This document has partly been translated from the Japanese original for reference purposes only. In the eventof any discrepancy between this translated document and the Japanese original, the original shall prevail. The
Company assumes no responsibility for this translation or for direct, indirect or any other forms of damages
arising from the translation.
Securities Code: 4021
June 4, 2019
To Those Shareholders with Voting Rights
Kojiro Kinoshita
Representative Director,
President & CEO
Nissan Chemical Corporation
5-1, Nihonbashi 2-chome, Chuo-ku,
Tokyo, JAPANNOTICE OF THE CONVOCATION OF
THE 149th ORDINARY GENERAL MEETING OF SHAREHOLDERS
You are cordially invited to attend the 149th Ordinary General Meeting of Shareholders of Nissan Chemical
Corporation (the “Company”). The meeting will be held as described below.
If you are unable to attend the meeting, you can exercise your voting rights by either of the following means.
Please review the Reference Documents for the General Meeting of Shareholders, and exercise your voting rights.
Exercise of Voting Rights in Writing (or by Post)
Please indicate your votes for or against the proposals on the enclosed Voting Rights Exercise Form and return itto the Company, ensuring that the form reaches us by 5:40 p.m., Tuesday, June 25, 2019 (Japan Time).
Exercise of Voting Rights via the Internet, etc.
Please access the website for exercising voting rights as indicated in the enclosed Voting Rights Exercise Formand exercise your voting rights by 5:40 p.m., Tuesday, June 25, 2019 (Japan Time).
1. Date and Time:

Wednesday, June 26, 2019 at 10:00 a.m. (Reception starts at 9:15 a.m.)

2. Place:

Josui Kaikan, 2F, Star Hall
1-1, Hitotsubashi 2-chome, Chiyoda-ku, Tokyo, Japan

3. Agenda of the Meeting:
Matters to be reported: 1. The Business Report and the Consolidated Financial Statements for the 149th
fiscal year (from April 1, 2018 to March 31, 2019) and results of audits by the
Accounting Auditors and the Audit & Supervisory Board of the Consolidated
Financial Statements
2. The Non-Consolidated Financial Statements for the 149th fiscal year (from April
1, 2018 to March 31, 2019)
Proposals to be resolved:
Proposal No. 1: Appropriation of Surplus
Proposal No. 2: Election of Nine (9) Directors
Proposal No. 3: Election of One (1) Corporate Auditor
Proposal No. 4: Determination of Amount and Other Details of Performance-Linked Stock
Compensation for Directors, etc.

1*For those attending the meeting, please present the enclosed Voting Rights Exercise Form at the reception
desk on arrival.
* Included in the documents that should be provided by the Company when providing the notice ofconvocation for this Ordinary General Meeting of Shareholders are the notes to Consolidated Financial
Statements and the notes to Non-Consolidated Financial Statements. As provided for by the relevant laws andregulations and Article 19 of the Company’s Articles of Incorporation, these documents are posted on the
Company’s website (https://www.nissanchem.co.jp/) and are not included in the accompanying material tothis document. In addition to the accompanying material to the notice of convocation for this Ordinary
General Meeting of Shareholders, the materials audited by the Corporate Auditors and the Accounting
Auditors include the notes to Consolidated Financial Statements and the notes to Non-Consolidated Financial
Statements that will be posted on the Company’s website indicated above.
* When it is necessary to modify the matters stated in the Reference Documents for the General Meeting of
Shareholders, the Business Report, the Non-Consolidated Financial Statements and the Consolidated
Financial Statements, please understand that any matters if modified will be shown on the Company’s website(https://www.nissanchem.co.jp/).
* The Company participates in the Electronic Voting Rights Exercise Platform for institutional investors
operated by ICJ Inc.
The Company’s website (https://www.nissanchem.co.jp/)2Reference Documents for the General Meeting of Shareholders
Proposal No. 1: Appropriation of Surplus
The Company upholds the basic policy of working to improve corporate value from a medium-to long-term
viewpoint and providing return of its profits to the shareholders.
After taking into consideration such factors as operating performance, business environment and preparation
for future business development, the Company proposes the year-end dividend for the current fiscal year as
follows.
(1) Type of dividend property
Cash(2) Matters related to distribution of dividend property and the total amountThe Company proposes to pay ¥42 per common share of the Company.
Under this proposal, the total amount of dividends paid is ¥6,206,849,376.
As the Company paid an interim dividend of ¥40, the annual dividend for the current fiscal year is ¥82 pershare.
(3) Effective date of the distribution of surplus
June 27, 20193

