Ichigo Inc.
(Tokyo Stock Exchange First Section, 2337)

Materials for the 17th Annual Shareholder Meeting

Our Mission

Ichigo Preserves and Improves Real Estate
Ichigo is a Japanese real estate owner/operator and clean energy producer. Our three key businesses are
Value-Add, in which Ichigo preserves and improves real estate; Asset Management, including managing theTokyo Stock Exchange-listed Ichigo Office REIT (8975), Ichigo Hotel REIT (3463), and Ichigo Green(9282); and Clean Energy, in which Ichigo builds and operates solar power plants on unused land nationwide.
We are committed to creating long-term value and serving the needs of society.

The word “Ichigo” comes from the ancient Japanese proverb, Ichigo
Ichie, literally meaning “One lifetime, one encounter.” The phrase was
first used by a 16th century master of the tea ceremony, Sen no Rikyu.
He called upon his disciples to give total focus and sincerity to each actof the tea ceremony for every guest, because that particular moment will
only exist once and must be fully lived and realized. Ichigo embraces the
Ichigo Ichie philosophy of sincerity and service, and works to build
strong long-term relationships to support the success of all of our clients,
shareholders, and stakeholders.

Ichigo Preserves and Improves Real Estate[Provisional Translation Only]
This English translation of the original Japanese document is provided solely for information purposes.
Should there be any discrepancies between this translation and the Japanese original, the latter shall prevail.

May 12, 2017
Ichigo Inc. (Tokyo Stock Exchange First Section, 2337)
Representative: Scott Callon, Chairman

Materials for the Seventeenth Annual Shareholder Meeting
Dear Shareholders:
We are pleased to invite you to attend the Seventeenth Annual Shareholder Meeting of
Ichigo Inc. (“Ichigo”).
If you are unable to attend the meeting, you may exercise your voting rights via postal
mail or the Internet. We would appreciate it if you could please review the Reference
Materials for the Annual Shareholder Meeting attached below and cast your vote by
returning the enclosed voting form or by accessing our voting website(http://www.evote.jp) no later than Friday, May 26, 2017, 6:30 p.m. JST.
1. Date and Time

Sunday, May 28, 2017 at 10:00 a.m.

2. Place

La Rose, Fifth Floor, Dai-ichi Hotel Tokyo
1-2-6 Shimbashi, Minato-ku, Tokyo

3. Agenda
Matters to be Reported
a. Business Report, Consolidated Financial Statements, and the results of the audit of theConsolidated Financial Statements by the Independent Auditor and Audit Committee
for the Seventeenth Term (March 1, 2016 – February 28, 2017)b. Parent Financial Statements for the Seventeenth Term (March 1, 2016 – February 28,
2017)
Matters to be Resolved
Election of 9 Directors

Additional Accounting Notes
Additional accounting notes to Ichigo’s consolidated and parent financial statements aredisclosed on our website at www.ichigo.gr.jp/ir/library
Please also note that any amendments to the business report, consolidated and parent
financial statements, or shareholder meeting materials will be posted on our website atwww.ichigo.gr.jp-1-

Voting via the Internet
1. Handling of Multiple Votes via both the Proxy Card and the Internet
If you cast multiple votes via both the proxy card and the Internet voting site, only thevote cast via the Internet will be deemed effective.
2. Handling of Multiple Votes via the Internet
If you cast multiple votes via the Internet voting site, only the last vote will be deemed
effective.
3. Internet Voting Procedure
The internet voting procedure is per the below. If you choose to attend the meeting, voting
via the proxy card or the Internet is unnecessary.
a. Voting Website(i)

You can access the designated website www.evote.jp from a PC, smartphone, ormobile phone. Please note that the website is not available from 2 a.m. to 5 a.m.
JST daily.

(ii)

If you use a firewall, have antivirus software installed, or use a proxy server, you
may encounter technical difficulties.

(iii) To exercise your voting rights from a mobile phone, please use i-mode, EZweb orYahoo! Keitai. To ensure security, you may not be able to vote from your mobile
phone if the phone does not support encrypted transmission (SSL).
(iv) We will accept votes submitted via the Internet until 6:30 p.m. JST on Friday, May
26, 2017. Please contact the help desk below if you have any questions.
b. How to Vote via the Internet(i)

Please access our voting website (http://www.evote.jp), and use the log-in ID andtemporary password shown on the enclosed voting form. Follow the on-screen
instructions to indicate your consent or dissent.

(ii)

To prevent unauthorized access and tampering of votes by third parties, please notethat you will be required to change the temporary password on the voting website.

(iii) A new login ID and temporary password is issued for each shareholder meeting.
c. Fees for Accessing the Voting Website
Please note that you will be responsible for expenses such as Internet access fees andtelephone and data charges incurred in accessing the voting website.
4. How to Receive Email Notices of Future Shareholder Meetings
For those interested in receiving notices of future shareholder meetings, please apply
online via the voting website. (Please note that a mobile phone email address cannot beregistered as the receiving email address.)-2-

Inquiries concerning the Voting Process
Help Desk, Corporate Agency Division, Mitsubishi UFJ Trust and Banking Corporation
Toll-free telephone (within Japan): 0120-173-027 (9:00 a.m. to 9:00 p.m. JST)
Institutional Investors
Institutional investors may use the electronic proxy-voting platform of the Tokyo Stock
Exchange for electronic voting.

-3-

Table of Contents
Materials for the Seventeenth Annual Shareholder Meeting
Reference Materials for the Seventeenth Annual Shareholder Meeting
Proposal Election of 9 Directors
Business Report
I. Current Operations and Financials
A. Business Conditions in the Current Fiscal Year
B. Earnings and Assets in the Current and Past Three Fiscal Years
C. Important Company and Subsidiary Information
D. Key Business Priorities
E. Key Business Segments
F. Principal Offices
G. Employees
H. Principal Lenders
I. Dividend and Distribution Policy
J. Other Material Matters
II. Other Matters
A. Shares and Shareholder Information
B. Employee Stock Options
C. Directors and Officers
D. Independent Auditor
E. Controls to Ensure Appropriate Business Conduct
F. Policy on Corporate Control (Takeover Defenses)
Consolidated Financial Statements
Consolidated Balance Sheet
Consolidated Income Statement
Consolidated Statement of Changes in Shareholders’ Equity
Parent Financial Statements
Parent Balance Sheet
Parent Income Statement
Parent Statement of Changes in Shareholders’ Equity
Auditor’s Report on the Consolidated Financial Statements
Auditor’s Report on the Parent Financial Statements
Audit Committee Report

-4-

1

5

22
27
29
30
31
31
32
32
33
33

34
35
42
48
49
54

55
56
57
58
59
60
61
62
63

Proposal

Election of 9 Directors

The terms of office of all nine Directors will expire at the conclusion of this shareholder
meeting. Accordingly, Ichigo proposes the election of the following nine Directors.
The candidates for Directors are as follows:
No.

1

Name
Scott Callon
Reappointment

2

Takuma Hasegawa
Reappointment

3

Minoru Ishihara
Reappointment

4

5

6

7

8

9

Tetsuya Fujita
Reappointment –Independent Director

Noriko Kawate
Reappointment –Independent Director

Yukio Suzuki
Reappointment –Independent Director

Masatoshi Matsuzaki
Reappointment –Independent Director

Kosuke Nishimoto
Reappointment –Independent Director

Current Position and Responsibility
Chairman of the Board of Directors,
Nominating Committee Member,Compensation Committee Member,
Chairman & Representative Statutory
Executive Officer
Chairman of Nominating Committee,
Chairman of Compensation Committee,
Chairman of Compliance Committee,
President & Representative Statutory
Executive Officer
Compliance Committee Member,
Executive Vice President & Statutory
Executive Officer (Real Estate Services)& COO
Lead Independent Director,
Chairman of Audit Committee,
Nominating Committee Member,Compensation Committee Member,Compliance Committee Member

Board Meeting
Attendance
100%(11 of 11 Total)

100%(11 of 11 Total)

100%(11 of 11 Total)

100%(11 of 11 Total)

Independent Director,
Nominating Committee Member, Audit
Committee Member, Compensation
Committee Member

100%(11 of 11 Total)

Independent Director,
Audit Committee Member, Vice
Chairman of Compliance Committee

100%(11 of 11 Total)

Independent Director,
Nominating Committee Member,Compensation Committee Member

100%(7 of 7 Total)

Independent Director

100%(7 of 7 Total)

Nobuhide Nakaido

N/A

New Appointment –Independent Director

-5-

N/A

No.

Name
(Date of Birth)

Career History
April 1988
September 1991
March 1994
August 1994
March 1997
June 2000
May 2001
April 2002
January 2003
May 2006
October 2008
November 2008

1

Scott Callon(December 6, 1964) November 2011
May 2012
July 2012

March 2014
September 2015
May 2016
October 2016

MIPS Computer Systems, Inc.
Asia-Pacific Research Center, Stanford
University
Research Institute of Capital Formation, Japan
Development Bank
Bankers Trust Asia Securities Co., Ltd.
Morgan Stanley Japan Limited
Japan Representative, Prudential plc
Representative Director, PCA Asset Management
LimitedMorgan Stanley Japan Limited
Head of Equities, Morgan Stanley Japan Limited
Partner and Chief Executive Officer, Ichigo AssetManagement, Ltd. (current)
Ichigo Chairman & Representative Statutory
Executive Officer (current)
Director (current), Chairman of Nominating
Committee, Chairman of Compensation
Committee, Vice Chairman of Compliance
Committee
Member of Nominating Committee (current),
Member of Compensation Committee (current)
Associate Director, Japan Association of
Corporate Directors, Audit & Supervisory Board
Member, Chiyoda Co., Ltd.
Director, Member of Nominating Committee,
Member of Compensation Committee, Ichigo
Real Estate Investment Advisors Co., Ltd.
Director, Ichigo Global Capital Co., Ltd.
(current)
Independent Director, Gwynnie Bee Inc.
(current)
Chairman of Compliance Committee
Chairman of Nominating Committee, Chairmanof Compensation Committee
Member of Nominating Committee (current),
Member of Compensation Committee (current)(Other Positions)
Partner and Chief Executive Officer, Ichigo Asset Management, Ltd.
Independent Director, Chiyoda Co., Ltd.

-6-

IchigoShares
Held

N/A

No.
(continued fromprevious page)1

Message to Our Shareholders
This is your company. Ichigo’s mission is to repay the trust of ourshareholders by driving sustainable growth in shareholder value. We
believe that companies exist to contribute to society and that Ichigo’s
growth will contribute to a brighter future for Japan.
We will continue to work to build our capabilities as a company andgrow value for all shareholders and stakeholders.

-7-

No.

Name
(Date of Birth)

Career History
April 1994
November 2002
October 2004
September 2005
May 2006
May 2007
March 2008
May 2009
March 2010
January 2011
March 2015
May 2015
March 2016
May 2016

2

October 2016
Takuma Hasegawa(January 29, 1971)

Joined Fujita Corporation
Joined Ichigo
General Manager, Fund Business Division
General Manager, Fund Business Division
Group 1
Senior Statutory Executive Officer & General
Manager, Fund Business Division Group 1
Senior Statutory Executive Officer & CMO
Senior Statutory Executive Officer
Director & Executive Vice President & Statutory
Executive Officer (Real Estate)
Independent Director, Takara Building
Maintenance Co., Ltd.
President & Representative Director (Overall
Company Management), Ichigo Estate Co., Ltd.
Executive Vice President & Statutory Executive
OfficerPresident & Representative Statutory
Executive Officer (current)
Chairman of Compliance Committee (current)
Member of Nominating Committee, Member ofCompensation Committee
Chairman of Nominating Committee (current),
Chairman of Compensation Committee (current)(Other Positions)
Chairman & Director, Ichigo ECO Energy Co., Ltd.
Message to Our Shareholders
This is the second year of our Power Up 2019 mid-term businessplan. We are dedicating all our strength as a team to fully achieve
the plan and maximize value for Ichigo’s shareholders.

-8-

IchigoSharesHeld

151,100
sharesNo.

Name(Date of Birth)

Career History
April 1990
October 2005
May 2007
March 2008
October 2008
November 2008
May 2009
October 2009
November 2009
May 2010

3
Minoru Ishihara(October 5, 1967) January 2011

April 2011
May 2011
November 2011
July 2012

November 2012

Joined Hazama Corporation
Joined Creed Corporation
Joined Ichigo as Head of Human Resources andGeneral Administration division
Executive Officer and Head of Human Resourcesand General Administration division
Chief Administrative Officer & Statutory
Executive Officer and Head of Business
Management
Director, Asset Investment Advisors Co., Ltd.
(now Ichigo Real Estate Investment Advisors Co.,Ltd.)
Senior Managing Director & Statutory Executive
Officer (Administration), Member of Compliance
Committee (current)
Senior Managing Director (Administration), Asset
Investment Advisors Co., Ltd. (now Ichigo Real
Estate Investment Advisors Co., Ltd.)
President & Representative Director, Asset
Logistics Co., Ltd. (now Ichigo Marché Co., Ltd.)
Director, Senior Managing Director & Statutory
Executive Officer (Administration), Member ofCompliance Committee
Senior Executive Managing Director & Statutory
Executive Officer (Administration, Environmental& Architectural Solutions) andSenior Managing Director (Administration),
Ichigo REIT Management Co., Ltd.
President & Representative Director, Miyako City
Co., Ltd.
Senior Managing Director (Administration),
Ichigo Real Estate Investment Advisors Co., Ltd.
Executive Vice President (current) & Statutory
Executive Officer (Administration)
Director (current), Executive Vice President &Statutory Executive Officer, Ichigo Real Estate
Investment Advisors Co., Ltd.
Director, Ichigo Global Capital Co., Ltd.
Director, Ichigo ECO Energy Co., Ltd.

