Note: This document has been translated from the Japanese original only for reference purposes. In the event of any
discrepancy between this translation and the Japanese original, the original shall prevail. The Company
assumes no responsibility for this translation or for any direct, indirect or consequential damage arising fromthis translation.

Asahi Holdings, Inc.
(Stock code: 5857)

Notice of the 6th Annual General Meeting of Shareholders
Date and time:
10:30 a.m. on Tuesday, June 16, 2015
Venue:
KOBE PORTOPIA HOTEL
10-1, Minatojima Nakamachi 6-chome, Chuo-ku, Kobe, Hyogo“Kairaku-no-ma,” basement floor, Main Building(Please refer to the place of the meeting shown at the end of this notice.)
Proposals:
Proposal 1:
Proposal 2:

Partial Amendments to the Articles of Incorporation
Election of Five (5) Directors (Excluding Directors Serving as the Audit Committee
Members)
Proposal 3:
Election of Four (4) Directors Serving as the Audit Committee Members
Proposal 4:
Determination of Amounts of Remuneration for Directors and Audit Committee
Members
Proposal 5:
Determination of Amounts and the Content of the Performance-Based Stock
Compensation Plan for Directors
Time limit for the exercise of voting rights using documents:
Documents must arrive before noon on Monday, June, 15, 2015.

Cover

Contents
 Notice of the 6th Annual General Meeting of Shareholders ............................................................. 2
Attached documents
Business Report ............................................................................................................................ 4Consolidated Financial Statements ............................................................................................. 21
Financial Statements ................................................................................................................... 32

Audit Reports .............................................................................................................................. 39 Reference Documents for General Meeting of Shareholders.......................................................... 46

1
Contents

Notice of the 6th Annual General Meeting of Shareholders
This is to inform you that the 6th Annual General Meeting of Shareholders will be held at thefollowing time and place and to cordially request your presence.
If you are unable to be present, you are entitled to exercise your voting rights in writing. In
such a case, you are kindly requested to read the attached reference documents and return theenclosed “Voting Right Exercise Form” by noon on Monday, June 15, 2015, after indicating
your approval or disapproval of each agenda item and affixing your signature and/or seal
thereon.

3. Meeting Agenda
Items to be reported: 1) Business Report, the consolidated financial statements and the resultsof audits of the consolidated financial statements by the Accounting
Auditor and the Board of Corporate Auditors for the 6th fiscal term
(April 1, 2014, through March 31, 2015)
2) Report on non-consolidated financial statements for the 6th fiscal
term (April 1, 2014, through March 31, 2015)
Items to be resolved:
Proposal 1: Partial Amendments to the Articles of Incorporation
Proposal 2: Election of Five (5) Directors (Excluding Directors Serving as the Audit
Committee Members)
Proposal 3: Election of Four (4) Directors Serving as the Audit Committee Members
Proposal 4: Determination of Amounts of Remuneration for Directors and Audit Committee
Members
Proposal 5: Determination of Amounts and the Content of the Performance-Based Stock
Compensation Plan for Directors

2
Cover letter of convocation

Convocation Notice
Financial Statements

Please note that the gifts will not be distributed to attending shareholders from this meeting.

Audit Report

1. Date and time:
2. Venue:

Details of the meeting
10:30 a.m. on Tuesday, June 16, 2015
KOBE PORTOPIA HOTEL
10-1, Minatojima Nakamachi 6-chome, Chuo-ku, Kobe, Hyogo“Kairaku-no-ma,” basement floor, Main Building(Please refer to the place of the meeting shown at the end of this notice.)

Business Reports

4-4-17 Kano-cho, Chuo-ku, Kobe, Japan
Asahi Holdings, Inc.
Mitsuharu Terayama, President & CEO

Consolidated
Financial Statements(Stock code: 5857)
May 28, 2015

Reference Documents for
General Meeting of Shareholders

Dear Shareholders:If you attend the meeting, please submit the “Voting Right Exercise Form” at the reception desk
upon arrival.
Please note that any modifications to the business report, the financial statements and/or thereference documents will be posted on our Web site (http://www.asahiholdings.com/).

3
Cover letter of convocation

Precious metal recycling businessIn the electronics sector, the Japanese market continues to contract as customers shiftoperations overseas, but because the Group worked to expand its E-scrap and precision
cleaning businesses, the collection volume of gold and silver increased from that of the same
period a year earlier. In the dental sector, we worked to secure collection volume even as thevolume of precious metals used for domestic dental treatment materials continued its
gradual decline. In the jewelry sector, the sluggish market continued, and the collection
volume of gold and silver decreased compared with the same period a year before. However,the collection volume of platinum and palladium increased year-on-year. In the automotive
catalyst sector, work on new customer development led to an increased collection volume of
palladium compared with the same period a year earlier.
The average sales price of gold and silver was lower than that of the same period a year
before. The average sales price of palladium was much higher than it was during the same
period a year earlier. The average sales price of platinum was virtually unchanged from thatof the same period last year.
Environmental preservation businessAlthough there were some signs of recovery in corporate production activity, overall itcannot be considered vigorous, and the emission amount of industrial waste are on the
decline. Our corporate customers' rising awareness of "reduce, reuse, and recycle" requires
diversity in processing and processing cost reductions. Under these circumstances, Group
companies have made sales efforts such as advancing one-stop processing solutions and thedevelopment of new customers. Volume handled, especially effluent and sludge, grew yearon-year.
Life & health businessIn the construction-related market, rising prices for construction materials and tightsupply and demand of construction-related workers led to delays in commencements andcompletions of construction works, and also activities such as reductions in construction

4
Status of business for the fiscal year

Convocation NoticeBusiness Reports
Consolidated
Financial Statements

1) Circumstances and results of businessIn the Japanese economy during the fiscal year ended March 31, 2015, although falling
crude oil prices and the weakened yen had positive effects on corporate activities, sluggish
export growth and other factors pressured inventory adjustment, forcing a slowdown. Whilesome believe the worst is now behind us, especially for manufacturing industries, with the
exception of some industries, the recovery remains moderate. As for personal consumption,
the downturn after the consumption tax increase lasted longer than expected.
Under these economic conditions, the Asahi Holdings Group (the “Group”)'s results ineach business segment were as follows.

Financial Statements(1) Status of business for the fiscal year

Audit Report

1. Current Status of the Group

Reference Documents for
General Meeting of Shareholders

Attached documents
Business Report (April 1, 2014, through March 31, 2015)

budgets. This affected the air conditioning design and installation sector and electric heaters
sector. In the health equipment sector, the downturn after the consumption tax increase
lasted long and the recovery of personal consumption remained very moderate. Moreover,
the weakening yen since the beginning of the third quarter has raised the cost of
procurements from overseas. Group companies in these sectors worked on countermeasuresagainst the increased procurement cost.
As a result of the above, as consolidated results of operations for the fiscal year, werecorded consolidated net sales of 111,417 million yen, operating income of 10,480 million
yen, ordinary income of 10,561 million yen, and net income of 5,774 million yen.
Compared with the previous fiscal year, net sales increased by 17,162 million yen,operating income increased by 848 million yen, ordinary income increased by 572 million
yen, and net income decreased by 196 million yen.
By segment, sales in the precious metal recycling business were 77,080 million yen, sales inthe environmental preservation business were 15,415 million yen, and sales in the life &health business were 18,920 million yen.

5
Status of business for the fiscal year

Convocation Notice

Net sales were composed of the following:<Breakdown of net sales>

34.9

103.7

Silver metals

4,941

4.4

71.3

Palladium

17,517

15.7

139.4

Platinum

8,701

7.8

107.3

Indium

131

0.1

17.0

Disposal revenues

17,706

15.9

103.6

Other

23,550

21.0

208.4

Total

111,417

100.0

118.2

Business Reports

2) Capital expenditure
Capital investment made in the fiscal year totaled 1,518 million yen. Main expenditure wasan investment in the in-house information system.
3) Financing
Not applicable for the fiscal year4) Assignment, absorption-type split and incorporation-type split of businessNot applicable for the fiscal year5) Acquisition of the business of other companies
Not applicable for the fiscal year6) Succession of rights and obligations pertaining to the business of other corporations,etc. through an absorption-type merger or an absorption-type split
As of October 1, 2014, Usuda Manufacturing Co., Ltd., and Asahi Pretec Corp. conducted
an absorption-type merger with Asahi Pretec Corp. as the surviving company.
7) Acquisition or disposal of shares or other equity or share options of other companies
As of July 1, 2014, FUJI MEDICAL INSTRUMENTS MFG. CO., LTD. became aconsolidated subsidiary of Japan Waste Corporation, a consolidated subsidiary of Asahi
Holdings, Inc. (the “Company”).
As of December 5, 2014, Asahi Americas Holdings, Inc., was newly established and becamea subsidiary of the Company.
As of March 5, 2015, Asahi Refining Holdings UK Limited and its two subsidiaries, Asahi
Refining USA Inc. and Asahi Refining Canada Ltd., became subsidiaries of Asahi Americas
Holdings, Inc., a subsidiary of the Company.

6
Status of business for the fiscal year

Consolidated
Financial Statements

38,867

YOY change (%)

Financial Statements

Gold metals

Ratio (%)

Audit Report

Net sales(millions of yen)

Reference Documents for
General Meeting of Shareholders

Category(2) Property and profit/loss

Net sales(Millions of yen)

151,094

96,36894,254

6th term
April 1, 2014
through
March 31, 2015
(Current fiscalyear)
111,417

Ordinary income(Millions of yen)

11,130

7,794

9,989

10,561

Net income
Net income per
share
Total assets(Millions of yen)

5,926

4,518

5,971

5,774

(Yen)

183.20139.24183.50176.89(Millions of yen)

58,31562,26066,112

104,877

Category

3rd term
April 1, 2011
through
March 31,2012

4th term
April 1, 2012
through
March 31,2013

5th term
April 1, 2013
through
March 31,
2014

(Millions of yen)
Net assets
38,90242,012
46,491
50,958
Net assets per(Yen)
1,198.77
1,288.56
1,422.51
1,542.82
sharethNote: The figures for the 5 term reflect the retrospective application of the “Practical Solution on Transactionsof Delivering the Company’s Own Stock to Employees etc. through Trusts” (ASBJ PITF No. 30, March 26,2015).

(3) Significant parent company and subsidiaries
1) Relationship with parent company
Not applicable2) Significant subsidiaries
Company name
Asahi Pretec Corp.
Japan Waste Corporation
Asahi Americas Holdings,
Inc.

Capital4,480 million
yen
400 million
yen
10 million
yen

Our voting
right ratio

Major business100.0%

Precious metal recycling business andenvironmental preservation business100.0%

Environmental preservation business100.0%

Precious metal refining businessNote: Asahi Americas Holdings, Inc. was established as of December 5, 2014.
(4) Challenges to be addressed
1) Precious metal recycling business segment
As it is the Group’s core business, the competitiveness of each Japanese domestic businessshall be enhanced. Along with working to expand the business base in North America, weshall work on expansion of new fields in Asian markets. Along with raising awareness of the“Asahi Refining” brand, we shall expand processing volumes of recycling raw materials in
the global market.
2) Environmental preservation business segment
As it is a stable growth business of the Group, profitability shall be emphasized, and active
capital expenditure shall be performed. M&A of companies that can contribute to growth willcontinue.

7
Property and profit/loss, Significant parent company and subsidiaries, and Challenges to be addressed1) The Company
Main office
Head offices

4-4-17 Kano-cho, Chuo-ku, Kobe
Kobe Head Office: 4-4-17 Kano-cho, Chuo-ku, Kobe
Tokyo Head Office: 1-7-12 Marunouchi, Chiyoda-ku, Tokyo
2) Major subsidiaries’ business offices(a) Asahi Pretec Corp.
Main office
21, Uozakihamamachi, Higashinada-ku, Kobe
Head offices
Kobe Head Office: 4-4-17 Kano-cho, Chuo-ku, Kobe
Tokyo Head Office: 1-7-12 Marunouchi, Chiyoda-ku, Tokyo
Research laboratory The Technical Research Center (Kobe-shi)
Business offices
Kitakanto (Kitakatsushika-gun, Saitama Pref.), Nagano (Tomi-shi,
Nagano Pref.), Hanshin (Amagasaki-shi, Hyogo Pref.), Kobe (Kobeshi), Shikoku (Saijo-shi, Ehime Pref.), Kitakyushu (Kitakyushu-shi)
Sales offices
Sapporo (Kitahiroshima-shi, Hokkaido), Aomori (Aomori-shi),Sendai (Miyagi-gun, Miyagi Pref.), Niigata (Sanjo-shi, Niigata Pref.),
Kitakanto (Kitakatsushika-gun, Saitama Pref.), Kanto (Kawaguchishi, Saitama Pref.), Yokohama (Yokohama-shi), Kofu (Chuo-shi,
Yamanashi Pref.), Shizuoka (Yaizu-shi, Shizuoka Pref.), Nagoya(Komaki-shi, Aichi Pref.), Hokuriku (Toyama-shi), Hanshin(Amagasaki-shi, Hyogo Pref.), Kobe (Kobe-shi), Okayama(Okayama-shi), Hiroshima (Hiroshima-shi), Shikoku (Saijo-shi,Ehime Pref.), Fukuoka (Koga-shi, Fukuoka Pref.), Kagoshima(Kagoshima-shi), Okinawa (Itoman -shi, Okinawa Pref.)8
Major financial institutions with loans to the Company, and Other important matters relating to thecurrent state of the Group

Convocation NoticeBusiness Reports
Consolidated
Financial Statements(6) Major sales offices and plants (as of March 31, 2015)

Financial Statements

The Group is mainly engaged in the precious metal recycling business, the environmental
preservation business and the life & health business.
1) Precious metal recycling business○ Collection/reproduction and processing of precious metals and other metals (gold,
silver, palladium, platinum, indium, etc.) and refining of precious metals○ Purchase and sales of precious metals and other metals○ Sales of precious metal products
2) Environmental preservation business3) Life & health business

Audit Report(5) Principal businesses (as of March 31, 2015)

Reference Documents for
General Meeting of Shareholders

3) Life & health business segment
Through new business development, the opening of new sales channels, and the buildingof a unique business model, it shall be set on the path of business growth as the Group's third
business pillar.

Plants

Saitama (Kitakatsushika-gun, Saitama Pref.), Saitama Recycling
Center (Kasukabe-shi, Saitama Pref.), Amagasaki (Amagasaki-shi,
Hyogo Pref.), Amagasaki Recycling Center (Amagasaki-shi, Hyogo
Pref.), Kobe (Kobe-shi), Ehime (Saijo-shi, Ehime Pref.), Kitakyushu(Kitakyushu-shi), Kitakyushu Hibiki (Kitakyushu-shi), Fukuoka(Koga-shi, Fukuoka Pref.)Note: As of October 1, 2014, Asahi Pretec Corp. absorbed its wholly owned subsidiary
Usuda Manufacturing Co., Ltd., and made it Nagano Business Office.

