarding the exercise of voting rights via the Internet
Exclusive telephone number of Stock Transfer Agency Web Support, Sumitomo Mitsui Trust Bank, Limited
Toll-free: 0120-652-031 (Business hours: 9:00–21:00)
To Institutional Investors
The electronic voting platform for institutional investors operated by ICJ, Inc. is available for the exercise of
voting rights.

-5-

Reference Document for the General Meeting of Shareholders
Proposal 1: Election of Seven (7) Directors (Excluding Directors Who Are Audit & Supervisory Committee
Members)
The term of office of all seven (7) Directors (excluding Directors who are Audit & Supervisory Committee
Members; the same shall apply hereinafter in this proposal unless otherwise stated) will expire at theconclusion of this General Meeting of Shareholders. Accordingly, the election of seven (7) Directors,
including two (2) Outside Directors, is proposed.
The decision on this proposal has been made through prior deliberation by the Nomination and Remuneration
Committee, the majority of whose members are Independent Outside Directors. In addition, the Audit andSupervisory Committee put this proposal under consideration, which led to the opinion that this proposal isreasonable.
The candidates for Directors are as follows.
Candidate
GenderNo.

NameMasahiro
Koezuka
YutakaYoneyama
Koichi
Otsuki
Noriaki
Kubo

1

Male

2

Male

3

Male

4

Male

5

Male

HisatoYoshida6

Male

Masatoshi
Suzuki7

FemaleSachikoKasanoRepresentative Director,
Chairman, President and CEO
Director and Deputy
President and CFO
Director and Deputy
President
Director and Deputy
President

Attendance atBoard ofDirectors
meetings
14 out of 14(100%)
14 out of 14(100%)
14 out of 14(100%)
14 out of 14(100%)

Director and Deputy
President

11 out of 11(100%)

Director

14 out of 14(100%)

Director

14 out of 14(100%)

Current position at theCompany
Reappointment
Reappointment
Reappointment
Reappointment
Reappointment
Reappointment
OutsideIndependent
Reappointment
OutsideIndependent

Reappointment Candidates for reappointment as Directors
Outside Candidates for appointment as Outside Directors
Independent Candidates for Independent Officers as provided by the TSE-6-

Candidate No. 1

Masahiro Koezuka(Date of birth: December 14, 1951)

Reappointment
Number of years in office
9 years 9 months
Number of the Company’s shares held
52,865
Attendance at Board of Directors meetings
14 out of 14 (100%)- Career summary, position and responsibility in the Company
April 1974
Joined the Ministry of International Trade and Industry (currently the Ministry of
Economy, Trade and Industry)
June 2010
Director, Senior Managing Executive Officer of Fujitsu Limited
May 2013
Director, Senior Executive Vice Chairman
September 2014 Representative Director of Socionext Inc. (Preparation Company)
February 2015
Director
April 2016
Representative Director and Chairman of Fujitsu Research Institute
April 2018
Representative Director, Chairman and CEO of Socionext Inc.
March 2022
Representative Director, Chairman, President and CEO (current position)[Reasons for selection as candidate]
He has served on the Board of Directors of the Company since its founding and is well-versed in thesemiconductor business, currently serving as Representative Director, Chairman, President and CEO, andhelping to expand the Company’s business performance and increase its corporate value. Therefore, we
believe that he will be able to appropriately perform his duties as Director and request his re-election.

-7-

Candidate No. 2

Yutaka Yoneyama (June 20, 1962)

Reappointment
Number of years in office
2 years 3 months
Number of the Company’s shares held
17,670Attendance at Board of Directors meetings
14 out of 14 (100%)- Career summary, position and responsibility in the Company
April 1985
Joined Matsushita Electric Industrial Co., Ltd. (currently Panasonic Holdings
Corporation)
April 2013
Accounting Group Manager of System LSI Division of Panasonic Corporation (currently
Panasonic Holdings Corporation)
March 2015
Deputy General Manager, Corporate Finance Division of Socionext Inc.
July 2018
General Manager, Corporate Finance Division
July 2020
General Manager, Corporate Finance Division and Corporate Affairs & HR
March 2022
Director Senior Vice President of Corporate Finance Division and Corporate Affairs &HR, and Intellectual Property & Legal
April 2022
Director and Corporate Executive Vice President in charge of Finance and Business
Administration
April 2024
Director and Deputy President in charge of Finance & Business Administration and CFO(current position)[Reasons for selection as candidate]
He has been in the semiconductor business for many years and has a wealth of experience and insight infinance and accounting. He continues to play a wide range of roles as CFO, helping to improve businessperformance and increase corporate value. Therefore, we believe that he will be able to appropriately perform
his duties as Director and request his re-election.

-8-

Candidate No. 3

Koichi Otsuki(July 22, 1963)

Reappointment
Number of years in office 5 years
Number of the Company’s shares held 49,985
Attendance at Board of Directors meetings

14 out of 14 (100%)- Career summary, position and responsibility in the Company
April 1988
Joined Fujitsu Limited
July 2013
Manager of High Performance Solution Department of Advanced Product Business
Headquarters of Fujitsu Semiconductor Limited (currently Fujitsu Limited)
March 2015
Vice President of Custom SoC Business Unit, Business Group II of Socionext Inc.
October 2016
Corporate Senior Vice President
October 2018
Corporate Senior Executive Vice President, Project leader for Custom Business
Promotion Project
April 2019
Corporate Senior Executive Vice President, Head of Sales Group
June 2019
Representative Director, Corporate Senior Executive Vice President, Head of Sales Group
March 2022
Director, Corporate Senior Executive Vice President, Head of Sales Group
April 2022
Director and Deputy President in charge of Sales & Business Development as well as
Strategic Sourcing & Production Management (current position)[Reasons for selection as candidate]
He has been responsible for the development and sales divisions in the semiconductor business for many
years, and is currently responsible for sales and business development as well as strategic sourcing andproduction management, helping to improve business performance and increase corporate value. Therefore,
we believe that he will be able to appropriately perform his duties as Director and request his re-election.

-9-

Candidate No. 4

Noriaki Kubo(August 9, 1963)

Reappointment
Number of years in office 6 years
Number of the Company’s shares held
49,885
Attendance at Board of Directors meetings
14 out of 14 (100%)- Career summary, position and responsibility in the Company
April 1986
Joined Matsushita Electric Industrial Co., Ltd. (currently Panasonic Holdings
Corporation)
October 2012
Head of Hardware Technology Headquarters, System LSI Division of Panasonic
Corporation (currently Panasonic Holdings Corporation)
March 2015
Vice President, IoT Systems Business Unit, Business Group I of Socionext Inc.
October 2016
Corporate Senior Vice President
June 2018
Corporate Senior Executive Vice President of Visual Solutions Business Unit
April 2019
Director, Corporate Senior Executive Vice President, Head of Automotive & Industrial
Business Group
April 2021
Director, Corporate Senior Executive Vice President in charge of Business Group
April 2022
Director and Deputy President in charge of Business and Development
April 2024
Director and Deputy President in charge of Business Group (current position)[Reasons for selection as candidate]
He has been responsible for the business and development divisions in the semiconductor business for many
years, and is currently responsible for the business group, helping to improve business performance andincrease corporate value. Therefore, we believe that he will be able to appropriately perform his duties as
Director and request his re-election.

- 10 -

Candidate No. 5

Hisato Yoshida(November 3, 1963)

Reappointment
Number of years in office
1 yearNumber of the Company’s shares held 17,670
Attendance at Board of Directors meetings

11 out of 11 (100%)- Career summary, position and responsibility in the Company
April 1988
Joined Matsushita Electric Industrial Co., Ltd. (currently Panasonic Holdings
Corporation)
April 2010
Group Manager of Fourth Development Group, First Business Division, System LSI
Division of Panasonic Corporation (currently Panasonic Holdings Corporation)
March 2015
Director, Development Department IV of IoT System Business Unit, Business Group I of
Socionext Inc.
April 2019
General Manager, System Development Division, Automotive & Industrial BusinessGroup
January 2021
Vice Head of Global Development Group and SNDP Promotion Group
April 2022
Corporate Executive Vice President and Head of Global Development Group
June 2023
Director, Corporate Executive Vice President and Head of Global Development Group
April 2024
Director and Deputy President in charge of Development Group (current position)[Reasons for selection as candidate]
He has been responsible for development division in the semiconductor business for many years, and isreviewing development systems as currently being responsible for the development group, helping to improvebusiness performance and increase corporate value. Therefore, we believe that he will be able to appropriately
perform his duties as Director and request his re-election.

- 11 -

Candidate No. 6

Masatoshi Suzuki(October 30, 1951)

Reappointment
OutsideIndependent
Number of years in office
3 years
Number of the Company’s shares held Attendance at Board of Directors meetings

14 out of 14 (100%)- Career summary, position and responsibility in the Company
April 1975
Joined Nippon Telegraph and Telephone Public Corporation (currently Nippon Telegraphand Telephone Corporation)
June 2008
Representative Director, Senior Executive Vice President, NTT DoCoMo, Inc. (currently
NTT DOCOMO, INC.)
June 2012
Representative Director, Senior Executive Vice President, MIRAIT Holdings Corporation(currently MIRAIT ONE Corporation)
October 2012
Representative Director, President
June 2020
Director and Advisor
June 2021
Outside Director of Socionext Inc. (current position)
Reasons for nomination as candidate for Outside Director and outline of expected roles
Leveraging a wealth of management experience gained from having served as a representative director andother positions at listed companies, he supervises and advises management from an objective and neutral
standpoint as Lead Independent Outside Director. Therefore, we believe that he will be able to appropriately
perform his duties as Outside Director from independent position and request his re-election.
The Company expects him to contribute to the enhancement of management oversight functions and theimprovement of corporate value through proposals for general management based on his extensive
management experience.

- 12 -

Candidate No. 7

Sachiko Kasano(April 14, 1977)

Reappointment
OutsideIndependent
Number of years in office
2 years 3 months
Number of the Company’s shares held Attendance at Board of Directors meetings
14 out of 14 (100%)- Career summary, position and responsibility in the Company
October 2001
Qualified as an attorney and joined Miyakezaka Sogo Law Office
January 2016
Opening of Kasumimon Sogo Law Offices (currently SHIOMIZAKA), Attorney (current
position)
June 2021
Outside Audit & Supervisory Board Member of Socionext Inc.
March 2022
Outside Director (Audit & Supervisory Committee Member)June 2023
Outside Director (current position)
June 2023
Outside Director (Audit & Supervisory Committee Member) of Restar Holdings
Corporation (currently Restar Corporation) (current position)
November 2023
Outside Statutory Auditor of PRAP Japan, Inc. (current position)- Significant concurrent positions
Attorney, SHIOMIZAKA
Outside Director (Audit & Supervisory Committee Member) of Restar Corporation
Outside Statutory Auditor of PRAP Japan, Inc.
Reasons for nomination as candidate for Outside Director and outline of expected roles
Based on her extensive experience as an attorney and her deep insight into corporate legal affairs andcompliance, she supervises and advises management from an objective and neutral standpoint. While Ms.
Kasano has no experience of being involved in corporate management other than having served in the past as
Outside Officer, we believe that she will be able to appropriately perform her duties as Outside Director fromindependent position and request her re-election.
The Company expects her to contribute to the enhancement of management oversight functions and theimprovement of corporate value through proposals for general management based on her extensive experienceand deep insight as an attorney.