-9-

IchigoSharesHeld344,100
sharesNo.

Name(Date of Birth)

Career History(continued from March 2013previous page)May 2015
March 2017
April 20173

Head of Real Estate Division (current)
Chairman & Director, Ichigo Marché Co., Ltd.
Chairman & Director, Takara Building
Maintenance Co., Ltd.
Chairman & Director, Nichibei Building
Services Co., Ltd.
Chairman & Director, Nichibei Security
Services Co., Ltd.
Executive Vice President & Statutory Executive
Officer (Real Estate) & COO (current)
President & Representative Director, Ichigo Real
Estate Services Fukuoka Co., Ltd. (current)
Chairman, President, & Representative Director,
Ichigo Marché Co., Ltd. (current)(Other Positions)
Chairman, President & Representative Director, Miyako City Co.,
Ltd.
Chairman, President & Representative Director, Ichigo Marché Co.,Ltd.
President & Representative Director, Ichigo Real Estate Services
Fukuoka Co., Ltd.
Message to Our Shareholders
We are seeing more IT activity in the real estate industry that is
facilitating IoT, interactive communication, and payments. This may
cause a significant change in our industry. I hope to grasp thisREtech (real estate technology) trend and leverage Ichigo’s
extensive experience in asset management and know-how in theprovision of tenant services to open up new opportunities for the
future.
Your continued guidance and support is greatly appreciated.

- 10 -

IchigoShares
Held

No.

Name
(Date of Birth)

Career History
April 1976
April 2001
April 2002
October 2006
April 2007
October 2009
May 2010

4

Tetsuya Fujita(March 26, 1954)

February 2011
March 2011
May 2011
May 2012
July 2012

May 2014

October 2015
May 2016

Joined Taisho Marine and Fire Insurance Co., Ltd.
(now Mitsui Sumitomo Insurance Co., Ltd.)
Executive Director, Taisho Marine & Fire
Insurance (Malaysia) Bhd. (now MSIG Insurance(Malaysia) Bhd)
Board Director, Skandia Life Insurance (Japan)(now Tokyo Marine Nichido Financial Life
Insurance Co., Ltd.)
Executive Director, AXA Life Insurance Co., Ltd.
Representative President & CEO, AXA Financial
Life Insurance Co., Ltd. (now AXA Life
Insurance Co., Ltd.)
Senior Advisor, AXA Life Insurance Co., Ltd.
Ichigo Independent Director (current), Member ofAudit Committee, Member of Compliance
Committee
Auditor of St. Thomas University
President of ReMark Japan Co., Ltd. (current)
Chairman of Compliance Committee
Member of Nominating Committee (current),
Member of Compensation Committee (current)
Director, Member of Audit Committee, Memberof Nominating Committee, Member ofCompensation Committee, Ichigo Real Estate
Investment Advisors Co., Ltd.
Chairman of Audit Committee (current), Memberof Compliance Committee (current)
Chairman of Audit Committee of Ichigo Real
Estate Investment Advisors Co., Ltd.
Advisor, LAUREATE INTERNATIONALUNIVERSITIES Japan (current)
Lead Independent Director (current)(Other Positions)
President, ReMark Japan Co., Ltd.
Advisor, LAUREATE INTERNATIONAL UNIVERSITIES Japan- 11 -

IchigoSharesHeld54,300sharesNo.

Name(Date of Birth)(continued fromprevious page)

4

Career History
Message to Our Shareholders
Ichigo is now in its second year of the Power Up 2019 mid-termbusiness plan and is continuing growth.
As an independent director, I will fulfill the role of supervising themanagement of the company through the Board and each Committee
to support its corporate governance and contribute to the growth of
Ichigo’s corporate value.

- 12 -

IchigoShares
Held

No.

Name
(Date of Birth)

Career History
April 1999
July 2001
August 2004
November 2004
February 2008
January 2009
May 2011
November 2011
July 2012
June 2013
May 2014

5

Noriko Kawate
February 2015
(February 22, 1976)

Joined International Dept., Deloitte Touche
Tohmatsu LLC
Qualified as Certified Public Accountant
Joined Cast & Itoga (now Soga, Uryu, Itoga)
Qualified as Certified Tax Accountant
President of CLEA Consulting Co., Ltd. (current)
Joined Gracia Corporation
Ichigo Director (current), Member of Audit
Committee (current)
Qualified as American Certified Public
Accountant (current)
Director, Member of Audit Committee of Ichigo
Real Estate Investment Advisors Co., Ltd.
Audit & Supervisory Board Member, Meiji
Machine Co., Ltd. (current)
Member of Nominating Committee, Member ofCompensation Committee (current)
Member of Nominating Committee, Member ofCompensation Committee of Ichigo Real Estate
Investment Advisors Co., Ltd.
Partner, Cast Group (current)(Other Positions)
President, CLEA Consulting Co., Ltd.
Partner, Cast Group
Message to Our Shareholders
Ichigo achieved and exceeded its targets for the first year of thePower Up 2019 mid-term business plan supported by the market andby its employees. However, the market surrounding Ichigo isentering a new phase, and the company must prove that its corecapabilities are strong enough to achieve the final-year targets of the
mid-term plan. As an independent director, I will contribute tosustainable corporate growth and increased corporate value throughboth growth-supportive and control-oriented corporate governance.

- 13 -

IchigoSharesHeld40,900sharesNo.

Name(Date of Birth)

Career History
April 1975
June 1996
June 1997
June 1999
June 2000
June 2003
June 2005
June 2008
July 2010
August 2010
June 2012
May 2015
September 2015
May 2016

6
Yukio Suzuki(June 3, 1950)

Joined Nomura Research Institute, Ltd.
Director, Nomura Research Institute Ltd.
Director & Head of Financial Research Center,
Nomura Securities Co., Ltd.
Senior Managing Director in charge of Research
Division, Nomura Asset Management Co., Ltd.
Senior Managing Director in charge of Research
Division, Nomura Asset Management Co., Ltd.
Executive Managing Director, Nomura AssetManagement Co., Ltd.
Director and Audit Mission Director, Nomura
Holdings, Inc.
Advisor, Nomura Securities Co., Ltd.
CEO, Belle Investment Research ofJapan Inc. (current)
Advisor, Deloitte Touche Tohmatsu, LLC
Independent Director, Systena Corporation(current)
Ichigo Director (current), Director of Ichigo
Real Estate Investment Advisors Co., Ltd.
Member of Compliance Committee
Member of Audit Committee (current), Deputy
Chairman of Compliance Committee (current)(Other Positions)
CEO, Belle Investment Research of Japan Inc.
Independent Director, Systena Corporation
Message to Our Shareholders
Continuous corporate value creation requires vision, strategy, andexecution by the management team, innovative development ingrowing the business, and all-encompassing risk management. It isespecially important to share the details of the process ofshareholder value creation with all of our stakeholders.
As an independent director, I will do my best to work forshareholder interests, supporting strong corporate governance, aworkplace that is supportive of Ichigo’s employees, and strong
environmental practices that benefit the planet.

- 14 -

IchigoSharesHeld

13,000sharesNo.

Name(Date of Birth)

Career History
April 1976
June 1999
October 2003
April 2005
April 2006

June 2006
April 2009
April 2013
April 20147
June 2014
Masatoshi Matsuzaki
May 2016(July 21, 1950)
May 2016
June 2016
June 2016
Aug 2016

Joined Konishiroku Photo Industry Co., Ltd.
(now Konica Minolta, Inc.)
General Manager, System Technology
Development Division, Office Document
Company, Konica Corporation
Director, Konica Minolta BusinessTechnologies, Inc.
Executive Officer, Konica Minolta Holdings
Inc.
Representative Director and President, Konica
Minolta Technology Center, Inc.
Senior Executive Officer, Konica Minolta
Holdings Inc.
Director and Senior Executive Officer, Konica
Minolta Holdings Inc.
Director, President and Chief Executive
Officer, Representative Executive Officer andPresident, Konica Minolta Holdings, Inc.
Director, President and Chief Executive
Officer, Representative Executive Officer,
Konica Minolta, Inc.
Director and Chairman of the Board of
Directors, Konica Minolta, Inc. (current)
Chairman of the Board of Directors, Japan
Business Machine and Information System
Industries Association
Deputy Chairman, Japan Association of
Corporate Directors (current)
Ichigo Director, Member of Nominating
Committee, Member of Compensation
Committee (current)
Independent Director, Nomura ResearchInstitute, Ltd. (current)
Independent Director, Nippon Sheet Glass Co.
Ltd. (current)
Member of Public Interest Supervisory
Committee, PwC Aarata LLC (current)(Other Positions)
Chairman of the Board of Directors, Konica Minolta Inc.
Deputy Chairman, Japan Association of Corporate Directors
Independent Director, Nomura Research Institute, Ltd.
Independent Director, Nippon Sheet Glass Co. Ltd.
Member of Public Interest Supervisory Committee, PwC Aarata
LLC- 15 -

IchigoSharesHeld

5,500
sharesNo.

Name(Date of Birth)(continued fromprevious page)

7

Career History
Message to Our Shareholders
I hope to share my experience and advise and supervise
management to further develop and strengthen Ichigo’s capabilities
and support the sustainable growth in its corporate value. I also
hope to fulfill my role as an independent director by seeking togive useful advice to management from a third-party perspective
about future growth opportunities and risks. With respect to bothfinancial and non-financial matters, I will also advise and supervise
management from a stakeholder’s perspective.

- 16 -

IchigoShares
Held

No.

Name
(Date of Birth)

Career History
April 1981
September 1984
June 1995
July 1996
November 1999
April 2006
June 2014
June 2015

May 2016
April 20178

Joined Kanebo Ltd. (Now Kanebo Cosmetics
Inc.)
Joined Meitec Corporation
Director, Meitec Corporation
Senior Managing Director, Meitec
Corporation
President, Meitec Corporation
President and CEO, Meitec Corporation
Chairman of the Board, Meitec Corporation
Resigned from the Board of Meitec
Corporation
Independent Director, Ryosan Company,
Limited (current)
Independent Director, Interworks Inc.
Ichigo Director (current)
Chairman & President and Representative
Director, Interworks Inc. (current)(Other Positions)
Independent Director, Ryosan Company, Limited
Chairman & President and Representative Director, Interworks
Kosuke Nishimoto Inc.
(March 1, 1958)
Message to Our Shareholders
I believe that growing corporate value for our stakeholders,beginning with our shareholders, is the very mission of a publiccompany and is at the heart of a company’s sustainable growth.
Sometimes companies need to take risks in order to grow. I hope
to fulfill my role as an independent director to support theachievement of the Power Up 2019 mid-term business plan byhelping to steer the company in the right direction towards soundcorporate growth.

- 17 -

IchigoSharesHeld

5,800
sharesNo.

Name(Date of Birth)

Career History
April 1971
June 1998
April 2002
April 2003

New Director
Candidate

April 2004
April 2005
June 20099

October 2011
April 2016

Joined Sumitomo Corporation
Director, Sumitomo Corporation
Managing Director, Sumitomo Corporation
Managing Executive Officer, Sumitomo
Corporation
Senior Managing Executive Officer,
Sumitomo Corporation
Executive Vice President, Sumitomo
Corporation
Chairman & CEO, Sumisho Computer
Systems Corporation (Now SCSKCorporation)
Chairman & CEO, SCSK Corporation
Senior Advisor, SCSK Corporation (current)(Other Positions)
Senior Advisor, SCSK Corporation

Nobuhide Nakaido(November 1, 1946) Message to Our Shareholders

I will bring my utmost efforts to contribute to Ichigo’s businessexpansion and corporate value enhancement, drawing upon myyears of business management experience at a listed company andexperience in improving corporate value through workstyle &workplace transformation.

