Note: This document has been translated from a part of the Japanese original for reference purposes only. In the event of any
discrepancy between this translated document and the Japanese original, the original shall prevail.

Securities code: 6104
June 12, 2020
To our shareholders:
Shigetomo Sakamoto,President
SHIBAURA MACHINE CO., LTD.
2-2 Uchisaiwaicho 2-Chome, Chiyoda-ku, TokyoNOTICE OF THE 97TH ORDINARY GENERAL MEETING OF SHAREHOLDERS
We are pleased to announce the 97th Ordinary General Meeting of Shareholders of SHIBAURA MACHINE CO.,LTD. (the “Company”), which will be held as described below.
Having carefully considered the options for preventing the spread of novel coronavirus (COVID-19) infection, if at
all possible, you are strongly encouraged to refrain from coming to the venue on the date of the meeting and exercise
your voting rights by postal mail or via the Internet, etc. Please exercise your voting rights after reviewing the attached
Reference Documents for the General Meeting of Shareholders no later than 5:30 p.m., Friday, June 26, 2020 (Japan
Standard Time).
1. Date and Time: Monday, June 29, 2020 at 10:00 a.m. (Reception desk opens at 9:00 a.m.) (Japan StandardTime)
2. Venue:Tokyo Kaikan, 3F “Rose”
2-1 Marunouchi 3-Chome, Chiyoda-ku, Tokyo(Please refer to the Guide Map to the Venue for the General Meeting of Shareholders attachedat the end. (This only applies to those who received the Japanese version of this notice))
Please note that the meeting place has changed from the venue of previous meetings.
3. Purposes:
Items to be reported:
1. Business Report and Consolidated Financial Statements for the 97th Term (from April 1, 2019 to March 31,2020), as well as the results of audit of the Consolidated Financial Statements by the Accounting Auditor
and the Audit and Supervisory Committee.
2. Non-Consolidated Financial Statements for the 97th Term (from April 1, 2019 to March 31, 2020)
Items to be resolved:
Proposal 1:
Election of Nine (9) Directors (excluding Directors Who Are Audit and Supervisory
Committee Members)
Proposal 2:
Election of One (1) Substitute Director Who Is an Audit and Supervisory Committee
Member
Proposal 3:
Determination of Remuneration for Granting Restricted Shares to Directors (excluding
Directors Who Are Audit and Supervisory Committee Members and Outside Directors)
and Revision of Remuneration Amount-1-

Reference Documents for the General Meeting of Shareholders
Proposal 1:

Election of Nine (9) Directors (excluding Directors Who Are Audit and Supervisory Committee
Members)

The terms of office of all eight Directors (excluding Directors who are Audit and Supervisory Committee Members;
the same shall apply hereinafter in this proposal) will expire at the conclusion of this Ordinary General Meeting of
Shareholders. Thus, the Company proposes that nine Directors be elected.
In addition, the Audit and Supervisory Committee has judged each candidate to be a reasonable nomination for the
position of Director of the Company for this proposal.
The candidates for Director are as follows:
No.

Name

1

Yukio Iimura

2

Shigetomo Sakamoto

Current position and responsibilities in the
Company
Chairman and Chief Executive Officer

Attendance at the
Notes[Reelection]

President and Chief Operating Officer
Security and Regulation Control Division
General Manager[Reelection]

Director and Executive Operating Officer
R&D Center General Manager, Sagami
3

Akiyoshi Kobayashi

Plant General Manager, in charge of
Administration Division, and in charge of

4

Hiroaki Ota―

5

Kiyoshi Sato

Outside Director

6

Seigo Iwasaki

Outside Director

Board of Directors
meetings
19 of 19
(100%)
19 of 19
(100%)[Reelection]

19 of 19
(100%)[New election]―

System Strategy Division[Reelection][Outside][Independent][Reelection]

7

Hiroshi Inoue[Outside][Independent][Reelection][Outside]

Outside Director[Independent]
8

Kazumine Terawaki[Reelection][Outside]

Outside Director[Independent]

19 of 19
(100%)
19 of 19
(100%)
14 of 15(93%)
15 of 15
(100%)[New election]
9
Note:

Chisa Hayakawa―[Outside]―[Independent]
For Hiroshi Inoue and Kazumine Terawaki, the attendance status at meetings of Board of Directors only incorporates themeetings of the Board of Directors that have been held since their appointments on June 21, 2019.

-2-

No.

Name (Date of birth)

Career summary, position and responsibilities (Significant
concurrent positions outside the Company)
Apr. 1980
Oct. 2000
Oct. 2004

Yukio Iimura(June 17, 1956)[Reelection]
1

June 2006
June 2008
June 2009
June 2013
Apr. 2017
May 2017

Joined the Company
Injection Molding Machine Engineering
Department Senior Manager of the Company
Micro-Pattern Imprinting Device Division
General Manager of the Company
Director of the Company
Headquarters of Engineering Division General
Manager of the Company
President of the Company
President and Chief Executive Officer of theCompany
Chairman and Chief Executive Officer of theCompany (present position)
Chairman of Japan Machine Tool Builders’
Association (present position)

Number of theCompany’s shares
owned

25,500[Reasons for nomination as candidate for Director]
Since being appointed President of the Company in 2009, Yukio Iimura has used his strong leadership skills to guidethe whole Group. Since April 2017, he has served as Chairman and Chief Executive Officer of the Company, and has
been involved in management of the Group with the aim of continuing to further enhance corporate value. We expect
him to strengthen corporate governance and the management structure still further, and have thus nominated him as a
candidate for Director.
[Attendance at the Board of Directors meetings (from April 1, 2019 to March 31, 2020)]
Attended all of the 19 meetings

-3-

No.