- 13 -

Notes:1. There are no special conflict of interests between any of the candidates and the Company.
2. Masatoshi Suzuki and Sachiko Kasano are candidates for Outside Directors.
3. Although Masatoshi Suzuki and Sachiko Kasano are currently Outside Directors. Masatoshi Suzuki and
Sachiko Kasano will have served as Outside Directors for three years and two years and three months,
respectively, at the conclusion of this General Meeting of Shareholders.
4. The Company has entered into limited liability agreements with Masatoshi Suzuki and Sachiko Kasanopursuant to Article 427, Paragraph 1 of the Companies Act and the Articles of Incorporation to limit their
liability for damages as defined under Article 423, Paragraph 1 of the Company Act to the minimum
liability amount stipulated in Article 425, Paragraph 1 of the Company Act. If they are elected andappointed as Directors, the Company plans to continue the said agreement.
5. The Company has entered into indemnity agreements with Masahiro Koezuka, Yutaka Yoneyama, Koichi
Otsuki, Noriaki Kubo, Hisato Yoshida, Masatoshi Suzuki and Sachiko Kasano to the effect that theCompany will compensate, to the extent provided by laws and regulations, for the expenses referred to in
Article 430-2, Paragraph 1, Item 1 of the Companies Act and the losses referred to in Item 2 of the same
paragraph so that Directors can fully perform their expected roles. If each candidate is elected andappointed as Director, the Company plans to continue the said agreement.
6. The Company has entered into officers’ liability insurance contracts with insurance companies pursuant
to Article 430-3, Paragraph 1 of the Companies Act, under which the insured is liable in connection withthe execution of his/her duties or shall be compensated for any damage that may arise from the receipt ofa claim related to the pursuit of such liability. All premiums for the insured are fully paid by theCompany. If each candidate is elected and appointed as Director, he or she will be an insured under the
relevant insurance policy. The policy is also scheduled to be renewed at the next renewal.
7. On July 7, 2021, MIRAIT Corporation (currently, MIRAIT ONE Corporation), for which Mr. Masatoshi
Suzuki was serving as a director, received a notice of administrative disposition from the Kanto Bureauof Telecommunications of the Ministry of Internal Affairs and Communications, concerning an order tosuspend its registered inspection business and a business improvement order, alleging that the company
had acted in violation of the Radio Act in connection with its past inspection of radio station equipment.
We understand that he was not aware of the above facts until they were made known to the corporation,and believe that he appropriately carried out his duties while serving as a director of the Company, suchas making recommendations on legal compliance on a regular basis, and after the fact came to light,
asking the Board of Directors of the corporation to take measures to prevent the recurrence of thesituation.
8. The Company appointed Masatoshi Suzuki and Sachiko Kasano as Independent Officers as provided by
Tokyo Stock Exchange and has registered them with Tokyo Stock Exchange. The Company will continue
to appoint them as Independent Officers if they are elected.
9. The number of the Company shares held by each candidate is as of March 31, 2024.
10. Sachiko Kasano’s name on the family register is Sachiko Yanai.

- 14 -

Reference: Composition of the Board of Directors and skill matrix of Directors (after theconclusion of this General Meeting of Shareholders)
If Proposal 1 is approved as proposed, the composition of the Board of Directors and the skill matrix of Directors
after the conclusion of this General Meeting of Shareholders will be as shown in the table below.

Name

Masahiro
Koezuka
YutakaYoneyama
Koichi
Otsuki
NoriakiKubo
HisatoYoshidaMasatoshi
Suzuki
SachikoKasanoYasuyoshi
Ichikawa
Morimasa
IkemotoNorikoYonedaGender1)
2)
3)
4)
Audit &
International
Supervisory Management Semiconductor
Finance andOutside Independent(Overseas
Committee
experiencebusiness
Accounting
experience)
Members

✓

✓

✓

Male

✓

✓

Male

✓

Male

✓

Male

✓

Male

✓

✓

Male

✓

✓

✓

Female

✓

✓

Male

✓

✓

✓

✓

Male

✓

✓

✓

✓

Female✓✓✓5)Legal andCompliance

✓

✓
✓

✓

- 15 -

Reference: Independence Standards for Outside Directors

Independence Standards for Outside Directors
The Company considers Outside Directors or candidates for such directors to be independent if it determinesthat none of the following 1 to 9 apply:
However, even if a person falls under any of the following 1 to 9, he or she may be appointed as Independent
Outside Director of the Company if the Company believes that he or she has sufficient independence,
provided that the reasons for such independence are publicly disclosed.
1.

A person whose major client or supplier is Socionext Group Companies (Note 1) (Note 2) or a businessexecutive person thereof (Note 3)
2. Major client of (Note 4) or major lender (Note 5) to Socionext Group Companies or a business executive
person thereof
3. An outside expert who receives a substantial amount of compensation from Socionext Group Companies
in addition to officer’s compensation (Note 6), or a person who belongs to the organization if the outside
expert is an organization such as a corporation
4. A member or employee of the accounting auditor of the Company
5. A person who receives a large donation from Socionext Group Companies (Note 7), or a person who
belongs to the organization if the recipient of such a donation is an organization such as a corporation
6. A business executive person of a corporation or other organization that accepts directors or other officers
from Socionext Group Companies
7. A person who has fallen under any of the above items 1 through 6 in the past three years
8. A major shareholder of the Company (Note 8) or a business executive person thereof
9. A close relative of one of the following (Note 9):(1) Persons listed above 1 through 8(2) A business executive person of Socionext Group Companies(3) A business executive person who has been an executive person of Socionext Group Companies in
the past three years
Note: 1 Socionext Group Companies means Socionext Inc. and its subsidiaries.
Note: 2 A person whose major client or supplier is Socionext Group Companies means a party whose sales toSocionext Group Companies account for 2% or more of its annual consolidated total sales in the mostrecent fiscal year.
Note: 3 A business executive person is defined in Article 2, Paragraph 3, Item 6 of the Regulations for
Enforcement of the Companies Act.
Note: 4 Major client or supplier for Socionext Group Companies means a party to which 2% or more ofSocionext Group Companies annual consolidated total sales in the most recent fiscal year arerecorded.
Note: 5 Major lender is a major lender stated in the Company’s most recent Business Report.
Note: 6 A substantial amount of compensation means that an individual is paid at least 10 million yen peryear in the most recent business year of Socionext Group Companies, and an organization such as acorporation is paid at least 2% of the total annual consolidated sales in the most recent business yearof the organization.
Note: 7 A large donation means a donation of at least 10 million yen per year in the most recent fiscal year ofSocionext Group Companies.
Note: 8 A major shareholder is a person who holds 10% or more of the voting rights.
Note: 9 A close relative is a spouse, a relative within the second degree of kinship or a relative living together.

- 16 -

Proposal 2: Election of One (1) Substitute Director Who Is an Audit & Supervisory Committee Member
In order to prepare for the case where the number of Directors who are Audit & Supervisory Committee
Members falls short of the number stipulated by laws and regulations, the Company requests election of one(1) Substitute Director who is an Audit & Supervisory Committee Member.
The election of the substitute Director who is Audit & Supervisory Committee Member is effective until thestart of the ordinary general meeting of shareholders for the last fiscal year of the fiscal years ending within
one year after the election; also, provided it is before the appointment of Director who is Audit & Supervisory
Committee Member becoming effective, the election may be rescinded by a resolution of the Board of
Directors with the consent of the Audit & Supervisory Committee.
With regard to this agenda item, the consent of the Audit & Supervisory Committee has been obtained.
The candidate for Substitute Director who is Audit & Supervisory Committee Member is as follows.
Go Anan(March 20, 1977)
OutsideIndependent
Number of years in office-

Number of the Company’s shares held Attendance at Board of Directors meetings-- Career summary
October 2001
Qualified as an attorney and joined Mori Sogo (currently Mori Hamada & Matsumoto)
April 2007
Joined Sueyoshi Sogo Law Office (currently SHIOMIZAKA) (current position)
May 2021
Outside Statutory Auditor of INFORICH INC. (current position)
June 2022
Outside Director of AGP CORPORATION (current position)- Significant concurrent positions
Attorney of SHIOMIZAKA
Outside Statutory Auditor of INFORICH INC.
Outside Director of AGP CORPORATION- 17 -

Reasons for nomination as a candidate for Substitute Outside Director who is Audit & Supervisory
Committee Member and outline of expected roles
He has extensive experience as an attorney and deep insight into corporate legal affairs. While Mr. Anan has
no experience of being involved in corporate management other than having served in the past as Outside
Officer, the Company concluded that he will be able to perform his duties appropriately from an independent
standpoint and proposes electing him as Substitute Outside Director who is Audit & Supervisory Committee
Member.
The Company expects him to contribute to the enhancement of management oversight functions and theimprovement of corporate value through proposals for general management based on his extensive experienceand insight as an attorney.
Notes:
1. There is no special conflict of interests between the candidate and the Company.
2. Go Anan is a candidate for Substitute Outside Director.
3. If Mr. Anan is elected and appointed as Director who is Audit & Supervisory Committee Member, theCompany plans to enter into a limited liability agreement with him pursuant to Article 427, Paragraph 1of the Companies Act and the Articles of Incorporation to limit his liability for damages as defined under
Article 423, Paragraph 1 of the Company Act to the minimum liability amount stipulated in Article 425,
Paragraph 1 of the Company Act.
4. If Mr. Anan is elected and appointed as Director who is Audit & Supervisory Committee Member, theCompany plans to enter into an indemnity agreement with him to the effect that the Company willcompensate, to the extent provided by laws and regulations, for the expenses referred to in Article 430-2,
Paragraph 1, Item 1 of the Companies Act and the losses referred to in Item 2 of the same paragraph sothat Director who is Audit & Supervisory Committee Member can fully perform his expected roles.
5. The Company has entered into officers’ liability insurance contracts with insurance companies pursuant
to Article 430-3, Paragraph 1 of the Companies Act, under which the insured is liable in connection withthe execution of his/her duties or shall be compensated for any damage that may arise from the receipt ofa claim related to the pursuit of such liability. All premiums for the insured are fully paid by theCompany. If the candidate is elected and appointed as Director who is Audit & Supervisory Committee
Member, he will be an insured under the relevant insurance policy.
6. If Go Anan is elected and appointed as Director who is Audit & Supervisory Committee Member, hemeets the requirements for Independent Officer as provided for by Tokyo Stock Exchange, and theCompany plans to register him as Independent Officer.
7. The number of the Company shares held by the candidate is as of March 31, 2024.

- 18 -

Business Report (April 1, 2023 to March 31, 2024)
1.

Current Status of Corporate Group(1)

Business progress and results[Status of the world economy]
The global economy has continued to slow down during the fiscal year under review, due to increased global
instability, exacerbated by factors such as the prolonged Russian invasion of Ukraine and the escalation in
Middle East tensions. In addition, factors which include strong inflationary pressures globally, persistently
high interest rates primarily in the U.S. and Europe, and stagnant domestic demand in China, have resulted in
downward pressures on economic activity. As such, the global economy continued to experience high levelsof uncertainty and remained at a low growth rate. Furthermore, differences in monetary policies among
countries have resulted in a continuous depreciation of the Japanese yen.
[Conditions in the global semiconductor market]
The semiconductor market continued to experience weak demand due to inventory adjustments of final
products starting in the second half of the previous fiscal year and bottomed out in the first half of the fiscal
year under review, but remained sluggish for some time. From the second half of the fiscal year under review,
demand gradually improved and the market as a whole showed a gradual recovery, with only single-digit
annual growth.
On a product-by-product basis, growth in most product categories, particularly memory chips andmicroprocessors, was negative compared to the previous fiscal year, but the Logic ICs that the Group (“theGroup”, “the Company”, “we” and “our” refer to Socionext Inc., and its consolidated subsidiaries, orSocionext Inc. on a non-consolidated basis, as the context may require) focused on showed positive growth.
By application, demand fell mainly for smartphones and personal computers, but among the Group’s focus
areas, growth was positive particularly in the data center & networking area and the automotive area. In theseareas, demand for semiconductors using cutting-edge technologies is increasing.
[Results of the Phase 1 transformation and initiatives for the Phase 2 transformation]
At the Group, we have been progressing with transforming our business model, and shifting focus areas tohigh-growth and cutting-edge business areas where more global large-scale design wins are expected, and also
carrying out structural reform including bold transformation in our business structure. This has all been
implemented by the current CEO since his appointment in April 2018 (which we refer to as the Phase 1transformation). As a result, we have been acquiring more design wins in our focus areas including
automotive, data center & networking, and smart devices areas. We have acquired design wins amounting toroughly 200 billion yen during each of the fiscal years ended March 31, 2020, 2021 and 2022, an increase
from the design win amount of roughly 100 billion yen for the fiscal year ended March 31, 2019, through thetransformation. Furthermore, from the fiscal year ended March 31, 2023, we have been further achieving
design wins amounting to 250 billion yen (1 U.S. dollar = 100 yen). In addition, the design wins which havebeen acquired have gradually entered the mass production phase and started contributing to an expansion insales.
Moreover, we are also proceeding with our next stage of transformation, which we call the Phase 2transformation. This phase is aimed at establishing a competitive R&D structure and creating a businessculture that is suitable for a multinational company. We are intensifying our efforts to transform our corporate
systems, organizational structures, and employee awareness through ongoing communication with global
customers, players that comprise the semiconductor ecosystem, investors and other parties.