- 18 -

IchigoSharesHeld

N/A

(Note 1) None of the candidates for Director has any relationship of note with Ichigo.
(Note 2)

Ichigo’s Nominating Committee and Board of Directors’ reasons fornominating Scott Callon, Takuma Hasegawa, and Minoru Ishihara as internal
candidates for Director are as follows:(i)

Scott Callon has extensive experience leading Ichigo since October 2008 as
Director and Chairman and has knowledge and expertise derived from serving
on a number of Japanese government bodies, including the Financial Services
Agency (FSA) Council of Experts that drafted Japan’s first Corporate
Governance Code and the Ministry of Economy, Trade and Industry (METI)
Competitiveness and Incentives Structures for Sustainable Growth Project(“Ito Review”). He assumed the position of Ichigo Director in November 2008,
and his term of office will have been 8.5 years at the close of this shareholder
meeting.
(ii)
Takuma Hasegawa has extensive knowledge and experience at Ichigo, having
led a number of Ichigo’s real estate businesses. He has been Ichigo’s President
since March 2015. He assumed the position of Ichigo Director in May 2013,and his term of office will have been four years at the close of this shareholder
meeting.
(iii)
Minoru Ishihara has extensive knowledge and experience as Executive Vice
President and COO of the Company. He assumed the position of Ichigo
Director in 2009, and his term of office will have been eight years at the closeof this shareholder meeting.
(Note 3) All six candidates for Independent Director – Tetsuya Fujita, Noriko Kawate,
Yukio Suzuki, Masatoshi Matsuzaki, Kosuke Nishimoto, and Nobuhide
Nakaido – meet the Tokyo Stock Exchange’s (TSE) requirements for
Independent Director and will be registered with the TSE as such.
(Note 4) Ichigo’s Nominating Committee and Board of Directors’ reasons fornominating Tetsuya Fujita, Noriko Kawate, Yukio Suzuki, Masatoshi
Matsuzaki, Kosuke Nishimoto, and Nobuhide Nakaido as candidates for
Independent Director are as follows:
(i)

(ii)

(iii)

(iv)

Tetsuya Fujita has extensive knowledge and experience working for a leading
property insurance company and a leading life insurance company. He assumed
the position of Independent Director in May 2010, and his term of office will
have been seven years at the close of this shareholder meeting.
Noriko Kawate has extensive experience in statutory auditing at a major
auditing firm and in accounting and tax advisory as a certified public
accountant and tax accountant. She assumed the position of Independent
Director in May 2011, and her term of office will have been six years at theclose of this shareholder meeting.
Yukio Suzuki has extensive experience and knowledge of corporate andsecurities research from serving important roles at a securities company, thinktank, and asset management company at a major financial group, and has
experience and knowledge in operational monitoring and risk control, which hecan draw upon to fully monitor the Company’s activities. He assumed theposition of Independent Director in May 2015, and his term of office will havebeen two years at the close of this shareholder meeting.
Masatoshi Matsuzaki has extensive experience as the CEO and Chairman
leading a major global office equipment manufacturer, driving a positive
structural transformation and business innovation, and played a leading role in- 19 -

developing a best-practice board committee system to support strong corporate
governance, which he can draw upon to fully monitor the Company’s activities
on behalf of shareholders. He assumed the position of Independent Director in
May 2016, and his term of office will have been one year at the close of thisshareholder meeting.
(v)
Kosuke Nishimoto has extensive experience and knowledge as the CEO andChairman leading Japan’s largest engineering services company, growing thecompany and deepening its capabilities on behalf of all stakeholders whiledriving a significant growth in shareholder value. He has deep understandingof human resources and talent development, which he can draw upon to fully
monitor Ichigo’s activities on behalf of shareholders. He assumed the positionof Independent Director in May 2016, and his term of office will have been one
year at the close of this shareholder meeting.
(vi)
Nobuhide Nakaido has extensive experience and knowledge as the Executive
Vice President of one of Japan’s largest trading companies and President &Chairman of a leading Japanese IT system company, driving innovation in the
IT service industry and increasing corporate value through workstyle &workplace transformation. He has extensive knowledge and experience leading
major global companies which he can draw upon to fully monitor Ichigo’s
activities on behalf of shareholders.
(Note 5) No candidate for Independent Director has been involved in inappropriate
conduct while serving as a Director in other companies over the past five
years.
(Note 6) Additional information pertaining to the independence of the candidates for
Independent Director is as follows:(i)

Tetsuya Fujita and Noriko Kawate served as an Independent Director of Ichigo
subsidiary, Ichigo Investment Advisors, from July 2012 to May 2016.
(ii)
Yukio Suzuki served as an Independent Director of Ichigo subsidiary, Ichigo
Real Estate Investment Advisors, from May 2015 to May 2016.
(iii)
No candidate for Independent Director has received in the last two years, norwill they receive, material monetary or other financial compensation(excluding any remuneration as Director or Advisor before assuming theposition of Independent Director) from Ichigo or related entities.
(iv)
No candidate for Independent Director is the spouse of the management of
Ichigo or related entities, nor are they related within three degrees ofconsanguinity.
(Note 7) In order to retain independent directors of high quality, Ichigo has signed
limited liability agreements with Tetsuya Fujita, Noriko Kawate, Yukio Suzuki,
Masatoshi Matsuzaki, and Kosuke Nishimoto. The extent of liabilities forcompensation under the agreements is the minimum limited liability amount as
defined in Article 425, paragraph 1 of the Company Law; provided that theliability is limited only when the Independent Directors have performed theirduties which cause liability in good faith and without gross negligence. Uponthe re-appointment of Tetsuya Fujita, Noriko Kawate, Yukio Suzuki,
Masatoshi Matsuzaki, and Kosuke Nishimoto and the appointment ofNobuhide Nakaido as Independent Directors, Ichigo will enter into newlimited liability agreements with equivalent terms with each of them.
(Note 8) Scott Callon has not received and will not receive any compensation from
Ichigo.
- 20 -

(Note 9) Shares owned by Yukio Suzuki, a candidate for Independent Director, include
shares owned by Belle Investment Research of Japan Inc., all of whose shares
are owned by Yukio Suzuki.
(Note 10) The number of Ichigo shares owned by each of the candidates for Director isas of February 28, 2017.

- 21 -

Business Report(March 1, 2016 – February 28, 2017)I.

Current Operations and Financials

A. Business Conditions in the Current Fiscal Year
1. Business Results and Progress
As a result of Japanese government and Bank of Japan policies, corporate earnings
and employment conditions in Japan have improved during the current fiscal year.
Although consumer spending and price levels remain stagnant, the economy is in aslow recovery phase and there is increasing optimism about the economic outlook.
However, uncertainty remains due to the shift in the global economic landscape andvolatility in the currency markets.
In the Japanese real estate market, higher corporate earnings have led to higher
occupancy and higher rents in offices, most notably in central Tokyo. The J-REIT
market is seeing steady appetite for real estate investment. This investment isincreasingly diversified, with continuing acquisition of hotels and logistics assets. In
the hotel market, strong demand is continuing, as inbound tourism from Asia is still
trending upwards.
With respect to the clean energy market, the number of companies considering exiting
the market is increasing due to the Ministry of Economy, Trade and Industry (METI)
establishing stricter requirements to qualify for the 20-year guaranteed feed-in-tariff(FIT). This is creating a secondary market for the sale and acquisition of existing
power plants and approvals to build solar power plants. Three solar YieldCos,
including Ichigo Green Infrastructure Investment Corporation (“Ichigo Green,” 9282),
have listed on the TSE Infrastructure market, and further growth of the TSE
Infrastructure market is expected.
Ichigo is working to take advantage of this positive business environment to drive
higher earnings for its shareholders and fully achieve its Power Up 2019 Mid-TermBusiness Plan announced in April 2016. Ichigo is actively acquiring real estate assetsthat will drive on-going growth in Ichigo’s Value-Add business and Ichigo Office
REIT (8975) and Ichigo Hotel REIT (3463). Ichigo also sold 13 Ichigo solar power
plants to Ichigo Green (9282) to support its IPO on the TSE Infrastructure market on
December 1, 2016.
Specifically, in the past year Ichigo has executed on the following major initiatives:
 Expanded growth investments (Value-Add real estate, Ichigo Office REIT and
Ichigo Hotel REIT bridge funds, etc.)
 Expanded its clean energy business, including listing Ichigo Green (9282) on the
TSE Infrastructure market
 Expanded the size and profitability of its clean energy business Improved the environmental efficiency, earthquake resistance, and functionalityof its real estate
Provided high-quality asset management services and strengthened tenant leasing
activities
 Acquired its first large-size Value-Add asset- 22 -

 Launched Ichigo Owners, a real estate owner services company, on March 1,
2017
Ichigo Owners caters to the needs of both the experienced real estate owners aswell as those seeking to invest in real estate of the first time, leveraging Ichigo’svalue-add capabilities to increase the value of clients’ real estate. Ichigo Owners
also provides ongoing asset management services tailored to the diverse needs ofIchigo clients, building long-term relationships of trust, and protecting andgrowing the value of client real estate holdings.
 Improved borrowing terms by de-collateralizing loans, extending loan maturities,
switching from floating to fixed-rate loans, and lowering the interest rates on its
loans Generated Value-Add profits and recycled capital into new investments
 Entered the JPX-Nikkei Index 400
Ichigo was selected for inclusion in the JPX-Nikkei Index 400 in August 2016. In
its Power Up 2019 mid-term business plan, Ichigo is seeking to rank within the
JPX-Nikkei 400’s top 200 companies by August 2019.
 Implemented a number of measures to strengthen the Ichigo brandAs a result, in the current fiscal year Ichigo recorded revenue of JPY 109,253 million(+119.8% year-on-year); operating profit of JPY 21,781 million (+41.3%
year-on-year); recurring profit of JPY 19,755 million (+42.2% year-on-year); and net
income of JPY14,894 million (+15.2% year-on-year).

New Value-Add Asset: Tradepia Odaiba- 23 -

Operating Profit(JPY million)
24,00021,781

18,00015,417

12,000
8,189
6,000

3,912
1,844

0
FY13/2

FY14/2

FY15/2

FY16/2

FY17/2Net Income(JPY million)

18,00014,89415,00012,92512,000
9,000

6,761

6,000
3,000

4,526
1,637

0
FY13/2

FY14/2

FY15/2- 24 -

FY16/2

FY17/2

Ichigo Green (9282) TSE Infrastructure Market IPO
Ichigo listed Ichigo Green, a solar power YieldCo, on the TSE Infrastructure market
on December 1, 2016.
Ichigo Green’s mission is to maximize shareholder value via a renewable energy
portfolio that provides both return stability and growth potential, offering investors an
opportunity to invest in the significant and rapidly growing green infrastructure asset
class while contributing to the development of a sustainable society.

Ichigo Takamatsu Kokubunjicho Nii ECO Power Plant

Ichigo Kiryu Okuzawa ECO Power Plant- 25 -

2. Capital Expenditures
During the current fiscal year Ichigo had capital expenditures of JPY 11,601 million
to acquire tangible fixed assets, primarily equipment for new solar power plants.
3. Financing
In order to further increase its profitability and financial strength, Ichigo has taken
action to lower the cost, diversify the terms, and lengthen the maturity of its loans. In
the current fiscal year, Ichigo’s balance of interest-bearing corporate loans was JPY
98,363 million (-6.1% year-on-year), and balance of non-recourse loans was JPY
75,857 million (+27.8% year-on-year). The interest rates on these corporate andnon-recourse loans were 1.2% (-0.2% year-on-year) and 1.3% (-0.3% year-on-year),respectively.
Ichigo continues to have an extraordinarily stable and durable balance sheet, withlong-term loans constituting 93.8% of total loans. Ichigo has continued to lengthen its
average loan term (now 10.8 years), and with 40.1% of Ichigo’s long-term loans fromJapan’s megabanks as of current fiscal year end. Ichigo also executed JPY 35 billionof interest rate hedges in the current fiscal year, hedging 51.7% of outstanding
interest-bearing corporate loans.
Average Interest Rate and Loan Term
(Loan Term, Years)(Interest Rate)

12

2.5%
Weighted Average Interest Rate

WeightedLoan
AverageLoan Term
Average
Period2.22%

10.8 years

1.96%

2.0%

9
9.0 years

8.7 years

1.71%
6

1.5%
4.7 years

5.9 years

1.41%
1.24%

1.0%

3
FY13/2

FY14/2

FY15/2

FY16/2

FY17/2

8% (JPY 4.9B)

10% (JPY 10.3B)

6% (JPY 6.1B)

92%(JPY 53.4B)

90%(JPY 94.4B)

94%(JPY 92.2B)

Term Structure of Loans
21% (JPY 1.5B)

14% (JPY 4.1B)

79%(JPY 5.5B)

86%(JPY 26.1B)

Short-Term
Long-Term- 26 -

4. Business Transfers, Absorption-Type Splits or Incorporation-Type Splits
N/A
5. Transferred Businesses from Other Companies
N/A
6. Succession of Rights and Obligations relating to the Business of Other Companies byAbsorption-Type Merger or Absorption-Type Split
N/A
7. Acquisition and Disposition of Shares and Other Interests in Other Companies andStock Acquisition Rights, etc.
N/A
B. Earnings and Assets in Current and Past Three Fiscal Years
Fourteenth
Term(Year ending
February 28,
2014)35,101

Fifteenth
Term(Year ending
February 28,
2015)
42,705Sixteenth
Term(Year ending
February 29,
2016)
49,699Seventeenth
Term(Year ending
February 28,
2017)109,253

Operating Profit (JPY million)

3,912

8,189

15,417

21,781

Recurring Profit (JPY million)

3,597

7,255

13,88919,755Net Income (JPY million)

4,526

6,761

12,925

14,894Net Income per Share (JPY)

9.83

13.58

25.86

29.66

Total Assets (JPY million)

114,944

172,744251,757

273,459

Net Assets (JPY million)

50,84258,377

72,166

83,443

Net Assets per Share (JPY)

97.42

111.54134.54

159.60

Dividend per Share (JPY)

1.1

1.3

3.0

5.0

11.8%

13.0%

21.0%

20.2%

Revenue (JPY million)

Return on Equity(Note 1) Net Income per Share is calculated based on the average number of sharesissued during the term. Net Assets per Share is calculated based on the numberof outstanding shares as of the end of the fiscal year. These figures do notinclude treasury shares.

- 27 -

Net Income per Share
(JPY)
29.66

30
25.86
20
13.58
9.83

10
3.66
0
FY13/2

FY14/2

FY15/2

FY16/2

FY17/2

Net Assets per Share
(JPY)

180

159.60134.54120

97.42

111.5463.52
60

0FY13/2

FY14/2

FY15/2

FY16/2

FY17/2

Total Assets & Net Assets
300,000

Total Assets

Net Assets

251,757

250,000
200,000

172,744150,000
100,000
50,000(JPY million)
273,459

114,944
80,42831,06658,37750,842

72,166

83,4430
FY13/2

FY14/2

FY15/2- 28 -

FY16/2

FY17/2

C. Important Company and Subsidiary Information(1) Controlling Parent Company
N/A – Ichigo does not have a controlling parent company.
(2) Important Subsidiaries
Percentage
Ownershipof Voting Rights

Name

CapitalIchigo Investment Advisors Co.,Ltd.

JPY 400 million

Ichigo Estate Co., Ltd.