(b) Japan Waste Corporation
Main office
4-4-17 Kano-cho, Chuo-ku, Kobe
Head offices
Kobe Head Office: 4-4-17 Kano-cho, Chuo-ku, Kobe
Tokyo Head Office: 1-7-12 Marunouchi, Chiyoda-ku, Tokyo
Business office
Yokohama (Yokohama-shi)
PlantsOgimachi Center (Kawasaki-shi), Aikawa Center (Aiko-gun,
Kanagawa Pref.)(c) Asahi Americas Holdings, Inc.
Main office
1-7-12 Marunouchi, Chiyoda-ku, Tokyo
Head office
1-7-12 Marunouchi, Chiyoda-ku, Tokyo
3) Other subsidiaries
Japan

Overseas

Nihon Chemitech Co., Ltd. (Kawaguchi-shi, Saitama Pref.), JW
Logistics, Co., Ltd. (Yokohama-shi), Taiyo Chemical Co., Ltd.
(Kagoshima-shi), Iyotec Co., Ltd. (Akashi-shi, Hyogo Pref.), Fuji
Rozai Co., Ltd. (Ota-ku, Tokyo), JW Glass Recycling Co., Ltd.
(Koto-ku, Tokyo), Ecomax Incorporated (Koza-gun, Kanagawa
Pref.), Kyodo Chemical Co., Ltd. (Tomakomai-shi, Hokkaido),
INTER CENTRAL, INC. (Takizawa-shi, Iwate Pref.), KOEIKOGYO
CO., LTD. (Yokohama-shi), FUJI MEDICAL INSTRUMENTS MFG.
CO., LTD. (Osaka-shi), and other
ASAHI G&S Sdn. Bhd. (Malaysia), Shanghai Asahi Pretec Co., Ltd.
(China), Asahi Pretec Korea Co., Ltd. (Seoul Special City), Asahi
Pretec Taiwan Co., Ltd. (Taiwan), Asahi Shih Her Technologies Co.,
Ltd. (Taiwan), Asahi Refining Holdings UK Limited (United
Kingdom), Asahi Refining USA Inc. (USA) and Asahi Refining
Canada Ltd. (Canada)(7) Employees (as of March 31, 2015)
1) Employees of the Group
Number of employees
2,080 (970)

Change from the end of previous fiscal year
+720 (up 727)

Notes: 1. The number of employees refers to the number of workers (excluding the staff
seconded from the Group to companies outside the Group but including staff

9
Property and profit/loss, Significant parent company and subsidiaries, and Challenges to be addressedAverage age

41 (–)+1 (–)

38 years andthree months

Average length ofserviceThree years andone month(Note) The number of employees refers to the number of workers (excluding the staff seconded
from the Company to companies outside the Company but including staff seconded
from companies outside the Company to the Company) and for the number of parttimers and fixed-term employees, annual average number of persons are shown
separately in brackets.

(8) Major financial institutions with loans to the Company (as of March 31, 2015)
Loan amount23,271 million yen
5,249 million yen
3,050 million yen

The Minato Bank, Ltd.
Mizuho Bank, Ltd.
The Chugoku Bank, Ltd.

1,100 million yen
100 million yen
100 million yen

Convocation Notice
Reference Documents for
General Meeting of Shareholders

Financial institutions
The Bank of Tokyo-Mitsubishi UFJ, Ltd.
Sumitomo Mitsui Banking Corporation
Resona Bank, Limited

Business Reports

Change from the endof previous fiscal year

Consolidated
Financial Statements

Number of employees

Financial Statements

2) Employees of the Company

Audit Reportseconded from companies outside the Group to the Group) and for the number ofpart-timers and fixed-term employees, annual average number of persons are shown
separately in brackets.
2. The increase of 720 employees compared with the previous year-end was because
FUJI MEDICAL INSTRUMENTS MFG. CO., LTD. became a subsidiary of Japan
Waste Corporation, which is a subsidiary of the Company, as of July 1, 2014, andAsahi Refining Holdings UK Limited and its two subsidiaries, Asahi Refining USA
Inc. and Asahi Refining Canada Ltd., became subsidiaries of Asahi Americas
Holdings, Inc., which is a subsidiary of the Company, as of March 5, 2015.

(9) Other important matters relating to the current state of the GroupNot applicable

10
Major financial institutions with loans to the Company, and Other important matters relating to thecurrent state of the Group2. Current state of the Company(1) Shares (as of March 31, 2015)
129,000,000 shares
1) Number of shares authorized:
36,254,344 shares
2) Number of shares issued:
9,3213) Number of shareholders:
4) Major shareholders (top 10 shareholders)Shareholders

Japan Trustee Services Bank, Ltd. (Trust account)
TERA ENTERPRISES Co., Ltd.
Mitsuharu Terayama
The Master Trust Bank of Japan, Ltd. (Trust account)
Masamichi Terayama
K&M Co., Ltd.
Asahi Employee Stock Ownership Plan
STATE STREET BANK AND TRUSTCOMPANY 505025
CHASE MANHATTAN BANK GTS CLIENTSACCOUNT ESCROWThe Bank of Tokyo-Mitsubishi UFJ, Ltd.

Number ofshares held(Thousands ofshares)Percentage ofshares held(%)

1, 7395.31

1, 350

4.12

882

2.70

865

2.64

802

2.45

700

2.14

681

2.08

535

1.63

527

1.61

450

1.37

(Notes) 1. The Company holds treasury stock of 3,519,057 shares, which is excluded from theabove major shareholders.
2. Percentage of shares held is calculated by excluding treasury stocks.

11
SharesDirector(excluding
OutsideDirectors)

Stock options
held by board
members

OutsideDirector

Corporate
AuditorJuly 10, 2012 to July 9, 2015

July 10, 2012 to July 9, 2015

(See Note.)(See Note.)

Number of stock options:
400 units
Number of shares subject tostock options:
40,000 shares
Number of persons holding
stock options:
2 persons
Number of stock options:–
Number of shares subject tostock options:–
Number of persons holding
stock options:–
Number of stock options:
200 units
Number of shares subject tostock options:
20,000 shares
Number of persons holding
stock options:
1 person

Number of stock options:
300 units
Number of shares subject tostock options:
30,000 shares
Number of persons holding
stock options:
2 persons
Number of stock options:–
Number of shares subject tostock options:–
Number of persons holding
stock options:–
Number of stock options:–
Number of shares subject tostock options:
Number of persons holding
stock options:––(Note) The person who is allotted stock options should be a Director, a Corporate Auditor, an
employee of the Company or the Company’s subsidiary or affiliate at the time of the exerciseof stock options. However, this shall not apply in cases where the Board of Directors of theCompany exceptionally allows, for example the Director or the Corporate Auditor of theCompany or the Company’s subsidiary or affiliate have resigned due to the expiration of theterm of office or retires due to the mandatory retirement age.

12
Stock options, etc.

Convocation NoticeBusiness Reports

193,500 yen per stock option(1,935 yen per share)

Consolidated
Financial Statements

193,500 yen per stock option(1,935 yen per share)

Financial Statements

Resolution date of issue
Number of stock options
Type and number of sharessubject to stock options
Amount to be paid in forstock options
The value of the property to
be contributed when stock
options are exercised
Exercise period of stock
options
Conditions for the exerciseof stock options

The first series of
The second series ofstock options
stock options
June 16, 2010
June 16, 2010
800 units
1,220 units
Common shares: 80,000 shares Common shares: 122,000 shares(100 shares per stock option)(100 shares per stock option)
Not required to be paid in in
Not required to be paid in in
exchange for stock options
exchange for stock options

Audit Report

Stock options granted to and held by the Company’s board members as consideration of
the execution of their duties (as of March 31, 2015)

Reference Documents for
General Meeting of Shareholders(2) Stock options, etc.

(3) Board members and corporate officers
1) Directors and Corporate Auditors (as of March 31, 2015)
Position

Name

Representative Director, President
and CEO

Mitsuharu Terayama

Director

Yoshikatsu Takeuchi

Director

Tomoya Higashiura

Director

Masaki Hirano

Director

Keitaro Shigemasa

Director

Kazuo Kawabata

Director

Shoji Morii

Full-time Corporate Auditor

Yukio Tanabe

Corporate Auditor

Kazuhiko Tokumine

Corporate Auditor

Junzo Kojima

Responsibility and importantconcurrent assignment
Chairman and Director
Asahi Pretec Corp.
Representative Director andPresident, Japan Waste Corporation
Representative Director andPresident, Asahi Pretec Corp.
Director, Japan Waste Corporation
General Manager of Information
Technology Department andGeneral Manager of Human
Resources Department
Representative Director andPresident, Asahi Americas Holdings,
Inc.
Director, Asahi Pretec Corp.
Director, Asahi Americas Holdings,
Inc.

Lawyer(Notes) 1. Director Shoji Morii is an Outside Director.
2. Corporate Auditor Kazuhiko Tokumine and Corporate Auditor Junzo Kojima are
Outside Corporate Auditors.
3. Full-time Corporate Auditor Yukio Tanabe has longtime experience of accounting of theCompany and possesses extensive expertise in finance and accounting related matters.
4. The Company designated Director Shoji Morii, Corporate Auditor Kazuhiko Tokumine
and Corporate Auditor Junzo Kojima as independent board members under theprovisions of the Tokyo Stock Exchange, and filed such status with the exchange.
2) Directors and Corporate Auditors who resigned during the fiscal year
Not applicable

13
Board members and corporate officers

Director(Outside Directors)
Corporate Auditor(Outside Corporate Auditors)
Total(Outside board members)

8
(1)
3
(2)
11
(3)

118 million yen(6)
28 million yen(10)
146 million yen(16)(Notes) 1. The amount to be paid to Directors does not include the employee salaries of
Directors who serve concurrently as employees.
2. The limit of compensation to be paid to Directors was up to an annual 200,000
thousand yen (not including the portion of salary of employee), which was resolved
at the 1st Annual General Meeting of Shareholders held on June 16, 2010.
3. The limit of compensation to be paid to Corporate Auditors was up to an annual
30,000 thousand yen, which was resolved at the 1st Annual General Meeting of
Shareholders held on June 16, 2010.

Reference Documents for
General Meeting of Shareholders

Audit Report

4) Matters related to outside board members(a) Important concurrent assignment as a person executing business of other corporations, etc.
and relationship between our company and the other corporations, etc.
Not applicable(b) Important concurrent assignment as a board member of other corporations, etc. andrelationship between our company and the other corporations, etc.
Not applicable

Business Reports

Payment amount

Consolidated
Financial Statements

Number of persons
subject to payment

Financial Statements

Category

Convocation Notice3) Compensation, etc., for Directors and Corporate Auditors
Total compensations, etc. for the fiscal year

14
Board members and corporate officers

(c) Main activities in the fiscal year
Category

Director

Name

Shoji Morii

Corporate
Kazuhiko Tokumine
AuditorCorporate
Junzo Kojima
AuditorActivities
He attended all Board of Directors’ meetings held during
the fiscal year. He has expertise and experience related to
management, including finance, and has been submitting
advice / recommendations to ensure the validity andappropriateness of making decisions on deliberations ofagenda and other matters.
He attended all Board of Directors’ meetings and Boardof Corporate Auditors’ meetings held during the fiscal
year. He has been submitting advice / recommendations
to ensure the validity and appropriateness of making
decisions on deliberations of agenda and other mattersfrom the highly professional viewpoint for laws as alawyer.
He attended all Board of Directors’ meetings and Boardof Corporate Auditors’ meetings held during the fiscal
year. He has been submitting advice / recommendations
to ensure the validity and appropriateness of making
decisions on deliberations of agenda and other mattersusing his long-held extensive experience.

(d) Outline of contents of a contract for limitation of liability
The Company and an Outside Director and Outside Corporate Auditors signed a contractthat limits the liability for compensation for damage set forth in Article 423, Paragraph 1of the Companies Act under provisions set forth Article 427, Paragraph 1 of the same Act.
The limit amount of the liability for compensation for damage under such a contract isdetermined to be the minimum liability amount stipulated in Article 425, Paragraph 1 of
the Companies Act.

15
Board members and corporate officers

51,600 thousand yen(Note) In the agreement between the Company and the Accounting Auditor, the amount ofcompensation, etc. for audit under the Companies Act and the amount of compensation,etc. for audit under the Financial Instruments and Exchange Act are not separated andmay not be separated actually. Therefore, the total of those amounts is stated for theamount in (a) above.
3) Non-audit services
We pay Ernst & Young ShinNihon LLC consideration for non-audit services—“issue ofcertification for overseas income laws” and “advisory service concerning the International
Financial Reporting Standards”—other than the services set forth in Article 2, Paragraph 1,of the Certified Public Accountants Act.

Convocation Notice
Reference Documents for
General Meeting of Shareholders

4) Policy for determining the dismissal or the refusal of reappointment of the Accounting
Auditor
When the Board of Directors finds it necessary in cases where the Accounting Auditor has
difficulty executing its duties, the Board of Directors will deal with the dismissal or therefusal of reappointment of the Accounting Auditor as a purpose of the General Meeting of
Shareholders based on the request of the Board of Corporate Auditors.
When it is found that the Accounting Auditor falls under the items set forth in any of itemsof Article 340, Paragraph 1 of the Companies Act, the Board of Corporate Auditors will
dismiss the Accounting Auditor in accordance with the consent of all Corporate Auditors. In
this case, the Corporate Auditor appointed by the Board of Corporate Auditors will report
the fact of the dismissal of the Accounting Auditor and reasons for the dismissal at theGeneral Meeting of Shareholders convened for the first time after the dismissal.