- 19 -

[Strengthening the R&D platform]
In April 2023 we established the Global Leading Group as an organization dedicated to building an R&D
platform through model projects undertaken in areas involving large-scale advanced technology. We havebeen continuously improving by integrating several key activities: establishing a computer-architecture-based
design and development platform along with standard design and development processes that are suitable for
our Solution SoC business model, and enhancing both the efficiency and visibility of these processes, alongwith reforms in terms of design and development management. Moving forward, we will continue to actively
enhance our development of advanced technologies.
Moreover, we opened the new branch office in Bangalore, India, under our subsidiary Socionext America Inc.
in August 2023 to strengthen our global design and development capabilities.
[Establishment of production system to strengthen a business model as a fabless company]
We have integrated the related organizations of production and procurement in Taiwan and Japan to enhance
our global production and procurement system. Given the concentration of semiconductor-related suppliers in
Taiwan, we have placed a team managing the production of our partners there to establish a direct interface
and strengthen our coordination with these suppliers. As a result, we have been developing a structure thatallows us to respond swiftly to any changes in the manufacturing capacities of our manufacturing partners.
[Strengthening relationships with global companies forming the semiconductor ecosystem]
With acquired design wins of large-scale advanced development projects over the past few years, we havestrengthened our relationships with global companies that form the ecosystem across the semiconductor
industry. We have particularly made progress such as joint development projects in advanced technology areas
by establishing and enhancing management-level relationships with global companies headquartered in North
America and Taiwan.
[Status of design and development]
Our research and development consists of both upfront investments in advanced technologies for acquiring
design wins in our focus areas and investments in product development linked to acquired design wins.
During the fiscal year under review, our research and development costs increased 8% from the previous
period to 53,279 million yen. This was mainly due to the increase seen in terms of product development for
design wins acquired.
Because the ecosystem continues to grow in complexity and flexibly, and to utilize the latest advanced
technologies, we regularly work with multiple partners and actively proceeded to work on advanced
technologies including 2nm and finer process nodes, advanced packaging technologies such as chiplets,
application of the latest EDA tools as well as platformization. In October 2023, we announced a project with
Arm Holding plc and Taiwan Semiconductor Manufacturing Company Limited (TSMC) for a 2nm multi-core
CPU chiplet PoC (Proof of Concept) and the launch of the development of an SoC for advanced ADAS andautonomous driving using a 3nm on-board process.
In the future, we will engage in advanced technologies including the development of SoCs using 2nm or finer
process nodes and the development of chiplet technologies as well as in the adoption of AI for design anddevelopment process.
[Status of business performance during the fiscal year under review]
The consolidated net sales for the year ended March 31, 2024 were 221,246 million yen, an increase of 14.8%
compared with the previous fiscal year. Our net sales consist of NRE revenue received from customers basedon costs incurred in scheduled milestones during the design and development process, and product revenue
from the applicable products which entered the mass production stage. NRE revenue for the fiscal year underreview was 37,609 million yen, an increase of 7.9% from the previous fiscal year. This increase was due to agreater proportion of NRE revenue from advanced technologies
finer than 7nm, which were derived from active design wins in the automotive area. Product revenue
increased by 16.7% from the previous fiscal year, to 182,876 million yen. This is due to design wins acquiredin or after 2019 have entered the mass production stage including 7nm products in the automotive application
market.
Operating income was 35,510 million yen, an increase of 63.6% from the previous fiscal year. Ordinary
income was 37,122 million yen, increased by 58.4% year-on-year. Profit attributable to owners of parent was
26,134 million yen, increased by 32.2% year-on-year. The increase in operating income was due mainly to therise in gross profit brought by the increased product revenue and the improved manufacturing cost ratio.
- 20 -

The depreciation of the Japanese yen has led to increases of 11.7 billion yen in net sales and 2.5 billion yen in
operating income compared to the previous fiscal year.
Results for the fiscal year under review
Net sales
221,246 million yen (up 14.8% year on year)
Operating income
35,510 million yen (up 63.6% year on year)
Ordinary income
37,122 million yen (up 58.4% year on year)
Profit attributable to owners of parent
26,134 million yen (up 32.2% year on year)- 21 -

(2)Issues to Deal WithAs a result of the Phase 1 transformation that we have been undertaking since the fiscal year ended March
2019, operating income has increased and sales and profit margins have also improved since the fiscal year
ended March 2022. In order to achieve sustainable growth in the future, there are many challenges which need
to be tackled, including strengthening development competitiveness, transforming our business structure,
globalizing the entire organization, and further improving profit margins. Based on the "quantitative changes"
achieved in the Phase 1 transformation, we will boldly promote the "qualitative changes" aimed at building acompetitive development system and creating an organizational culture suitable for a global company, as theGroup's Phase 2 transformation.
[Restructure development system and improve business processes]
In line with the shift to a business model of the Solution SoC, the Group has been proceeding to restructure its
development system to strengthen development capabilities and improve development efficiency since 2020.
Through ongoing communication with global
customers, players in the semiconductor ecosystem and investors, we will promote in an integrated manner
establishing a design and development platform as well as standard design and development processes
suitable for our Solution SoC business model, enhancing both the efficiency and visibility of these processes,
alongside reforms in design and development management.
In addition, we will implement measures to globalize and improve operations in our production management
group as we expand design wins with global customers. We aim to improve efficiency and transparency indelivery systems by connecting customers with the Group's production systems. Through this effort, we will
establish a robust structure that enables accurate production planning and timely procurement, and will
improve our business processes, including when it comes to our relationships with foundries and Outsourced
Semiconductor Assembly and Test (OSAT) companies to which we entrust our manufacturing.
[Expansion of sales and operating income with a view to medium- to long-term growth]
For future sales management, the Group has adopted a management indicator called the balance of design wins
acquired, which is the balance obtained by subtracting actual sales from the amount of design wins acquired.
Based on the balance of design wins acquired, the Group is now able to forecast sales through the fiscal year
ending March 2026 to some extent. For the continuous sustainable growth of the Group in the fiscal year
ending March 2027 and beyond, we recognize that it is necessary to continuously acquire the same level ofdesign wins per year as in the current fiscal year, which is around 250 billion yen (1 U.S. dollar = 100 yen). To
this end, in addition to the automotive area, which has been steadily acquiring design wins, we will promote
efforts to acquire design wins in a balanced manner in each of our focus areas, including the data center &networking area.
As for measures to increase operating income, we will continue to improve manufacturing gross profit,
improve things in terms of income and expenditures in the area of development, and appropriately manage
sales and administrative expenses.

- 22 -

[Initiatives for Sustainability]
The Group identifies materiality (important issues) to be addressed with a sense of priority and promotes
sustainability activities.
As part of our efforts to address environmental issues and climate change, we are working to achieve a
decarbonized society by reducing our greenhouse gas (GHG) emissions and contributing to the reduction of
GHG emissions by our customers through the Group’s advanced SoC that enable to reduce the consumptionof energy and the occupation of space.
In terms of human capital, we are working to maximize the human capital of the Group by enhancing systems
related to human rights, diversity, the promotion of good health, and safety and health, and by formulating
educational programs related to the training of engineers.
The Group is committed to having sustainability activities take place throughout the supply chain, including atpartner companies, and will contribute to solving social issues and realizing a sustainable society through thefurther growth of its business.
The Group is committed to fulfilling its social responsibility as a global corporation and continuing to be anentity that can earn the trust and support of all stakeholders. The Group will provide new value to the world
with its cutting-edge SoC technology, and continue to strive to improve corporate value over the medium tolong term.

- 23 -

(3)Status of Capital investment

Capital investment (including intangible assets) made during the fiscal year under review totaled 24,438
million yen. The main investments among them are for intellectual property (IP), reticles, test boards andenhancement of the development environment.

(4)

Status of Financing

To respond to increasing needs for working capital related to increasing product revenue, as well as to addressa global economic slowdown and geopolitical risks, the Company entered the commitment line agreement of
20 billion yen. As of March 31, 2024, the commitment lines with a total amount of 20 billion yen wereunused.

- 24 -

(5) Financial Position and Results of Operations
Category

7th Business
PeriodFYE March 2021

8th Business
PeriodFYE March 2022

9th Business
PeriodFYE March 2023

10th Business
PeriodFYE March 2024
Fiscal year underreview
221,246
35,51037,122

Net sales(Million yen)
99,746
117,009
192,767
Operating income(Million yen)
1,552
8,463
21,711
Ordinary income(Million yen)
1,969
9,050
23,440
Profit attributable to(Million yen)
1,469
7,480
19,763
26,134owners of parent
Profit per share
(Yen)
8.73
44.44
117.40148.39Total assets(Million yen)
104,235
118,428
193,945
186,840
Net assets(Million yen)
81,676
89,609109,864
131,020
Notes: 1. The Company conducted a 4-for-1 share consolidation of its common stock, Type A shares and Type B shares eachon September 5, 2022. In addition, due to exercise of put options by its shareholders, the Company acquired all TypeA shares and Type B shares on September 6, 2022, and delivered as consideration 1.3466666 shares of common
stock for Type A shares per share and 1 share of common stock for Type B shares per share. The Company cancelled
all the Type A shares and Type B shares. Profit per share is computed based on the assumption that the shareconsolidation was conducted at the beginning of the fiscal year ended March 31, 2021.
2. The Company implemented a stock split on January 1, 2024 at a ratio of 1 common stock to 5 shares. Profit per
share is computed based on the assumption that the stock split was implemented at the beginning of the fiscal year
ended March 31, 2021.

- 25 -

(6) Major Subsidiaries
Company nameCommon stock

Socionext America Inc.

The Company’s
stake

Main BusinessThousand USD
Design, development and sales
100.0%
2,800
of solution SoCs
Socionext Europe GmbH
Thousand Euros
Design, development and sales
100.0%
11,400of solution SoCs
Socionext Technology PacificThousand USD
Design, development and sales
100.0%
Asia Ltd.
6,000
of solution SoCs
Socionext Technology
Chinese Yuan
Design, development and sales
100.0%(Shanghai) Co., Ltd.
12,249,600
of solution SoCs
Socionext Taiwan Inc.
Thousand NTD
Design, development and sales
100.0%
29,000of solution SoCs
Socionext Korea Ltd.
Million KRW
100.0% Sales of solution SoCs
400
Notes: Shares of Socionext Technology (Shanghai) Co., Ltd. and Socionext Taiwan Inc. are held indirectly
through Socionext Technology Pacific Asia Ltd.