Ichigo ECO Energy Co., Ltd.

JPY 500 million

JPY 100 million

Business Segment

100%

J-REIT and private equity realestate fund asset management

100%

Real estate business including
acquiring, leasing, selling,
offering brokerage andadvisory services, andmanaging REIT bridge funds

100%

Clean energy businessgenerating and supplying solar
power, environmental
conservation engineering, andconsulting

Ichigo Real Estate Services
Fukuoka Co., Ltd.

JPY 50 million

100%Real estate leasing,management, and purchase andsale activity in the Kyushu
regionIchigo Global Capital Co., Ltd.

JPY 10 million

100%

Formation of investment funds
for cross-border M&A advisory

Ichigo Marché Co., Ltd.

JPY 95 million

100%

Wholesale market property
management

Miyako City Co., Ltd.

JPY 50 million

100%

Large-scale retail store
management

Takara Building MaintenanceCo., Ltd.

JPY 10 million

100%

Comprehensive facility
management(Note 1) Ichigo Real Estate Investment Advisors has changed its corporate name to
Ichigo Investment Advisors Co., Ltd as of September 1, 2016.
(Note 2) Ichigo established 100% subsidiary Ichigo Owners Co., Ltd., a real estate
owner services company, with paid-in capital of JPY 100 million on March
1, 2017.
(Note 3) Ichigo sold Takara Building Maintenance Co., Ltd. to Sinanen Holdings Co.,
Ltd. on March 1, 2017.

- 29 -

D. Key Business Priorities
The Japanese real estate continues to show strength. However, while strong investor
demand for real estate continues because of scarce alternative investment opportunities
amidst the persistence of low interest rates, investor sentiment has begun to become
more cautious due to the uncertainty of the impact of Brexit and the policy mix under US
President Donald Trump. With the Bank of Japan already at negative rates, further
declines in interest rates appear unlikely. Although investor sentiment seems to be
weakening, real estate demand both from corporate and individual investors, supported
by favorable corporate earnings and a robust labor market, continues to be robust, andboth real estate prices and rents appear firm, with room for rental growth.
Within this environment, Ichigo announced its new mid-term business plan Power Up
2019 last fiscal year. The key goals of Power Up 2019 are to: 1) drive further sustainableearnings growth in Ichigo’s core businesses; 2) develop new businesses that will be
forward growth engines; and 3) deepen Ichigo’s core capabilities and corporate strength.
Ichigo considers Power Up 2019’s KPIs to be commitments to its shareholders, and justas with Shift Up 2016, Ichigo intends to exceed them.
Power Up 2019 Key Initiatives(1) Core Business Growth̶List Ichigo’s solar assets on the TSE’s new Infrastructure Fund Market
̶Support the on-going growth of Ichigo Office REIT (8975) and Ichigo Hotel
REIT (3463)
̶Expand the architecture and structural engineering team to deliver real estatethat is high-function, safe, secure, and environmentally friendly̶Spin out a dedicated leasing team to drive tenant acquisition and rental income(2) New Business Creation
̶Extend Ichigo’s REIT-focused asset management business into the much larger
physical real estate market
̶Grow Ichigo’s hotel business synergistically with Ichigo Hotel REIT̶

Launch one or more REtech businesses, fusing Ichigo’s Real Estate and IT
capabilities(3) Finance as a Strategic Weapon̶

Grow both financial stability and earnings̶De-collateralize loans, lengthen loan maturities, lower borrowing costs, getcredit ratings, and issue bonds to diversify funding profile(4) High Capital Efficiency and Organic Growth̶ROE >15%(5) Best Place to Work̶

Support employee health and wellness
̶

Goal: Japan’s number one company in providing opportunities for employees(6) Global Best Practice Governance and Compliance- 30 -

E. Key Business Segments (as of February 28, 2017)
Ichigo’s core activity is to preserve and improve real estate. Ichigo receives rental
income during the period it is carrying out its value-add, along with profits on sale thatreflect the real estate’s higher value after the value-add is complete. In addition to its
value-add activity with respect to mid-size office, hotel, and retail assets, Ichigo develops
and operates solar power plants to supply clean energy and bring productive use tounused land.

F. Principal Offices (as of February 28, 2017)
Headquarter
Ichigo Inc.
Ichigo Investment Advisors Co., Ltd.
Ichigo Estate Co., Ltd.
Ichigo ECO Energy Co., Ltd.
Ichigo Global Capital Co., Ltd.
Ichigo Real Estate Services Fukuoka Co., Ltd.

Chiyoda-ku, Tokyo

Fukuoka City, Fukuoka Prefecture

Ichigo Marché Co., Ltd.

Matsudo City, Chiba Prefecture

Miyako City Co., Ltd.

Miyazaki City, Miyazaki Prefecture

Takara Building Maintenance Co., Ltd.

Ryugasaki City, Ibaraki Prefecture(Note) Ichigo Real Estate Investment Advisors Co., Ltd. changed its corporate nameto Ichigo Investment Advisors Co., Ltd. on September 1, 2016.

- 31 -

G. Employees (as of February 28, 2017)
1. Employees (Consolidated basis)
Number of employees

Increase/decrease from the end of previous fiscal year

240 (625)+7 (+12)(Note 1) The number of employees is the number of full-time employees (excluding
workers dispatched from Ichigo to other companies and including workers
dispatched from other companies to Ichigo), including directors who arealso employees.
(Note 2) The average number of non-full-time employees (including part-time andtemporary staff) is presented in parentheses.

2. Employees (Parent basis)
Number of
employees

Increase/decrease
from the end of
previous fiscal year

Average age

Average years of
employment

84 (3)+6 (+2)41.4 years old

4.6 years(Note 1) The number of employees is the number of full-time employees (excluding
workers dispatched from Ichigo to other companies and including workers
dispatched from other companies to Ichigo) including directors who arealso employees.
(Note 2) The average number of non-full-time employees (including part-time andtemporary staff) is presented in parentheses.
(Note 3) On a year-on-year basis the number of employees increased by six;
however, this was mainly due to employees being moved from a
subsidiary pursuant to a corporate reorganization.
H. Principal Lenders (as of February 28, 2017)
Lenders

AmountSumitomo Mitsui Banking Corporation

JPY 21,060 million

Mizuho Bank, Ltd.

JPY 14,268 million

Kansai Urban Banking Corporation

JPY 10,799 million

The Bank of Fukuoka, Ltd.

JPY 7,080 million

The Tokyo Star Bank, Limited

JPY 5,562 million(Note) These amounts do not include non-recourse loans held by funds that Ichigo
manages (e.g., tokumei kumiai partnerships, etc.)- 32 -

I. Dividend and Distribution Policy
Ichigo views dividend distributions to its shareholders as one of its most importantpriorities.
Ichigo’s Board of Directors adopted on April 19, 2016 a progressive dividend policy.
This policy underscores Ichigo’s commitment to driving continued organic earnings anddividend growth for its shareholders. Under a progressive dividend policy, the previous
year’s dividend becomes the floor for the current year’s dividend. The dividend will beraised (or kept flat) but not cut, providing shareholders downside dividend protection.
In addition to this progressive dividend policy, Ichigo is newly setting a minimum DOE(dividend on equity) payout ratio of 3%. In contrast to a “dividend payout ratio policy,”
which calculates dividends based upon annual earnings which can be highly volatile, a
DOE policy paying dividends based upon more stable shareholder equity is by its very
nature more stable. Ichigo believes that the combination of a progressive dividend and a
DOE-based payout policy will significantly increase the security, certainty, and visibilityof its dividend to the benefit of Ichigo’s shareholders.
Dividend per share this fiscal period is JPY 5, up 67% year-on-year.
Dividend per Share

(JPY)

6

5.0

5
4
3.0

3
2
1

1.0

1.1

1.3

FY13/2

FY14/2

FY15/20

J. Other Material Matters
N/A- 33 -

FY16/2

FY17/2

II. Other Matters
A. Shares and Shareholder Information (as of February 28, 2017)
1. Number of Authorized Shares:

1,500,000,000 shares

2. Total Number of Shares Issued:503,712,300 shares (including 329,600 treasury shares)

3. Number of Shareholders:

38,651
Top 10 Shareholders

Name

Shares Held

Shareholding Ratio

ICHIGO TRUST PTE. LTD. (Standing Proxy: The Hong
Kong and Shanghai Banking Corporation Limited)

249,443,200

49.55%BNYM SA/NV FOR BNYM FOR BNY GCM CLIENT
ACCOUNTS M LSCB RD(Standing Proxy: The Bank of Tokyo-Mitsubishi UFJ, Ltd.)26,952,001

5.35%

Chase Manhattan Bank GTS Clients Account Escrow(Standing Proxy: Mizuho Bank, Ltd.)

17,653,000

3.51%Japan Trustee Services Bank, Ltd.
(Trust Account)

11,334,800

2.25%

CGML-LONDON EQUITY(Standing Proxy: Citibank Japan Ltd.)8,411,900

1.67%

MORGAN STANLEY MUFG SECURITIES CO. LTD

6,796,554

1.35%

MORGAN STANLEY MUFG SECURITIES CO. LTD(Standing Proxy: Sumitomo Mitsui Banking Corporation)

5,051,600

1.00%

MACQUARIE BANK LIMITED-MBL LONDON BRANCH(Standing Proxy: Citibank Japan Ltd.)

5,000,000

0.99%

STATE STREET BANK AND TRUST COMPANY(Standing Proxy: The Hong Kong and Shanghai Banking
Corporation Limited, Tokyo Branch)

4,322,741

0.86%

THE MASTER TRUST BANK OF JAPAN, LTD. (Trust
Account)

4,226,700

0.84%

339,192,496

67.38%

TOTAL(Note 1) Shareholding Ratio is calculated excluding 329,600 treasury shares.
(Note 2) The Shareholding Ratio of Ichigo Trust Pte. Ltd., Ichigo’s largest shareholder,decreased from 59.55% on February 29, 2016 to 49.55%.

- 34 -

B. Employee Stock Options
1. Stock Acquisition Rights Issued as Consideration for Execution of Duties by Officers

Date of resolution
Number of stock acquisition rights
Type and number of shares
Issue price
Exercise price
Exercise period
Exercise conditions210th Stock Acquisition Right Plan
August 8, 2011398 units1
79,600 common shares (200 shares per unit)
N/A
JPY 11,000 per unit (JPY 55 per share)
August 9, 2013 – August 8, 2018

Holding by Directors

Number of stock acquisition rights:
Directors
Number of shares:(excluding Independent Directors)
Number of holders:
Independent Directors
Statutory Executive Officers(excluding those who are
Directors)

Number of stock acquisition rights:
Number of shares:
Number of holders:Number of stock acquisition rights:
Number of shares:
Number of holders:

1

－
－
－
－
－
－
200 units
40,000 shares2

Of the total stock acquisition rights, 200 units have been issued to Officers.
(2,208 units have been exercised in the fiscal year ending February 2017.)
2
Exercise Conditions(i) Ichigo must fully complete its buyback of either 61,693 shares or JPY
616,930,000 as approved by Ichigo’s Board of Directors on August 8, 2011.
(ii) Any person who is allotted stock acquisition rights is required to remain in theposition of Director, Statutory Executive Officer, Advisor or employee of
Ichigo, or Director, Statutory Executive Officer, Auditor or employee of
Ichigo’s subsidiaries and other similar positions until the rights are exercised,
except for retirement due to expiration of term, mandatory retirement, andother cases approved by the Board of Directors.
(iii) Pledges and other disposition of stock acquisition rights are not permitted.
(iv) If a person who is allotted stock acquisition rights should become deceased,
the heir may exercise the rights subject to the conditions provided for in the
Stock Acquisition Rights Allotment Agreement as described in (v).
(v) Other conditions are subject to the Stock Acquisition Rights Allotment
Agreement entered into between Ichigo and recipient of stock acquisitionrights pursuant to the resolution of Ichigo’s Board of Directors.
(Note) Shares of Ichigo were split 200 shares to one effective September 1, 2013.

- 35 -

Date of resolution
Number of stock acquisition rights
Type and number of shares
Issue price
Exercise price
Exercise period
Exercise conditions211th Stock Acquisition Right Plan
August 24, 2012
4,190 units1
838,000 common shares (200 shares per unit)
N/A
JPY 12,000 per unit (JPY 60 per share)
August 25, 2014 – August 24, 2019

Holding by Directors

Number of stock acquisition rights:
Directors
Number of shares:(excluding Independent Directors)
Number of holders:Number of stock acquisition rights:
Independent Directors
Number of shares:
Number of holders:
Statutory Executive Officers
Number of stock acquisition rights:(excluding those who are
Number of shares:
Directors)
Number of holders:1

1,679 units
335,800 shares2－－－
1,181 units
236,200 shares3

Of the total stock acquisition rights, 2,860 units have been issued to Officers.
(3,545 units have been exercised in the fiscal year ending February 2017.)
2
Exercise Conditions(i) Ichigo must pay an interim or full-year dividend in the 13th fiscal year (March
1, 2012 – February 28, 2013)(ii) Any person who is allotted stock acquisition rights is required to remain in theposition of Director, Statutory Executive Officer, Advisor or employee of
Ichigo, or Director, Statutory Executive Officer, Auditor or employee of
Ichigo’s subsidiaries and other similar positions until the rights are exercised,
except for retirement due to expiration of term, mandatory retirement, andother cases approved by the Board of Directors.
(iii) Pledges and other disposition of stock acquisition rights are not permitted.
(iv) If a person who is allotted stock acquisition rights should become deceased,
the heir may exercise the rights subject to the conditions provided for in the
Stock Acquisition Rights Allotment Agreement as described in (v).
(v) Other conditions are subject to the Stock Acquisition Rights Allotment
Agreement entered into between Ichigo and recipient of stock acquisitionrights pursuant to the resolution of Ichigo’s Board of Directors.
(Note) Shares of Ichigo were split 200 shares to one effective September 1, 2013.