Name (Date of birth)

Career summary, position and responsibilities (Significant
concurrent positions outside the Company)
Apr. 1983
June 2006
June 2009
June 2010
Oct. 2010
June 2013

June 2016
Shigetomo Sakamoto(May 22, 1958)[Reelection]
2

Apr. 2017

June 2017

June 2019Feb. 2020
Apr. 2020

Joined the Company
Corporate Planning Division General Managerof the Company
Director of the Company
Tokyo Head Office General Manager of theCompany
Global Corporate Strategy Division General
Manager of the Company
Director and Managing Executive Officer,
Component Business Unit General Manager,
and Corporate Planning Division General
Manager of the Company
Representative Director and Executive
Operating Officer, Compliance Division
General Manager, Security and Regulation
Control Division General Manager, Corporate
Strategic Planning Division General Manager,
Sagami Plant General Manager, and RMO of
the Company
Machine Tools Business Unit General Manager
and Gotemba Plant General Manager of theCompany
In charge of Corporate Strategic Planning
Division and in charge of TQM Promotion
Division of the Company
Vice President and Operating Officer of theCompany
President and Chief Operating Officer of theCompany (present position)
Security and Regulation Control Division
General Manager of the Company (present
position)

Number of theCompany’s shares
owned

7,100

[Reasons for nomination as candidate for Director]
Shigetomo Sakamoto was appointed President and Chief Operating Officer of the Company in February 2020,
becoming responsible for management of the Group, such as executing the management reform plan, based on his
extensive experience and achievements primarily in the Corporate Strategic Planning Division. We expect him toenhance corporate value by further strengthening the management base and reliably executing the management reform
plan, and have thus nominated him as a candidate for Director.
[Attendance at the Board of Directors meetings (from April 1, 2019 to March 31, 2020)]
Attended all of the 19 meetings

-4-

No.

Name (Date of birth)

Career summary, position and responsibilities (Significant
concurrent positions outside the Company)
Apr. 1985
Oct. 2004
June 2013
June 2014

June 2015

June 2016
Akiyoshi Kobayashi(November 14, 1960)

Apr. 2017[Reelection]
June 20183
June 2019Feb. 2020
Apr. 2020

Joined the Company
Extrusion Machine Engineering Department
Senior Manager of the Company
Extrusion Machine Division General Managerof the Company
Executive Officer, Advanced Machinery
Business Unit Deputy General Manager of theCompany
Director and Executive Officer, Advanced
Machinery Business Unit General Manager of
the Company
In charge of Control Systems Division of theCompany
Molding Machinery Business Unit General
Manager, Administration Division General
Manager, and Sagami Plant General Managerof the Company
Director and Senior Managing Executive
Officer, Corporate Strategic Planning Division
General Manager, and Engineering and Quality
Division General Manager of the Company
Director and Executive Operating Officer(present position) and in charge of Control
Systems Division of the Company
Compliance Division General Manager of theCompany
R&D Center General Manager, Sagami Plant
General Manager, in charge of Administration
Division, and in charge of System Strategy
Division of the Company (present position)

Number of theCompany’s shares
owned

6,700

[Reasons for nomination as candidate for Director]
Since being appointed as Director, Akiyoshi Kobayashi has been involved with management from the perspective of
the Research and Development Division, based on his extensive experience and achievements gained throughexecution of operation in the Extrusion Machine business in the past. We believe that he will continue to be an
appropriate appointment to expand the Group’s business, refine the Group’s technology and raise quality, and havehigh expectations for his management decision-making and oversight. Accordingly, we have nominated him as a
candidate for Director.
[Attendance at the Board of Directors meetings (from April 1, 2019 to March 31, 2020)]
Attended all of the 19 meetings

-5-

No.