Business Reports

Amount of compensation, etc.
30,300 thousand yen

Consolidated
Financial Statements(a) Amount to be paid by the Company(b) Total amount of money to be paid by the Company
and the Company’s subsidiaries and other benefits
on property

Financial Statements

1) Name of Accounting Auditor
Ernst & Young ShinNihon LLC
2) Amount of compensation, etc. for the Accounting Auditor

Audit Report(4) Accounting Auditor

16
Accounting Auditor

(5) Structure to ensure the appropriateness of business
Decisions on a structure to ensure that the execution of duties by Directors conforms to the laws
and regulations and the Articles of Incorporation, and other structures to ensure theappropriateness of the business of the company are as follows:
1) Structure to ensure that the execution of duties by Directors and employees conforms
to the laws and regulations and the Articles of Incorporation(a) To ensure that laws and regulations and the Articles of Incorporation are thoroughly
followed, we compile and improve our regulations and manuals related to compliancewhile continuing to make well known to employees the existence of an in-house reporting
hotline responding to the case where behaviors violating laws and regulations and the
Articles of Incorporation are detected.
(b) If a situation that infringes compliance occurs, we maintain a structure where the detailsof such situation and a countermeasure therefor are reported immediately to Directors andCorporate Auditors.
2) Structure related to preservation and management of information regarding theexecution of duties by Directors(a) Information and documents (information on the execution of duties) regarding theexecution of duties by Directors are preserved and managed appropriately in accordancewith in-house regulations and management manuals related thereto while the state ofoperation is examined and regulations and other rules are reviewed when necessary.
3) Regulation and other structures regarding a risk of loss(a) In a bid to appropriately control risks involved in a business execution process and abusiness structure of our group, we establish a structure to understand/assess risks inbusiness activities and implement a measure, thereby improving a structure to prevent thematerialization of risks while ensuring compliance.
(b) We compliment efforts for compliance and risk management and conduct internal audits
to deter a risk of loss without omission. If behaviors with a risk of loss are found, they arereported to the Board of Directors and related divisions immediately.
4) Structure to ensure effective execution of Directors’ duties(a) A management plan is drawn up and the Board of Directors examines the details thereof
and makes decisions thereon. In addition, periodical reports on whether the management
plan is implemented as scheduled are made from subsidiaries and business execution lines.
(b) Regarding the supervision of the business execution, the Board of Directors examines andmakes decisions on the matters set forth in the rules for the Board of Directors and thematters to be discussed that fall under the criteria thereon. Particularly important mattersare examined at the group strategy meeting to enhance such examination related todecision-making.
5) Structure to ensure the appropriateness of business at the business group of theCompany(a) To understand management information at subsidiaries and affiliates, appropriate business
reports are submitted on a quarterly basis. Through these reports, if a risk of loss on
subsidiaries, etc. has been found or a potential risk of loss may be found, reports are
submitted immediately to the Board of Directors regarding the details of the risk of loss,
the degree of loss that may occur, and its impacts, etc. on the Company.

17
Structure to ensure the appropriateness of business

18
Structure to ensure the appropriateness of businessConvocation NoticeBusiness Reports
Consolidated
Financial Statements
Financial Statements
Audit Report
Reference Documents for
General Meeting of Shareholders(b) We implement periodical inspections to understand safety and health for the execution ofbusiness by our subsidiaries and affiliates and provide continued guidance to prevent theoccurrence of a risk of loss on safety and health.
(c) To prevent inappropriate transactions or accounting methods between our company andsubsidiaries, etc., adequate exchange of information is carried out with the audit divisionof subsidiaries, etc. or the division equivalent thereto.
6) Matters for appointment of employees to assist Corporate Auditors(a) Employees to assist the duties of Corporate Auditors are appointed when necessary.
7) Matters related to the independence of employees to assist duties of Corporate
Auditors from Directors(a) Appointment and transfer of employees to assist Corporate Auditors requires the consent
of the Board of Corporate Auditors(b) In evaluating the performance of employees to assist Corporate Auditors, Corporate
Auditors’ opinions are obtained.
8) Structure for Directors and employees to report to Corporate Auditors and otherstructures for reports to Corporate Auditors, as well as a structure to ensure theeffective conduct of audits by Corporate Auditors(a) Directors and employees provide necessary reports and information upon request of
Corporate Auditors in accordance with the determination of the Board of Corporate
Auditors.
(b) Reports and information in the preceding paragraph should mainly be as follows:• Status of activities of divisions involved in the creation of our internal control system• Status of activities of Corporate Auditors and internal audits of our subsidiaries, etc.
• Our significant accounting policy and accounting standards and changes thereof• Details of announcement of financial results and forecast• Operations of in-house reporting system and details of the reports• Making it obligatory to circularize in-house ringisho (collective decision-making sheet)and the minutes of meetings required by Corporate Auditors(c) When recognizing that laws and regulations and the Articles of Incorporation are or may
be violated even for items other than those set forth in the preceding paragraphs above, theBoard of Directors and employees report to that effect to the Board of Corporate Auditors
immediately.
(d) The Board of Directors and employees should fully respect Corporate Auditors’ opinions
on ensuring the effectiveness of audit.

(6) Policy to determine the distribution, etc. of surplus
The Articles of Incorporation stipulates that the Company may carry out the distribution, etc.
of surplus pursuant to the resolutions of the Board of Directors, instead of the resolutions of
the General Meeting of Shareholders. In addition, we believe that it is also important to seek
to improve our corporate value through ongoing stable profitability and further growth, andto enhance retained earnings to prepare for investments in growth fields and the developmentof new businesses, with a basic policy to respond to expectations of shareholders throughstable dividends.
Under this policy, regarding the distribution, etc. of surplus, we will further strengthen
consolidated and nonconsolidated results for each fiscal year and our financial structure, withgiving comprehensive consideration to the future management strategy, etc. of our group.
After then, we will return earnings to shareholders.

(Note) The amount and the number of shares stated in this report are rounded down to the nearest unit.
The percentage is rounded to the nearest unit.

19
Policy to determine the distribution, etc. of surplus

Account

AmountLIABILITIESCurrent assets

48,556,537

Cash and deposits

11,046,611

Notes and accounts receivable-trade

15,146,387

Merchandise and finished goods

4,855,470

Current liabilities

45,603,338

Work in process

9,141,400

Notes and accounts payabletrade
Short-term loans payable
Current portion of long-termloans payable
Accounts payable-otherRaw materials and supplies

1,633,326

Income taxes payable

2,111,596

854,166

Deferred tax assets

6,161,691
26,171,659
270,000
3,473,216

Provision for bonuses

747,911

Other

5,919,420

Provision for directors’ bonuses

36,600Allowance for doubtful accounts(40,246)

Provision for repairs

106,680

Noncurrent assets

56,321,376

Provision for product warranties

85,731

Provision for sales rebates

371,981

Provision for sales returns

13,200

Deferred tax liabilities

776,754

Property, plant and equipment

32,334,096

Other

5,276,316

Buildings and structures

12,298,087

Noncurrent liabilities

8,316,547

Machinery, equipment and vehicles

5,013,916

Long-term loans payable

6,550,000

Land

14,568,241

Deferred tax liabilities

1,567,562

Construction in progress

38,220Other

415,630

Net defined benefit liability
Other
Total liabilities

126,555
72,43053,919,886

Business Reports

AmountConsolidated
Financial Statements

Account
ASSETS

Financial Statements

Consolidated Balance Sheets (as of March 31, 2015)

Convocation Notice

Consolidated Financial Statements

49,819,392

Capital stock

4,480,817

22,643,627

Goodwill

21,737,557

Capital surplus

6,038,759

906,069

Retained earnings

44,459,425(5,159,609)

Other

Investment securities

168,994

Deferred tax assets

368,867

Net defined benefit asset

154,207

Treasury stock
Accumulated othercomprehensive income
Valuation difference on
available-for-sale securities
Deferred gains or losses onhedgesForeign currency translation
adjustment
Subscription rights to shares

Other

676,113

Minority interests

Allowance for doubtful accounts(24,528)

Investments and other assets

Total assets

1,343,653

104,877,914

685,274
33,107
313,451
338,715
77,908375,452

TOTAL NET ASSETS

50,958,027

TOTAL LIABILITIES AND
NET ASSETS

104,877,914(Note) Amounts less than one thousand yen are omitted.

20
Consolidated Balance Sheets

Reference Documents for
General Meeting of Shareholders

Shareholders’ equity
Intangible assets

Audit Report

NET ASSETS

(Thousands of yen)
Consolidated Statements of Income (April 1, 2014 to March 31, 2015)
Account
AmountNet sales
111,417,067
Cost of sales
88,340,760
Gross profit
23,076,307
Selling, general and administrative expenses
12,595,945
Operating income
10,480,362
Non-operating income
Interest income and dividends
39,911
Gains on foreign exchange
37,805
Subsidy income
36,468
Other
68,999183,185
Non-operating expenses
Interest expenses
54,004
Other
48,022102,026
Ordinary income
10,561,520
Extraordinary income
Gains on sale of noncurrent assets
9,360
Gains on sale of investment securities
10,12019,480Extraordinary loss
Loss on retirement and sale of noncurrent assets
69,301
Impairment losses
57,405Additional tax on value-added tax
736,816
863,523
Income before income taxes and minority
9,717,477
interests
Income taxes-current
3,916,099
Income taxes-deferred(40,697)
3,875,401
Income before minority interests
5,842,076
Minority interests in loss
67,130Net income
5,774,946(Note) Amounts less than one thousand yen are omitted.

21
Consolidated Statements of Income

4,480,817

6,108,187

40,715,629(5,384,309)

45,920,324(69,428)(67,008)

4,597(131,839)

6,038,759

40,648,620(5,379,712)

45,788,485(1,964,141)(1,964,141)

5,774,946

5,774,946
(897)

(897)

221,000

221,000－－

3,810,804

220,1024,030,907

4,480,817

6,038,759

44,459,425(5,159,609)

49,819,392

Accumulated other comprehensive income

Balance at April
1, 2014
Cumulative
effects ofchanges inaccounting
policies
Restated balance
at April 1, 2014
Changes during
the period
Dividends fromsurplus
Net income
Purchase oftreasury stock
Disposal oftreasury stock
Net changes in
items other thanshareholders’equity during
the period
Total changes
during the period
Balance at March
31, 2015

Valuationdifference on
available-forsale securities

Deferred gains
or losses onhedges

15,205(121,332)

Foreigncurrencytranslation
adjustment

Total
Subscription
accumulated
rights toothersharescomprehensive
income665,549

559,42177,908

Minority
interest

66,103

Total net
assets46,623,757(131,839)

15,205(121,332)

665,549

559,42177,908

66,10346,491,918

Convocation Notice

Total shareholders’equityTreasury stockBusiness Reports

4,480,817

Retained earnings(1,964,141)
5,774,946(897)
221,000

17,902434,784(326,833)

125,852－

309,349

435,201

17,902434,784(326,833)

125,852－

309,349

4,466,109

33,107

313,451

338,715

685,274

77,908375,452

50,958,027(Note) Amounts less than one thousand yen are omitted.

22
Consolidated Statements of Changes in Net Assets

Reference Documents for
General Meeting of Shareholders

Balance at April 1,
2014
Cumulative effects
of changes inaccounting
policies
Restated balance atApril 1, 2014
Changes during
the period
Dividends fromsurplus
Net income
Purchase oftreasury stock
Disposal oftreasury stock
Net changes in
items other thanshareholders’equity during theperiodTotal changes
during the period
Balance at March
31, 2015

Capital surplus

Consolidated
Financial Statements

Capital stock

Financial Statements

Shareholders’ equity

Audit Report

Consolidated Statements of Changes in Net Assets (April 1, 2014 to March 31, 2015)(Thousands of yen)

Notes to consolidated financial statements(Basis of preparing consolidated financial statements)
1. Scope of consolidation
Number of consolidated subsidiaries

24

Asahi Pretec Corp.
Japan Waste Corporation
Nihon Chemitech Co., Ltd.
JW Logistics, Co., Ltd.
Taiyo Chemical Co., Ltd.
Iyotec Co., Ltd.
Fuji Rozai Co., Ltd.
JW Glass Recycling Co., Ltd.
Ecomax Incorporated
Kyodo Chemical Co., Ltd.
INTER CENTRAL, INC.
KOEIKOGYO CO., LTD.
Major consolidated subsidiaries
FUJI MEDICAL INSTRUMENTS MFG. CO.,LTD.
Asahi G&S SDN. BHD.
Shanghai Asahi Pretec Co., Ltd.
Asahi Pretec Korea Co., Ltd.
Asahi Pretec Taiwan Co., Ltd.
Asahi Shih Her Technologies Co., Ltd.
Asahi Americas Holdings, Inc.
Asahi Refining Holdings UK Limited
Asahi Refining USA Inc.
Asahi Refining Canada Ltd.
and 2 other companies
FUJI MEDICAL INSTRUMENTS MFG. CO., LTD. is included in the scope of
consolidation due to its stock acquisition on July 1, 2014.
Asahi Americas Holdings, Inc. is included in the scope of consolidation as it was newly
established on December 5, 2014.
Asahi Refining Holdings UK Limited and its two subsidiaries (Asahi Refining USA Inc.,
Asahi Refining Canada Ltd.) are included in the scope of consolidation as all shares of Asahi
Refining Holdings UK Limited were acquired on March 5, 2015.
Additionally, Usuda Manufacturing Co., Ltd. has been excluded from scope of
consolidation due to its merger with Asahi Pretec Corp on October 1, 2014.
Nonconsolidated subsidiaries

None

2. Equity method affiliate
Equity method affiliates
None
Jiangmen Asahi Pretec Kanfort Environmental Managemant Co., Ltd. has been excluded

23
Notes to consolidated financial statements

(2) Depreciation and amortization for major assets
1) Property, plant and equipment other: The Company and domestic consolidated
than leased assets
subsidiaries: declining-balance method Note:
Buildings acquired on or after April 1, 1998
other than equipment: straight-line method
Foreign consolidated subsidiaries: mainly
straight-line method based on accounting
standards of local country.
2) Intangible assets other than leased: The Company and domestic consolidated
assetssubsidiaries: straight line method
Foreign consolidated subsidiaries: straight-line

24
Notes to consolidated financial statements

Convocation NoticeBusiness Reports
Consolidated
Financial Statements
Financial Statements

4. Accounting policies(1) Valuation standards and methods for major assets
1) Securities
Other securities
Other securities for which market: Stated at fair value prevailing at the balance
quotations are available
sheet date with unrealized gains and losses,
directly included in net assets. The cost of
securities sold is determined by the movingaverage method.
Other securities for which market: Cost mainly determined by the moving-average
quotations are not available
method.
2) Derivative: Market price method
3) Inventories
Merchandise and finished goods, work : Stated at cost. Cost is determined mainly by thein process, raw materials and supplies
moving-average method (the method of writedowns based on the decrease in profitability isapplied in order to calculate the inventory valueon the balance sheet).
(A part of merchandise and finished goods isdetermined by individual cost method based on
the actual cost method.)