- 36 -

Date of resolution
Number of stock acquisition rights
Type and number of shares
Issue price
Exercise price
Exercise period
Exercise conditions2

12th Stock Acquisition Right Plan
January 10, 2014
871,100 units1
871,100 common shares (1 share per unit)
N/A
JPY 337 per share
January 12, 2016 – January 10, 2021

Holding by Directors

Number of stock acquisition rights:
Directors
Number of shares:(excluding Independent Directors)
Number of holders:Number of stock acquisition rights:
Independent Directors
Number of shares:
Number of holders:
Statutory Executive Officers
Number of stock acquisition rights:(excluding those who are
Number of shares:
Directors)
Number of holders:1

153,700 units
153,700 shares2
5,300 units
5,300 shares
1
142,800 units
142,800 shares
9

Of the total stock acquisition rights, 301,800 units have been issued to Directors.
(10,500 units have been exercised in the fiscal year ending February 2017.)
2
Exercise Conditions(i) Any person who is allotted stock acquisition rights is required to remain in theposition of Director, Statutory Executive Officer, Advisor or employee of
Ichigo, or Director, Statutory Executive Officer, Auditor or employee of
Ichigo’s subsidiaries and other similar positions until the rights are exercised,
except for retirement due to expiration of term, mandatory retirement, andother cases approved by the Board of Directors.
(ii) Pledges and other disposition of stock acquisition rights are not permitted.
(iii) If a person who is allotted stock acquisition rights should become deceased,
the heir may exercise the rights subject to the conditions provided for in the
Stock Acquisition Rights Allotment Agreement as described in (iv).
(iv) Other conditions are subject to the Stock Acquisition Rights Allotment
Agreement entered into between Ichigo and recipient of stock acquisitionrights pursuant to the resolution of Ichigo’s Board of Directors.

- 37 -

Date of resolution
Number of stock acquisition rights
Type and number of shares
Issue price
Exercise price
Exercise period
Exercise conditions213th Stock Acquisition Right Plan
January 13, 2015
1,817,300 units1
1,817,300 common shares (1 share per unit)
N/A
JPY 382 per share
January 14, 2017 – January 13, 2022

Holding by Directors

Number of stock acquisition rights:
Directors
Number of shares:(excluding Independent Directors)
Number of holders:Number of stock acquisition rights:
Independent Directors
Number of shares:
Number of holders:
Statutory Executive Officers
Number of stock acquisition rights:(excluding those who are
Number of shares:
Directors)
Number of holders:1
2

270,000 units
270,000 shares2
18,000 units
18,000 shares
2
284,000 units
284,000 shares
11

Of the total stock acquisition rights, 572,000 units have been issued to Officers.
Exercise Conditions(i) Any person who is allotted stock acquisition rights is required to remain in theposition of Director, Statutory Executive Officer, Advisor or employee of
Ichigo, or Director, Statutory Executive Officer, Auditor or employee of
Ichigo’s subsidiaries and other similar positions until the rights are exercised,
except for retirement due to expiration of term, mandatory retirement, andother cases approved by the Board of Directors.
(ii) Pledges and other disposition of stock acquisition rights are not permitted.
(iii) If a person who is allotted stock acquisition rights should become deceased,
the heir may exercise the rights subject to the conditions provided for in the
Stock Acquisition Rights Allotment Agreement as described in (iv).
(iv) Other conditions are subject to the Stock Acquisition Rights Allotment
Agreement entered into between Ichigo and recipient of stock acquisitionrights pursuant to the resolution of Ichigo’s Board of Directors.

- 38 -

Date of resolution
Number of stock acquisition rights
Type and number of shares
Issue price
Exercise price
Exercise period
Exercise conditions2
Holding by Officers

Directors(excluding those who are Directors)
Independent Directors
Statutory Executive Officers(excluding those who are also
Directors)
1
2

14th Stock Acquisition Right Plan
January 13, 2016
1,460,000 units1
1,460,000 common shares (1 share per unit)
N/A
JPY 474 per share
January 14, 2018 – January 13, 2023
Number of stock acquisition rights:
Number of shares:
Number of holders:Number of stock acquisition rights:
Number of shares:
Number of holders:Number of stock acquisition rights:
Number of shares:
Number of holders:

175,000 units
175,000 shares2
24,000 units
24,000 shares
3
203,000 units
203,000 shares
11

Of the total stock acquisition rights, 402,000 units have been issued to Officers.
Exercise Conditions(i) Any person who is allotted stock acquisition rights is required to remain in theposition of Director, Statutory Executive Officer, Advisor or employee of
Ichigo, or Director, Statutory Executive Officer, Auditor or employee of
Ichigo’s subsidiaries and other similar positions until the rights are exercised,
except for retirement due to expiration of term, mandatory retirement, andother cases approved by the Board of Directors.
(ii) Pledges and other disposition of stock acquisition rights are not permitted.
(iii) If a person who is allotted stock acquisition rights should become deceased,
the heir may exercise the rights subject to the conditions provided for in the
Stock Acquisition Rights Allotment Agreement as described in (iv).
(iv) Other conditions are subject to the Stock Acquisition Rights Allotment
Agreement entered into between Ichigo and recipient of stock acquisitionrights pursuant to the resolution of Ichigo’s Board of Directors.

- 39 -

Date of resolution
Number of stock acquisition rights
Type and number of shares
Issue price
Exercise price
Exercise period
Exercise conditions2
Holding by Officers

Directors(excluding those who are Directors)
Independent Directors
Statutory Executive Officers(excluding those who are also
Directors)
1
2

15th Stock Acquisition Right Plan
January 13, 2017
2,000,000 units1
2,000,000 common shares (1 share per unit)
N/A
JPY 423 per share
January 14, 2020 – January 13, 2025
Number of stock acquisition rights:
Number of shares:
Number of holders:Number of stock acquisition rights:
Number of shares:
Number of holders:Number of stock acquisition rights:
Number of shares:
Number of holders:

210,000 units
210,000 shares
2
90,000 units
90,000 shares
6
278,000 units
278,000 shares
11

Of the total stock acquisition rights, 578,000 units have been issued to Officers.
Exercise Conditions(i) Any person who is allotted stock acquisition rights is required to remain in theposition of Director, Statutory Executive Officer, Advisor or employee of
Ichigo, or Director, Statutory Executive Officer, Auditor or employee of
Ichigo’s subsidiaries and other similar positions until the rights are exercised,
except for retirement due to expiration of term, mandatory retirement, andother cases approved by the Board of Directors.
(ii) Pledges and other disposition of stock acquisition rights are not permitted.
(iii) If a person who is allotted stock acquisition rights should become deceased,
the heir may exercise the rights subject to the conditions provided for in the
Stock Acquisition Rights Allotment Agreement as described in (iv).
(iv) Other conditions are subject to the Stock Acquisition Rights Allotment
Agreement entered into between Ichigo and recipient of stock acquisitionrights pursuant to the resolution of Ichigo’s Board of Directors.

- 40 -

2. Stock Acquisition Rights Issued for the Consideration for Execution of Duties by
Officers and Employees during the Current Fiscal Year
Date of resolution
Number of stock acquisition rights
Type and number of shares
Issue price
Exercise price
Exercise period
Exercise conditions215th Stock Acquisition Right Plan
January 13, 2017
2,000,000 units1
2,000,000 common shares (1 share per unit)
N/A
JPY 423 per share
January 14, 2020 – January 13, 2025

Holding by Employees

Employees(excluding those who are Directors
and Statutory Executive Officers)

Number of stock acquisition rights:
Number of shares:
Number of holders:

1,407,000 units
1,407,000 shares
179

Directors and Employees of
Subsidiaries

Number of stock acquisition rights:
Number of shares:
Number of holders:

15,000 units
15,000 shares2

1
2

Of the total stock acquisition rights, 1,422,000 units have been issued to employees.
Exercise Conditions(i) Any person who is allotted stock acquisition rights is required to remain in theposition of Director, Statutory Executive Officer, Advisor or employee of
Ichigo, or Director, Statutory Executive Officer, Auditor or employee of
Ichigo’s subsidiaries and other similar positions until the rights are exercised,
except for retirement due to expiration of term, mandatory retirement, andother cases approved by the Board of Directors.
(ii) Pledges and other disposition of stock acquisition rights are not permitted.
(iii) If a person who is allotted stock acquisition rights should become deceased,
the heir may exercise the rights subject to the conditions provided for in the
Stock Acquisition Rights Allotment Agreement as described in (iv).
(iv) Other conditions are subject to the Stock Acquisition Rights Allotment
Agreement entered into between Ichigo and recipient of stock acquisitionrights pursuant to the resolution of Ichigo’s Board of Directors.

3. Other Material Matters regarding Stock Acquisition Rights
N/A- 41 -

C. Directors and Officers
1. Directors (as of February 28, 2017)
Position

Name

Director

Scott
CallonDirector

TakumaHasegawa

Director

MinoruIshihara

Independent
Director3

TetsuyaFujita1

Independent
Director3

NorikoKawate2

Independent
Director3

Yukio
SuzukiIndependent
Director3

Takashi
Kawamura

Independent
Director3

Masatoshi
Matsuzaki

Independent
Director3

KosukeNishimoto1

Responsibility and Other Business Affiliations
Chairman & Representative Statutory Executive Officer
Chairman of the Board of Directors, Nominating Committee Member,Compensation Committee Member
Partner and Chief Executive Officer, Ichigo Asset Management, Ltd.
Independent Director, Chiyoda Co., Ltd.
President & Representative Statutory Executive Officer
Chairman of Compliance Committee, Nominating Committee, andCompensation Committee
Chairman & Director, Ichigo ECO Energy Co., Ltd.
Executive Vice President & Statutory Executive Officer(Real Estate Services) & COO
Compliance Committee Member
Chairman & Representative Director and President, Miyako City Co., Ltd.
Chairman of Audit Committee, Nominating Committee Member,Compensation Committee Member, Compliance Committee Member
President, ReMark Japan Co., Ltd.
Advisor, Laureate International Universities Japan
Nominating Committee Member, Audit Committee Member, Compensation
Committee Member
President, CLEA Consulting Co., Ltd.
Partner, Cast Group
Vice Chairman of Compliance Committee, Audit Committee Member
CEO, Belle Investment Research of Japan Inc.
Advisor, Deloitte Touche Tohmatsu, LLC
Independent Director, Systena Corporation
Chairman, Hitachi, Ltd.
Independent Director, Mizuho Financial Group
Independent Director, Calbee, Inc.
Independent Director, Tokyo University Kyoso Platform Development
Company
External Auditor, Nikkei Inc.
Independent Director, Nitori Holdings Co., Ltd.
Nominating Committee Member, Compensation Committee Member
Chairman of the Board of Directors, Konica Minolta Inc.
Deputy Chairman, Japan Association of Corporate Directors
Independent Director, Nomura Research Institute, Ltd.
Independent Director, Nippon Sheet Glass Co. Ltd.
Member, Public Interest Supervisory Committee of PwC Aarata LLC
Independent Director, Ryosan Company, Limited
Independent Director, Interworks Inc.

Tetsuya Fujita, Chairman of Audit Committee, has served as president of a major
property insurance company in addition to having served as internal audit officer at amajor life insurance company and is certified as an internal auditor, and thus has
extensive knowledge of internal auditing.
- 42 -

2

Audit Committee Member Noriko Kawate is a Certified Public Accountant as well as a
Certified Tax Accountant and thus has extensive knowledge of the finance andaccounting fields.
3
Ichigo has registered all of the Independent Directors with the Tokyo Stock Exchange
as meeting the Tokyo Stock Exchange’s qualifications for independent directors.
(Note) Ichigo has assigned officers and employees to assist the Audit Committee to fulfill
its duties. Independent from other officers and employees, they proactively collectinformation and work closely with the Audit Committee members on a daily basis,and thus the effectiveness of auditing by the Audit Committee is ensured. Sincesuch condition is maintained, Ichigo does not appoint a fulltime Audit Committee
member.
2. Statutory Executive Officers (as of February 28, 2017)
Position

Name

Chairman & Representative
Statutory Executive Officer

Scott Callon

Chairman & Representative
Statutory Executive Officer

Kenji Iwasaki

President & Representative
Statutory Executive Officer

Takuma Hasegawa

Responsibility and Other Business
Affiliations
Overall Group Management
Partner and Chief Executive Officer, Ichigo
Asset Management, Ltd.
Overall Group Management
Overall Group Management
Chairman & Director, Ichigo ECO EnergyCo., Ltd.
Real Estate Services
Chairman & Representative Director andPresident, Miyako City Co., Ltd.