Name (Date of birth)

Career summary, position and responsibilities (Significant
concurrent positions outside the Company)
Apr. 1984
Apr. 2001
Feb. 2009
Mar. 2014

Hiroaki Ota(March 7, 1962)

Aug. 2014
Feb. 2015[New election]
4
Mar. 2015

Apr. 2017
Apr. 2020

5

Joined Mitsui Bank (currently Sumitomo
Mitsui Banking Corporation)
Joined Daiwa Securities SMBC Co. Ltd.
(currently Daiwa Securities Co. Ltd.)
Joined GCA Savvian Corporation (currently
GCA Corporation)
Audit and Supervisory Board Member of
Mezzanine Corporation
Audit and Supervisory Board Member of GCA
FAS Co., Ltd.
CFO and Managing Director of GCA Savvian
Corporation (currently GCA Corporation)
Director of GCA Savvian Singapore Private
Ltd.
Director, CFO and Managing Director of GCA
Savvian Corporation (currently GCA
Corporation)
Managing Director of GCA Corporation
Executive Operating Officer of GCA Partners
Corporation (present position)

Number of theCompany’s shares
owned

0

[Reasons for nomination as candidate for Director]
Hiroaki Ota has extensive experience and achievements related to finance and corporate management through theexecution of business at other companies, and has an impressive character and knowledge. We believe that he isqualified to further strengthen the Group’s management structure and will also be able to fulfill his responsibilities as
Director, and have thus nominated him as a candidate for Director.
Apr. 1979
Joined Tokyo Electron Limited
Apr. 2003
Senior Executive, president’s office of Tokyo
Electron Limited
June 2003
President and CEO of Tokyo Electron Limited
Apr. 2009
Vice Chairman of the Board of Tokyo Electron
LimitedJune 2011
Director of Tokyo Electron Limited
Kiyoshi Sato
Chairman of Tokyo Electron America, Inc.
(April 2, 1956)
Chairman of Tokyo Electron Europe, Ltd.
[Reelection]
0
Nov. 2013
Director of Tokyo Electron Limited, President[Candidate for Outside Director]of TEL Solar AG[Candidate for Independent
June 2016
Audit and Supervisory Board Member of
Officer]Tokyo Electron Yamanashi Limited
June 2017
Outside Director of the Company (present
position)
June 2019
Outside Director of Mazda Motor Corporation(present position)
June 2019
Outside Director of Inabata & Co., Ltd.
(present position)[Reasons for nomination as candidate for Outside Director]
Kiyoshi Sato possesses an impressive character and knowledge, and we believe that he will be able to fulfill his
responsibilities as Outside Director by utilizing his extensive experience and knowledge gained by the businessoverseas, and as an officer for other companies. Accordingly, we have nominated him as a candidate for Outside
Director.
[Regarding Independence]
There is no special interest between Kiyoshi Sato and the Company. There is no special interest between Mazda Motor
Corporation and Inabata & Co., Ltd., at which he is engaged in his main concurrent posts, and the Company.
[Attendance at the Board of Directors meetings (from April 1, 2019 to March 31, 2020)]
Attended all of the 19 meetings

-6-

No.

Name (Date of birth)

Career summary, position and responsibilities (Significant
concurrent positions outside the Company)
Mar. 1969
July 1988

6

Number of theCompany’s shares
ownedJoined SHIZUOKA GAS Co., Ltd.
General Planning Group Leader of
SHIZUOKA GAS Co., Ltd.
Mar. 1996
Director of SHIZUOKA GAS Co., Ltd.
Mar. 2000
Managing Director of SHIZUOKA GAS Co.,
Ltd.
Mar. 2001
Senior Managing Director of SHIZUOKAGAS Co., Ltd.
Seigo Iwasaki
Mar. 2006
Representative Director and President of(October 8, 1946)
SHIZUOKA GAS Co., Ltd.
Jan. 2011
Representative Director and Chairman of[Reelection]
2,400
SHIZUOKA GAS Co., Ltd.
[Candidate for Outside Director]
May 2014
Outside Director of STAR MICRONICS CO.,
[Candidate for IndependentLTD. (present position)
Officer]June 2015
Outside Director of Murakami Corporation(present position)
Jan. 2018
Director and Special Adviser of SHIZUOKAGAS Co., Ltd.
June 2018
Outside Director of the Company (present
position)Mar. 2020
Special Adviser of SHIZUOKA GAS Co., Ltd.
(present position)[Reasons for nomination as candidate for Outside Director]
Seigo Iwasaki possesses an impressive character and knowledge, and we believe that he will be able to fulfill his
responsibilities as Outside Director by utilizing his extensive experience and knowledge gained as an officer for othercompanies. Accordingly, we have nominated him as a candidate for Outside Director.
[Regarding Independence]
There is no special interest between Seigo Iwasaki and the Company. There is no special interest between STAR
MICRONICS CO., LTD. and Murakami Corporation at which he is engaged in his main concurrent posts, and theCompany.
[Attendance at the Board of Directors meetings (from April 1, 2019 to March 31, 2020)]
Attended all of the 19 meetings

-7-

No.