- 26 -

(7) Principal Business (as of March 31, 2024)
The Company’s business is a single segment of the Solution SoC business and consists primarily of thefollowing five areas:
Area
Main Applications
Automotive
AD/ADAS, in-vehicle sensing, IVI (In-Vehicle Infotainment),
cockpit HMI
Data center & networking
Data center, AI accelerators and 5G mobile phone base stations
Smart Devices
Smart glasses, AR/VR, action cameras, digital still cameras
Industrial automation
FA, measuring instruments, printers, projectors
IoT & Radar Sensing
Smart home appliances, smart home, IoT devices, broadcast
receivers, satellite communication/in-vehicle communication
devices(8) Principal Offices (as of March 31, 2024)
1) The Company
Name

Location
Yokohama City, Kanagawa Prefecture
Kyoto City, Kyoto Prefecture
Kasugai City, Aichi Prefecture
Sendai City, Miyagi Prefecture

Head Office
Kyoto Office
Kozoji OfficeSendai Office2) Subsidiaries
Company name
Socionext America Inc.
Socionext Europe GmbH
Socionext Technology Pacific Asia Ltd.
Socionext Technology (Shanghai) Co., Ltd.
Socionext Taiwan Inc.
Socionext Korea Ltd.

Location
USA, Milpitas
Germany, Langen
China, Hong Kong
China, Shanghai
Taiwan, Taipei
South Korea, Seoul- 27 -

(9) Employees (as of March 31, 2024)
Number of employees
Change from the previous fiscal year-end
2,534
Increase of 8
Note: The number of employees includes temporary employees (fixed-term employees, contract employees,
and incoming secondees). In addition to the above, we have 47 employees on secondment outside theGroup.

- 28 -

2. Current condition of the Company(1) Shares (as of March 31, 2024)
1) Total number of authorized shares
673,000,000
Note: As a result of the stock split (1 share of common stock split into 5 shares) on January 1, 2024, the total
number of authorized shares increased by 538,400,000 shares.
2) Total number of shares outstanding
178,687,405
Notes: 1. The exercise of share subscription rights between April 1, 2023 and December 31, 2023 increased
the total number of shares outstanding by 1,973,475 shares.
2. As of July 31, 2023, the Company issued 7,515 shares of common stock to five Directors (excluding
Directors who are Audit & Supervisory Committee Members and Outside Directors), six executive
officers who do not concurrently serve as Directors, and one employee for the purpose of issuing
restricted stock as a stock compensation.
3. As a result of the stock split (1 share of common stock split into 5 shares) on January 1, 2024, thetotal number of shares outstanding increased by 142,590,624 shares.
4. The exercise of share subscription rights between January 1, 2024 and March 31, 2024 increased thetotal number of shares outstanding by 449,125 shares.
3)

Number of shareholders

89,566- 29 -

4)

Major shareholders
Number of shares
held (shares)
20,001,300
7,466,200
6,500,000
5,001,825
3,655,300

Name of shareholder

The Master Trust Bank of Japan, Ltd. (trust account)
Custody Bank of Japan, Ltd. (trust account)
The Nomura Trust and Banking Co., Ltd. (trust account)
SSBTC CLIENT OMNIBUS ACCOUNT
Ueda Yagi Tanshi Co., Ltd.
J.P. MORGAN SECURITIES PLC FOR AND ON BEHALF OF
3,114,400
ITS CLIENTS JPMSP RE CLIENT ASSETS-SEGR ACCTGOLDMAN SACHS INTERNATIONAL
2,995,430
Nomura Securities Co., Ltd.
2,888,427
BNYM SA/NV FOR BNYM FOR BNY GCM CLIENT
2,834,045
ACCOUNTS M LSCB RD
STATE STREET BANK AND TRUST COMPANY 505225
2,679,700
Note: Percentage of shareholding is calculated after deducting treasury stock (788 shares).

Percentage ofshareholding (%)
11.19
4.17
3.63
2.79
2.04
1.74
1.67
1.61
1.58
1.49

5) Shares granted to the Company officers as consideration for performance of duties during thebusiness year under review
Number of persons eligible
Eligible Directors
Number of shares (shares)(persons)
Directors (excluding Directors
who are Audit & Supervisory
4,559
6
Committee Members and Outside
Directors)
Notes: 1. The number of persons eligible includes 1 employee (a Director who retired at the conclusion of theNinth Ordinary General Meeting of Shareholders held on June 28, 2023).
2. Details of the Company's stock compensation are described in "2. (2) 5) Compensation, etc. for
Directors."- 30 -

(2) Status of Officers
1) Directors (as of March 31, 2024)
Position in the Company

Name

Responsibilities and Significant Concurrent
PositionsRepresentative Director, Chairman,
President and CEO

Masahiro
Koezuka

Director and Deputy President

Koichi Otsuki

Director and Deputy President
Director and Corporate Executive
Vice President
Director and Corporate Executive
Vice President
Director

Noriaki Kubo
YutakaYoneyama

In charge of Sales & Business Development aswell as Strategic Sourcing & Production
Management
In charge of Business and Development
In charge of Finance and Business
Administration

Hisato Yoshida

Head of Global Development Group

Masatoshi Suzuki

Director

Sachiko Kasano

Director (Audit & Supervisory
Committee Member)

Yasuyoshi
Ichikawa

Attorney of SHIOMIZAKA
Outside Director (Audit & Supervisory
Committee Member) of Restar Holdings
Corporation
Outside Statutory Auditor of PRAP Japan, Inc.
Member of Yasuyoshi Ichikawa Certified Public
Accountant Office, Certified Public Accountant
Outside Statutory Auditor of Dai Nippon Printing
Co., Ltd.

Director (Full-time Audit &Supervisory Committee Member)Morimasa
Ikemoto--Representative Attorney of Kobe Grace Law
OfficeOutside Director of KEIWA Incorporated
Notes: 1. Directors Masatoshi Suzuki and Sachiko Kasano and Directors who are Audit & Supervisory
Committee Members Yasuyoshi Ichikawa, Morimasa Ikemoto and Noriko Yoneda are Outside
Directors.
2. There is no special relationship between the Company and the organizations in which significant
concurrent positions are held by Director Sachiko Kasano and Directors who are Audit &Supervisory Committee Members Yasuyoshi Ichikawa and Noriko Yoneda.
3. Directors who are Audit & Supervisory Committee Members Yasuyoshi Ichikawa and Morimasa
Ikemoto have considerable knowledge of finance and accounting as follows:* Yasuyoshi Ichikawa, Director who is an Audit & Supervisory Committee Member, is qualified asa certified public accountant.
* Morimasa Ikemoto, Director who is an Audit & Supervisory Committee Member, engaged in theaccounting and audit departments of other companies for many years.
4. The Company selected Morimasa Ikemoto as a full-time Audit & Supervisory Committee Member
in order to enhance information-gathering, improve the effectiveness of audits through adequate
collaboration with the internal audit department, etc., and strengthen the audit and supervisory
functions.
5. The Company has designated Outside Directors Masatoshi Suzuki, Sachiko Kasano, Yasuyoshi
Ichikawa and Noriko Yoneda as Independent Officers as provided for by the Tokyo Stock Exchange,and has registered them with the Tokyo Stock Exchange. The Company additionally designatedMorimasa Ikemoto, an Outside Director, as an Independent Officer as provided for by the Tokyo
Stock Exchange, and has registered him with the Exchange on April 4, 2024.
Director (Audit & Supervisory
Committee Member)

Noriko Yoneda- 31 -

2) Outline of contracts for limitations of liability
The Company has entered into agreements with Outside Directors Masatoshi Suzuki, Sachiko Kasano,Yasuyoshi Ichikawa, Morimasa Ikemoto and Noriko Yoneda pursuant to Article 427, Paragraph 1 of theCompanies Act and the Articles of Incorporation, to limit their liability for damages as defined under Article
423, Paragraph 1 of the Companies Act.
The amount of liability under the said agreements shall be limited to the minimum liability amount stipulated
in Article 425, Paragraph 1 of the Company Act. Such limitation of liability is permitted only when the
director concerned acts in good faith and without gross negligence in the performance of duties that caused
the liability.
3) Outline of contents for indemnity agreement
The Company has entered into indemnity agreements provided in Article 430-2, Paragraph 1 of theCompanies Act, with Directors Masahiro Koezuka, Koichi Otsuki, Noriaki Kubo, Yutaka Yoneyama, Hisato
Yoshida, Masatoshi Suzuki and Sachiko Kasano, and Directors who are Audit & Supervisory Committee
Members Yasuyoshi Ichikawa, Morimasa Ikemoto and Noriko Yoneda. The agreements are to the effect that
the Company will compensate, to the extent provided by laws and regulations, for the expenses referred to in
Article 430-2, Paragraph 1, Item 1 of the Companies Act and the losses referred to in Item 2 of the same
paragraph. In order to ensure that the appropriate execution of duties by corporate officers is not underminedby the indemnity agreement, the Company stipulates that in the event that an officer executes his or her duties
for the purpose of pursuing his or her own or a third party’s illicit gain or causing damage to the Company, theCompany may claim reimbursement of the expenses under Item 1 of the same paragraph, and in the event that
there is malicious intent or gross negligence in the execution of his or her duties, the loss under Item 2 of thesame paragraph shall not be covered by the indemnity.
4) Outline, etc. of contents of officers’ liability insurance contract
The Company has entered into officers’ liability insurance contracts with insurance companies as provided forin Article 430-3, Paragraph 1 of the Companies Act with Directors (including Directors who are Audit &Supervisory Committee Members), executive officers and managers etc. of the Company and officers andmanagers etc. of the Company’s subsidiaries constituting the insured persons. Under such insurance policies,
the Company is responsible for all premiums, and the insurance company indemnifies the insured against any
indemnities and litigation costs that the insured may incur if the insured receives a claim for damages in theperformance of its duties.

- 32 -

5)Compensation, etc. for Directorsa.

Total amount of compensation, etc. for directors
Total amount of compensation, etc. by type(million yen)
Total amountPerformance-based
Number ofofcompensation
eligible
Category
compensation,
officers
Basic
Nonetc. (million(persons)
compensation
Monetarymonetaryyen)
compensation compensation,etc.
Director(excluding Audit &
365
187
89
89
9
Supervisory
Committee Members)(of which, Outside
(22)
(22)
(-)
(-)
(3)
Directors)
Director (Audit &Supervisory
34
34
(-)
(-)
5
Committee Member)(of which, Outside
(29)
(29)
(-)
(-)
(4)
Directors)
Total
399
221
89
89
14
(of which, Outside
(51)
(51)
(-)
(-)
(7)
Directors)
Notes: 1.The amount of compensation, etc. for Directors (excluding Audit and Supervisory Committee
Members.) includes the amount of compensation, etc. for the two Directors (including one Outside
Director) who retired at the conclusion of the Ninth Ordinary General Meeting of Shareholders heldon June 28, 2023 while in office.
2. The amount of compensation, etc. for Directors (Audit & Supervisory Committee Members)
includes the amount of compensation, etc. for one Director who retired at the conclusion of theNinth Ordinary General Meeting of Shareholders held on June 28, 2023 while in office.
3. With respect to Sachiko Kasano, who retired from the position of Director (Audit and Supervisory
Committee Member) and assumed the position of Director (excluding Audit and Supervisory
Committee Member) at the conclusion of the Ninth Ordinary General Meeting of Shareholders heldon June 28, 2023, the term of office as a Director (excluding Audit and Supervisory Committee
Member) is stated in Director (excluding Audit and Supervisory Committee Member) and the termof office as a Director (Audit and Supervisory Committee Member) is stated in Director (Audit andSupervisory Committee Member) separately in the total amount and the number of eligible officers
listed above.
4. The above total amount of non-monetary compensation, etc. is the amount recorded as expenses
related to restricted stock compensation for Directors (excluding Audit & Supervisory Committee
Members and Outside Directors).
b. Performance-based compensation, etc.
Outline of the matters related to performance-based compensation is described in “e. Policies, etc. fordecisions on the content of compensation for individual directors, etc.,” “B. Compensation structure,” “1)
Directors in charge of business execution,” “(ii) Incentive compensation (cash and stock).”- 33 -

c. Non-monetary compensation, etc.
Non-monetary compensation, etc. consist of the Company’s shares. The terms and conditions at the time ofallotment are described in “e. Policies, etc. for decisions on the content of compensation for individual
directors, etc.,” “B. Compensation structure,” “1) Directors in charge of business execution,” “(ii) Incentive
compensation (cash and stock)” “c. Payment of incentive compensation (stock)” below. The status of granting
for the fiscal year under review is described in "2. (1) 5) Shares granted to the Company officers as
consideration for performance of duties during the business year under review.”d.