Audit Report

3. Fiscal year of consolidated subsidiaries
Among consolidated subsidiaries, the fiscal year end of Asahi G&S Sdn. Bhd., Shanghai Asahi
Pretec Co., Ltd., Asahi Pretec Korea Co., Ltd., Asahi Pretec Taiwan Co., Ltd. and Asahi Shih Her
Technologies Co., Ltd. is December 31 of each year. For the preparation of consolidated financial
statements, the Company uses financial statements as of December 31 and makes adjustments asnecessary for consolidation in relation to significant transactions during their year-end date andthe consolidated year-end date.

Reference Documents for
General Meeting of Shareholders

from equity method affiliate due to sale of its stock during the fiscal year ended March 31,
2015.

3) Leased assets(3) Significant allowances
1) Allowances for doubtful account2) Provision for bonuses

3) Provision for director’s bonuses

4) Provision for repairs

5) Provision for product warranties

6) Provision for sales rebates

7) Provision for sales returns

25
Notes to consolidated financial statements

method based on accounting standards of local
country.
Software for internal use is amortized under thestraight-line method based on the period forwhich the Company can use such software (5years or less).
: Leased assets related to financial leases that do
not transfer ownership rights to the lessees areamortized under the straight-line method basedon the lease term as the useful life and residual
value of zero. Finance leases whose starting
date of lease transactions that do not transfer
ownership rights to the lessees before the startof the applied first fiscal year are continuously
subject to accounting in accordance withmethods used for an ordinary lease transaction.

: To prepare for losses from doubtful receivables,
general allowance of the Company anddomestic consolidated subsidiaries is recorded
based on the actual bad debt ratio, and specificallowance is recorded based on the amountdeemed to the uncollectible considering thecollectibility. As for foreign consolidated
subsidiaries, specific credits are based on
estimated uncollectible amount.
: To allow for the payment of bonuses to
employees, the standard for estimated amountsof bonuses to be paid is recorded.
: To allow for the payment of bonuses todirectors, the standard for estimated amounts ofbonuses to be paid is recorded.
: To allow our payment of periodic maintenanceof production equipment, the Company records
the amount of estimated cost to be paid during
this fiscal year.
: To allow for cost of after-sales service, theCompany records the actual cost of the past to
be paid.
: To allow for sales rebates, some consolidated
subsidiaries record the cost of this fiscal year’s
portion of the estimated sales rebate.
: To allow for sales returns, some consolidated

26
Notes to consolidated financial statements

Convocation NoticeBusiness Reports
Consolidated
Financial Statements
Financial Statements
Audit Report(4) Other important items for preparing consolidated financial statements
1) Hedge accounting
Hedge accounting methods: The Company accounts for hedging activities
under deferral hedge accounting. Furiate-shori(accounting method in which the current andforward rate difference is allocated by period
length for the calculation at the accounting
period) is applied to forward foreign exchange
contracts which conform to the requirements ofsuch hedge accounting.
Hedging instruments and targets
Hedging instruments: Derivative transaction and exchange contracts
Hedged targets: Precious metal products and monetary assets
and liabilities denominated in foreign
currencies
Hedge policy: To reduce the precious metal market price risk
and to improve income and expenditurebalance, the company hedges price fluctuation
risk based on internal rules.
Methods for valuation of: During the start of hedging to the judgment ofappropriateness for hedging
appropriateness, accumulated rate fluctuationsin hedge targets and hedge items are comparedand then valuation is made on the basis of theamount of changes in hedge targets and hedge
item. For foreign exchange contracts subject tofuriate-shori, the valuation of appropriatenessis omitted.
2) Accounting method for consumption: Consumption taxes are accounted for using thetaxes
net method of reporting.
3) Translation of foreign currency: All monetary assets and liabilities denominateddenominated assets or liabilities into
in foreign currencies are translated into
Japanese yen
Japanese yen at the exchange rates prevailing at
the fiscal closing date. Resulting gains andlosses are included in net profit or loss for theperiod.
All assets and liabilities as well as revenues andexpenses of foreign subsidiaries and affiliatedcompanies are translated into Japanese yen at
the spot exchange rates prevailing at the fiscal
closing date of such subsidiaries and affiliates,
and translation adjustments are included in

Reference Documents for
General Meeting of Shareholders

subsidiaries record the estimated sales returns
losses at the year - end of this fiscal year.

4) Amortization of goodwill“Foreign currency translation adjustments of“Net assets.”: By judging respective case, goodwill isamortized under the straight-line method withina period of 20 years.

5) Accounting for net defined benefit
liability
Method of attributing expected benefit
to periods: Whencalculating
retirement
benefitobligations, benefit formula is used for
attributing expected retirement benefits toperiods through March 31, 2015.
Amortization of actual gain or loss,: Prior service costs are expensed in a lump sum
prior service cost and othersin the fiscal year in which they arise. Actuarial
differences are expensed in a lump sum in thefiscal year in which they arise.
Simplified method for small companies : Some domestic consolidated subsidiaries use
the simplified method to calculate defined
benefit liabilities and related costs.

(Notes to changes in accounting policies)(1) Change in valuation method for inventories
Our method for valuation of inventories has been mainly the weighted-average method (themethod of write-downs based on the decrease in profitability in order to calculate the inventory
value on the balance sheet). Beginning with the current fiscal year, we changed to mainly themoving-average method (the method of write-downs based on the decrease in profitability in orderto calculate the inventory value on the balance sheet).
The aims of this change are to respond to fluctuations in metals prices, carry out managementof inventories by item and by process precisely and on time, value inventories, and performperiodic accounting of profit and loss more accurately. It accompanies the introduction of a new IT
system.
Because we did not preserve the inventory receipts and payments records that would be neededin order to calculate unit costs with the moving-average method for past fiscal years, it is
impossible to retroactively apply this accounting policy to determine cumulative effects. Therefore,
the book values of inventories at the end of the previous fiscal year were carried over as initialbalances for the current fiscal year, with the moving-average method being used from the
beginning of this term.
Compared to the past method, it decreases operating income, ordinary income, and income
before income taxes and minority interests by 122,899 thousand yen each, and net income by
79,098 thousand yen for the fiscal year.
(2) Application of the “Practical Solution on Transactions of Delivering the Company’s Own Stockto Employees, etc., through Trusts”
We began applying the "Practical Solution on Transactions of Delivering the Company’s Own
Stock to Employees etc. through Trusts" (ASBJ PITF No. 30, March 26, 2015) during the current

27
Notes to consolidated financial statements

Convocation NoticeBusiness Reports
Reference Documents for
General Meeting of Shareholders

Audit Report

Financial Statements

Consolidated
Financial Statements

fiscal year. When we deliver treasury stock to the trust, we recognize the disposal balance. Profit orloss related to sales of shares by the trust to the employee stock ownership plan, dividends paid by
us on shares held by the trust, and net charges related to the trust are included by us as liabilities.
This change in accounting policy was applied retrospectively to past fiscal years, and thecumulative effects of this change have been reflected in the book value of net assets at the
beginning of the fiscal year under review.
Consequently, compared with figures before this retroactive application, as of the beginning of
the fiscal year under review, capital surplus decreased by 69,428 thousand yen, retained earnings
decreased by 67,008 thousand yen, and treasury stock decreased by 4,597 thousand yen.

28
Notes to consolidated financial statements

(Notes to consolidated balance sheet)
1. Assets pledged as collateral and obligations related to collateral(1) Assets pledged as collateral
Buildings and structures
79,087 thousand yen
Land158,932 thousand yen
Total
238,019 thousand yen(2) Obligations related to collateral
Short-term loans payable
Total

50,000 thousand yen
50,000 thousand yen

2. Accumulated depreciation of property, plant and equipment
30,080,330 thousand yen
3. Notes receivable endorsed

29
Notes to consolidated financial statements

74,009 thousand yen

(2) Among dividends whose record date within this consolidated accounting period, those having
an effective date within the following consolidated accounting period (scheduled)Class of
Total
Source ofDividends
RecordEffective
Resolution
sharesdividends
dividends
per sharedate
date
May 11, 2015
Board ofCommon982,058 Retained
March 31,
May 29,30.00 yen
Directors’
stock
thousand yen earnings
2015
2015
Meeting30
Notes to consolidated financial statements

Convocation NoticeBusiness Reports
Consolidated
Financial Statements
Financial Statements

Class of
Total
Dividends
Effective
Record datesharesdividends
per sharedate
May 12, 2014
Common982,073
March 31,
May 30,30.00 yen
Board of Directors’ Meetingstock
thousand yen
2014
2014
October 29, 2014
Common982,067
September November
30.00 yen
Board of Directors’ Meetingstock
thousand yen
30, 2014
26, 2014(Note) Total dividends resolved by the Board of Directors’ Meeting held on May 12, 2014, include
dividends of 4,617 thousand yen paid to the trust account of the employee shareholding
association. Total dividends resolved by the Board of Directors’ Meeting held on October 29,
2014, include dividends of 3,387 thousand yen paid to the trust account of the employee
shareholding association.
Resolution

Audit Report

2. Dividends(1) Dividends paid

Reference Documents for
General Meeting of Shareholders(Notes to consolidated statements of changes in net assets)
1. Class and number of issued shares and treasury shares
Number of shares Number of shares Number of shares Number of sharesat the beginning of increased during decreased during at the end of this
this consolidated
this consolidated this consolidated consolidated
accounting period accounting period accounting period accounting period(Thousands of(Thousands of(Thousands of(Thousands ofshares)shares)shares)shares)Issued shares
Common stock
36,25436,254
Total
36,25436,254
Treasury shares
Common stock
3,672
0
153
3,519
Total
3,672
0
153
3,519
(Notes) 1. The increase of 0 thousand shares in treasury shares of common stock was due to thepurchase of shares less than one unit.
2. The decrease of 153 thousand shares in treasury shares of common stock was mainly
due to the sale of those shares to the employee shareholding association from the trust
account of the employee shareholding association.

3. Share options at the end of this accounting period
Class of shares subject to the share options
Number of shares subject to the share options
Balance of share options

2010 share options
Common stocks
202,000 shares
77,908 thousand yen(Notes to financial instruments)
1. Status of financial instruments
As for fund investments, the Group limits to short-term deposits, etc. and procures funds throughloans provided by financial institutions, such as banks.
The credit risk involved in notes receivable and trade accounts receivable are reduced inaccordance with the credit control regulations. Investment securities mainly consist of shares, andmarket prices of listed shares are evaluated on a regular basis.
Loans payable are used for working funds, capital investment. Derivative transactions are madewithin the scope of actual demand pursuant to the internal management regulations.
2. Market value, etc. of financial instruments
The amount, market value, and their difference reported on the consolidated balance sheet on
March 31, 2015 (consolidated fiscal closing date for the current fiscal year), are as follows:(Thousands of yen)Amount on
consolidated financial Market value (*1)
Difference
statements (*1)
(1) Cash and cash equivalents
11,046,611
11,046,611–(2) Notes receivable and15,146,387
15,146,387–
accounts receivable-trade(3) Investment securities
Other securities
153,159
153,159–(4) Notes payable and accounts(6,161,691)(6,161,691)–
payable-trade(5) Short-term loans payable(26,171,659)(26,171,659)–(6) Accounts payable-other(3,473,216)(3,473,216)–(7) Income taxes payable(2,111,596)(2,111,596)–(8) Long-term loans payable(including current portion(6,820,000)(6,820,093)
93
of long-term loans payable)(9) Derivative transactions
Those subject to hedge
468,536
468,536–
accounting (*2)(*1) Those included in liabilities are shown in parentheses.
(*2) Net receivables and payables resulting from derivative transactions are shown at net amount,and items which become net payables in total are shown in parentheses.
(Notes) 1. Methods for calculating market values of financial instruments, as well as securities and31
Notes to consolidated financial statements

Principle
processing
methods

Forwardcontracts
Selling
contracts

Precious
metal
products

14,636,970(Note) 2. Unlisted shares (15,834 thousand yen on the consolidated balance sheet) have no market
prices and their future cash flows cannot be estimated. Because of this, we consider it isvery difficult to know market values and therefore, such shares are not included in “(3)Investment securities.”(Notes to lease real estate)
Not stated because of its relative unimportance(Notes to information per share)
Net assets per share
Net income per share

1,542.82 yen
176.89 yen

32
Notes to consolidated financial statements

Convocation NoticeBusiness Reports
Consolidated
Financial Statements
Financial Statements

Methods forcalculating
Market valuessuchmarketMore thanvaluesone yearStated at the
price–
14,168,433
presented bytrade partners

Contract amount, etc.

Audit Report

Hedge
Types, etc. ofMajor hedged
accounting
derivative
targets
methodstransactions

Reference Documents for
General Meeting of Shareholders

derivative transactions(1) Cash and cash equivalents, as well as (2) Notes receivable and accounts receivabletrade
These items are settled in a short term and market values thereof are almost
equivalent to their book values. Therefore, these are stated at their book values.
(3) Investment securities and other securities
Market values of these items are stated at prices of stock exchanges, and investment
trusts are stated at prices presented by financial institutions we have transactions with.
(4) Notes payable and accounts payable-trade, (5) Short-term loans payable, (6) Accounts
payable-other, and (7) Income taxes payable
These items are settled in a short term and market values thereof are almost
equivalent to their book values. Therefore, these are stated at their book values.
(8) Long-term loans payable (including current portion of long-term loans payable)
Market values of Long-term loans payable (including current portion of long-termloans payable) are stated in accordance with a method where the total amount of theprincipal and interest is discounted at an interest rate assumed in case new loans of asimilar nature are provided.
(9) Derivative transactions
1) Those which are not subject to hedge accounting
Not applicable2) Those which are subject to hedge accounting
The contract amount, etc. on consolidated fiscal closing date by hedge accounting
method are as follows:(Thousands of yen)(Notes to significant subsequent events)
Not applicable

33
Notes to consolidated financial statements

Current assets

16,206,882

Cash and deposits

1,327,039

Deferred tax assets

11,914

Short-term loans to affiliatedcompanies

13,753,704

Income taxes receivable

1,114,185

Other

37

Noncurrent assets

34,128,444

Property, plant andequipment

6,576,589

Buildings

3,161,886

Tools, equipment andfixturesLand

151
3,414,552

Intangible assets

7,367

Software7,367

Investments and otherassetsShares of affiliatedcompanies
Deferred tax assets
Total assets

27,544,487
27,519,040
25,44650,335,327

Amount559,077
400,000
20,000107,186
4,159
24,3003,431
5,050,000
5,050,000
5,609,077
44,648,341
4,480,817
23,012,557
6,054,118
16,958,438
22,314,576
22,314,576
22,314,576(5,159,609)
77,90844,726,249
50,335,327

Balance sheet

Reference Documents for
General Meeting of Shareholders(Note) Amounts less than one thousand yen are omitted.