Name (Date of birth)

Career summary, position and responsibilities (Significant
concurrent positions outside the Company)
Apr. 1963
June 1993
June 1996

7

Number of theCompany’s shares
ownedJoined Tokyo Broadcasting System, Inc.
Director of Tokyo Broadcasting System, Inc.
Managing Director of Tokyo Broadcasting
System, Inc.
June 1997
Senior Managing Director of Tokyo
Broadcasting System, Inc.
June 2001
Vice President and Representative Director ofTokyo Broadcasting System, Inc.
June 2002
President and Representative Director of Tokyo
Broadcasting System, Inc.
Oct. 2004
President and Representative Director of Tokyo
Hiroshi Inoue
Broadcasting System Television, Inc.
(January 5, 1940)
June 2006
Outside Director of Tokyo Electron Limited
Apr. 2009
Chairman and Representative Director of[Reelection]
0
Tokyo Broadcasting System Holdings, Inc.
[Candidate for Outside Director]
Chairman and Representative Director of[Candidate for Independent
Tokyo Broadcasting System Television, Inc.
Officer]
Apr. 2012
President of The Japan Commercial
Broadcasters Association (general incorporated
association)
Apr. 2016
Honorary Chairman and Director of Tokyo
Broadcasting System Holdings, Inc.
Honorary Chairman and Director of Tokyo
Broadcasting System Television, Inc.
June 2018
Executive Advisor of Tokyo Broadcasting
System Television, Inc. (present position)
June 2019
Outside Director of the Company (present
position)[Reasons for nomination as candidate for Outside Director]
Hiroshi Inoue possesses an impressive character and knowledge, and we believe that he will be able to fulfill his
responsibilities as Outside Director by utilizing his extensive experience and knowledge gained as an officer for othercompanies. Accordingly, we have nominated him as a candidate for Outside Director.
[Regarding Independence]
There is no special interest between Hiroshi Inoue and the Company. There is no special interest between Tokyo
Broadcasting System Television, Inc., at which he is engaged in his main concurrent post, and the Company.
[Attendance at the Board of Directors meetings (from April 1, 2019 to March 31, 2020)]
Of 19 meetings, attended 14 of the 15 meetings held after his appointment

-8-

No.

Name (Date of birth)

Career summary, position and responsibilities (Significant
concurrent positions outside the Company)
Apr. 1980

8

Number of theCompany’s shares
owned

Prosecutor of Tokyo District Public Prosecutors
OfficeJan. 2014
Director-General of Public Security
Intelligence Agency
Jan. 2015
Superintending Prosecutor, Sendai High
Prosecutors Office
Sept. 2016
Superintending Prosecutor, Osaka High
Prosecutors Office
Kazumine Terawaki
Apr. 2017Retired from his post of Superintending(April 13, 1954)
Prosecutor, Osaka High Prosecutors Office
June 2017
Lawyer registration (Tokyo Bar Association),[Reelection]
0
Joined Satoshi Suzuki Law Office (present[Candidate for Outside Director]
position)[Candidate for Independent
Feb. 2018
Outside Corporate Auditor of Kewpie
Officer]
Corporation (present position)
June 2018
External Audit and Supervisory Board Memberof The Shoko Chukin Bank, Ltd. (present
position)
June 2019
Outside Director of the Company (present
position)
June 2019
Outside Audit and Supervisory Board Memberof Kajima Corporation (present position)[Reasons for nomination as candidate for Outside Director]
Kazumine Terawaki possesses an impressive character and knowledge, and we believe that he will be able to fulfill his
responsibilities as Outside Director by utilizing his extensive experience and knowledge gained as a lawyer and an
officer for other companies. Accordingly, we have nominated him as a candidate for Outside Director.
[Regarding Independence]
There is no special interest between Kazumine Terawaki and the Company. There is no special interest between
Kewpie Corporation, The Shoko Chukin Bank, Ltd. and Kajima Corporation, at which he is engaged in his main
concurrent posts, and the Company.
[Attendance at the Board of Directors meetings (from April 1, 2019 to March 31, 2020)]
Of 19 meetings, attended all 15 meetings held after his appointment

-9-

No.

Name (Date of birth)

Career summary, position and responsibilities (Significant
concurrent positions outside the Company)
Apr. 1991
Mar. 1998
July 2009
Apr. 20119Notes:

Number of theCompany’s shares
ownedJoined Sanyo Securities Company Limited
Joined FANCL CORPORATION
Joined Calbee, Inc.
Investor Relations Group Manager of Calbee,
Inc.
Chisa Hayakawa
Apr. 2013
Executive Officer (present position) and(June 27, 1968)
Investor Relations Department General
Manager of Calbee, Inc.
[New election]
0
Apr. 2014
Corporate Planning Department General[Candidate for Outside Director]
Manager and Investor Relations Department[Candidate for Independent
General Manager of Calbee, Inc.
Officer]
Apr. 2016
East Japan Sales Department Deputy General
Manager of Calbee, Inc.
Apr. 2017
East Japan Sales Department General Manager
of Calbee, Inc.
Apr. 2019
Financial & Accounting Department General
Manager of Calbee, Inc. (present position)[Reasons for nomination as candidate for Outside Director]
Chisa Hayakawa possesses an impressive character and knowledge, and we believe that she will be able to fulfill her
responsibilities as Outside Director by utilizing her extensive experience and knowledge gained through expertise andwide-ranging business execution as a securities analyst and a certified tax accountant. Accordingly, we have nominatedher as a candidate for Outside Director.
[Regarding Independence]
There is no special interest between Chisa Hayakawa and the Company. There is no special interest between Calbee,
Inc., at which she is engaged in her main concurrent post, and the Company.
1. There is no special interest between the above candidates for Director and the Company.
2. Kiyoshi Sato, Seigo Iwasaki, Hiroshi Inoue, Kazumine Terawaki and Chisa Hayakawa are candidates for Outside Director.
3. Kiyoshi Sato, Seigo Iwasaki, Hiroshi Inoue and Kazumine Terawaki are currently Outside Directors of the Company, andat the conclusion of this General Meeting of Shareholders, Kiyoshi Sato, Seigo Iwasaki, Hiroshi Inoue and Kazumine
Terawaki will have served as Outside Directors for three years, two years, one year and one year respectively.
4. In accordance with the Articles of Incorporation of the Company and Article 427, paragraph (1) of the Companies Act, theCompany has concluded limited liability agreements referred to in Article 423, paragraph (1) of the Companies Act with
Kiyoshi Sato, Seigo Iwasaki, Hiroshi Inoue and Kazumine Terawaki which prescribe that the maximum extent of theliability for damages shall be the amount set forth in laws and regulations. If their reelections are approved, the Company
plans to continue these limited liability agreements. If the election of Chisa Hayakawa is approved, the Company plans toconclude the same limited liability agreement with her.
5. The Company has designated Kiyoshi Sato, Seigo Iwasaki, Hiroshi Inoue and Kazumine Terawaki as Independent Officers
based on the stipulation by the Tokyo Stock Exchange and registered them to the said exchange. If their reelections areapproved, the Company plans to continue their registration as the Independent Officers. In addition, Chisa Hayakawa
meets the requirements for Independent Officers based on the regulations of the Tokyo Stock Exchange, and in the eventthat her election is approved, the Company plans to designate her as an Independent Officer.

- 10 -

Proposal 2:

Election of One (1) Substitute Director Who Is an Audit and Supervisory Committee Member

The validity of the election of substitute Director who is an Audit and Supervisory Committee Member Akifumi
Imamura, approved at the 96th Ordinary General Meeting of Shareholders held on June 21, 2019, will be expired at
the start of this Ordinary General Meeting of Shareholders. Accordingly, the Company requests approval for theelection of one substitute Director who is an Audit and Supervisory Committee Member to be ready to fill a vacant
position should the number of Directors who are Audit and Supervisory Committee Members fall below the number
required by laws and regulations.
The Audit and Supervisory Committee has given its consent to this proposal.
The candidate for substitute Director who is an Audit and Supervisory Committee Member is as follows:
Name(Date of birth)

Career summary (Significant concurrent positions outside the Company)
Apr. 1982

Number of theCompany’s shares
owned

Lawyer registration (DAIICHI TOKYO BAR
ASSOCIATION)
Apr. 1989
Partner Lawyer of Atago Law Office
May 2003
Partner Lawyer of Greenhill Law and Patent Office (present
position)
Apr. 2005
Vice-president of DAIICHI TOKYO BAR ASSOCIATION
June 2005
Outside Audit and Supervisory Board Member of JBCC
Akifumi Imamura
Holdings Inc.
0
(April 18, 1953)
June 2011
Outside Audit and Supervisory Board Member of Itoham
Foods Inc.
Apr. 2016
Outside Audit and Supervisory Board Member of ITOHAMYONEKYU HOLDINGS INC. (present position)
June 2016
Audit and Supervisory Committee Member/Outside Directorof JBCC Holdings Inc. (present position)
Mar. 2020
Outside Audit and Supervisory Board Member of Otomo
Logistics Service Co., Ltd. (present position)[Reasons for nomination as candidate for Outside Director who is a substitute Audit and Supervisory Committee Member]
Akifumi Imamura has an impressive character and knowledge, and we believe that he will be able to reflect his extensive experienceand knowledge gained as a lawyer and an outside officer for other companies. Accordingly, we have nominated him as a candidate
for Outside Director who is a substitute Audit and Supervisory Committee Member.
[Regarding Independence]
There is no special interest between Akifumi Imamura and the Company. There is no special interest between ITOHAM YONEKYUHOLDINGS INC., JBCC Holdings Inc. and Otomo Logistics Service Co., Ltd., at which he is engaged in his main concurrent posts,
and the Company. Akifumi Imamura satisfies the requirements for an Independent Officer as provided for by Tokyo Stock
Exchange, Inc.
Notes: 1. Akifumi Imamura is a candidate for substitute Outside Director.
2. In accordance with the Articles of Incorporation of the Company and Article 427, paragraph (1) of the Companies Act, if
Akifumi Imamura is appointed as an Outside Director who is an Audit and Supervisory Committee Member, the Company
plans to conclude a limited liability agreement referred to in Article 423, paragraph (1) of the Companies Act with him,
which prescribes that the maximum extent of the liability for damages shall be the amount set forth in laws and regulations.