Executive Vice President &Statutory Executive Officer &COO
Executive Managing Director

Eri Murai

Administration & HR

Executive Managing Director

Go Watanabe

Finance

Executive Managing Director

Takeyuki Yoshimatsu

Business Management

Statutory Executive Officer

Katsuhiko Hattori

Engineering

Statutory Executive Officer

Haruki Nakane

Compliance

Statutory Executive Officer

Hiroshi Shimazu

Audit

Statutory Executive Officer

Hisayoshi Towata

Finance

Statutory Executive Officer

Kenichi Nagao

Statutory Executive Officer

Masaaki Yajima

Statutory Executive Officer

Akihiko Tsukasa

Special Projects
Engineering, PM & BM, Planning
Executive Vice President, Takara Building
Maintenance Co., Ltd.
Osaka Branch

Statutory Executive Officer

Kenichi Tanaka

Planning

Minoru Ishihara- 43 -

3. Directors and Statutory Executive Officers who Stepped Down during the Current
Fiscal Year
N/A
4. Outline of Limited Liability Agreement with Independent Directors
Ichigo has entered into agreements to limit liability under Article 423, paragraph 1 of
the Company Law pursuant to the provisions of Article 427, paragraph 1 thereof inorder to retain talented persons as Independent Directors.
The extent of liability for compensation under the agreements is the minimum limited
liability amount as defined in Article 425, paragraph 1 of the Company Law; provided
that the liability is limited only when the Independent Directors have performed theirduties in good faith and without gross negligence.
5. Total Remuneration Paid to Directors and Statutory Executive Officers
Number of Recipients

Amount Paid

Directors(of whom are Independent Directors)

10(7)

JPY 223 million(JPY 51 million)

Statutory Executive Officers

13

JPY 58 million

Total(of whom are Independent Directors)

23(7)

JPY 281 million(JPY 51 million)(Note 1) As of the end of the term, there are nine Directors (including six Independent
Directors) and fifteen Statutory Executive Officers (three of whom are also
Directors), resulting in a total of twenty-one officers. Since those who are botha Statutory Executive Officer and a Director do not receive Statutory Executive
Officer's remuneration, the total amount and number of recipients are shown in
the row of Directors and not in the row of Statutory Executive Officers.
(Note 2) The figures above do not include two Directors, as they do not receive
remuneration from Ichigo.
(Note 3) Since there is one director who stepped down and three Statutory Executive
Officers who are also Directors, there is a difference between the twenty-five
officers which is the sum of two officers not receiving remuneration and thetwenty-three officers in the table above, and the total of twenty-one officers asof the end of the current fiscal year.
(Note 4) The amount paid includes remuneration in the form of stock options of JPY 29
million for Directors (of which JPY 3 million is for Independent Directors) andstock options of JPY 3 million for Statutory Executive Officers.
(Note 5) In addition, Ichigo paid JPY 247 million as employee compensation to twelve
Statutory Executive Officers. This amount includes remuneration in the form ofstock options of JPY 26 million.
(Note 6) Subsidiaries paid JPY 510,000 as remuneration to officers.

- 44 -

6. Policy on Determining Remuneration for Directors and Statutory Executive Officers
a. Basic Policy
Remuneration for Directors and Statutory Executive Officers of Ichigo is determinedbased on the duties of each person, contribution to Ichigo, base compensation, priorexperience, etc.
b. Specific Policies– Remuneration for Directors
Remuneration for Directors consists of a monthly base salary and aperformance-based bonus. The monthly base salary is a fixed amount based on therole and responsibilities of each Director, while the performance-based bonus isbased on Ichigo’s performance.
– Remuneration for Statutory Executive Officers
Remuneration for Statutory Executive Officers consists of a monthly base salary
and a performance-based bonus. The monthly base salary is a fixed amount basedon the role and responsibilities of each Statutory Executive Officer, whereas theperformance-based bonus is based on the performance of Ichigo and the divisionand individuals for which each Statutory Executive Officer is responsible.
– Stock Options
Stock options are granted to Directors and Statutory Executive Officers tostrengthen their motivation to improve performance for the benefit of shareholders.
These stock options are granted in addition to the remuneration described above.
7. External Offices Helda. Positions in Other Companies and the Relationship between Ichigo and these Other
Companies– Tetsuya Fujita, Independent Director, is also President of ReMark Japan Co., Ltd.
Ichigo has no relationship with ReMark Japan Co., Ltd.
– Noriko Kawate, Independent Director, is also President of CLEA Consulting Co.,
Ltd. and Partner of Cast Group. Ichigo has no relationship with CLEA Consulting
Co., Ltd. or Cast Group.
– Yukio Suzuki, Independent Director, is also CEO of Belle Investment Research ofJapan Inc. Ichigo has no relationship with Belle Investment Research of JapanInc.
b. Positions as Independent Directors in Other Companies– Tetsuya Fujita, Independent Director, is Japan Advisor to Laureate International
Universities. Ichigo has no relationship with Laureate International Universities.
– Yukio Suzuki, Independent Director, is an Independent Director of Systena
Corporation. Ichigo has no relationship with Systena Corporation.

- 45 -

– Takashi Kawamura, Independent Director, is a Chairman of Hitachi, an
Independent Director of Mizuho Financial Group, Calbee, Inc., Tokyo University
Kyoso Platform Development Company, and Nitori Holdings Co., Ltd. and anExternal Auditor of Nikkei Inc. Ichigo has no relationship with any of thesecompanies.
– Masatoshi Matsuzaki, Independent Director, is the Chairman of the Board of
Directors of Konica Minolta Inc., the Deputy Chairman of Japan Association of
Corporate Directors, an Independent Director of Nomura Research Institute, Ltd.,and Nippon Sheet Glass Co. Ltd., and a Member of the Public Interest
Supervisory Committee of PwC Aarata LLC. Ichigo has no relationship with anyof these companies.
– Kosuke Nishimoto, Independent Director, is an Independent Director of Ryosan
Company, Limited and Independent Director of Interworks Inc. Ichigo has no
relationship with any of these companies.
c. Relationship with Ichigo or Related Entities of Ichigo
The six Independent Directors have no spouse or relatives in the third degree orcloser who are Statutory Executive Officers of Ichigo or related entities.

- 46 -

d. Principal Director Activities in the Current Fiscal Year

Independent
Director

Tetsuya Fujita

Independent
Director

Maki Kumagai

Independent
Director

Noriko Kawate

Independent
Director

Kenichiro Yoshida

Independent
Director

Yukio Suzuki

Independent
Director

Takashi Kawamura

Independent
Director

Masatoshi Matsuzaki

Independent
Director

Kosuke Nishimoto

Activities
Attended 11 out of 11 meetings (100%) of the Board of
Directors. Attended 18 out of 18 meetings (100%) of the Audit
Committee and attended 3 out of 3 meetings (100%) of theCompliance Committee. Attended 7 out of 7 meetings (100%) of
the Nominating Committee and 7 out of 7 meetings (100%) of
the Compensation Committee since becoming a member.
Commented and advised on resolutions and discussions from an
objective standpoint independent from the management team.
Attended 4 out of 4 meetings (100%) of the Board of Directors
held during her term. Attended 7 out of 7 meetings (100%) of the
Audit Committee during her term. Attended 2 out of 2 meetings(100%) of the Nominating Committee during her term.
Commented and advised on resolutions and discussions from an
objective standpoint independent from the management team.
Attended 11 out of 11 meetings (100%) of the Board of
Directors. Attended 18 out of 18 meetings (100%) of the Audit
Committee. Attended 7 out of 7 meetings (100%) of theNominating Committee and 7 out of 7 meetings (100%) of theCompensation Committee since becoming a member.
Commented and advised on resolutions and discussions from an
objective standpoint independent from the management team.
Attended 4 out of 4 meetings (100%) of the Board of Directors
during his term. Commented and advised on resolutions anddiscussions from an objective standpoint independent from the
management team.
Attended 11 out of 11 meetings (100%) of the Board of
Directors. Attended 11 out of 11 meetings (100%) of the Audit
Committee since becoming a member. Attended 3 out of 3
meetings (100%) of the Compliance Committee. Commented andadvised on resolutions and discussions from an objective
standpoint independent from the management team.
Attended 7 out of 7 meetings (100%) of the Board of Directors
since becoming a director. Commented and advised on
resolutions and discussions from an objective standpoint
independent from the management team.
Attended 7 out of 7 meetings (100%) of the Board of Directors
since becoming a director. Attended 5 out of 5 meetings (100%)of the Nominating Committee since becoming a member.
Attended 7 out of 7 meetings (100%) of the Compensation
Committee since becoming a member. Commented and advisedon resolutions and discussions from an objective standpoint
independent from the management team.
Attended 7 out of 7 meetings (100%) of the Board of Directors
since becoming a director. Commented and advised on
resolutions and discussions from an objective standpoint
independent from the management team.

- 47 -

D. Independent Auditor
1. Grant Thornton Taiyo LLC
2. Fees Paid to the Independent Auditor(i)Fees paid to the Independent Auditor for the current fiscal year
Fees for the services specified in Paragraph 1 of Article 2 of theCertified Public Accountants Act (Act No. 103 of 1948)

JPY 76 million

Fees for the services other than those specified in Paragraph 1 of
Article 2 of the Certified Public Accountants Act–
JPY 76 million(ii) Total monetary and other financial benefits payable by Ichigo andsubsidiaries to the Independent Auditor

JPY 94 million(Note 1) Pursuant to Item 1, Article 399 of the Company Law, Ichigo’s Audit
Committee agrees with the amount of auditor’s remuneration after a thoroughconfirmation and consideration of the validity of the content of auditor’s audit
plan, execution of work, transition of remuneration, and calculation of
remuneration estimates based on “Auditor Assessment and Selection Standards”
and “Auditor Selection and Compensation Agreement Processes” set forth by
Ichigo’s Audit Committee.
(Note 2) Audit agreements between Ichigo and the Independent Auditor do not clearly
itemize the amounts of audit fees for the audits under both the Company Law
and the Financial Instruments and Exchange Law, and, as a matter ofpracticality, Ichigo is not able to itemize them. Therefore, the amount of fees
for the Independent Auditor for the current fiscal year shows the total amount.

- 48 -

3. Policy for the Determination of Dismissal or Non-Reappointment of the Independent
Auditor
The Audit Committee has stipulated a Policy for the dismissal or non-reappointmentof the Independent Auditor based on the “Independent Auditor Evaluation & Selection
Standards” and “Independent Auditor Selection & Compensation Agreement
Processes” set forth by Ichigo’s Audit Committee. The Policy is as below:(a) The term of the Independent Auditor is one year, as specified in a one-year audit
contract.
(b) The reappointment of the Independent Auditor will be decided at the Audit Committee(c) 1. The selection, dismissal, or the non-reappointment of the Independent Auditor
will be decided at the Annual Shareholder Meeting. The Audit Committee makes
the decision to place this on the shareholding meeting agenda.
2. In the event Ichigo decides to dismiss or not reappoint an Independent Auditor
at Ichigo’s discretion or for the breach of laws and regulations such as theCompany Law or the Certified Public Accountants Law, or the breach of thecontract of engagement, the dismissal or the non-reappointment will bedeliberated by the Audit Committee with reference to the views of the Directors
and Statutory Executive Officers.
3. In the event the dismissal or the non-reappointment of the Independent Auditor
is to become the agenda of the shareholder meeting, the details of the agenda item
will be determined by the Audit Committee.
4. In the event the Independent Auditor contravenes his/her duty as an Auditor orif proper duty as an Auditor stipulated in Article 340 Paragraph 1 of the Company
Act is deemed difficult, the Audit Committee may dismiss the Independent
Auditor upon consent of all Audit Committee members.
E. Controls to Ensure Appropriate Business Conduct
Pursuant to Articles 416 of the Company Law and Article 112 of the Enforcement
Regulation of the Company Law, Ichigo's Board approved and enacted a “Basic
Policy for the Establishment of Structure of Internal Controls,” with details shown in
the following tables. Pursuant to Article 14 of Ichigo’s Article of Incorporation, Ichigo
has made this policy available on its corporate website.
www.ichigo.gr.jp/ir/management_policies/internal_controls.html
1. Internal Controls to Ensure that Statutory Executive Officers and Employees
Execute Their Duties in Full Compliance with Japanese Law and Ichigo’s Articles
of Incorporation (Article 416 Paragraph 1 of the Company Law, Article 112
Paragraph 2 Item 4 of the Enforcement Regulation of the Company Law)
Overview(1) The Board complies with relevant laws and regulations, the Articles ofIncorporation, resolutions adopted at shareholders’ meetings, Ichigo's mission,
Ichigo’s Code of Corporate Ethics, and Ichigo’s Code of Conduct in making its
decisions and delegating daily management to the Statutory Executive Officers,that in turn supervise employees within their respective delegated areas ofmanagement. The Board supervises the Statutory Executive Officers by- 49 -

receiving periodic reports on the status of business execution. The Audit
Committee audits the performance of duties for both Statutory Executive
Officers and employees.
(2) The Board sets internal rules, establishes relevant divisions and appoints
Statutory Executive Officers, and engages external experts with respect toestablishing compliance, financial reporting controls, internal audit,
prevention of dealings with anti-social forces, and prevention of insider
trading.
Status(1) The Board is comprised of six independent and three internal directors, andhad a total of 11 meetings during this fiscal period with a 100% attendance
rate. Statutory Executive Officers make decisions and or seek board approvalthrough proposal documents, and report their activities to the Board at least
once every three months. The Audit Committee is comprised of three
independent directors, and held a total of 18 meetings during this fiscal
period with a 100% attendance rate.
(2) (a) Compliance – The Compliance Committee held three meetings todeliberate material compliance matters and conducted training sessions basedon the company's Code of Corporate Ethics and Code of Conduct. A
whistle-blowing system exists, including the ability to directly notify an
external lawyer.
(b) Financial Reporting Controls – The President together with Statutory
Executive Officers of each division and subsidiaries work to ensurecompliance with internal controls and the evaluation thereof.
(c) Internal Audit – The objective of Internal Audit for this fiscal year was tocontribute to management level decision-making through a group-wide,risk-based approach focusing on recommendations to prevent and improve
operations. Specifically, audits examined the appropriateness of fulfilment ofmanagement contracts, procurement of funds, storage and status ofinvestment securities, tenant leasing, and construction consignments.
(d) Prevention of Dealings with Anti-Social Forces – Ichigo has establishedmanuals on how to handle Anti-Social Forces as well as rules that prescribe
certain Anti-Social Force clauses to be included in contracts. Furthermore,
Ichigo works with the Tokyo Metropolitan Police Department and otherexternal experts in conducting due diligence of business counterparts. (See“System Against Anti-Social Forces”)(e) Prevention of Insider Trading – Through its internal rules on the
management of insider information, Ichigo strictly manages all critical
corporate information and ensures proper disclosure thereof. Internal rules
require that all officers and employees must pre-clear any transaction indesignated securities with the Statutory Executive Officer of their respective
divisions.