Business Reports

ASSETS

Account
LIABILITIESCurrent liabilities
Short-term loans payable
Current portion of long-termloans payable
Accounts payable-otherAccrued expenses
Provision for directors’
bonuses
Other
Noncurrent liabilities
Long-term loans payable
Total liabilities
NET ASSETS
Shareholders’ equity
Capital stock
Capital surplus
Capital reserve
Other capital surplus
Retained earnings
Other retained earnings
Retained earnings carriedforwardTreasury stock
Subscription rights to shares
TOTAL NET ASSETSTOTAL LIABILITIES AND
NET ASSETS

Consolidated
Financial Statements

AmountFinancial Statements

Account(Thousands of yen)

Audit Report

Balance sheet (as of March 31, 2015)

Convocation Notice

Financial statements

34

Statements of income (April 1, 2014 to March 31, 2015)
Account
Operating income
Operating expenses
Operating income
Non-operating income
Interest income
Rent income
Gains on sale of derivatives
Other
Non-operating expenses
Interest expenses
Foreign exchange losses
Depreciation expenses for assets lent
Other
Ordinary income
Extraordinary loss
Losses on retirement of noncurrent assets
Impairment losses
Net income before income taxes
Income taxes-current
Income taxes-deferred
Net income(Note) Amounts less than one thousand yen are omitted.

35
Statements of income(Thousands of yen)Amount
6,690,223
1,111,195
5,579,028
79,1462,155
61,464
5,814
21,400
177
2,216
758

145
32,6542,500(7,110)148,581

24,554
5,703,054

32,8005,670,254(4,610)5,674,865

4,480,817

6,054,118

17,027,866

18,670,861(5,384,309)

40,849,354(69,428)(67,008)

4,597(131,839)

16,958,438

18,603,852(5,379,712)

40,717,515(1,964,141)(1,964,141)

5,674,865

5,674,865
(897)

(897)

221,000

221,000–––

3,710,723

220,1023,930,826

4,480,817

6,054,118

16,958,438

22,314,576(5,159,609)

44,648,341

Subscription
rights to shares

Total net assets

77,90840,927,262(Note) Amounts less than one thousand yen are
omitted.

Business Reports

6,054,118(131,839)

77,908

Audit Report

Balance at April
1, 2014
Cumulative
effects ofchanges inaccounting
policies
Restated balance
at April 1, 2014
Changes during
the period
Dividends fromsurplus
Net income
Purchase oftreasury stock
Disposal oftreasury stock
Net changes in
items other thanshareholders’equity during
the period
Total changes
during the period
Balance at March
31, 2015

4,480,817

Total shareholders’equity40,795,423(1,964,141)
5,674,865

Reference Documents for
General Meeting of Shareholders

Balance at April
1, 2014
Cumulative
effects of changes
in accounting
policies
Restated balance
at April 1, 2014
Changes during
the period
Dividends fromsurplus
Net income
Purchase oftreasury stock
Disposal oftreasury stock
Net changes in
items other thanshareholders’equity during
the period
Total changes
during the period
Balance at March
31, 2015

Treasury stock

Consolidated
Financial Statements

Capital stock

Financial Statements(Thousands of yen)
Shareholders’ equity
Capital surplus
Retained earnings
Other retained
earnings
Other capital
Capital reserve
surplusRetained earnings
carried forward

Convocation NoticeStatements of changes in net assets (April 1, 2014 to March 31, 2015)(897)
221,000–––

3,930,826

77,90844,726,249

36
Statements of changes in net assets

Notes to non-consolidated financial statements(Notes to significant accounting policies)
1. Valuation standards and valuation methods for assets
Securities
Shares of subsidiaries: Cost mainly determined by the moving-averagemethod.
2. Depreciation methods for noncurrent asset
Property, plant and equipment: Declining-balance method (Straight-line method
for buildings (excluding structures annexed tobuildings))
Assets with acquisition amount of 100 thousand
yen or more to less than 200 thousand yen are
depreciated for three years using the straightline method.
Intangible assets: Straight-line method
Software for internal use is amortized under thestraight-line method based on the period forwhich our company can use such software (5years or less).
3. Accounting standards for provisions
Provision for director’s bonuses: To allow for the payment of bonuses to directors,
subsidiaries records the standard for estimatedamounts of bonuses to be paid.

4. Other important items for preparing financial statements
Accounting method for consumption taxes : Consumption taxes are accounted for using thenet method of reporting.
(Changes in accounting policies following the revision, etc., of accounting standards, etc.)
Application of the “Practical Solution on Transactions of Delivering the Company’s Own Stock to
Employees, etc., through Trusts”
1. Details of and reasons for the accounting policy change
We began applying the “Practical Solution on Transactions of Delivering the Company’s Own
Stock to Employees etc. through Trusts” (ASBJ PITF No. 30, March 26, 2015) during the current
fiscal year. When we deliver treasury stock to the trust, we recognize the disposal balance. Profit orloss related to sales of shares by the trust to the employee stock ownership plan, dividends paid by
us on shares held by the trust, and net charges related to the trust are included by us as liabilities.
This change in accounting policy was applied retrospectively to past fiscal years.
2. Effects on the beginning balance of net assets
Consequently, compared with figures before this retroactive application, as of the beginning of

37
Notes to non-consolidated financial statements

(Notes to balance sheet)
1. Accumulated depreciation of property, plant and equipment 1,327,394 thousand yen

6,690,223 thousand yen
86,706 thousand yen
81,291 thousand yen(Notes to statements of changes in net assets)
Class and number of treasury stocks
Number of shares Number of shares Number of shares Number of sharesat the beginning
increased during
decreased during at the end of thisClass of shares of this fiscal year this fiscal year
this fiscal year
fiscal year
(Thousands of(Thousands of(Thousands of(Thousands ofshares)shares)shares)shares)Common stocks
3,672
0
153
3,519
Total
3,672
0
153
3,519
(Notes) 1. The increase of 0 thousand shares in treasury shares of common stock was due to thepurchase of shares less than one unit.
2. The decrease of 153 thousand shares in treasury shares of common stock was due to thesale of those shares to the employee shareholding association from the trust account of
the employee shareholding association.

38
Notes to non-consolidated financial statements

Audit Report(Notes to statements of income)Amount of transaction with affiliated companies
Amount of operating transactions with affiliated companies
Operating income
Amount of other operating transactions
Amount of transactions other than operating transactions

Reference Documents for
General Meeting of Shareholders

3. Monetary claims and monetary obligations related to affiliated companies
Short-term monetary claims
13,753,704 thousand yen
Short-term monetary obligations
62,518 thousand yen

Financial Statements

Consolidated
Financial Statements

Business Reports

2. Guarantee liabilities
Guarantees are provided for the bank loans of the following companies.
Asahi Americas Holdings, Inc.
22,900,000 thousand yen
Asahi Refining Canada Ltd.
1,181,585 thousand yen
Asahi Pretec Korea Co., Ltd.
521,659 thousand yen
Total
24,603,245 thousand yen

Convocation Notice

the fiscal year under review, other capital surplus decreased by 69,428 thousand yen, retained
earnings carried forward decreased by 67,008 thousand yen, and treasury stock decreased by 4,597
thousand yen.

(Notes to tax effect accounting)Breakdowns of main items causing deferred tax assets and deferred tax liabilities
Deferred tax assets
Losses carried-forward for tax purposes
25,446 thousand yen
Business tax
2,193 thousand yen
Provision for directors’ bonuses
8,043 thousand yen
Other1,678 thousand yen
Total deferred tax assets
37,361 thousand yen
Net deferred tax assets
37,361 thousand yen(Notes to transactions with related parties)
Subsidiaries and affiliated companies, etc.
Category

Name ofcompanies

Asahi
AmericasHoldings, Inc.
Asahi Refining
Subsidiary
Canada Ltd.
Asahi Pretec
Subsidiary
Korea Co.,Ltd.
Subsidiary

Subsidiary

Asahi Pretec
Corp.

Amount oftransaction(Thousands ofyen)

Account

Term-endbalance(Thousands ofyen)

22,900,000––

Debt guarantee

1,181,585––

Debt guarantee

521,659––

100,000––

Voting rights(%)

Relationshipwith relatedparties

Details oftransaction

Owned
Direct 100%

Debt guarantee

Debt guarantee

Owned
Indirect 100%

Debt guarantee

Owned
Indirect 100%

Debt guarantee

Owned
Direct 100%

Debt guarantee
Debt guarantee provided for bankprovidedloans to theCompany
Collection ofloaned funds
Support of funds
Loan of funds(Note 1)
Management
Management
guidance
guidance(Note 2)
Receipt ofReceipt ofdividends
dividends

9,890,652
13,753,704

Short-termloans toaffiliatedcompanies

13,753,704

732,499––

5,500,000––

Transaction terms and conditions and policy, etc., to determine terms and conditions fortransactions(Note 1) As for loans of funds, we reasonably determine interest rates taking into consideration
market interest rates.
(Note 2) We determine prices and other terms and conditions for transactions by reference toprevailing market interest rates, etc.
(Notes to information per share)
Net assets per share
1,363.92 yen
Net income per share
173.83 yen(Notes to significant subsequent events)
Not applicable

39
Notes to non-consolidated financial statements

Independent Auditor’s Report
May 7, 201540
Transcript of accounting auditor’s audit report on consolidated financial statements

Consolidated
Financial Statements

Pursuant to Article 444, paragraph 4 of the Companies Act, we have audited the consolidated
financial statements, namely the consolidated balance sheet, the consolidated statement of income,and the consolidated statement of changes in net assets of Asahi Holdings, Inc. for the consolidated
fiscal year from April 1, 2014 to March 31, 2015, including notes to the consolidated financial
statements.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of consolidated financial
statements in conformity with corporate accounting principles generally accepted in Japan. This
includes the improvement and application of the internal control that management deemed necessary
to prepare and fairly present consolidated financial statements that are free from material
misstatements caused by fraud or error.
Auditors’ Responsibility
Our responsibility is to express independent opinions on consolidated financial statements based on
our audit. We conducted our audit in accordance with auditing standards generally accepted in Japan.
Those standards require that we draw up a plan and perform the audit pursuant to the plan to obtainreasonable assurance about whether the consolidated financial statements are free from material
misstatements.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosuresin the consolidated financial statements. Audit procedures are selected and applied depending on
auditor judgment on the basis of the assessment of the risks of material misstatements of theconsolidated financial statements arising from fraud or error. The purpose of the audit of theconsolidated financial statements is not to express an opinion on the validity of internal control, but
in assessing the risks, the auditors consider internal control relevant to the preparation and fairpresentation of the consolidated financial statements in order to design audit procedures that areappropriate in the circumstances. An audit also includes evaluating the accounting policies adopted
by management, application methods therefor and estimates made by management, as well as
evaluating the overall financial statement presentation.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
Audit Opinion
In our opinion, the consolidated financial statements referred to the above present fairly, in all

Financial Statements

Ken Tarui

Audit Report

Mitsuo Cho

Reference Documents for
General Meeting of Shareholders

Ernst & Young ShinNihon LLC
Designated andCertified Public Accountant
Engagement Partner,
Designated andCertified Public Accountant
Engagement Partner,

Business Reports

To the Board of Directors of
Asahi Holdings, Inc.

Convocation Notice

Audit Reports
Transcript of accounting auditor’s audit report on consolidated financial statements

material respects, the assets as well as income and losses in the period pertaining to consolidated
financial statements of the corporate group which consists of Asahi Holdings, Inc. and its
consolidated subsidiaries in conformity with corporate accounting principles generally accepted inJapan.
Interests
There are no interests between the Company and us or engagement partners, which should be statedin compliance with the Certified Public Accountants Act.

41
Transcript of accounting auditor’s audit report on consolidated financial statements

Ken Tarui

Pursuant to Article 436, paragraph 2, item 1 of the Companies Act, we have audited the financial
statements, namely the balance sheet, the statements of income, and the statements of changes in net
assets of Asahi Holdings, Inc. for the 6th fiscal year from April 1, 2014 to March 31, 2015, including
notes to non-consolidated financial statements and supplementary schedules thereto.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of financial statements andsupplementary schedules thereto in conformity with corporate accounting principles generally
accepted in Japan. This includes the improvement and application of the internal control thatmanagement deemed necessary to prepare and fairly present financial statements and supplementaryschedules thereto that are free from material misstatements caused by fraud or error.
Auditors’ Responsibility
Our responsibility is to express independent opinions on financial statements and supplementaryschedules thereto based on our audit. We conducted our audit in accordance with auditing standards
generally accepted in Japan. Those standards require that we draw up a plan and perform the audit
pursuant to the plan to obtain reasonable assurance about whether the financial statements and the
supplementary schedules thereto are free from material misstatements.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosuresin the financial statements and the supplementary schedules thereto. Audit procedures are selected
and applied depending on auditors’ judgment on the basis of the assessment of the risks of material
misstatements of the financial statements and the supplementary schedules thereto arising from fraud
or error. The purpose of the audit of the financial statements and the supplementary schedules thereto
is not to express an opinion on the validity of internal control, but in assessing the risks, the auditors
consider internal control relevant to the preparation and fair presentation of the financial statements
and the supplementary schedules thereto in order to design audit procedures that are appropriate in
the circumstances. An audit also includes evaluating the accounting policies adopted by management,
application methods therefor and estimates made by management, as well as evaluating the overall
financial statement presentation.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
Audit Opinion
In our opinion, the financial statements and the supplementary schedules thereto referred to theabove present fairly, in all material respects, the assets as well as income and losses in the period

42
Transcript of accounting auditor’s audit report

Business Reports

Mitsuo Cho

Consolidated
Financial Statements

Ernst & Young ShinNihon LLC
Designated andCertified Public Accountant
Engagement Partner,
Designated andCertified Public Accountant
Engagement Partner,

Financial Statements

To the Board of Directors of
Asahi Holdings, Inc.

Audit Report

May 7, 2015

Reference Documents for
General Meeting of Shareholders

Independent Auditor’s Report

Convocation NoticeTranscript of accounting auditor’s audit reportpertaining to such financial statements and the supplementary schedules thereto in conformity withcorporate accounting principles generally accepted in Japan.
Interests
There are no interests between the Company and us or engagement partners, which should be statedin compliance with the Certified Public Accountants Act.