- 11 -

Proposal 3:

Determination of Remuneration for Granting Restricted Shares to Directors (excluding
Directors Who Are Audit and Supervisory Committee Members and Outside Directors) andRevision of Remuneration Amount

1. Overview of the proposal
The Company requests approval of the adoption of new share-based remuneration plans (the “Plan”) that enlist
two types of shares with transfer and other restrictions (“restricted shares”) for the Company’s Directors(excluding Directors who are Audit and Supervisory Committee Members and Outside Directors; “Eligible
Directors”). At its 96th Ordinary General Meeting of Shareholders held on June 21, 2019, the Company gained
approval with respect to amounts of remuneration for the Company’s Directors (excluding Directors who are
Audit and Supervisory Committee Members), for an amount not exceeding ¥500 million annually (including theamount not exceeding ¥150 million annually for Outside Directors; provided, however, that this does not include
the portion of employee salaries paid to the Directors concurrently serving as employees). The Company now
seeks approval with respect to providing the Eligible Directors with the new share-based remuneration separatelyfrom the aforementioned remuneration framework for the purposes stated in “2. Reasons for adopting the Plan,”
and with respect to accordingly revising the amounts of remuneration for the Company’s Directors (excluding
Directors who are Audit and Supervisory Committee Members).
Specifically, the total amounts of remuneration, etc. provided for the purpose of granting restricted shares to the
Eligible Directors on the basis of this proposal, which is in the form of monetary remuneration claims, shall be
set at an amount not exceeding ¥25 million annually and deemed reasonable in view of the purposes stated in “2.
Reasons for adopting the Plan” for the “continuous service-type restricted share-based remuneration” as describedunder “3. (2) Continuous service-type restricted share-based remuneration,” and shall be set at an amount notexceeding ¥75 million for the “performance-linked and restricted share-based remuneration” as described under“3. (3) Performance-linked and restricted share-based remuneration” in the fiscal year following the end of theapplicable period of the Company’s medium-term management plan determined by the Board of Directors of theCompany. Moreover, following the adoption of the Plan, amounts of remuneration for the Company’s Directors(excluding Directors who are Audit and Supervisory Committee Members) shall be set at an amount not exceeding¥450 million annually (including the amount not exceeding ¥150 million annually for Outside Directors; provided,
however, that this shall not include the portion of employee salaries paid to the Directors concurrently serving as
employees). This will involve decreasing by ¥50 million annually the ¥500 million maximum annual
remuneration for the Company’s Directors (excluding Directors who are Audit and Supervisory Committee
Members) thus far (including the amount not exceeding ¥150 million annually for Outside Directors; provided,
however, that this shall not include the portion of employee salaries paid to the Directors concurrently serving as
employees).
There are currently eight Directors (excluding Directors who are Audit and Supervisory Committee Members; ofwhich four are Outside Directors), and if Proposal 1 is approved and adopted as proposed, the number of Directors(excluding Directors who are Audit and Supervisory Committee Members) will be nine (of which five are Outside
Directors).
2. Reasons for adopting the Plan
The Company has announced the “New ‘Shibaura Machine’ Long-term Vision 2030” as the long-term strategy toachieve both the resolving of social issues and the enhancing of corporate value through responding to megatrends
facing the global manufacturing industry with outstanding technological innovations, and “Management ReformPlan” as the medium-term management plan. The Plan entails granting share-based remuneration to the Eligible
Directors with the objectives of giving them an incentive to achieve the performance targets stated in the“Management Reform Plan” and make continuous improvements to the corporate value through further
strengthening the link between remuneration for Eligible Directors and the medium- to long-term performance of
the Company and promoting shared values between the Eligible Directors and shareholders in accordance withthe basic policy set forth as follows.
(1) Provide sound incentive to Directors by furnishing an appropriate mix of fixed remuneration composed ofbasic remuneration and variable remuneration composed of (i) share-based remuneration contingent on
continuous service, (ii) bonus in cash linked to short-term performance, and (iii) share-based remuneration
linked to medium- to long-term performance, underpinned by the objectives of transforming the Company- 12 -