Proposal No. 2: Election of Nine (9) Directors
The terms of office of all eight (8) Directors will expire at the conclusion of this Ordinary General Meetingof Shareholders. Accordingly, we would like to increase one (1) Director to further strengthen the management
structure, and the election of nine (9) Directors, including three (3) Outside Directors, is proposed.
The candidates for Directors are as follows:
Candidate
No.

Name

Position/responsibilities in the Company

Representative Director, President &CEO
Director, Senior Executive Vice
President
Head of Finance & Accounting
Department
Corporate Strategy & Coordination
CFO
Internal Audit Department, andEnvironment, Safety & Quality
Assurance Department
Director, Senior Executive Vice
President
R&D
Chemicals Division, Pharmaceuticals
Division, Research Planning
Department, Intellectual Property
Department, and Personnel
Department
Director, Managing Executive
Officer
Head of Corporate Planning
Department
CRO
Director, Managing Executive
Officer
Head of Agricultural Chemicals
Division
Purchasing Department
Director, Managing Executive
Officer
Head of Performance Materials
Division

Attribute1

Kojiro Kinoshita

2

Junichi Miyazaki

3

Hiroyoshi Fukuro

4

Katsuaki Miyaji

5

Takashi Honda

6

Hitoshi Suzuki

7

Tisato Kajiyama

Outside Director

Reelection

OutsideDirector

Independent
Officer8

Tadashi Ohe

Outside Director

Reelection

OutsideDirector

Independent
Officer

9

Hidehito Obayashi

New
CandidateOutsideDirector

Independent
Officer4

Reelection

Reelection

Reelection

Reelection

Reelection

Reelection

No.

Name
(Date of birth)

Career summary
Apr. 1977
Jun. 2002

Kojiro Kinoshita(April 19, 1948)

Joined the Company
Director, Head of Corporate Planning Department of
the Company
Jun. 2006 Managing Director of the Company
Jun. 2008 Representative Director, President & CEO of theCompany (to the present)(Position and responsibilities in the Company)
Representative Director, President & CEO

Number of theCompany’s
shares held

94,300Reelection

1
Attendance atmeetings of theBoard of Directors
12/12

Reason for the nomination of the candidate for Director
Mr. Kojiro Kinoshita served as General Manager of the Business Strategy Department, Chemicals General
Headquarters and also as Head of the Corporate Planning Department. In addition, as Representative
Director and President & CEO of the Company since June 2008, he has been promoting strategies toenhance the corporate value of the Company Group. Considering his wide-ranging experience,achievements, and insights, the Company judges that Mr. Kinoshita remains qualified to be a Director that
performs decision-making on business operations and oversees the execution of duties by Directors, andagain nominated him as a candidate for Director.

5

No.

Name
(Date of birth)