43
Transcript of accounting auditor’s audit report44Transcript of Board of Corporate Auditors’ audit report

Business Reports
Consolidated
Financial Statements
Financial Statements

1. Method and Contents of Audit by Corporate Auditors and the Board of Corporate Auditors
The Board of Corporate Auditors has established the audit policies, assignment of duties, etc. andreceived a report from each corporate auditor regarding the status of implementation of theiraudits and results thereof. In addition, the Board of Corporate Auditors has received reports fromthe directors, etc. and the accounting auditor regarding the status of performance of their duties,
and requested explanations as necessary.
In conformity with the corporate auditors auditing standards established by the Board of
Corporate Auditors, and in accordance with the audit policies and assignment of duties, etc., eachcorporate auditor endeavored to facilitate a mutual understanding with the directors, the internal
audit division and other employees, etc., endeavored to collect information and maintain andimprove the audit environment, has attended the meetings of the board of directors and otherimportant meetings, received reports on the status of performance of duties from the directors andother employees and requested explanations as necessary, examined important approval/decision
documents, and inspected the status of the corporate affairs and assets at the head office and otherprincipal business locations. Also, each auditor periodically reported by directors and employees
about the establishment and application of the details of board of directors' resolutions and thesystem established based on such resolutions (internal control system) in connection with thesystem to ensure that the exercise of duties by directors complies with laws and the Article of
Incorporation as described in the business report and the establishment of a system as set forth in
Article 100 paragraphs 1 and 3 of the Ordinance for Enforcement of the Companies Act as being
necessary for ensuring the appropriateness of the corporate affairs of a joint stock company(kabushiki kaisha), and then each auditor requested explanations as necessary and expressed
opinions. With respect to the subsidiaries, each corporate auditor endeavored to facilitate a mutual
understanding and exchanged information with the directors and corporate auditors, etc. of eachsubsidiary and received from subsidiaries reports on their respective business as necessary. Basedon the above-described methods, each corporate auditor examined the business report andsupplementary schedules thereto for the fiscal year under consideration.
In addition, each corporate auditor monitored and verified whether the accounting auditor
maintained its independence and properly conducted its audit, received a report from theaccounting auditor on the status of its performance of duties, and requested explanations asnecessary. Each Corporate auditor was notified by the accounting auditor that it had established a“system to ensure that the performance of duties of the accounting auditor was properly
conducted” (the matters listed in the items of Article 131 of the Company Accounting
Regulations) in accordance with the “Quality Control Standards for Audits” (Business Accounting
Council on October 28, 2005), and requested explanations as necessary. Based on the above-

Audit Report

With respect to the directors’ performance of their duties during the 6th fiscal year (from April 1,2014 to March 31, 2015), the Board of Corporate Auditors, with a consensus of opinion of all
corporate auditors, has prepared this audit report after deliberations based on the audit reports
prepared by each corporate auditor, and hereby report as follows:

Reference Documents for
General Meeting of Shareholders

Audit Report

Convocation NoticeTranscript of Board of Corporate Auditors’ audit reportdescribed methods, each corporate auditor examined the financial statements (balance sheet,statements of income, statements of changes in net assets, and notes to financial statements) andthe supplementary schedules thereto, as well as the consolidated financial statements(consolidated balance sheet, consolidated statements of income, consolidated statements ofchanges in net assets, and notes to consolidated financial statements), for the fiscal year underconsideration.
2. Results of Audit(1) Results of audit of business report, etc.
(i) We acknowledge that the business report and the supplementary schedules thereto fairly
present the status of the Company in conformity with the applicable laws and regulations
and the articles of incorporation of the company.
(ii) We acknowledge that no misconduct or material fact constituting a violation of any law or
regulation or the articles of incorporation of the company was found with respect to thedirectors’ performance of their duties.
(iii)We acknowledge that the Board of Directors’ resolutions with respect to the internal control
systems are appropriate. We did not find any matter to be mentioned with respect to thedirectors’ performance of their duties concerning the internal control systems.
(2) Results of audit of financial statements and supplementary schedules thereto
We acknowledge that the methods and results of audit performed by the accounting auditor,
Ernst & Young ShinNihon LLC, are appropriate.
(3) Results of audit of consolidated financial statements
We acknowledge that the methods and results of audit performed by the accounting auditor,
Ernst & Young ShinNihon LLC, are appropriate.
May 11, 2015
Board of Corporate Auditors, Asahi Holdings, Inc.
Full-time Corporate Auditor : Yukio Tanabe
Corporate Auditor: Kazuhiko Tokumine
Corporate Auditor: Junzo Kojima(Note) Corporate Auditor Kazuhiko Tokumine and Junzo Kojima are outside auditors set forth in
Article 2, item 16 and Article 335, paragraph 3 of the Companies Act.

45
Transcript of Board of Corporate Auditors’ audit reportCurrent Articles of Incorporation

Draft of Amended Articles of Incorporation

CHAPTER 1.
GENERAL PROVISIONSCHAPTER 1.
GENERAL PROVISIONS

Articles 1 to 3 <Omitted>

Articles 1 to 3 <Same as the present>(Organizations)
Article 4: In addition to the general meeting ofshareholders and directors, the Company shallhave the following organizations.

(Organizations)
Article 4: In addition to the general meeting ofshareholders and directors, the Company shallhave the following organizations.

1. Board of Directors;
2. Corporate Auditors;
3. Board of Corporate Auditors; and4. Accounting Auditor

1. Board of Directors;
2. Board with Audit Committee; and<Deleted>
3. Accounting Auditor

46
Proposal for Partial Amendments to the Articles of Incorporation

Business Reports
Consolidated
Financial Statements
Financial Statements
Audit Report

2. Details of amendments
We propose that the current articles be partly amended as described in the draft below. The
proposed partial amendments to the Articles of Incorporation shall take effect upon the
conclusion of this Annual General Meeting of Shareholders.
(Amended portions are underlined)

Reference Documents for
General Meeting of Shareholders

Proposal 1
Partial Amendments to the Articles of Incorporation
1. Reason for proposal(1) From the viewpoint of enhancing corporate governance by reinforcing the audit and supervisory
functions of the Board of Directors, the Company plans to make a transition to a company with a
Board with Audit Committee, which was newly established pursuant to the Act for Partial
Revision of the Companies Act enforced on May 1, 2015, to leverage the function of nonexecutive Outside Directors without executive authority over operations. To this end, we
propose that provisions regarding the Board with Audit Committee and audit committee
members be newly established and provisions regarding corporate auditors and the Board of
Corporate Auditors be deleted from the current Articles of Incorporation of the Company.
(2) Pursuant to the revised Companies Act, it has become possible for the Company to enter into
limited liability agreements with non-executive directors based on the provisions of the Articles
of Incorporation. We therefore propose that the scope of directors, etc., who can enter into alimited liability agreement be amended to ensure that directors without executive authority over
operations may sufficiently fulfill the role expected of them through the conclusion of limited
liability agreements. Note that consent has been received from each corporate auditor withregard to the amendments to Article 31 (Exemption from Liability of Directors).
(3) In addition to the above, we propose that the numbering of articles, etc., be changed to reflect
each of the aforementioned changes.

Convocation Notice

Reference Documents for General Meeting of Shareholders

Current Articles of Incorporation
Articles 5 to 16 <Omitted>

Draft of Amended Articles of Incorporation
Articles 5 to 16 <Same as the present>

CHAPTER 4.
DIRECTORS AND BOARD OF
DIRECTORSCHAPTER 4.
DIRECTORS AND BOARD OF
DIRECTORS, AS WELL AS BOARD
WITH AUDIT COMMITTEE(Number of Directors)
Article 17: The number of the directors of theCompany shall not exceed ten (10).

(Number of Directors)
Article 17: The number of the directors of theCompany shall not exceed ten (10) (excluding
directors concurrently serving as the Audit
Committee Members).

<Newly established>

2. The directors concurrently serving as the
Audit Committee Members shall be not morethan six (6).

(Method of Electing Directors)
Article 18: A director of the Company shall beelected at a general meeting of shareholders.

(Method of Electing Directors)
Article 18: A director shall be elected at a
general meeting of shareholders while making
a distinction between directors concurrently
serving as the Audit Committee Members andother directors.

2. <Omitted>

2. <Same as the present>

3. <Omitted>

3. <Same as the present>(Term of Office of Directors)(Term of Office of Directors)

Article 19: The term of office of a director
shall expire at the close of the annual general
meeting of shareholders pertaining to the lastbusiness year ending within one (1) year after
his/her election.

Article 19:
The term of office of a director (excluding a
director serving as the Audit Committee
Member) shall expire at the close of the annual
general meeting of shareholders pertaining to
the last business year ending within one (1)year after his/her election.

<Newly established>

2. The term of office of a director serving as
the Audit Committee Member shall expire at
the close of the annual general meeting ofshareholders pertaining to the last businessyear ending within two (2) years after his/herelection.

47
Proposal for Partial Amendments to the Articles of Incorporation

(Convener and Chairman of the Meeting)(Convener and Chairman of the Meeting)

Article 21: <Omitted>

Article 21: <Same as the present>(Convocation Procedure Regarding Meeting of
the Board of Directors)
Article 22:
Convocation notice regarding a meeting of theBoard of Directors shall be dispatched at least
three (3) days prior to the date of suchmeeting; provided, however, that such period
may be shortened in the case of urgent
necessity.

(Convocation Notice Regarding Meeting of
the Board of Directors)
Article 22:
Convocation notice regarding a meeting of theBoard of Directors shall be dispatched to eachdirector at least three (3) days prior to the dateof such meeting; provided, however, that such
period may be shortened in the case of urgent
necessity.

2. A meeting of the Board of Directors may beheld without carrying out the convocation
procedures upon the consent of all the
directors and corporate auditors.

2. A meeting of the Board of Directors may beheld without carrying out the convocation
procedures upon the consent of all the
directors.

<Newly established>(Convocation Notice Regarding Meeting of
the Board with Audit Committee)
Article 23:
1. A convocation notice regarding a meeting of
the Board with Audit Committee shall be
issued to each audit committee member at
least three (3) days prior to the date of suchmeeting; provided, however, that such period
may be shortened in the case of urgent
necessity.

48
Proposal for Partial Amendments to the Articles of Incorporation

Convocation NoticeBusiness Reports

Article 20: <Same as the present>

Consolidated
Financial Statements

Article 20: <Omitted>

Financial Statements

3. The term of office of a director serving as
the Audit Committee Member elected to fill avacancy created by the retirement of a director
serving as the Audit Committee Member
before the expiration of his/her term of officeshall expire at the expiration of the term ofoffice of the retired director serving as the
Audit Committee Member.

Audit Report<Newly established>

Draft of Amended Articles of Incorporation

Reference Documents for
General Meeting of Shareholders

Current Articles of Incorporation

Current Articles of Incorporation<Newly established>

Article 23: <Omitted><Newly established>

Article 24: <Omitted><Newly established>

Draft of Amended Articles of Incorporation
2. A meeting of the Board with Audit
Committee may be held without carrying out
the convocation procedures upon the consent
of all the audit committee members.
Article 24: <Same as the present>(Board with Audit Committee Regulations)
Article 25: In addition to laws and regulations
and these Articles of Incorporation, mattersregarding a meeting of the Board with Audit
Committee shall be provided in the Board with
Audit Committee Regulations to be prescribedby the Board with Audit Committee.

Article 26: <Same as the present>(Method of Adopting Resolutions of the Board
with Audit Committee)
Article 27: Resolutions of the Board with
Audit Committee shall be adopted by amajority of the audit committee members
being present at the relevant meeting, and amajority vote of such audit committee
members in attendance.

(Omission of the Procedure for Adopting
Resolutions of the Board of Directors)(Omission of the Procedure for Adopting
Resolutions of the Board of Directors)

Article 25: When all directors agree, in writing
or by electromagnetic records, on all mattersto be resolved at the Board of Directors, theresolutions of the Board of Directors of theCompany shall be deemed to have been
adopted; provided, however, that this provision
shall not apply in case where a corporate
auditor raises objection thereto.

Article 28: When all directors agree, in writing
or by electromagnetic records, on all mattersto be resolved at the Board of Directors, theresolutions of the Board of Directors of theCompany shall be deemed to have been
adopted.

49
Proposal for Partial Amendments to the Articles of Incorporation

(Exemption from Liability of Directors)(Exemption from Liability of Directors)

Article 26:<Omitted>

Article 31:<Same as the present>

2. Pursuant to the provision of Article 427,
Paragraph 1, of the Companies Act, theCompany may enter into agreements with
Outside Directors to the effect that their
liability for damages arising from their failure
to perform their duties shall be limited;
provided, however, that the limit of theliability under such agreements shall be theamount prescribed by laws and regulations.

2. Pursuant to the provision of Article 427,
Paragraph 1, of the Companies Act, theCompany may enter into agreements withdirectors (excluding directors with executive
authority over operations, etc.) to the effectthat their liability for damages arising fromtheir failure to perform their duties shall belimited; provided, however, that the limit of
the liability under such agreements shall be theamount prescribed by laws and regulations.

50
Proposal for Partial Amendments to the Articles of Incorporation

Convocation Notice(Remuneration, etc., for Directors)
Article 30: Remuneration, bonus and otherproperty benefits to be provided by theCompany as consideration for execution ofduties of directors shall be determined byresolution of a general meeting ofshareholders, while making a distinction
between directors concurrently serving as the
Audit Committee Members and otherdirectors.

Business Reports<Newly established>

Consolidated
Financial Statements(Delegation of Decision to Directors)
Article 29: Pursuant to the provision of Article399-13, Paragraph 6, of the Companies Act,
the Company may delegate a decision
regarding important duties (excluding mattersset forth in items of Article 399-13, Paragraph
5, of the Companies Act) to a director byresolution of the Board of Directors.

Financial Statements<Newly established>

Audit Report

Draft of Amended Articles of Incorporation

Reference Documents for
General Meeting of Shareholders

Current Articles of Incorporation

Current Articles of Incorporation

Draft of Amended Articles of Incorporation

CHAPTER 5.
CORPORATE AUDITORS AND BOARD
OF CORPORATE AUDITORS<Deleted>(Number of Corporate Auditors)
Article 27: The number of the corporate
auditors of the Company shall not exceed four
(4).

<Deleted>(Method of Electing Corporate Auditors)
Article 28: A corporate auditor of theCompany shall be elected at a general meetingof shareholders.

<Deleted>

2. Election of a corporate auditor shall bemade by a quorum of shareholders holding
one-third (1/3) or more of the voting rights
held by all the shareholders entitled to exercise
their voting rights being present at the relevant
general meeting of shareholders, and by the
resolution of a majority vote of the voting
rights of such attending shareholders.

<Deleted>(Term of Office of Corporate Auditors)
Article 29:
The term of office of a corporate auditor shall
expire at the close of the annual general
meeting of shareholders pertaining to the lastbusiness year ending within four (4) years
after his/her election.