into a highly profitable enterprise and achieving sustainable growth, with the aim of increasing theCompany’s corporate value over the medium to long term(2) Strongly motivate Directors to achieve the performance targets by linking the Company’s medium-term
management plan, including the Management Reform Plan, and share-based remuneration(3) Share the benefits and risks of share price fluctuations with the shareholders by increasing the ratio of sharebased remuneration and promoting the Directors’ shareholding
The share-based remuneration granted under the Plan further promotes a continuous sharing of value withshareholders under a system that restricts the transfer of shares until retirement of the Director.
3. Details of the Plan
(1) Overview of the Plan
Under the Plan, the Company shall, based on the resolution of the Board of Directors, grant Eligible Directors
with monetary remuneration claims for the allocation of restricted shares, and, by having the Eligible Directors
make contribution in kind to the Company using all the monetary remuneration claims as contributed assets,shall issue or dispose of its common shares to the Eligible Directors and allow them to hold such shares. The
Plan consists of two types of share-based remuneration plan; “continuous service-type restricted share-based
remuneration,” which requires the Eligible Director’s continuous service for a certain period as the Company’s
Director in order for the transfer restriction to be lifted, and the “performance-linked and restricted sharebased remuneration,” in which the number of restricted shares to be granted varies in accordance with theachievement level of the performance targets established in advance by the Board of Directors. As a generalrule, the date on which transfer restriction is lifted and the retirement date of a respective Director are one andthe same under either plan.
The specific timing of provision thereof and allocation to each Eligible Director shall be decided by the Boardof Directors upon its having been furnished with a report of the Remuneration Advisory Committee,
established as an advisory body to the Board of Directors. The total number of common shares to be issued or
disposed of by the Company under the Plan shall be set at a number not exceeding 19,000 shares annually forthe “continuous service-type restricted share-based remuneration,” and shall be set at a number not exceeding
57,000 shares for the “performance-linked and restricted share-based remuneration” as the number of shares
to be issued or disposed of in the fiscal year following the end of the applicable period of the Company’s
medium-term management plan determined by the Board of Directors of the Company. In either case, however,
if a share split of the Company’s common shares (including an allotment without contribution of theCompany’s common shares) or share consolidation of the shares on and after the date of resolution by this
General Meeting of Shareholders, or in any similar event that would make it necessary to adjust the maximum
total number of shares to be allotted, the Company may rationally adjust the maximum total number of shares
to be allotted. The amount to be paid in per share shall be determined by the Board of Directors based on theclosing price of the Company’s common share on the Tokyo Stock Exchange on the business day immediately
prior to each date of resolution by the Board of Directors concerning the issuance or disposal of the shares (ifthere is no transaction on such date, the closing price of the closest preceding trading day), which will bewithin the range not specially advantageous to Eligible Directors.
(2) Continuous service-type restricted share-based remuneration
The issuance or disposal of the common shares under “continuous service-type restricted share-based
remuneration” is carried out, as a general rule, on an annual basis and monetary remuneration claims are
granted to the Eligible Directors based on a resolution by the Board of Directors of the Company. By having
the Eligible Directors make contribution in kind to the Company using the entire amount of those monetary
remuneration claims as contributed assets, the Company delivers a number of shares, as restricted shares, of anumber equivalent to the value of those monetary remuneration claims divided by the price determined by the
Board of Directors based on the closing price of the Company’s common share on the Tokyo Stock Exchangeon the business day immediately prior to each date of resolution by the Board of Directors (if there is notransaction on such date, the closing price of the closest preceding trading day), which will be within the range
not specially advantageous to Eligible Directors.
For the issuance or disposal of the common shares of the Company, an agreement on allotment of restricted
shares that includes the content outlined below (the “Allotment Agreement I”), shall be entered into between
the Company and each Eligible Director.
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(i)An Eligible Director shall not transfer, create a security interest in, or otherwise dispose of the commonshares of the Company allotted under the Allotment Agreement I (the “Allotted Shares”) for the period
from the payment date of the common shares of the Company allotted under the Allotment Agreement I
until the time that the Eligible Director retires from the position of Director of the Company (the“Restriction Period”). The restriction described in the preceding sentence will hereinafter be referred toas the “Restriction.”(ii) In the event that the Eligible Director retires from the position of Director of the Company before theexpiration of the scheduled period for service specified by the Board of Directors during the Restriction
Period (the “Service Provision Period”), the Company shall acquire, by rights, the Allotted Shares without
contribution, unless there is a reason that the Board of Directors deems justifiable.
(iii) Notwithstanding the provision of (i) above, the Company shall lift the Restriction of all of the Allotted
Shares upon expiration of the Restriction Period, on the condition that the Eligible Director has remainedin the position of Director of the Company throughout the Service Provision Period. However, if the
Eligible Director retires from the position as provided in (ii) above before the expiration of the Service
Provision Period due to the reason the Board of Directors of the Company deems justifiable, which is
specified in (ii) above, the Company shall rationally adjust the number of the Allotted Shares on which
the Restriction is to be lifted, and the timing of lifting the Restriction as needed.
(iv) The Company shall acquire, by rights, without contribution the Allotted Shares on which the Restriction
has not been lifted at the expiration of the Restriction Period in accordance with the provision of (iii)
above.
(v) Notwithstanding the provision of (i) above, if, during the Restriction Period, a matter relating to“Reorganization” (as defined below) is approved by a General Meeting of Shareholders of the Company(or the Company’s Board of Directors in cases where approval by a General Meeting of Shareholders is
not required with respect to said Reorganization), the Company shall, prior to the effective date of said
Reorganization, lift the Restriction on a number of the Allotted Shares as rationally determined byresolution of the Company’s Board of Directors and taking into account the period from thecommencement date of the Service Provision Period until the date of approval for said Reorganization.
Such “Reorganization” shall collectively refer to the following matters: a merger agreement whereby theCompany is a disappearing entity; a share exchange agreement, a share transfer plan or other type of
reorganization whereby the Company becomes a wholly owned subsidiary of another company.
(vi) In cases provided for in (v) above, the Company shall acquire, by rights, without contribution the Allotted
Shares on which the Restriction has not been lifted as of the time immediately after the Restriction was
lifted in accordance with the provisions in (v) above.
(vii) Other matters regarding Allotment Agreement I shall be determined by the Board of Directors of theCompany.
(3) Performance-linked and restricted share-based remuneration
The evaluation period of “performance-linked and restricted share-based remuneration” shall be the applicable
period of the Company’s medium-term management plan determined by the Board of Directors of theCompany. The evaluation period described in the preceding sentence will hereinafter be referred to as the“Performance Evaluation Period.” The Eligible Director shall be granted a monetary remuneration claims inan amount calculated by multiplying the level of achievement of the performance benchmarks predeterminedby the Board of Directors as of the end of the Performance Evaluation Period (the “Performance-based
Payment Ratio”) by the remuneration amount on the basis of an Eligible Director’s position (the “Positionspecific Base Remuneration”). By having the Eligible Directors make contribution in kind to the Company
using the entire amount of those monetary remuneration claims as contributed assets, the Company delivers anumber of shares, as restricted shares, of a number equivalent to the value of those monetary remuneration
claims divided by the price determined by the Board of Directors based on the closing price of the Company’scommon share on the Tokyo Stock Exchange on the business day immediately prior to each date of resolution
by the Board of Directors (if there is no transaction on such date, the closing price of the closest preceding
trading day), which will be within the range not specially advantageous to Eligible Directors (the “Share Priceof Allotted Shares”).