Matters relating to the resolution of the General Meeting of Shareholders on compensation, etc. of
Directors*
Directors (excluding Directors who are Audit & Supervisory Committee Members)
At the Extraordinary General Meeting of Shareholders on July 27, 2022, it was resolved by a deemed
resolution that the total amount of monetary compensation for Directors (excluding Directors who are Audit& Supervisory Committee Members) shall not be more than 550 million yen per year (including not morethan 45 million yen for Outside Directors; however, this does not include the employee salaries of directors
who also serve as employees). The specific amount of compensation for each individual has been decided by
the Board of Directors on condition that the decision is made based on the report made by the Nomination andRemuneration Committee to the Board of Directors, and is subject to approval of the Nomination andRemuneration Committee and left to the discretion of Masahiro Koezuka, Representative Director, Chairman
and President. The reason for delegating this authority was that the Representative Director was judged to besuitable for evaluating the division in which each director is in charge, taking into account the performance of
the Company as a whole. The number of Directors on the Board at the time the proposal pertaining to thedeemed resolution was made (excluding Directors who are Audit & Supervisory Committee Members), wasnine, two of whom resigned when the resolution was deemed to have been made at the Extraordinary General
Meeting of Shareholders and the general shareholders’ General Meeting of Class Shareholders on July 27,
2022. As such, the number of Directors at the time when the said resolution was deemed to have been madewas seven.
In addition, separately from the monetary compensation, the introduction of a performance-based restricted
stock compensation plan was approved by a deemed resolution at the above-mentioned extraordinary general
meeting of shareholders. (an outline of the plan is described in “e. Policies, etc. for decisions on the content ofcompensation for individual directors, etc.,” in “B. Compensation structure,” “1) Directors in charge ofbusiness execution,” “(ii) Incentive compensation (cash and stock),” in “c. Payment of incentive
compensation (stock)” below. Specifically, the resolution stipulates that the total amount of monetarycompensation claims to be paid to eligible directors for the grant of performance-based restricted stockcompensation shall not exceed 170 million yen per year (however, this does not include the employee salaries
of directors who also serve as employees). And it states that eligible directors shall pay all such monetarycompensation claims in the form of property contributed in kind and receive the issuance or disposition of theCompany’s common stock, whereby the total number of the Company’s common stock to be issued or
disposed of shall not exceed 200,000 shares per year (however, adjustments will be made in the event of astock split or consolidation of the Company’s common stock). The number of eligible directors at the time
when the said resolution was deemed to have been made was five.

- 34 -

*Directors who are Audit & Supervisory Committee Members
At the Extraordinary General Meeting of Shareholders held on July 27, 2022, it was resolved by a deemed
resolution that the compensation of Directors who are Audit & Supervisory Committee Members shall be
fixed basic compensation only and no more than 200 million yen per year (including no more than 80 million
yen for Outside Directors), taking into account the nature of their roles and duties. The specific amount ofbasic compensation for each individual has been determined through discussion among Directors who are
Audit & Supervisory Committee Members. The number of Directors who are Audit & Supervisory
Committee Members at the time the proposal pertaining to the deemed resolution was made was four, one ofwhom resigned when the resolution was deemed to have been made at the Extraordinary General Meeting of
Shareholders and the general shareholders’ General Meeting of Class Shareholders on July 27, 2022, so thenumber of Directors who are Audit & Supervisory Committee Members at the time when the said resolution
was deemed to have been made was three.
e. Policies, etc. for decisions on the content of compensation for individual directors, etc.
◆ Changes made to the Policies, etc. for decisions on the content of compensation for individual Directors(excluding Directors who are Audit & Supervisory Committee Members)
With the aim of further promoting business growth and business transformation, as well as initiatives for
management activities focusing on corporate values, the Company has partially revised its incentive
compensation system by resolution of the Board of Directors on April 12, 2024, following deliberations by the
Nomination and Remuneration Committee. The revised system applies to incentive compensation based on
performance for fiscal years beginning on or after April 1, 2024 (see below for details). Incentive
compensation based on performance for fiscal years ended March 31, 2024 or before will be paid based on thesystem before the revision.

- 35 -

[Summary of Revision]
Item

Before revision

After revision

Variation range ofincentivecompensation (cashand stock)

The Nomination andRemuneration Committee makes acomprehensive consideration of
the level of achievement ofevaluation indicators and makes ajudgement within the range of 0 150%

Structure andpayment proceduresof incentive
compensation (cashand stock)(New)

The Nomination andRemuneration Committee
makes a comprehensive
consideration of the level ofachievement of evaluation
indicators and makes ajudgement within the range of 0
- 200%
・If the level of achievement ofevaluation indicators exceeds
150%, all or part of the
incentive compensation (cash)
exceeding 150% can be paid as
incentive compensation (stock)・When the Nomination andRemuneration Committee
judges the above payment to beappropriate, it submits a reportto that effect, and the Board of
Directors deliberates anddecides based on the report

R e fe r t oB-1) (ii)

B-1) (ii)◆Policies, etc. for decisions on the content of compensation for individual Directors (excluding Directors who
are Audit & Supervisory Committee Members) (revised)
A. Details of the Directors’ Compensation System
1) Basic concept
The Company’s approach to directors’ compensation is as follows:*
Highly linked to the company’s performance and highly transparent and objective*
Enhancement of corporate value and compensation should be linked in order to share a sense of interest
with shareholders*
Contribute to securing and retaining a global management team that meets qualified capability
requirements in realizing the corporate vision
Compensation for executive directors among Directors consists of a basic compensation based on thecompensation standard for the position, and cash and stock incentive compensation reflecting the level ofachievement of the company’s performance in each fiscal year. In stock incentive compensation, theCompany grants performance-based restricted stock.

- 36 -

Compensation for Outside Directors among Directors is fixed basic compensation only in light of their role insupervising business execution.
If the Company appoints a non-executive director who does not fall under any of the above categories, thecompensation for such non-executive director will be considered separately based on a report by the
Nomination and Remuneration Committee.

Eligible Directors

Executive Director

Independent Outside
Directors

Basiccompensation

Contents
To achieve performancetargets and increase
shareholder value, basic
compensation and incentive
compensation (cash andstock) will be provided.
To ensure independence, only
basic compensation that is
not linked to performance
will be paid.

Incentive compensation
Cash
Stock-based
compensation compensation

✓

✓

✓

✓

-

-

2) Compensation level
In light of the business environment surrounding the Company, we will objectively compare compensationlevels with those of other companies in the same industry or other companies of the same size, based on thedata from research firms, and establish appropriate levels relevant for the positions.
3) Process for determining compensation
The Company has established a voluntary Nomination and Remuneration Committee to ensure theappropriateness of compensation levels and amounts and the transparency of the decision-making process.
The chairman and the majority of committee members are Independent Outside Directors.
The Board of Directors consults with the Nomination and Remuneration Committee on basic policies anddecision procedures. The recommendations of the Nomination and Remuneration Committee are deliberated
by the Board of Directors, and the Board of Directors decides the basic policy and decision procedures andmakes a resolution on the agenda for the General Meeting of Shareholders in the event that the upper limit of
total compensation is reviewed.
The specific amount of basic compensation and incentive compensation (cash and stock) for each individual isdetermined within the scope of the total amount of compensation approved by the General Meeting of
Shareholders based on the report made by the Nomination and Remuneration Committee to the Board of
Directors. It is subject to approval by the Nomination and Remuneration Committee and is determined at thediscretion of Representative Director, Chairman, based on a resolution of the Board of Directors.

- 37 -

B. Compensation structure
The compensation structure of the Company’s Directors is as follows:1)

Directors in charge of business execution

Type of compensation

OutlineFixed/Variable

Payment
methodPercentage to
total

Based
on
the
scope
of
responsibility and role (position) in
Basic compensation
Fixed
60%
the Company, a fixed amount is
paid as basic compensation
Cash payment
Payment by cash (bonus) as
performance-based compensation
Cashbased on the evaluation of
20%
performance results in the target
Incentive
year
Variablecompensation
Payment by stock as performanceStockbased compensation based on the
Payment by
20%
Notes: 1. evaluation of performance results
stockin the target year
Notes: 1. Stocks are distributed to directors after the end of the relevant fiscal year by providing monetarycompensation claims to grant performance-based restricted stock compensation and having thedirectors pay the full amount of the monetary compensation claims as property contributed in kind.
2. Percentage figures are estimates and are the percentages when 100% of the performance targets areachieved. In addition, if the achievement of the evaluation indicators exceeds 150%, as described
below, the ratio of cash and stock to the total incentive compensation may differ.
(i)Basic compensation
Basic compensation is determined, referring to the amount of past compensation, by comparing with theperformance of other companies in the same industry or similar size.
Basic compensation is paid as monthly compensation in a fixed amount.
(ii) Incentive compensation (cash, stock)a. Structure
In the evaluation items and indicators for the performance-based portion, we consider “net sales,” “operating
profit,” and “design win amount,” which are used as numerical targets in the management plan, as quantitative
items, with a weighting of approximately 25% each, and also take into account business transformation,
growth strategy, ESG measures, etc. as qualitative items as below with a weighting of approximately 25%. In
addition, we evaluate all of these items based on comprehensive judgment by the Nomination andRemuneration Committee. We selected the indicators because we believe that quantitative items are numericaltargets in the Company’s management plan and qualitative items are essential for the sustainable developmentof the Company. The results of the evaluation are reported to and deliberated by the Board of Directors.

- 38 -

Itemssubject toevaluation

Items inevaluation

Evaluation
timing

Evaluation indicator(target)Net sales
OperatingincomeDesign win
amountBusinesstransformation,
growthstrategy, ESG
measures, etc.

Weightingpercentage

The Nomination
andCommonQuantitative
25%
Remuneration
Items
items
Committee
At the end
25%
Degree ofmakes aof thetargetjudgment withintarget fiscal
achievement
the range of 0 year
Individual
Qualitativein target
200% by
25%
items
items
fiscal year
comprehensively
considering thedegree ofachievement of100%
each item.
Notes: 1. We set minimum goals for each evaluation indicator (target). We also set a cap in the variation rangeof the evaluation for incentive compensation (cash and stock) and determine the evaluation level sothat the rate of achievement and the payment amount are consistent.
2. If the achievement of the evaluation indicators exceeds 150%, the Company may provide all or partof the portion of the incentive compensation (cash) exceeding 150% as incentive compensation(stock) instead of incentive compensation (cash), based on the report of the Nomination andRemuneration Committee, for the purpose of ensuring that the eligible Directors conduct businesswith more focus on corporate value. In this case, the sum of incentive compensation (stock) paid inproportion to the achievement of the evaluation indicators and incentive compensation (stock) paidin lieu of incentive compensation (cash) may exceed the amount equivalent to 200% of incentive
compensation (stock) paid in the case of 100% achievement of the evaluation indicators.
3. We will consider adding ROE to the evaluation indicator (target) for judgement in the future.
4. Net sales, which are set as an evaluation indicator (target) for the performance-based portion,
reached 221.2 billion yen for fiscal year ended March 31, 2024, as opposed to the initial financial
results forecast of 200.0 billion yen. Operating income for the same period was 35.5 billion yen,
compared with the initial forecast of 22.5 billion yen. The design win amount for the same period
came to about 250.0 billion yen, compared with the initial plan to acquire design wins amounting toabout 250.0 billion yen.