<Deleted>

2. The term of office of a corporate auditor
elected as a replacement of another corporate
auditor shall be the same as the remaining
period of the predecessor’s term of office.

<Deleted>51
Proposal for Partial Amendments to the Articles of Incorporation

(Full-Time Corporate Auditors)
Article 30: The Board of Corporate Auditors
shall by resolution select full-time corporate
auditors.

<Deleted>(Convocation Procedure Regarding Meetingsof the Board of Corporate Auditors)
Article 31: Convocation notice regarding ameeting of the Board of Corporate Auditors
shall be dispatched at least three (3) days prior
to the date of such meeting; provided,
however, that such period may be shortened in
the case of urgent necessity.

<Deleted>

2. A meeting of the Board of Corporate
Auditors may be held without carrying out the
convocation procedure upon the consent of all
the corporate auditors.

<Deleted>(Board of Corporate Auditors Regulations)
Article 32: In addition to laws and regulations
and these Articles of Incorporation, mattersregarding a meeting of the Board of Corporate
Auditors shall be provided in the Board of
Corporate Auditors Regulations to beprescribed by the Board of Corporate Auditors.

<Deleted>

Convocation Notice

Draft of Amended Articles of Incorporation

Reference Documents for
General Meeting of Shareholders

Audit Report

Financial Statements

Consolidated
Financial Statements

Business Reports

Current Articles of Incorporation

52
Proposal for Partial Amendments to the Articles of Incorporation

Current Articles of Incorporation

Draft of Amended Articles of Incorporation(Method of Adopting Resolutions of the Boardof Corporate Auditors)
Article 33: Resolutions of the Board of
Corporate Auditors shall be adopted by amajority vote of the Board of Corporate
Auditors except as otherwise provided by laws
and regulations.

<Deleted>(Exemption from Liability of Corporate
Auditors)
Article 34:
Pursuant to the provision of Article 426,
Paragraph 1, of the Companies Act, theCompany may, by resolution of the Board of
Directors,
exemptcorporate
auditors(including former corporate auditors) fromtheir liability for damages arising from theirfailure to perform their duties to the extent
prescribed by laws and regulations.

<Deleted>

2. Pursuant to the provision of Article 427,
Paragraph 1, of the Companies Act, theCompany may enter into agreements withoutside corporate auditors to the effect that
their liability for damages arising from theirfailure to perform their duties shall be limited;
provided, however, that the limit of theliability under such agreements shall be theamount prescribed by laws and regulations.

<Deleted>

CHAPTER 6.
ACCOUNTING AUDITORCHAPTER 5.
ACCOUNTING AUDITOR

Articles 35 and 36 <Omitted>

Articles 32 and 33 <Same as the present>

CHAPTER 6.
ACCOUNTING

CHAPTER 7.
ACCOUNTING
Articles 37 to 39 <Omitted>

Articles 34 to 36 <Same as the present>

53
Proposal for Partial Amendments to the Articles of Incorporation

<Newly established>

2. The agreements that limit the liability forcompensation for damages set forth in Article
423, Paragraph 1, of the Companies Act
regarding conduct carried out before the closeof the 6th Annual General Meeting of
Shareholders by outside corporate auditors(including former outside corporate auditors)
shall comply with Article 34, Paragraph 2(Exemption from Liability of Corporate
Auditors), of the Articles of Incorporation, aprovision prior to the change pursuant to theresolution at said Annual General Meeting of
Shareholders.

Convocation Notice(Transitional Measures Regarding Exemption
from Liability of Corporate Auditors)
1. The Company may, by resolution of theBoard of Directors, exempt corporate auditors(including former corporate auditors) fromtheir liability for compensation for damages
set forth in Article 423, Paragraph 1, of theCompanies Act to the extent prescribed bylaws and regulations regarding conduct carriedout before the close of the 6th Annual General
Meeting of Shareholders.

Business Reports<Newly established>

Consolidated
Financial Statements

SUPPLEMENTARY PROVISIONS

Reference Documents for
General Meeting of Shareholders<Newly established>

Financial Statements

Draft of Amended Articles of Incorporation

Audit Report

Current Articles of Incorporation

54
Proposal for Partial Amendments to the Articles of Incorporation

Proposal 2

Election of Five (5) Directors (Excluding Directors Serving as the Audit
Committee Members)

The Company plans to make the transition to a Company with a Board with Audit Committee on
the condition that Proposal 1 “Partial Amendments to the Articles of Incorporation” is approvedat this Meeting. In addition, the terms of office all seven (7) Directors will expire.
Accordingly, we propose the election of five (5) Directors (excluding Directors serving as the
Audit Committee Members; the same applies hereinafter in this proposal).
The candidates for Director to be elected are as follows.
Candidate
No.

1

Name
(Date of birth)

Career, Position and Duties at Asahi Holdings(Important concurrent assignment)

October 1973: Senior Managing Director of
Asahi Pretec Corp.
May 1981:
Appointed as Representative
Director and President of Asahi
Pretec Corp.
April 2009:
Appointed as Representative
Director and President of Asahi
Holdings, Inc.
April 2011:
Appointed as CEO & COO of
Mitsuharu Terayama
Asahi Holdings, Inc.
(March 10, 1940)
April 2011:
Appointed as Chairman and
To be Reelected
Director of Asahi Pretec Corp. (topresent)
June 2012:
Appointed as CEO of Asahi
Holdings, Inc.
June 2014:
Appointed as President & CEO of
Asahi Holdings, Inc. (to present)[Significant concurrent duties]
Appointed as Chairman and Director of Asahi
Pretec Corp.

Ownershipof Shares

882,345
shares55
Proposal for Election of Five (5) Directors (Excluding Directors Serving as the Audit Committee
Members)

Career, Position and Duties at Asahi Holdings(Important concurrent assignment)

Business Reports

April 1999:
June 2001:

Financial Statements

5,050
sharesReference Documents for
General Meeting of Shareholders

Audit Report2

Joined Asahi Pretec Corp.
Appointed as Director andGeneral Manager of General
Affairs Department of Asahi
Pretec Corp.
April 2004:
Appointed as Director andGeneral Manager ofEnvironmental Business Divisionand concurrently serving as
General Manager of Business
Coordination Division of Asahi
Yoshikatsu Takeuchi
Pretec Corp.
(January 1, 1956)
March 2006: Appointed as Director and
To be Reelected
General Manager ofEnvironmental Recycling
Business Division of Asahi Pretec
Corp.
May 2008:
Appointed as Representative
Director and President of Japan
Waste Corporation (to present)
April 2009:
Appointed as Director of Asahi
Holdings, Inc. (to present)[Significant concurrent duties]
Representative Director and President of Japan
Waste

Ownershipof Shares

Convocation Notice

Name(Date of birth)

Consolidated
Financial Statements

Candidate
No.

56
Proposal for Election of Five (5) Directors (Excluding Directors Serving as the Audit Committee
Members)

Candidate
No.

3

Name
(Date of birth)

Career, Position and Duties at Asahi Holdings(Important concurrent assignment)

Tomoya Higashiura(January 26, 1961)
To be ReelectedFebruary 2001: Joined Asahi Pretec Corp.
June 2006:
Appointed as Director andGeneral Manager of
Administration Division of Asahi
Pretec Corp.
May 2007:
Appointed as President of Taiyo
Kagaku Co., Ltd.
April 2009:
Appointed as Director andGeneral Manager of Corporate
Development & Administration
Division of Asahi Holdings, Inc.
June 2010:
Appointed as Director andGeneral Manager of Precious
Metal Recycling Business
Division of Asahi Pretec Corp.
April 2011:
Appointed as Director of Asahi
Holdings, Inc. (to present)
January 2012: Appointed as Director of Asahi
Pretec Corp.
June 2014:
Appointed as Representative
Director & President of Asahi
Pretec Corp. (to present)[Significant concurrent duties]
Representative Director & President of Asahi Pretec
Corp.

Ownershipof Shares

1,500
shares57
Proposal for Election of Five (5) Directors (Excluding Directors Serving as the Audit Committee
Members)

Career, Position and Duties at Asahi Holdings(Important concurrent assignment)

Audit Report

Financial Statements

1,000
sharesReference Documents for
General Meeting of Shareholders

4

Business Reports

June 2011:

Keitaro Shigemasa(February 15, 1965)
To be Reelected

Joined Asahi Pretec Corp.
Appointed as General Manager ofInformation Technology
Department of Asahi Pretec Corp.
Appointed as Chief Information
Officer of Asahi Holdings group
April 2012:
Appointed as General Manager ofInformation Technology
Department of Asahi Holdings,
Inc.
June 2013:
Appointed as Director andGeneral Manager of Information
Technology Department andconcurrently serving as General
Manager of Planning &Communication Department of
Asahi Holdings, Inc.
July 2014:
Appointed as Director andGeneral Manager of Information
Technology Department andconcurrently serving as General
Manager of Human Resources
Department of Asahi Holdings,
Inc. (to present)
December 2014:Appointed as Representative
Director & President of Asahi
Americas Holdings, Inc. (topresent)[Significant concurrent duties]
Representative Director & President of Asahi
Americas Holdings, Inc.

Ownershipof Shares

Convocation Notice

Name(Date of birth)

Consolidated
Financial Statements

Candidate
No.

58
Proposal for Election of Five (5) Directors (Excluding Directors Serving as the Audit Committee
Members)

Candidate
No.

5

Note:

Name
(Date of birth)

Career, Position and Duties at Asahi Holdings(Important concurrent assignment)

Kazuo Kawabata(April 20, 1957)
To be Reelected

July 2008:
Joined Asahi Pretec Corp.
October 2008: Appointed as Deputy Head ofTechnology Support &Production Management Divisionof Asahi Pretec Corp.
April 2012:
Appointed as General Manager ofTechno Center of Asahi Pretec
Corp.
April 2013:
Appointed as Director andGeneral Manager of Techno
Center of Asahi Pretec Corp. (topresent)
June 2014:
Appointed as Director of Asahi
Holdings, Inc. (to present)
December 2014: Appointed as Director of Asahi
Americas Holdings, Inc. (topresent)[Significant concurrent duties]
Director of Asahi Pretec Corp.
Director of Asahi Americas Holdings, Inc.

Ownershipof Shares

4,000
sharesThere are no special interests between each candidate and the Company.

59
Proposal for Election of Five (5) Directors (Excluding Directors Serving as the Audit Committee
Members)1

September 2004: Joined Asahi Pretec Corp.
June 2008:
Appointed as Deputy General
Manager of Corporate
Development Division of Asahi
Pretec Corp.
April 2009:
Appointed as Director and General
Manager of Management Division
Yukio Tanabeof Asahi Pretec Corp.
(December 27, 1958) April 2009:
Appointed as Director of Asahi
Newly Elected
Holdings, Inc.
April 2010:
Appointed as Director and General
Manager of Corporate
Development & Administration
Division of Asahi Holdings, Inc.
June 2011:
Appointed as Full-Time Corporate
Auditor of Asahi Holdings, Inc. (topresent)

1,000
sharesShoji Morii
June 2003:(February 12, 1948)
Newly Elected
June 2006:
June 2009:
June 2010:

2

60
Proposal for Election of Four (4) Directors Serving as the Audit Committee Members

Business Reports

1,000
sharesJune 2001:

Financial Statements

Joined Sumitomo Trust andBanking Co., Ltd.
Appointed as Corporate Officer
and General Manager of Kyoto
Branch of Sumitomo Trust andBanking Co., Ltd.
Appointed as Representative
Director and President of Kobe
Airport Terminal Co., Ltd.
Representative Director andPresident of Kaijo Access Co., Ltd.
Appointed as Outside Director of
Asahi Pretec Corp.
Appointed as Outside Director of
Asahi Holdings, Inc. (to present)

Audit Report

April 1972:

Consolidated
Financial Statements

The Company plans to make the transition to a Company with a Board with Audit Committee on
the condition that Proposal 1 “Partial Amendments to the Articles of Incorporation” is approvedat this Meeting.
Accordingly, we propose the election of four (4) Directors serving as the Audit Committee
Members.
Consent of the Board of Corporate Auditors has been obtained in advance with regard to this
proposal. The candidates for Director serving as the Audit Committee Member are as follows.
Candidate
Name
Career, Position and Duties at Asahi Holdings
OwnershipNo.
(Date of birth)(Important concurrent assignment)of Shares

Convocation NoticeElection of Four (4) Directors Serving as the Audit Committee Members

Reference Documents for
General Meeting of Shareholders

Proposal 3

Candidate
No.

Name
(Date of birth)

Career, Position and Duties at Asahi Holdings(Important concurrent assignment)

Ownershipof Shares

3

April 1993:
Registered as lawyer (to present)
December 2001: Appointed as Provisional Audit
Committee Member of Asahi
Pretec Corp.
Kazuhiko Tokumine
June 2002:
Appointed as Audit Committee(January 11, 1958)
Member of Asahi Pretec Corp.
Newly Elected
April 2009:
Appointed as Corporate Auditor of
Asahi Holdings, Inc. (to present)[Significant concurrent duties]
Lawyer6,000
shares4

April 1975:
Joined Bank of Japan
November 1997:Appointed as General Manager of
Hakodate Branch, Bank of Japan
April 2001:
Appointed as General Manager ofKobe Branch, Bank of Japan
April 2004:
Appointed as Professor, Graduate
School of Economics, Kobe
University
April 2007:
Appointed as Advisor to Senshu
Hiroharu Ohkubo
Ikeda Bank, Ltd. (to present)(November 3, 1952)
Appointed as President &Newly Elected
Representative Director, Shizen
Soken Co., Ltd. (to present)
April 2014:
Appointed as a part-time lecturer atFaculty of Economics, Osaka
University of Economics (topresent)[Significant concurrent duties]
Advisor of Senshu Ikeda Bank, Ltd.
President & Representative Director, Shizen Soken
Co., Ltd.