Career summary
Apr. 1974

2

Number of theCompany’s
shares held

Joined The Industrial Bank of Japan, Limited (currently
Mizuho Bank, Ltd.)
Jun. 2000 General Manager, International Department of The
Industrial Bank of Japan, Limited (currently Mizuho
Bank, Ltd.)
Jun. 2003 Corporate Auditor of Mizuho Corporate Bank, Ltd.
(currently Mizuho Bank, Ltd.)
Apr. 2005 Managing Executive Officer of Kowa Real Estate Co.,
Ltd. (currently Nippon Steel Kowa Real Estate Co.,
Ltd.)
Jul. 2005 Managing Director of Kowa Real Estate Co., Ltd.
(currently Nippon Steel Kowa Real Estate Co., Ltd.)
Apr. 2006 Advisor of the Company
Jun. 2006 Director of the Company
31,800Junichi Miyazaki(October 9, 1951) Apr. 2007 Director, Head of Corporate Administration
Department of the Company
Jun. 2008 Managing Director of the Company
Reelection
Jun. 2011 Senior Managing Director of the Company
Attendance at
Apr. 2013 Director, Senior Executive Vice President of themeetings of theCompany (to the present)
Board of Directors(Position and responsibilities in the Company)
12/12
Director, Senior Executive Vice President
Head of Finance & Accounting Department
Corporate Strategy & Coordination
CFO
Internal Audit Department, and Environment, Safety & Quality
Assurance Department
Reason for the nomination of the candidate for Director
Mr. Junichi Miyazaki has strived to improve the financial structure of the Company and contributed to theCompany Group’s growth from a variety of perspectives as the person in charge of Corporate Strategy &Coordination since his assumption of office as Director in June 2006, utilizing his wide-ranging knowledge
cultivated through his experience in a financial institution. Considering his wide-ranging experience,achievements, and insights, the Company judges that Mr. Miyazaki remains qualified to be a Director that
performs decision-making on business operations and oversees the execution of duties by Directors, andagain nominated him as a candidate for Director.

6

No.

Name
(Date of birth)

Career summary
Apr. 1979
Jun. 2004

Hiroyoshi Fukuro(April 18, 1952)
3

Reelection

Attendance atmeetings of theBoard of Directors
12/12

Joined the Company
Director, Head of Electronic Materials ResearchLaboratories of the Company
Jun. 2011 Managing Director of the Company
Apr. 2013 Senior Managing Director of the Company
Apr. 2014 Director, Senior Managing Executive Officer of theCompany
Apr. 2018 Director, Senior Executive Vice President of theCompany (to the present)(Position and responsibilities in the Company)
Director, Senior Executive Vice President
R&D
Chemicals Division, Pharmaceuticals Division, Research Planning
Department, Intellectual Property Department, and Personnel
Department

Number of theCompany’s
shares held

26,200Reason for the nomination of the candidate for Director
Mr. Hiroyoshi Fukuro has been engaged in research of electronic materials for many years, and contributed
to business expansion in the performance materials field, as Head of Performance Materials Division and as
the person in charge of R&D of material science since his assumption of office as Director in June 2004.
Considering his wealth of experience, achievements, and knowledge, the Company judges that Mr. Fukuro
remains qualified to be a Director that performs decision-making on business operations and oversees theexecution of duties by Directors, and again nominated him as a candidate for Director.

7

No.

Name
(Date of birth)

Career summary
Apr. 1985
Jun. 2010

4

Number of theCompany’s
shares held

Joined the Company
Director, Head of Chemical Research Laboratories of
the Company
Jun. 2011 Director, Head of Advanced Materials & Planning
Department of the Company
Apr. 2014 Director, Executive Officer, Head of Electronic
Materials Research Laboratories of the Company
Jun. 2014 Executive Officer, Head of Electronic Materials
Research Laboratories of the Company
Oct. 2014 Executive Officer, Head of Materials Research
11,800Katsuaki Miyaji
Laboratories of the Company(January 27, 1961)
Apr. 2016 Managing Executive Officer, Head of Corporate
Planning Department of the Company
Reelection
Jun. 2016 Director, Managing Executive Officer, Head ofCorporate Planning Department of the Company (to the
Attendance atpresent)
meetings of the(Position and responsibilities in the Company)
Board of Directors
Director, Managing Executive Officer
12/12
Head of Corporate Planning Department
CRO
Reason for the nomination of the candidate for Director
Mr. Katsuaki Miyaji has been engaged in research for many years, and has undertaken tasks related tomaterials research as well as the creation of new products, which is the driving force for the Company
Group’s growth. Since April 2016, he has been focusing on understanding the status of business operations
in each division and achieving goals across the entire Company Group as Head of Corporate Planning
Department. The Company judges that Mr. Miyaji remains qualified to be a Director that performs decisionmaking on business operations and oversees the execution of duties by Directors, and again nominated him
as a candidate for Director.