- 50 -

2. System to Ensure Proper Storage and Management of Information Required for
Execution of Duty by Statutory Executive Officers (Article 112 Paragraph 2 Item
1 of the Enforcement Regulation of the Company Act)
Overview
Ichigo has internal rules with respect to the creation, management, and storage of
information and documents pertaining to execution of duties by Statutory
Executive Officers, and remains fully compliant with all relevant laws andregulations.
StatusHandling of information is stipulated in the Information Management Policy andhandling of documents is stipulated in the Document Management Policy, and all
officers and employees conduct business in full compliance with both policies.
3. Risk Management Policies and Systems (Article 112 Paragraph 2 Item 2 of the
Enforcement Regulation of the Company Act)
Overview
Ichigo's policy is that the Statutory Executive Officer of each division is responsible
for the compliance of respective business operations and for managing businessrisks. In addition, a Chief Risk Officer has been appointed and a Risk Management
Division established in order to ensure a proper risk management framework exists
across the entire group and deal with any significant risks that arise. Ichigo's risk
management framework also prescribes how to respond to any loss of basic business
functions as a result of natural disasters or accidents.
StatusIchigo continually monitors business execution and the risk thereof, and the Chief
Risk Officer reports monitoring results to the Board. Ichigo has business
continuity plans that specify how to recover from natural disasters and accidents,
and all officers and employees are fully aware of these plans.
4. Systems to Ensure Effective Execution of Duties by Statutory Executive Officers(Article 112 Paragraph 2 Item 3 of the Company Act )Overview
Ichigo provides for efficient and agile execution of duties by establishing clarity
with respect to scope of responsibilities and associated authority. Ichigo setsbusiness plans and monitors progress based on the group's management
philosophy and mission, annual group policies, and annual business targets.
Furthermore, Ichigo holds a regular Senior Management Meeting comprised of
the Chairmen, President, Executive Vice President, and representatives of eachsubsidiary to evaluate and take decisions on material business matters.
StatusStatutory Executive Officers execute their duties within their respective delegatedscopes of responsibilities without any undue overlap or negligence. Ichigo
announced its Power Up 2019 mid-term business plan (MTP) at the beginning of- 51 -

this fiscal period, set its business policies and targets for this year in accordancewith the MTP, and has successfully achieved the targets. The Head of Financeprovides analytic support to the Senior Management Meeting to support its
effectiveness.
5. Audit Committee and Audit Systems (Article 416 of the Company Act, Article 112
Paragraph 1 Items 1-7 of the Enforcement Regulation of the Company Act)
Overview(1) Ichigo appoints directors and employees that assist the Audit Committee in theexecution of its duties. Such directors and employees are set to be independent
from the Board, Directors, and Statutory Executive Officers, with any change
in appointment requiring the authorization of the Audit Committee.
(2) Audit Committee Members attend important meetings, and can request
explanations from officers and employees as well as view all related materials.
(3) Officers and employees must report to the Audit Committee or Audit
Committee Members matters that have material impact on the business andfinancial situation of Ichigo. Any person making such report shall not receive
disadvantageous treatment for making such report.
(4) The Audit Committee maintains a close relationship with the Internal Audit
Department by discussing audit plans and receiving reports on audit results.
The Audit Committee also receives periodic reports from the external auditor
as well as exchanges views on any material audit matters.
(5) The Audit Committee holds meetings with Audit Committee Members andauditors of subsidiaries, attends important meetings at subsidiaries, andreceives explanations and reports from subsidiaries in order to assess theappropriate execution of duties by directors and Statutory Executive Offices ofsubsidiaries.
(6) The Audit Committee, at its sole discretion, can appoint external specialists
necessary for the execution of audits and can request that Ichigo bearassociated costs.
Status(1) In accordance with internal rules pertaining to directors and employees
assisting in the duties of the Audit Committee, Ichigo has appointed one
Statutory Executive Officer and two employees, and has ensured their
independence. Furthermore, the prior consent from the Audit Committee has
been sought for any organizational or compensation matter with respect tothese appointed persons.
(2) In accordance with Audit Committee Rules, the Audit Committee attended
important management meetings and received explanations as well as
reviewed any relevant materials. In addition, officers and employees havemade all required reporting to the Audit Committee, and no disadvantageous
treatment has resulted from such reporting.
(3) The Audit Committee approved internal audit plans and received reports on the
results of audits. Furthermore, the Audit Committee has received periodic
reports from the external auditor and has engaged in discussion of material
audit matters.
- 52 -

(4) The Audit Committee holds two liaison meetings a year with Audit Committee
Members and auditors of subsidiaries, and receives explanations and reports
from the officers and employees of subsidiaries.
(5) The Audit Committee has requested that Ichigo bear the costs associated withauditing of subsidiaries.
6. Systems to Ensure Fully Appropriate Business Activities by Ichigo and its
Subsidiaries (Article 112 of the Enforcement Regulation of the Company Act)
Overview(1) Ichigo and all subsidiaries share Ichigo’s Management Philosophy, Code ofCorporate Ethics, and Code of Conduct, and have executed a managementagreement requiring that they work collaboratively in dealing with corporate
governance, compliance, risk management, and prevention of dealings with
Anti-Social Forces.
(2) Ichigo has appointed a Statutory Executive Officer and established a Business
Management Division responsible for monitoring business activities ofsubsidiaries, and requires each subsidiary to provide business reports.
(3) With respect to any transaction with Ichigo Trust Pte. Ltd., the controllingshareholder of Ichigo, Ichigo's takes special care to protect the interests ofminority shareholders via the Board evaluating the purpose, process, and priceof such transactions and ensuring that they increase Ichigo’s corporate value.
(4) Ichigo supports, advises, and manages its subsidiaries to ensure their businessactivities are fully compliant with the Company Act. Ichigo oversees
appropriate business conduct of subsidiaries by receiving periodic reports withrespect to their business operations as well as execution of duties by directors
and officers.
(5) Through its internal rules on the management of insider information, Ichigo
strictly manages all critical corporate information and ensures proper
disclosure thereof. Internal rules require that all officers and employees must
pre-clear any transaction in designated securities with the Statutory Executive
Officer of their respective divisions.
Status(1) Structure to Ensure that Ichigo Subsidiaries Execute Their Duties inCompliance with Laws and Regulations and Ichigo’s Articles of Incorporation
The Boards of each subsidiary have approved a “Basic Policy for the
Establishment of Structure of Internal Controls,” pursuant to the one
established by Ichigo. Audit Committee Members and internal auditors ofrespective subsidiaries attend Board meetings as well as any other importantmanagement meetings and examine related materials to ensure directors andofficers are executing their duties in compliance with laws and regulations,and Ichigo's Articles of Incorporation.
(2) Structure for Ichigo Subsidiaries to Report to Ichigo on the Execution of Their
DutiesThe President receives a report every three months from the presidents of eachsubsidiary with respect to business operations and the execution of duties bydirectors and officers.

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(3) Structure of Risk Management at Ichigo Subsidiaries
Each subsidiary monitors business risks pursuant to their respective risk
management policies, and reports results to Ichigo's Risk Management
Division. The Head of Ichigo's Risk Management Division, in turn, reports
this information to Ichigo's Board. The Chief Risk Officer provides the Board
with a comprehensive update on the status of group-wide risk management.
(4) Structure to Ensure Efficient Execution of Duties at Ichigo Subsidiaries
Each subsidiary has policies in place to ensure clarity of scope of
responsibilities, with management decisions being made in line with suchpolicies, therefore resulting in the efficient execution of duties.
Establishment and Status of Internal Structures to Prevent Dealings with
Anti-Social Forces
As part of its internal control systems, Ichigo has established an internal structure
to prevent dealings with Anti-Social Forces as described below:(1) Ichigo and its subsidiaries have clear policies on preventing dealings with
Anti-Social Forces stipulated within its Code of Corporate Ethics.
(2) Ichigo has appointed the Executive Vice President and the Business
Management Division as being responsible in handling requests from
Anti-Social Forces, and receives advice on this matter from one of its
independent directors that is also a lawyer. Furthermore, Ichigo augments its
efforts in this area by collaborating with external experts such as theOrganized Crime Control Division of the Tokyo Metropolitan Police
Department, the Marunouchi Police Station, and the National Center for
Removal of Criminal Organizations.
(3) Ichigo's Compliance Officer centrally manages group-wide information
pertaining to Anti-Social Forces(4) Under no circumstance will Ichigo heed to the request from an Anti-Social
Force, and shall firmly reject any request working together with external
experts. All contracts with external parties will include language that aims toprevent dealings with Anti-Social Forces. Ichigo will terminate business
relationships with any existing counterpart that is identified as being an
Anti-Social Force.
(5) All officers and employees of Ichigo and subsidiaries receive compliancetraining, and are made fully aware of their obligation to prevent dealings with
Anti-Social Forces and escalate any concerns on this matter.
F. Policy on Corporate Control (Takeover Defenses)
Ichigo has not adopted any takeover defense, poison pill, or any other policy withrespect to persons who would seek to control decisions with respect to Ichigo’s
financial and business policies.

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Consolidated Balance Sheet(As of February 28, 2017)
Item
AssetsAmountCurrent Assets
Cash and cash equivalents
Trade notes and accounts receivable
Operational loans
Operational securities investments
Real estate for sale

222,344
47,678
913
1,324
1,433
167,805

Deferred tax assets
Other
Less: allowance for doubtful
accounts
Fixed Assets
Property, Plant, and Equipment
Buildings and structures
Depreciation
Building and structures (net)
Solar power plant equipment
Depreciation
Solar power plant equipment (net)Land
Buildings under construction
Solar power plant equipment underconstruction
Other
Depreciation
Other (net)
Intangible Assets
Goodwill
Leasehold rights
Other
Investments and Other Assets
Securities investments

516
3,125
-453
51,11545,654
10,173-2,797
7,375
7,822
-575
7,246
18,627
9
416
-331
85
1,956
1,864
62
29
3,504
1,426
10

Deferred tax assets

339

Less: allowance for doubtful
accounts
Total Assets

Deferred tax liabilities

Amount19,548
110
805
611
112
5,209
6,825
1,655
62

Accrued bonuses
Other current liabilities
Long-Term Liabilities
Bonds
Non-recourse bonds
Long-term loans
Long-term non-recourse loans
Deferred tax liabilities
Long-term security deposits received
Other long-term liabilities

36
4,119
170,467
632
100
91,60468,319
1,147
8,038
624

Total Liabilities
Net Assets
Shareholders’ Equity
CapitalCapital reserve surplus
Retained earnings
Treasury shares
Accumulated Other Comprehensive
IncomeValuation gain (loss) on othersecurities
Deferred gain (loss) on long-term
interest rate hedges
Foreign currency translation
adjustment

190,015

12,308Long-term loans receivable

Other

Item
Liabilities
Current Liabilities
Trade notes and accounts payable
Short-term loans
Short-term non-recourse loans
Bonds (due within one year)
Long-term loans (due within one year)
Long-term non-recourse loans(due within one year)
Income taxes payable(JPY million)

1,820
-92

273,459

Stock Options
Minority Interests
Total Net Assets
Total Liabilities and Net Assets- 55 -

80,532
26,65011,05642,840
-15
-192
117
-365
55
491
2,612
83,443
273,459

Consolidated Income Statement(March 1, 2016 – February 28, 2017)(JPY million)

Item
Revenue
Cost of Goods Sold
Gross Profit
SG&A
Operating Profit
Non-Operating Profit
Interest income
Dividend income
Other
Non-Operating Expenses
Interest expense
Valuation loss on derivatives
Debt financing-related fees
Other
Recurring Profit
Extraordinary Gains
Gain on sales of securities investments
Extraordinary Losses
Impairment loss
Earthquake-related damages
Office move expenses
Other
Pre-Tax Net Income
Income taxes-current
Income taxes-deferred
Pre-Minority Interest Net Income
Net Income Attributable to Minority Interests
Net Income- 56 -

Amount109,253
82,44626,806
5,025
21,781
–
85
32
1,303
38
585
216
2,466
1,090
244
31
224
4,863
573

118

2,144
19,7552,466

1,590
20,6305,436
15,194299
14,894

Consolidated Statement of Changes in Shareholders' Equity(March 1, 2016 – February 28, 2017)(JPY million)
Shareholders’ Equity
CapitalReserve

CapitalBalance as of March 1, 2016
Changes in the Current Fiscal Year
Share Issuance
Dividend Payment
Net Income
Change in Consolidated Subsidiaries
Sale of Treasury Shares
Changes in Items other thanShareholders’ Equity
Total Changes
Balance as of February 28, 2017

Balance as of March 1, 2016
Changes in the Current Fiscal Year
Share Issuance
Dividend Payment
Net Income
Change in Consolidated
Subsidiaries
Sale of Treasury Shares
Changes in Items other thanShareholders’ Equity
Total Changes
Balance as of February 28, 2017