- 39 -

25%

Variation range

b.
Payment of incentive compensation (cash)
After the performance evaluation period ends, the Nomination and Remuneration Committee makes acomprehensive judgement of the level of achievement of evaluation indicators and submits a report within therange of 0 - 200% to the Board of Directors. In addition, if the achievement of the evaluation indicators
exceeds 150% and the Nomination and Remuneration Committee judges that it is appropriate to pay all or partof the incentive compensation (cash) exceeding 150% as incentive compensation (stock) instead of incentive
compensation (cash), it will report to the Board of Directors to that effect. Based on the report of theNomination and Remuneration Committee, the Board of Directors deliberates and decides the level of
incentive compensation (cash) payment.
Payment is made in cash in June of the fiscal year following the target fiscal year of performance evaluation.
<Conceptual image of evaluation>
Fiscal year
before target
fiscal year
4th quarter
Targetsetting

Target fiscal year
1st quarter2nd quarter3rd quarter

Evaluation period

4th quarter

Fiscal year
followingtarget fiscal
year
1st quarter
Finalevaluationand payment(June)

c. Payment of incentive compensation (stock)
I Outline
After the performance evaluation period ends, the Nomination and Remuneration Committee makes acomprehensive judgement of the level of achievement of evaluation indicators and submits a report within therange of 0 - 200% to the Board of Directors. In addition, if the achievement of the evaluation indicators
exceeds 150% and the Nomination and Remuneration Committee judges that it is appropriate to pay all or partof the incentive compensation (cash) exceeding 150% as incentive compensation (stock) instead of incentive
compensation (cash), it will report to the Board of Directors to that effect. Based on the report of theNomination and Remuneration Committee, the Board of Directors deliberates and decides the level of
incentive compensation (stock) payment.

- 40 -

When the performance evaluation period ends and Eligible Directors meet the following requirements, theCompany shall deliver performance-based restricted stock to each Eligible Director by providing monetarycompensation claims to grant performance-based restricted stock to each Eligible Director and having each
Eligible Director pay the full amount of such monetary compensation claims as property contributed in kind.
*
During the performance evaluation period and up to and including immediately prior to the conclusion of
the first ordinary general meeting of shareholders held after the end of the performance evaluation
period, the Eligible Directors continued to hold the positions among positions of Socionext Personnel of
the Company as predetermined by the Board of Directors of the Company*
He or she does not fall under certain illegal acts or other reasons for non-payment as determined by the
Board of Directors of the Company
The performance-based restricted stock will be delivered by means of the issuance of new shares or the
disposition of treasury stock by the Company, and the amount to be paid in per share will be determined by
the Board of Directors on the basis of the closing price of the Company’s common stock on the Tokyo Stock
Exchange on the business day immediately preceding the date of each resolution of the Board of Directors of
the Company regarding the allotment of performance-based restricted stock (if a trade is not made on the saidday, the closing price on the immediately preceding trading day) to the extent that the amount is notparticularly favorable to Eligible Directors who will subscribe for such common stock.
II Transfer restriction period
Eligible Directors shall not transfer, create a security interest on or dispose otherwise of the shares of common
stock of the Company allotted to them (hereafter referred to as the “Allotted Shares”) under the allotment
agreement (hereafter referred to as “Transfer Restrictions”). This shall apply during the period from the dateof allotment of the performance-based restricted stock under the Restricted Stock Allotment Agreement to be
separately concluded with the Company (hereafter referred to as the “Allotment Agreement”) until the date ofretirement from the positions among Socionext Personnel of the Company as predetermined by the Board of
Directors of the Company (hereafter referred to as the “Transfer Restriction Period”).
III Treatment at the time of retirement
If an Eligible Director retires from one of the positions of officer or employee of the Company as
predetermined by the Board of Directors of the Company, the Company will naturally acquire the Allotted
Shares free of charge, unless his or her term of office expires, he or she dies, or the Board of Directors
determines that there are other valid reasons for his or her retirement.

- 41 -

IV Lifting of Transfer Restrictions, Etc.
The Company will release Transfer Restrictions on all of the Allotted Shares upon the expiration of theTransfer Restriction Period, provided that the Eligible Directors have continued to hold positions among
Socionext Personnel of the Company as predetermined by the Board of Directors of the Company during theTransfer Restriction Period.
Year X
March
Year X+1
March
Year X+2
March
Year X+3
March

Targetsetting

Year X+1
March

Year X+2
March

Year X+3
March

Evaluation
periodEvaluationand grant(June, July)

Targetsetting

Evaluation
periodEvaluationand grant(June, July)

Targetsetting

Evaluation
periodYear X+4
March

Year X+5
March

Year X+6
March

Transferable after
retirement

Transferable after
retirement
Evaluationand grant(June, July)

Transferable after
retirement

2) Outside Directors among Directors
In view of the role of supervising the execution of business, only fixed basic compensation is paid.
f. Matters related to delegation of decisions on compensation for individual directors
Matters related to the delegation of decisions on compensation for individual directors are described in “d.
Matters relating to the resolution of the general meeting of shareholders on compensation, etc. of directors,”“Directors (excluding Directors who are Audit & Supervisory Committee Members),” and “e. Policies, etc.
for decisions on the content of compensation for individual directors, etc.” and “A. Details of the Directors’Compensation System.” Based on the fact that the amount of compensation for each individual director(excluding directors who are Audit & Supervisory Committee Members) has been determined through suchprocedures, the Board of Directors has determined that the content of such compensation is in line with its
decision policy.

- 42 -

6) Matters related to Outside Officers
Status of major activities
Category

Name

Attendance

Board of Directors
meetings
14 out of 14
Outside Director

Masatoshi
SuzukiNomination andRemuneration
Committee meetings
17 out of 17

Board of Directors
meetings
14 out of 14

Outside Director

SachikoKasanoAudit & Supervisory
Committee meetings
4 out of 4
Nomination
andRemuneration
Committee meetings
14 out of 14- 43 -

Outline of statements made and duties
performed regarding expected roles of
Outside Directors
Leveraging a wealth of management
experience gained from having served as arepresentative director and other positions atlisted companies, he supervises and advises
management from an objective and neutral
standpoint as Lead Independent Outside
Director.
In addition, as Chairman of the Nomination
and Remuneration Committee, he provides
various opinions and proposals from an
independent standpoint, and contributes toenhancement of supervisory functions,transparency and fairness in the process ofdetermining the content of proposals forelection of directors and officers
compensation, etc.
Based on her extensive experience as an
attorney and her deep insight into corporate
legal affairs and compliance, she supervises
and advises management from an objective
and neutral standpoint.
Prior to her retirement as an Outside Director(Audit and Supervisory Committee Member),
she led audits of execution of duties byDirectors and promoted the management of
the Committee as Chairman of the Audit &Supervisory Committee.
In addition, as a member of the Nomination
and Remuneration Committee, she provides
various opinions and proposals from an
independent standpoint, and contributes toenhancement of supervisory functions,transparency and fairness in the process ofdetermining the content of proposals forelection of directors and officers
compensation, etc.

Outline of statements made and duties
performed regarding expected roles of
Outside Directors
Based on his extensive experience as a
Board of Directors
certified public accountant and his deep
Outside Director
meetings
insight into financial accounting, he(Audit &14 out of 14
supervises and advises management from an
Yasuyoshi
Supervisoryobjective and neutral standpoint.
Ichikawa
Committee
Audit & Supervisory
In addition, as Chairman of the Audit &Member)Committee meetings
Supervisory Committee, he leads audits of
15 out of 15
execution of duties by Directors and promotes
management of the Committee.
He has served as Director who is an Audit &Supervisory Committee Member and a fulltime Auditor of listed companies, andBoard of Directors
supervised and advised management taking
Outside Director
meetings
advantage of extensive experience and from
(Full-time Audit
11 out of 11
Morimasa
professional standpoints regarding finance and& Supervisory
Ikemotoaccounting, and internal control and auditing
Committee
Audit & Supervisoryfrom an objective and neutral standpoint.
Member)Committee meetings
In addition, as a full-time Audit &11 out of 11
Supervisory Committee Member, he audits
execution of duties by Directors based on his
expert knowledge.
Based on her extensive experience as an
Board of Directors
attorney and her deep insight into corporate
Outside Director
meetings
legal affairs and compliance, she supervises(Audit &11 out of 11
and advises management from an objective
Supervisory
Noriko Yoneda
and neutral standpoint.
Committee
Audit & Supervisory
In addition, as a member of the Audit &Member)Committee meetings
Supervisory Committee, she audits execution
11 out of 11
of duties by Directors based on her expert
knowledge.
Notes: 1. In addition to the above number of meetings of the Board of Directors, there were four (4) written
resolutions that were deemed to have been made by the Board of Directors in accordance with theprovisions of Article 370 of the Companies Act and the Articles of Incorporation.
2. At the conclusion of the Ninth Ordinary General Meeting of Shareholders held on June 28, 2023,
Outside Director Sachiko Kasano retired from the post of Outside Director (Audit & Supervisory
Committee Member) due to the expiration of her term of office and assumed the position of
Outside Director who is not an Audit & Supervisory Committee Member.
3. Masatoshi Suzuki has been selected as the Lead Independent Outside Director from among theIndependent Outside Directors. The role of the Lead Independent Outside Director is to act as aliaison between the management and Independent Outside Directors and to facilitate dialogue
between them. In addition, he participates in the determination of the agenda of the regular Boardof Directors meetings, and when necessary, convenes a meeting of outside officers while
determining the agenda of the meeting and chairing it, and communicates the results of thedeliberations to the management or the Board of Directors to encourage discussion.
Category

Name

Attendance- 44 -

3.

Policy on Decisions of Dividends of Surplus, Etc.

One of the Company’s key management priorities is to increase corporate value over the medium to long term
while returning profits to shareholders. We aim to pay a stable dividend with a target consolidated dividend
payout ratio of around 40%, taking into account the balance between advance investment in the development
needed for future growth and maintaining a solid financial base as credit to customers. In addition, over the
medium term, we will continue to invest in growth and maintain a strong financial base while promoting
shareholder return with a target total return ratio of around 50% in order to further improve shareholderinterests and capital efficiency.
In addition, the Articles of Incorporation stipulate that matters stipulated in each item of Article 459,
Paragraph 1 of the Companies Act, such as dividends of surplus, shall be determined by a resolution of theBoard of Directors without a resolution of a general meeting of shareholders, and that an interim dividend
may be paid with September 30 of each year as the record date, unless otherwise provided by law. The
Company’s basic policy is to pay dividends twice a year, an interim dividend and a year-end dividend, fromthe fiscal year ended March 2024 onward.
Based on this policy, at the meeting of the Board of Directors held on May 17, 2024, the Company resolved to
set the year-end dividend at 25 yen per share, with a payment commencement date of June 5, 2024.
In order to expand its investor base and improve market liquidity, the Company implemented a stock split at aratio of 1 common stock to 5 shares with an effective date of January 1, 2024. Since the interim dividend of
115 yen per share was paid on September 30, 2023, prior to the stock split, the annual dividend for the fiscal
year under review is equivalent to 240 yen per share, if calculated on a pre-stock-split basis, including 115 yenof the interim dividend and 125 yen of the year-end dividend. After the stock split, the annual dividend for the
fiscal year under review is equivalent to 48 yen per share including 23 yen of the interim dividend and 25 yenof the year-end dividend.