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<Method of calculating number of shares to be delivered>
Number of shares to be delivered = Position-specific Base Remuneration(*1) x Performance-based Payment
Ratio(*2) / Share Price of Allotted Shares(*3)(*1) Position-specific Base Remuneration is to be determined by the Board of Directors on a separate basis,
according to positions held by Eligible Director.
(*2) The Performance-based Payment Ratio is to be determined by the Board of Directors, but it is planned to be
calculated by the following formula for the initial Performance Evaluation Period
Performance-based Payment Ratio = payment ratio based on consolidated operating profit ratio x 70% +payment ratio based on consolidated ROE (return on equity) x 30%
 The Performance-based Payment Ratio varies across a range of 0% to 200% according to results achieved
with respect to the consolidated operating profit ratio and consolidated ROE during the Performance
Evaluation Period.
 The Performance-based Payment Ratio shall be a range of 100% to 200% in cases where any of theconsolidated operating profit ratio or consolidated ROE targets for the final fiscal year of the medium-term
management plan decided by the Board of Directors of the Company. When this is not the case, thePerformance-based Payment Ratio shall be assigned 0%, and no shares will be delivered.
 The Performance-based Payment Ratio shall be reviewed each time when the new medium-term
management plan is formulated.
(*3) The Share Price of Allotted Shares shall be determined by the Board of Directors based on the closing priceof the Company’s common share on the Tokyo Stock Exchange on the business day immediately prior to eachdate of resolution by the Board of Directors concerning the issuance or disposal of the shares (if there is notransaction on such date, the closing price of the closest preceding trading day), which will be within the range
not specially advantageous to Eligible Directors.

Moreover, the Company may rationally adjust the number of shares to be delivered in accordance with theperiod of service of an Eligible Director during the Performance Evaluation Period.
The Company shall deliver common shares not subject to the Restriction of a number calculated using thesame formula as that aforementioned if an Eligible Director retires from his or her position as Director due toexpiration of his or her term of office on or before the date of the first Ordinary General Meeting of
Shareholders held after the end of the final fiscal year of the Performance Evaluation Period, or on other
legitimate grounds. However, the Company will not deliver restricted shares if a Director retires from his or
her position during the Performance Evaluation Period or has been involved in certain types of misconduct.
In addition, the Company shall not deliver shares if, during the Performance Evaluation Period, approval has
been granted for matters relating to a Reorganization by a General Meeting of Shareholders of the Company(or the Company’s Board of Directors in cases where approval by a General Meeting of Shareholders is not
required with respect to said Reorganization; however, this shall apply only if the effective date of said
Reorganization is scheduled prior to the date of share delivery under the Plan).
As a general rule, the Company’s common shares shall be issued or disposed of under “performance-linked
and restricted share-based remuneration” after the end of the final fiscal year of the Performance Evaluation
Period. For the issuance or disposal of the common shares of the Company, an agreement on allotment of
performance-linked and restricted shares that includes provisions, as outlined below (the “Allotment
Agreement II”) shall be entered into between the Company and Eligible Directors (provided, however,excluding those who have retired from the position of Director (“Retiree”) due to expiration of his or her officeon or before the date of the first Ordinary General Meeting of Shareholders held after the end of the final fiscal
year of the Performance Evaluation Period, or on other legitimate grounds).
(i) An Eligible Director shall not transfer, create a security interest in, or otherwise dispose of the commonshares of the Company allotted under the Allotment Agreement II until the Eligible Director retires fromthe position of Director of the Company.
(ii) Under certain circumstances, the Company may acquire said common shares without contribution.
(iii) Other details including conditions for lifting the Restriction that have been predetermined by theCompany’s Board of Directors.

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An allotment agreement concluded between the Company and a Retiree shall not impose the Restriction.
Furthermore, in the case of an Eligible Director’s retirement through death, an amount of money equivalent
to the monetary remuneration claims that were planned to be paid for the granting of restricted shares shall be
paid to the inheritors.

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