Retained
Earnings

26,575

10,968

74

74

‐41

Total
Shareholders’Equity66,95626

149‐1,504
14,894
‐3
39

26
‐15

13,57580,532

Minority
Interests

Total Net
AssetsTreasury
Shares29,454‐1,504
14,894‐3
13

74
26,65088
11,056

13,38642,840

Other Comprehensive Income
Deferred Gain
Foreign
Valuation
Total Other(Loss) on
Currency
Gain (Loss)
Comprehensive
Long-Term
Translation
on Other
IncomeInterest Rate
Adjustment
Securities
Hedges
761
23
533
‐251

Stock
Options

319

4,357

72,166149‐1,504
14,894
‐3
39

‐643

‐113

32

‐725

172

‐1,745‐2,298

‐643
117

‐113
‐365

32
55

‐725
‐192

172
491

‐1,745
2,612

11,277
83,443- 57 -

Parent Balance Sheet(As of February 28, 2017)
Item
AssetsAmountCurrent Assets
Cash and cash equivalents
Accounts receivables
Real estate for sale
Operational securities investments
Short-term loans to affiliates
Advance payment
Accounts receivables - other
Consolidated tax receivables
Deferred tax assets
Other
Less: allowance for doubtful
accounts
Fixed Assets
Property, Plant, and Equipment
Buildings and structures
Depreciation
Building and structures (net)
Land
Other
Depreciation
Other (net)
Intangible Assets
SoftwareInvestments and Other Assets
Investments in securities
Securities investments ofsubsidiaries and affiliates
Bonds of subsidiaries and affiliates
Securities investments of otheraffiliates
Long-term loans receivable
Long-term loans to affiliates
Deferred tax assets

43,60929,387
284
3,201
533
8,050
49
545
591
202
1,172
-411
54,248
3,048
674
-230
444
2,579
59
-35
24
18
18
51,182
1,321(JPY million)

Item
Liabilities
Current Liabilities
Short-term loans
Short-term loans from affiliates
Bonds (due within one year)
Long-term loans (due within one year)
Accounts payable
Expenses payable
Income taxes payable
Advances received
Deposits received
Other current liabilities

AmountLong-Term Liabilities

18,821

Bonds
Long-term loans
Long-term security deposits received
Other long-term liabilities
Total Liabilities
Net Assets
Shareholders’ Equity
CapitalAdditional paid-in capital
Capital reserve
Other additional paid-in capital

4,896
285
42
112
2,004
949
23
1,338
84
20
35
632
17,920256
1223,71873,92426,65011,056
10,96689

5,616

Retained earnings

36,23231

Earnings reserve44

35,316
10
9,241
190

Other retained earnings
Retained earnings carried forward
Treasury shares
Revaluation and Adjustment
Valuation gain (loss) on othersecurities

36,18736,187
-15
-275

Other

436

Less: allowance for doubtful
accounts-981

Deferred gain (loss) hedges-341

97,858Stock Options
Total Net Assets
Total Liabilities and Net Assets

491
74,14097,858

Total Assets- 58 -

66

Parent Income Statement(March 1, 2016 – February 28, 2017)(JPY million)

Item

AmountRevenue
Cost of Goods Sold
Gross Profit
SG&A
Operating Profit
Non-Operating Profit
Interest income
Dividend income
Income from provision of credit guarantees
Other
Non-Operating Expenses
Interest expense
Debt financing-related fees
OthersRecurring Profit
Extraordinary Gains
Gain on sales of investment securities
OthersExtraordinary Losses
Office move expenses
Pre-Tax Net Income
Income taxes-current
Income taxes-deferred
Net Income- 59 -

19,716985
18,7302,648
16,082
371
80
59
72
410
205
251

582

867
15,797

2,436
28

2,465

24

24
18,238

3,256
1,155

4,412
13,826

Parent Statement of Changes in Shareholders’ Equity(March 1, 2016 – February 28, 2017)(JPY million)
Shareholders’ Equity
Capital surplus

Balance as of March 1, 2016
Changes in the Current Fiscal Year
Share issuance
Dividend Payments
Sale of Treasury Shares
Net Income
Changes in Items other thanShareholders’ Equity
Total Changes
Balance as of February 28, 2017

CapitalCapitalReserve

Other
CapitalSurplus

Total
CapitalSurplus26,575

10,89176

10,96874

74

Balance as of March 1, 2016
Changes in the Current Fiscal Year
Share Issuance
Dividend Payments
Sale of Treasury Shares
Net Income
Changes in Items other than Shareholders’ Equity
Total Changes
Balance as of February 28, 201774
10,966

Treasury
Shares

Total
Shareholder
Equity-41

61,41374
1374
26,650Retained earnings
Other
Retained
Earnings
Total
Earnings
Retained
CarriedReserve
Earnings
Forward/Retained
Earnings
44
23,86623,91013
89-1,504-1,504

13,826

13,826

12,321
36,187

12,321
36,23213

88
11,05626－
44

Valuation Adjustment
Deferred Gain
Valuation Gain
Total Valuation(Loss) on(Loss) on Other
Adjustment
Long-Term Interest
Securities
Rate Hedges
703
491
‐212

‐636
‐636
66

- 60 -

‐129
‐129
‐341

‐766
‐766
‐275

149
-1,50439
13,82626‐15

12,51173,924

Stock Options

Total Net
Assets319

62,223

172
172
491

149
-1,50439
13,826‐593
11,917
74,140Auditor's Report on the Consolidated Financial Statements
Report of Independent Auditors
April 13, 2017
To the Board of Directors of Ichigo Inc.
Grant Thornton Taiyo LLC
Satoshi Kirikawa, CPA, Designated and Engagement Partner (seal)
Kenta Nishimura, CPA, Designated and Engagement Partner (seal)
We have audited the consolidated financial statements of Ichigo Inc., namely the consolidated balance sheet, theconsolidated income statement, the consolidated statement of changes in shareholders' equity and the notes toconsolidated financial statements, for the fiscal year from March 1, 2016 to February 28, 2017 pursuant to
Article 444, paragraph 4 of the Company Law.
Management’s Responsibility with respect to the Financial Statements
Management is responsible for compiling and indicating the consolidated financial statements in accordance withthe generally accepted accounting principles of Japan. This includes the operation and maintenance of an internal
compliance structure which management deems necessary to ensure that the consolidated financial statements
are compiled and indicated free of material misstatement in the form of fraud or error.
Auditor’s Responsibility
The responsibility of the Auditor is to perform an independent audit and declare an opinion with respect to theconsolidated financial statements. We conducted our audit in accordance with auditing standards generally
accepted in Japan. Those standards require that we obtain reasonable assurance about whether the consolidated
financial statements are free of material misstatement.
We conducted our audit by carrying out auditing procedures on amounts in the consolidated financial statements
and information we received from the Company. These procedures included sampling and testing based on ourassessment of the potential risk of material misstatement in the form of fraud or error. Although our intent is not
to express an opinion regarding the appropriateness of the internal compliance structure, we did assess operationof the internal compliance structure to the extent it affects the accuracy of the consolidated financial statements.
This included an overall assessment of the consolidated financial statements and any assumptions made bymanagement with respect to the Company’s accounting policies or their application, and any estimates indicatedin the consolidated financial statements.
We believe we received sufficient and appropriate information to have a reasonable basis to express our opinion.
Auditing Opinion
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, thefinancial position of the Ichigo Group consisting of Ichigo Inc. and its consolidated subsidiaries for the period forthe consolidated financial statements in conformity with accounting principles generally accepted in Japan.
Subsequent Events
As described in “7. Material Matters after Closing of the Fiscal Period,” the Company completed the sale of its
100% subsidiary Takara Building Maintenance Co., Ltd. on March 1, 2017. This does not affect the opinion of
the auditor.
Potential Conflicts of Interest
There are no interests to be specified pursuant to the provisions of the Certified Public Accountant Law between
the Company and us or the engagement partner.

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Auditor's Report on the Parent Financial Statements
Report of Independent Auditors
April 13, 2017
To the Board of Directors of Ichigo Inc.
Grant Thornton Taiyo LLC
Satoshi Kirikawa, CPA, Designated and Engagement Partner (seal)
Kenta Nishimura, CPA, Designated and Engagement Partner (seal)
We have audited the Seventeenth term financial statements of Ichigo Inc., namely the balance sheet, the income
statement, the statement of changes in shareholders' equity and the notes to the financial statements andschedules, for the fiscal year from March 1, 2016 to February 28, 2017 pursuant to Article 436, paragraph 2, item
1 of the Company Law.
Management’s Responsibility with respect to the Financial Statements
Management is responsible for compiling and indicating the financial statements and notes and schedules thereto
in accordance with the generally accepted accounting principles of Japan. This includes the operation andmaintenance of an internal compliance structure which management deems necessary to ensure that the financial
statements and notes and schedules are compiled and indicated free of material misstatement in the form of fraud
or error.
Auditor’s Responsibility
The responsibility of the Auditor is to perform an independent audit and declare an opinion with respect to thefinancial statements and the notes and schedules. We conducted our audit in accordance with the auditing
standards generally accepted in Japan. Those standards require that we obtain reasonable assurance about
whether the financial statements and schedules are free of material misstatement.
We conducted our audit by carrying out auditing procedures on amounts in the financial statements and notes andschedules and information we received from the Company. These procedures included sampling and testing
based on our assessment of the potential risk of material misstatement in the form of fraud or error. Although ourintent is not to express an opinion regarding the appropriateness of the internal compliance structure, we didassess operation of the internal compliance structure to the extent it affects the accuracy of the financial
statements and notes and schedules. This included an overall assessment of the consolidated financial statements
and notes and schedules and any assumptions made by management with respect to the Company’s accounting
policies or their application, and any estimates indicated in the financial statements and notes and schedules.
We believe we received sufficient and appropriate information to have a reasonable basis to express our opinion.
Auditing Opinion
In our opinion, the financial statements and schedules referred to above present fairly, in all material respects, thefinancial position of Ichigo Inc. for the period for the financial statements and schedules in conformity withaccounting principles generally accepted in Japan.
Subsequent Events
As described in “7. Material Matters after Closing of the Fiscal Period,” the Company completed the sale of its
100% subsidiary Takara Building Maintenance Co., Ltd. on March 1, 2017. This does not affect the opinion of
the auditor.
Potential Conflicts of Interest
There are no interests to be specified pursuant to the provisions of the Certified Public Accountant Law between
the Company and us or the engagement partner.
- 62 -

Audit Committee Report

April 19, 2017
Audit Committee, Ichigo Inc.
Tetsuya Fujita, Audit Committee Member (seal)
Noriko Kawate, Audit Committee Member (seal)
Yukio Suzuki, Audit Committee Member (seal)
The Audit Committee has audited the execution of the duties of the Directors and Statutory Executive Officers
during the Seventeenth fiscal year from March 1, 2016 to February 28, 2017. We report the method and results ofthis audit as follows:
1. Method and Description of Audit
The Audit Committee has received regular reports and has made requests for explanations as necessary fromthe Directors, Statutory Executive Officers, and employees of Ichigo regarding the details of resolutions by the
Board of Directors with respect to Article 416, paragraph 1, item 1, b and e of the Company Law and thesystem established under the resolutions (internal control system) and in accordance with audit policy andduties prescribed by the Audit Committee. In cooperation with the Internal Audit Office and other internal
control related divisions of Ichigo, the Audit Committee has investigated the process and details ofdecision-making at important meetings, the details of principal-approved documents and other material
documents relating to the execution of business, the execution of duties by Statutory Executive Officers andemployees and reviewed Ichigo's business and assets. With respect to subsidiaries, we have communicated andexchanged information with directors and auditors of subsidiaries and received business reports fromsubsidiaries as necessary.
In addition, we have supervised and verified that the Independent Auditor was independent and conducting anappropriate audit and received reports on the execution of duties from the Independent Auditor and requested
explanations as necessary. We have also received a report from the Independent Auditor that the structure toensure appropriate performance of duties (matters described in Article 131, each item of the Company
Calculation Rules) has been established pursuant to laws and regulations including the Standards for Quality
Control of Audits (issued by Business Accounting Council on October 28, 2005) and that management
structures have been properly established within the audit firm.
By these methods, we have reviewed Ichigo’s own business report, financial statements (balance sheet,income statement, statement of changes in shareholders’ equity and notes) and their schedules, along with
Ichigo’s consolidated financial statements (including the consolidated balance sheet, consolidated income
statement, consolidated statement of changes in shareholders’ equity and consolidated notes).
2. Results of Audit
A. Audit Results of Business Report(1) We note that the business report and its schedules present Ichigo's status correctly pursuant to all laws
and regulations and the Articles of Incorporation.
(2) We note that there has been no misconduct with respect to the execution of duties by Directors andStatutory Executive Officers, nor have we discovered any material facts which violate laws andregulations or the Articles of Incorporation.
(3) We note that the details of the resolution by the Board of Directors with respect to the internal control
system are reasonable. Also, there is nothing material to be pointed out with respect to the execution ofduties on the internal control system by Statutory Executive Officers.

- 63 -

(4) Audit Results of Financial Statements and their Schedules
We note that the method and results of the audit conducted by the Independent Auditor, Grant Thornton
Taiyo LLC, were reasonable.
(5) Audit Results of Consolidated Financial Statements
We note that the method and results of the audit conducted by the Independent Auditor, Grant Thornton
Taiyo LLC, were reasonable.
2. Material Matters after Closing of the Fiscal Period
As described in the Consolidated and Parent Financial Statements, Ichigo completed the sale of its 100%
subsidiary Takara Building Maintenance Co., Ltd. on March 1, 2017.
(Note) All members of the Audit Committee are Independent Directors as provided in Article 2, item 15 andArticle 400, paragraph 3 of the Company Law.

- 64 -