- 45 -

Consolidated Financial Statements
Consolidated balance sheet(As of March 31, 2024)
Item
AssetsCurrent assets
Cash on hand and in banks
Accounts receivable-trade, net
Finished goods
Work in process
Accounts receivable-other
Other current assets
Non-current assets
Property, plant and equipment

Amount138,901
69,73835,257
6,090
19,414
2,935
5,467

Item
Liabilities
Current liabilities
Accounts payable-trade
Accounts payable-otherAccrued expenses
Income taxes payable
Liabilities related to chargeable
subcontracting
Other current liabilities(Million yen)Amount53,094
15,764
9,334
8,859
6,817
9,319
3,001

Buildings and structures, net
Machinery and equipment, net

47,93921,8003,441
6Long-term liabilities
Asset retirement obligations
Other long-term liabilities

2,726
350
2,376

Tools, furniture and fixtures, net
LandConstruction in progress

17,318800
235

Total liabilities
Net assets
Shareholders’ equity
Common stock
Deposits for subscriptions of shares
Capital surplus
Retained earnings
Treasury stock

55,820Intangible assets
Technology assets
Other
Investments and other assets
Investment securities
Deferred tax assets
Other assets

18,464
16,166
2,298
7,675
0
6,740

Accumulated other comprehensive
incomeForeign currency translation
adjustments

128,998
32,65685
32,656
63,604
(3)
2,022
2,022

935

Total net assets
Total assets
186,840 Total liabilities and net assets(Note) Monetary amounts are rounded to the nearest million yen.

- 46 -

131,020
186,840

Consolidated Statement of Income
From April 1, 2023 to March 31, 2024
(Million yen)
Item

AmountNet sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Foreign exchange gain
Other income
Non-operating expenses
Other expenses
Ordinary income
Profit before income taxes
Income taxes - current
Income taxes - deferred
ProfitProfit attributable to owners of parent(Note) Monetary amounts are rounded to the nearest million yen.

- 47 -

221,246
111,243
110,00374,49335,510
384
1,224
67
63

10,694
294

1,675
63
37,122
37,122
10,98826,134
26,134

Non-consolidated Financial Statements
Non-Consolidated balance sheet(As of March 31, 2024)
Item
AssetsAmountCurrent assets
Cash on hand and in banks
Accounts receivable-trade, net
Finished goods
Work in process
Advance payments to suppliers

126,71254,26938,6586,089
19,413
3,163

Prepaid expenses
Accounts receivable-other
Other current assets

1,843
3,123
149

Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery and equipment, net
Tools, furniture and fixtures
Land

47,25018,771873
016,863800

Construction in progress

234

Intangible assets
Technology assets
Other

18,416
16,1662,250

Investments and other assets
Investment securities
Shares of subsidiaries and affiliates
Deferred tax assets
Other assets

10,061
0
2,704
6,551
804

Item
Liabilities
Current liabilities
Accounts payable-trade
Accounts payable-otherAccrued expenses
Income taxes payable
Liabilities related to chargeable
subcontracting
Other current liabilities
Long-term liabilities
Asset retirement obligations
Total liabilities
Net assets
Shareholders’ equity
Common stock
Deposits for subscriptions ofsharesCapital surplus
Legal capital surplus
Retained earnings
Other retained earnings
Retained earnings brought forward
Treasury stock

Total net assets
173,962
Total liabilities and net assets
Total assets(Note) Monetary amounts are rounded down to the nearest million yen.

- 48 -(Million yen)Amount50,177
16,913
9,280
6,066
6,534
9,319
2,062
300
300
50,477
123,485
32,65685
32,65632,65658,09058,09058,090(2)

123,485
173,962

Non-Consolidated Statement of Income
From April 1, 2023 to March 31, 2024
(Million yen)
Item

AmountNet sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Dividend income
Foreign exchange gain
Other income
Non-operating expenses
Other expenses
Ordinary income
Income before income taxes
Income taxes - current
Income taxes - deferred
Profit(Note) Monetary amounts are rounded down to the nearest million yen.

- 49 -

220,245
111,199
109,045
75,06533,980
1,345
1,270
91
37

10,138
200

2,707
37
36,64936,64910,33826,311

(Translation)Independent Auditor’s Report
May 15, 2024
The Board of Directors
Socionext Inc.
Ernst & Young ShinNihon LLC
Tokyo, Japan/s/Noriyasu Hanafuji
Designated Engagement Partner
Certified Public Accountant/s/Shinichi Masuda
Designated Engagement Partner
Certified Public Accountant
OpinionPursuant to Article 444, paragraph 4 of the Companies Act, we have audited the accompanying
consolidated financial statements, which comprise the consolidated balance sheet, theconsolidated statement of income, the consolidated statement of changes in net assets, and notes
to the consolidated financial statements of Socionext Inc. and its consolidated subsidiaries (theGroup) applicable to the fiscal year from April 1, 2023 to March 31, 2024.
In our opinion, the accompanying consolidated financial statements present fairly, in all material
respects, the consolidated financial position and results of operations of the Group applicable tothe fiscal year ended March 31, 2024, in accordance with accounting principles generally
accepted in Japan.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for
the Audit of the Consolidated Financial Statements section of our report. We are independent of
the Group in accordance with the ethical requirements that are relevant to our audit of theconsolidated financial statements in Japan, and we have fulfilled our other ethicalresponsibilities in accordance with these requirements. We believe that the audit evidence wehave obtained is sufficient and appropriate to provide a basis for our opinion.

- 50 -

Other Information
The other information comprises the information included in the Group’s business report and its
supplementary schedules. Management is responsible for preparation and disclosure of the otherinformation. The Audit and Supervisory Committee is responsible for overseeing the Group’sreporting process of the other information.
Our opinion on the consolidated financial statements does not cover the other information and
we do not express any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is toread the other information and, in doing so, consider whether the other information is materiallyinconsistent with the consolidated financial statements or our knowledge obtained in the audit orotherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of
this other information, we are required to report that fact.
We have nothing to report in this regard.
Responsibilities of Management, the Audit and Supervisory Committee for theConsolidated Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated
financial statements in accordance with accounting principles generally accepted in Japan, andfor such internal control as management determines is necessary to enable the preparation of
consolidated financial statements that are free from material misstatement, whether due to fraud
or error.
In preparing the consolidated financial statements, management is responsible for assessing theGroup’s ability to continue as a going concern and disclosing, as required by accounting
principles generally accepted in Japan, matters related to going concern.
The Audit and Supervisory Committee is responsible for overseeing the Group’s financial
reporting process.
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial
statements as a whole are free from material misstatement, whether due to fraud or error, and toissue an auditor’s report that includes our opinion. Misstatements can arise from fraud or error
and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these consolidated
financial statements.
As part of an audit in accordance with auditing standards generally accepted in Japan, we
exercise professional judgment and maintain professional skepticism throughout the audit. We
also:
・ Identify and assess the risks of material misstatement of the consolidated financial
statements, whether due to fraud or error, design and perform audit procedures responsive tothose risks, and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion.

- 51 -

・ Consider internal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances for our risk assessments, while the purpose of the audit of
the consolidated financial statements is not expressing an opinion on the effectiveness of theGroup’s internal control.
・ Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
・ Conclude on the appropriateness of management’s use of the going concern basis ofaccounting and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Group’s ability tocontinue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the related disclosures in the
consolidated financial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor’s report. However, future events or conditions may cause the Group to cease tocontinue as a going concern.
・ Evaluate the overall presentation, structure and content of the consolidated financial
statements, including the disclosures, and whether the consolidated financial statements
represent the underlying transactions and events in a manner that achieves fair presentationin accordance with accounting principles generally accepted in Japan.
・ Obtain sufficient appropriate audit evidence regarding the financial information of theentities or business activities within the Group to express an opinion on the consolidated
financial statements. We are responsible for the direction, supervision and performance ofthe group audit. We remain solely responsible for our audit opinion.
We communicate with the Audit and Supervisory Committee regarding, among other matters,
the planned scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.
We also provide the Audit and Supervisory Committee with a statement that we have compliedwith the ethical requirements regarding independence that are relevant to our audit of theconsolidated financial statements in Japan, and to communicate with them all relationships andother matters that may reasonably be thought to bear on our independence, and whereapplicable, actions taken to eliminate threats or safeguards applied to reduce threats to an
acceptable level.
Interest Required to Be Disclosed by the Certified Public Accountants Act of Japan
Our firm and its designated engagement partners do not have any interest in the Group which is
required to be disclosed pursuant to the provisions of the Certified Public Accountants Act ofJapan.
Notes to the Readers of Independent Auditor's Report
This is an English translation of the Independent Auditor's Report as required by the Companies Act of Japanfor the conveniences of the reader.

- 52 -

(Translation)Independent Auditor’s Report
May 15, 2024
The Board of Directors
Socionext Inc.
Ernst & Young ShinNihon LLC
Tokyo, Japan/s/Noriyasu Hanafuji
Designated Engagement Partner
Certified Public Accountant/s/Shinichi Masuda
Designated Engagement Partner
Certified Public Accountant
OpinionPursuant to Article 436, paragraph 2, item 1 of the Companies Act, we have audited theaccompanying non-consolidated financial statements, which comprise the balance sheet, thestatement of income, the statement of changes in net assets, and notes to the non-consolidated
financial statements of Socionext Inc. (the Company) applicable to the fiscal year from April 1,
2023 to March 31, 2024.
In our opinion, the accompanying non-consolidated financial statements present fairly, in allmaterial respects, the financial position and results of operations of the Company applicable tothe fiscal year ended March 31, 2024, in accordance with accounting principles generally
accepted in Japan.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for
the Audit of the Non-consolidated Financial Statements section of our report. We are
independent of the Company in accordance with the ethical requirements that are relevant to our
audit of the non-consolidated financial statements in Japan, and we have fulfilled our otherethical responsibilities in accordance with these requirements. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

- 53 -

Other Information
The other information comprises the information included in the Company’s business report andits supplementary schedules. Management is responsible for preparation and disclosure of theother information. The Audit and Supervisory Committee is responsible for overseeing theCompany’s reporting process of the other information.
Our opinion on the non-consolidated financial statements does not cover the other information
and we do not express any form of assurance conclusion thereon.
In connection with our audit of the non-consolidated financial statements, our responsibility is toread the other information and, in doing so, consider whether the other information is materiallyinconsistent with the non-consolidated financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of
this other information, we are required to report that fact.
We have nothing to report in this regard.
Responsibilities of Management, the Audit and Supervisory Committee for the Nonconsolidated Financial Statements
Management is responsible for the preparation and fair presentation of these non-consolidated
financial statements in accordance with accounting principles generally accepted in Japan, andfor such internal control as management determines is necessary to enable the preparation of
non-consolidated financial statements that are free from material misstatement, whether due tofraud or error.
In preparing the non-consolidated financial statements, management is responsible for assessing
the Company’s ability to continue as a going concern and disclosing, as required by accounting
principles generally accepted in Japan, matters related to going concern.
The Audit and Supervisory Committee is responsible for overseeing the Company’s financial
reporting process.
Auditor’s Responsibilities for the Audit of the Non-consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the non-consolidated financial
statements as a whole are free from material misstatement, whether due to fraud or error, and toissue an auditor’s report that includes our opinion. Misstatements can arise from fraud or error
and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these nonconsolidated financial statements.
As part of an audit in accordance with auditing standards generally accepted in Japan, we
exercise professional judgment and maintain professional skepticism throughout the audit. We
also:
・ Identify and assess the risks of material misstatement of the non-consolidated financial
statements, whether due to fraud or error, design and perform audit procedures responsive tothose risks, and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion.