—

Notes: 1. There are no special interests between each candidate and the Company.
2. Shoji Morii, Kazuhiko Tokumine and Hiroharu Okubo are candidates for Outside
Director.
3. Shoji Morii has professional expertise and experience in management including financeand financial affairs. We ask shareholders to elect him as an Outside Director for his
expected useful opinions. His term of office as Outside Director will be five years at theclose of this Annual General Meeting of Shareholders.
4. We ask shareholders to elect Kazuhiko Tokumine as an Outside Director for his
expected useful opinions on the validity and appropriateness of making decisions on
deliberations of the agenda and other matters from his highly professional viewpoint as

61
Proposal for Election of Four (4) Directors Serving as the Audit Committee Members

Convocation NoticeBusiness Reports
Consolidated
Financial Statements
Financial Statements
Reference Documents for
General Meeting of Shareholders

Audit Reporta lawyer. He is currently an Outside Corporate Auditor of the Company and his term ofoffice as Outside Corporate Auditor will be six years at the close of this Annual General
Meeting of Shareholders. Although he has no experience of being directly engaged incorporate management, we anticipate that he will be capable of appropriately
performing his duties as an Outside Director for the aforementioned reason.
5. Hiroharu Okubo has a wealth of expertise and experience in the financial field. We ask
shareholders to elect him as an Outside Director for his expected useful opinions.
6. The Company has entered into a contract with Shoji Morii and Kazuhiko Tokumine that
limits their liability for compensation for damages set forth in Article 423, Paragraph 1,of the Companies Act under provisions set forth in Article 427, Paragraph 1, of the same
Act. The limit amount of the liability for compensation for damages under such acontract is determined to be the minimum liability amount stipulated in Article 425,
Paragraph 1, of the Companies Act. If Shoji Morii, Yukio Tanabe, Kazuhiko Tokumineand Hiroharu Okubo are elected, the Company intends to enter into the same contract
with each of them to limit their liability for compensation for damages.
7. The Company has notified the Tokyo Stock Exchange that Shoji Morii and Kazuhiko
Tokumine are independent board members as per the provisions of the Tokyo Stock
Exchange, and they will continue to be independent board members if this proposal isapproved and assume the position of Outside Director. Hiroharu Okubo satisfies therequirements of an independent board member as per the provisions of the Tokyo Stock
Exchange. Accordingly, if this proposal is approved and he assumes the position of
Outside Director, the Company intends to newly notify the Tokyo Stock Exchange that
he is an independent board member.

62
Proposal for Election of Four (4) Directors Serving as the Audit Committee Members

Proposal 4

Determination of Amounts of Remuneration for Directors and Audit Committee
Members

The limit of compensation to be paid to Directors was resolved to be a maximum annual amountof 200 million yen at the 1st Annual General Meeting of Shareholders held on June 16, 2010, andthe resolution has been maintained up to now. The Company however will transition to a
Company with a Board with Audit Committee if Proposal 1 “Partial Amendments to the Articles
of Incorporation” is approved at this Annual General Meeting of Shareholders. Accordingly, on
the condition that Proposal 1 “Partial Amendments to the Articles of Incorporation,” Proposal 2“Election of Five (5) Directors (Excluding Directors Serving as the Audit Committee Members)”
and Proposal 3 “Election of Four (4) Directors Serving as the Audit Committee Members” areapproved at this Annual General Meeting of Shareholders, we propose the abolition of
remuneration for Directors and ask shareholders to approve the proposed amounts ofremuneration for Directors (excluding Directors serving as the Audit Committee Members) andDirectors serving as the Audit Committee Members in place of the aforementioned provision.
We propose that the remuneration for Directors (excluding Directors serving as the Audit
Committee Members) be a maximum annual amount of 200 million yen in view of the generalcircumstances including the economic situation. Said remuneration for Directors shall exclude
the portion of salaries as employees to those Directors concurrently working as employees.
We propose that the remuneration for Directors serving as the Audit Committee Members be a
maximum annual amount of 100 million yen by taking into account their duties andresponsibilities.
Although there are currently seven (7) Directors, the number of Directors (excluding Directors
serving as the Audit Committee Members) will be five (5) if Proposal 2 is approved as proposed.
If Proposal 3 is approved, the number of Directors serving as the Audit Committee Members
who would newly assume the position will be four (4).

63
Proposal for Determination of Amounts of Remuneration for Directors and Audit Committee
Members

(2) Maximum amount of funds to be contributed to the trust by the Company*
The Company will contribute funds, of which the maximum amount is 243 million yen, for theshares to be awarded as remuneration for Directors for each fiscal year ending between March 31,
2016, and March 31, 2018, an applicable period of three fiscal years (hereinafter, the “Applicable
Period”), thereby establishing a trust (hereinafter, the “Trust”) of which the covered trust period
is three years, in which Directors of the Applicable Companies who meet the criteria forbeneficiaries shall be beneficiaries, together with the funds contributed as remuneration for their

64
Proposal for Determination of Amounts and the Content of the Performance-Based Stock
Compensation Plan for Directors

Convocation NoticeBusiness Reports
Consolidated
Financial Statements
Financial Statements

2. Amounts and the content of the remuneration in the Compensation Plan
(1) Details of the Compensation Plan
The Compensation Plan is a stock compensation plan, in which a trust is established by using
funds contributed by the Applicable Companies, and the Company’s shares are awarded to such
Directors of the respective Applicable Companies corresponding to the number of points that
Directors of the Applicable Companies have been awarded based on their respective
achievement ratios and positions. The timing of issuing the Company’s shares shall be August
2018, in principle. The number of points to be awarded to the Directors of the respective
Applicable Companies will be calculated after adjusting the number of points awarded every
year to the Directors based on their positions using a coefficient that is determined according toachievement ratios in the medium-term management plan of the Company, which was released in
March 2015.

Audit Report

1. Content of the Proposal and the purpose of introducing said compensation system
The compensation for Directors of the Company previously consisted of “basic remuneration”
and “bonuses.” We ask shareholders the approval of the introduction of a new performance-based
stock compensation plan (hereinafter, the “Compensation Plan”) for Directors (excluding
Directors serving as the Audit Committee Members; the same applies hereinafter in this Proposal
5). The Compensation Plan, as described hereafter, is intended to integrally manage theremuneration for officers for the sake of Directors of the Company and its subsidiaries(hereinafter, the “Applicable Companies”). The purpose of introducing the Compensation Plan
targeting Directors is to increase their awareness of contributing to further enhancing the Asahi
Holdings Group’s business performance and corporate value.
If Proposal 4 “Determination of Amounts of Remuneration for Directors and Audit Committee
Members” is approved, the remuneration for Directors will be a maximum annual amount of 200
million yen (excluding the portion of salaries as employees to those Directors concurrently
working as employees). In addition to such a remuneration scheme, we ask shareholders theapproval of this new stock compensation, based on their respective positions and achievement
ratios in the medium-term management plan (3 years). The number of Directors covered by theCompensation Plan will be five (5) if Proposal 2 “Election of Five (5) Directors (Excluding
Directors Serving as the Audit Committee Members)” is approved as proposed.
Furthermore, if this proposal is approved as proposed, the remuneration for Directors will consistof “basic remuneration,” “bonuses” and “stock compensation.”

Reference Documents for
General Meeting of Shareholders

Proposal 5 Determination of Amounts and the Content of the Performance-Based Stock
Compensation Plan for Directorsrespective Directors by subsidiaries of the Company (the maximum amount of the total amountof said funds contributed by the subsidiaries of the Company shall be 270 million yen).
*Maximum amount of funds for contribution to the Trust is a total of the funds for stockacquisition and Trust expenses.
(3) Calculation method and upper limit of the Company’s shares to be acquired by Directors
At the end of March every year during the trust period, the Directors will be awarded by the
Applicable Company a certain number of points based on their positions. Provided, however,that the number of points will be adjusted in May 2018 by multiplying the coefficient that isdetermined based on the achievement ratio in the medium-term management plan during theApplicable Period by the number of accumulated points awarded for the Applicable Period.
Specifically, the “Calculation method” below presents how the number of points are calculated.
One point will equate to one share of the Company’s shares.* The Company’s shares will be
issued to each Director in August 2018, according to the number of accumulated points after the
aforementioned adjustment.
The upper limit of the total number of points that each Director of the Company may be awarded
annually shall be 27,000 points. Meanwhile, the maximum number of Asahi Holdings’ shares foracquisition that will be acquired by the Trust to issue them to Directors of the Company(hereinafter, the “Number of Shares Acquired”) shall be 81,000 shares, which corresponds to thetotal number of points to be awarded to each Director per year (27,000 points) multiplied by the
number of years of the trust period (3).
*Adjustment of points due to stock splits, mergers, etc., can be made if it is recognized that an
adjustment in the number of points in any of the aforementioned cases during the trust period isfair and impartial.
(Calculation method)
Number of base points to be determined as described in 1) below × Performance-based
coefficient set forth in 2) below

1) Number of base points for each Director
The number of base points granted to Directors during each fiscal year under evaluation is asshown below.
Table 1. Number of base points according to position
Position
Number of base points
Representative Director
3,200
Director
1,600*In case of a change in position name and the like, the number of base points at anequivalent position shall apply.

65
Proposal for Determination of Amounts and the Content of the Performance-Based Stock
Compensation Plan for Directors

Convocation NoticeBusiness Reports
Reference Documents for
General Meeting of Shareholders

Audit Report(4)Method of acquiring the Company’s shares for the Trust
The acquisition of the Company’s shares by the Trust is planned to be from the stock market
within the maximum amount of funds for contribution to the Trust and the maximum Number of
Shares Acquired.
Furthermore, during the trust period, in the event that the number of shares in the Trust is
insufficient for the number of accumulated points awarded to Directors of the Company,
additional funds may be allocated to the Trust within the scope for the maximum amount offunds for contribution to the Trust and the maximum Number of Shares Acquired in order toadditionally acquire the Company’s shares.

Consolidated
Financial Statements

Table 2. Performance-based coefficientAchievement ratio on performance
Performance-based coefficient
100% or more
1.0
70% or more
0.5
Below 70%
0.0
*Achievement ratio on performance (%) = Achievement ratio of consolidated operating
income for the fiscal year ending March 31, 2018

Financial Statements

2) Performance-based coefficient
The performance-based coefficient shall be as follows, according to the achievement ratio in themedium-term management plan (3 years), which was released in March 2015.

66
Proposal for Determination of Amounts and the Content of the Performance-Based Stock
Compensation Plan for Directors

Reference: Excerpt from the press release dated May 11, 2015
[Trust scheme to be initially established]
1) Approval at this General Meeting of Shareholders【Trustor】
Asahi Holdings
8) Transfer without charge andretirement of remaining shares
9) Distribution of residual
assets3) Establishment of the trust
2) Establishment ofregulations concerning stock5) Dividends【Trustee (Joint trustee)】 (planned)
4) The Company’s
sharesMitsubishi UFJ Trust and Banking Corporation
The Master Trust Bank of Japan, Ltd.

Stock market

7) Issuance of theCompany’s sharesand performancein money【Beneficiary】

The Trust4) Payment of
costs

Directors

The Company’s shares, funds

6) Directions on non-exercise of voting rights

Trust administrator

1)

The Applicable Companies shall respectively receive approval on a resolution on remuneration for officers regarding

2)

The Applicable Companies will, at a Board of Directors meeting thereof, respectively formulate the regulations

3)

The Applicable Companies will respectively contribute funds within the scope of this Annual General Meeting of

4)

5)
6)
7)

8)

9)

the introduction of the Compensation Plan at this Annual General Meeting of Shareholders.
concerning stock issuance relative to the introduction of the Compensation Plan.

Shareholders’ approval as outlined in 1). The Company will, within the scope of this Annual General Meeting of
Shareholders’ approval as outlined in 1), establish a trust (the “Trust”) to award the Company’s shares to eligible
Directors who meet the criteria for beneficiaries by adding the funds reserved for remuneration to the eligible
Directors of the Company to the funds contributed from the respective applicable subsidiaries.
According to the directions of its trust administrator, the Trust will use the funds reserved in 3) to acquire theCompany’s shares on the stock market. The number of shares acquired by the Trust will be within the scope of theresolution approved at this Annual General Meeting of Shareholders. The Company’s shares in the Trust will be
managed at appropriately separated accounts depending on the amounts contributed by the respective ApplicableCompanies.
Dividends from the Company’s shares in the Trust will be handled in the same way as with other shares.
Voting rights for the Company’s shares in the Trust will not be exercised while those shares are held by the Trust.
During the trust period, points will be awarded to the eligible Directors based on their positions in each fiscal year.
The number of points awarded to the eligible Directors will be adjusted based on the coefficient, which will be
determined based on the achievement ratio in the medium-term management plan of the Company. The Company’s
shares corresponding to the number of post-adjustment points, which have been awarded to said eligible Directors,
will be issued by the Trust in August 2018 to the eligible Directors who meet who meet the prescribed criteria forbeneficiaries.
Should shares remain when the Trust expires due to failure to achieve performance targets of the medium-term
management plan or for any other reason, it is planned that the remaining shares will be transferred without charge by
the Trust as a grant to the Company and retired in accordance with a Board of Directors’ resolution. Provided, however,that on the condition that a proposal regarding the continuation of the Trust is submitted for discussion and is approvedat an annual general meeting of shareholders to be held after three years, the Trust may be continuously used as a new
stock compensation plan by extending the Applicable Period and the trust period within the scope approved byresolution at said general meeting of shareholders.
It is planned that any assets remaining in the Trust after distribution to beneficiaries will be returned to the Company atthe time of settlement of the Trust.

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Reference: Excerpt from the press release dated May 11, 2015

Exercise of voting rights
Type of stock acquired
Maximum amount offunds for contribution
Rights holder
Remaining assets

Asahi Holdings, Inc.
Asahi Holdings as the rights holder shall be entitled to receivable assets
remaining after deductions for stock purchases from the funds within
the scope of the fund reserved for expenses for trust assets.

Convocation NoticeBusiness Reports
Reference Documents for
General Meeting of Shareholders[Overview of details of business associated with the Trust and stock]
Trust-related business
It is planned that Mitsubishi UFJ Trust and Banking Corporation and
Master Trust Bank of Japan, Ltd., will be the trustees of the Trust tohandle trust-related business.
Stock-related business
It is planned that Mitsubishi UFJ Morgan Stanley Securities will handle
business related to transferring Asahi Holdings’ shares to beneficiaries
on an outsourcing agreement basis.

Consolidated
Financial Statements

Beneficiary
Trust administrator
Trust indenture date
Trust periodPlan launch dateFinancial Statements

Purpose of trust
TrustorTrusteeMonetary trust other than a specified solely administered monetary trust(Third Party Beneficiary Trust)
Providing incentives to the Directors of Asahi Holdings, Inc.
Asahi Holdings, Inc.
Mitsubishi UFJ Trust and Banking Corporation (planned)(Joint trustee: The Master Trust Bank of Japan, Ltd. (planned))
Directors who meet the criteria for beneficiaries
Third party that has no interest in Asahi Holdings (CPA)
February 2016 (planned)
February 2016 (planned) to August 2018 (planned)
February 2016 (planned) (awarding of points to start on March 31,
2016)
Not to be exercised
Asahi Holdings’ common shares
513 million yen (planned) (including Trust fees and Trust expenses)

Audit Report[Overview of trust agreement]
Type of trust

68
Reference: Excerpt from the press release dated May 11, 2015