- 54 -

・ Consider internal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances for our risk assessments, while the purpose of the audit of
the non-consolidated financial statements is not expressing an opinion on the effectivenessof the Company’s internal control.
・ Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
・ Conclude on the appropriateness of management’s use of the going concern basis ofaccounting and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Company’s ability tocontinue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the related disclosures in the nonconsolidated financial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor’s report. However, future events or conditions may cause the Company to cease tocontinue as a going concern.
・ Evaluate the overall presentation, structure and content of the non-consolidated financial
statements, including the disclosures, and whether the non-consolidated financial statements
represent the underlying transactions and events in a manner that achieves fair presentationin accordance with accounting principles generally accepted in Japan.
・ Obtain sufficient appropriate audit evidence regarding the financial information of theentities or business activities within the Company to express an opinion on the nonconsolidated financial statements. We are responsible for the direction, supervision andperformance of the audit. We remain solely responsible for our audit opinion.
We communicate with the Audit and Supervisory Committee regarding, among other matters,
the planned scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.
We also provide the Audit and Supervisory Committee with a statement that we have compliedwith the ethical requirements regarding independence that are relevant to our audit of the nonconsolidated financial statements in Japan, and to communicate with them all relationships andother matters that may reasonably be thought to bear on our independence, and whereapplicable, actions taken to eliminate threats or safeguards applied to reduce threats to an
acceptable level.
Interest Required to Be Disclosed by the Certified Public Accountants Act of Japan
Our firm and its designated engagement partners do not have any interest in the Company
which is required to be disclosed pursuant to the provisions of the Certified Public Accountants
Act of Japan.
Notes to the Readers of Independent Auditor's Report
This is an English translation of the Independent Auditor's Report as required by the Companies Act ofJapan for the conveniences of the reader.

- 55 -

Audit & Supervisory Committee’s Report

Audit Report
The Audit & Supervisory Committee has audited the Directors’ execution of duties for the tenth fiscal year
from April 1, 2023 to March 31, 2024. The following are the reports of the methods and results of the audit.
1. The methods and contents of the audit
With respect to the contents of the resolution of the Board of Directors regarding the matters set forth in
Article 399-13, Paragraph 1, Item 1, (b) and (c) of the Companies Act, and the systems (Internal Control
Systems) developed based on such resolution, the Audit & Supervisory Committee received periodic reports
from Directors, employees and other relevant functions concerning the status of formation andimplementation of such systems, asked for explanations as necessary, expressed its opinions and conducted
the audit in the following manner.
1) In accordance with the audit policy and the allocation of duties and other terms defined by the Audit &Supervisory Committee, the Audit & Supervisory Committee, in coordination with the internal control
divisions of the Company, attended material meetings, received reports from the Directors, employees
and other relevant functions on matters related to their execution of duties, asked for explanations asnecessary, and investigated the status or condition of the business activities and assets by inspecting
important approval document and reports in the head office and other major offices.
In addition, with respect to subsidiaries, the Audit & Supervisory Committee communicated andexchanged information with directors and auditors of subsidiaries, and received reports on business fromsubsidiaries whenever necessary.
2) The Audit & Supervisory Committee monitored and verified that the Accounting Auditor maintained
independence and conducted appropriate audits, received reports from the Accounting Auditor on thestatus of their audit work, and asked for explanations as necessary. The Audit & Supervisory Committee
was also advised by the Accounting Auditor that they had the “system for ensuring that the performanceof the accounting auditors is being carried out correctly” (matters set forth in each item of Article 131 of
the Rules of Corporate Accounting)” in place in accordance with the “Quality Control Standards”(Business Accounting Council, October 28, 2005) and other relevant regulations and asked for
explanations as necessary.
Based on the above stated steps, the Audit & Supervisory Committee examined the business report and the
supplementary schedules, the non-consolidated financial statements (the balance sheet, the statement ofincome, the statement of changes in net assets and the notes to the financial statements) and the supplementaryschedules thereof, and the consolidated financial statements (the consolidated balance sheet, the consolidated
statement of income, the consolidated statement of changes in net assets and the notes to the consolidated
financial statements) for the fiscal year under review.
2. Results of the audit(1) Results of the audit of the business report and the supplementary schedules
1) The business report and the supplementary schedules present fairly the status of the Company’s businessconditions in conformity with the applicable laws and regulations and the Articles of Incorporation;
There is no indication of significant wrongdoing or violation of laws and regulations and the Articles ofIncorporation in the Directors’ execution of duties; and
3) The contents of the resolution by the Board of Directors regarding the internal control system wereappropriate. Also there is no item to be noted on description in the business report and the Directors’
execution of duties regarding the internal control systems.
(2) Audit Results on the Non-consolidated Financial Statements and the Supporting Schedules
The methods and results of audits conducted by Ernst & Young ShinNihon LLC, the Accounting Auditor of
the Company, are appropriate.
(3) Results of the audit of the consolidated financial statements
The methods and results of audits conducted by Ernst & Young ShinNihon LLC, the Accounting Auditor of
the Company, are appropriate.
2)- 56 -

May 16, 2024
Audit & Supervisory Committee of Socionext Inc.
Audit & Supervisory Committee Member (Outside Director)
Audit & Supervisory Committee Member (Outside Director)
Full-time Audit & Supervisory Committee Member (Outside Director)- 57 -

Yasuyoshi Ichikawa
Noriko Yoneda
Morimasa Ikemoto(Seal)(Seal)(Seal)

Reference: The Group’s Business Model
The Company provides services mainly in the Custom SoC for specific applications, among the Logic IC market.

Memory IC
ASSP stands for Application Specific Standard Product, generally
referring to large-scale integrated circuits with specificfunction/purpose limited to a certain domain or application

Analog IC
Application specificproduct

Semiconductor

Logic IC
General Purpose Logic

Custom SoC
Integrated circuit that combines multiple functionsof a circuit for a specific customer
Three business models
Traditional ASIC
Solution SoC

New business
model

ASIC designed by ASSP vendor< The Company’s Primary Applications >Automotive

Data Center &Networking

Smart Devices

Industrial
automation

IoT & Radar sensing

Features of Solution SoC Business Model

Covering upstream of the design
flow (architecture and specification
design of SoC)

Possible to combine optimal
technologies without restrictions
from ASSP business

Provide custom SoCs tocustomers with limited inhouse resources of
upstream design

Possible to provide optimal
SoCs for customers- 58 -

Understand optimal systemservices, including SoCs

Enable to provide SoCs
that deliver optimal systemservices demanded bycustomers

Custom SoC design flow by business model

Upstream design

Application design offinal products

SoC
designTraditional
ASIC

Solution SoC

ASIC designed by
ASSP vendor

Area managed bycustomer

CustomerManaged Area

Area managed bycustomer

Area managed by
Custom SoC Vendor

Custom SoC
Vendor-Managed
Areas

Area managed by
Custom SoC
VendorFoundry/OSAT

Foundry/OSAT

Foundry/OSAT

Architecture design

Planning andspecification design

Logic design

Downstream design

Physical design

Quality control

Manufacturing andassembly of designed
SoC

Major
Differences

Scope ofdesignFlexibility ofdesignCover fordownstream
design only

Cover for upstream design as well

Design optimal SoCs by leveraging outside
vendors offering cutting-edge technology- 59 -

Design restricted
by in-house
ASSP

Reference: Initiatives for Sustainability“Together with our global partners, we bring innovation to everyone everywhere.” Based on this mission, theGroup evaluated social issues that need to be resolved and their importance for the Company’s business growth,and identified materiality (priority issues) to be addressed as priorities. We will continue to examine and discuss
medium- to long-term initiatives to achieve sustainable growth by responding flexibly to changes in global
trends and the business environment.
At the Group, we will continue to work with our partners in the semiconductor ecosystem to enhance theeffectiveness of our efforts to address materiality throughout the supply chain, and strive to achieve a sustainable
society by solving social issues and further growing our business.

◆Materiality Map
Environment

Solution of social issues/growth of businessSocialGovernanceMateriality to address with priority

Water resource management

Human Rights and Diversity
Quality and reliability
Stable supply

Energy management

Corporate governanceIntegrity and compliance(By pursuing new technologies)
Contribution to innovation

Reduction of GHG emissions
Asset management of design

Privacy protection

data (Information security, cyber risk)Waste management

Labor, safety and health(Work-life balance)Sustainable supply chain
 Securing, retention anddevelopment of humanresource
 Empowerment andengagement of employees

Forest conservation
Biodiversity

For more information about the Group's sustainability, see the ESG Report on the Company’s website.

- 60 -

Reference: Description of Key Terms Used in the Semiconductor Industry
Terminology
ADAS
IP

NRE Sales

OSAT

SCM

SoC

(Listed in alphabetical order)
Description
Abbreviation for advanced driving assistant system for automobiles.
Abbreviation for intellectual property. It is circuit information that is organized inpartial functional units to make up a semiconductor, and is divided into procurement
IP that is purchased from outside and in-house IP that is developed in-house.
Abbreviation for non-recurring engineering sales. It refers to the sales received from
customers during the development stage before mass production of a product. NRE
sales correspond to design and development costs incurred during the development
phase, such as labor costs, IP, design tools, reticles, and prototype manufacturing, andare usually recorded multiple times as development milestones progress.
Abbreviation of Out-sourced Semiconductor Assembly and Test. Manufacturing
companies contracted dedicatedly in the later stages (assembly and test) ofsemiconductor manufacturing.
Abbreviation for supply chain management.
A method of business management to achieve overall efficiency and optimization bycomprehensively reviewing the flow of manufactured products from material
procurement through design, manufacturing, and distribution to the end user.
Abbreviation for system on chip.
The implementation of multiple functions needed to run a device or system on a single
semiconductor chip.

- 61 -

Terminology
System architecture
ChipletTest board
Tapeout
Designmethodology
Semiconductor
ecosystem
Packagingtechnology
Foundry
ReticleDescription
The design and structure of the entire system in which semiconductor is mounted.
A semiconductor packaging technology that combines multiple semiconductor chips
like blocks and treats them like a single chip to realize more advanced functions andperformance without relying solely on the refinement of process technology in the preprocess of semiconductor manufacturing.
Also called an evaluation board, it is a printed circuit board that contains peripheral
chips, circuits and terminals necessary for operation and is created and provided fortesting and evaluating products such as semiconductor chips.
The step of completing the semiconductor design process and moving to the reticle
manufacturing process for transferring circuit information.
A set of semiconductor design methods, including tools for designing and developing
semiconductors.
A structure of business relationships between multiple semiconductor companies that
support the design, development and manufacture of semiconductors.
A technology used in the manufacturing process of semiconductors, called the postprocess, to protect semiconductor chips from the outside and to connect themelectrically.
A company that specializes in contract manufacturing of the pre-process ofsemiconductor manufacturing.
A glass substrate used in the semiconductor manufacturing process to transfer designed
circuit information to a silicon wafer through an exposure device.

- 62 -

Information on the venue of the Tenth Ordinary General Meeting of Shareholders
Venue“Chidori” on the fourth floor of Shin Yokohama Prince Hotel
3-4 Shin-Yokohama, Kohoku-ku, Yokohama City, Kanagawa Prefecture

To Azamino

Yokohama
Arena

Arena Avenue

Loop Road 2
Sotetsu/Tokyu ShinYokohama LineBus Terminal

CUBICPLAZ
A Shinyokohama

Yokohama
Arena Exit

Yokohama Municipal Subway Line, ShinYokohama Station

FamilyMart

SMBC BankMUFG Bank

McDonald's
Bank of
Yokohama

Exit 3SHINYOKOHAMA
Prince PePe
Entrance

Daily
Yamazaki

Venue

Shin
Yokohama
Prince Hotel

JR Shin-Yokohama Station
To Osaka

To Kikuna

To Tokyo

To Yokohama

Floor map

Access - JR Shin-Yokohama Station

Please go up to the fourth floor by escalator

2 minutes’ walk from North Exit on the Yokohama Line
2 minutes’ walk from East Exit or West Exit on the Tokaido Shinkansen
Line
Leave the ticket gate and walk towards the Yokohama Arena Exit.
- Yokohama Municipal Subway Blue Line, Shin-Yokohama Station
Sotetsu/Tokyu Shin-Yokohama Line, Shin-Yokohama Station

2 minutes’ walk from Exit 3

Fourthfloor

AtriumChidori

First
floor
Elevator

From ShinYokohama
StationEscalator
Entrance*We do not offer souvenirs at shareholders meetings.
We would appreciate your understanding.

Shin-Yokohama
Prince PePe,

Socionext Inc.

- 63 -

Driveway

Lobby front desk
Shin-Yokohama
Prince Hotel