8

No.

Name
(Date of birth)

Career summary
Apr. 1981
Feb. 1997
Jun. 2012

5

Number of theCompany’s
shares held

Joined the Company
Vice President of Nissan Chemical Europe GmbH
General Manager of Planning & Development
Department, Agricultural Chemicals Division of theCompany
Apr. 2014 Executive Officer, Deputy Head of Agricultural
Chemicals Division, General Manager of Planning &Development Department, Agricultural Chemicals
Division of the Company
Apr. 2017 Managing Executive Officer, Head of Agricultural
Chemicals Division of the Company
5,100
Takashi Honda
Director, Managing Executive Officer, Head of(March 8, 1959)
Jun. 2017 Agricultural Chemicals Division of the Company (tothe present)
Reelection(Position and responsibilities in the Company)
Director, Managing Executive Officer
Head of Agricultural Chemicals Division
Attendance atPurchasing Department
meetings of theBoard of Directors(Significant position concurrently held)
12/12
President of Hokkaido Sun Agro Co., Ltd.
Representative Director of Nissan Chemical Europe S.A.S.
Representative Director of Nissan Chemical Agro Korea Ltd.
Chairman of Nissan Agro Tech India Private Limited
Reason for the nomination of the candidate for Director
Mr. Takashi Honda has been engaged in the agricultural chemicals business focused on development ofagricultural chemicals and licensing for many years. As the General Manager of the Planning &Development Department since June 2012, and as Head of the Agricultural Chemicals Division since April
2017, he has been managing the agricultural chemicals business. The Company judges that Mr. Honda
remains qualified to be a Director that performs decision-making on business operations and oversees theexecution of duties by Directors, and again nominated him as a candidate for Director.

9

No.

Name
(Date of birth)

Career summary
Apr. 1985
Apr. 2007

6

Number of theCompany’s
shares held

Joined the Company
General Manager of Semiconductor Materials
Department, Electronic Materials Division of theCompany
Jun. 2010 General Manager of Semiconductor Materials Research
Department, Electronic Materials ResearchLaboratories of the Company
Jun. 2012 General Manager of Semiconductor Materials
Department, Performance Materials Division of theCompany
Apr. 2013 Deputy Head of Performance Materials Division of theCompany
Jun. 2013 Director, Deputy Head of Performance Materials
Division of the Company
Apr. 2014 Director, Executive Officer, Deputy Head ofHitoshi Suzuki
Performance Materials Division of the Company
8,000(December 11,
Jun. 2014 Executive Officer, Deputy Head of Performance
1961)
Materials Division of the Company
Apr. 2016 Executive Officer, Head of Materials Research
Reelection
Laboratories of the Company
Apr. 2018 Managing Executive Officer, Head of Performance
Attendance atMaterials Division of the Company
meetings of theJun. 2018 Director, Managing Executive Officer, Head ofBoard of Directors
Performance Materials Division of the Company (to the
10/10
present)(Position and responsibilities in the Company)
Director, Managing Executive Officer
Head of Performance Materials Division(Significant position concurrently held)
Chairman of Nissan Chemical America Corporation
Representative Director of NCK Co., Ltd.
Reason for the nomination of the candidate for Director
Mr. Hitoshi Suzuki has been engaged in research of electronic materials centering on semiconductormaterials for many years. As the Head of the Materials Research Laboratories since April 2016, and as Headof the Performance Materials Division since April 2018, he has contributed to business expansion in theperformance materials field. The Company judges that Mr. Suzuki qualifies to be a Director that performs
decision-making on business operations and oversees the execution of duties by Directors, and again
nominated him as a candidate for Director.

10

No.

Career summary

Number of theCompany’s
shares held

Post Doctor Course of The University of Massachusetts
Amherst, USA
Nov. 1984 Professor of Faculty of Engineering at Kyushu
University (currently National University Corporation
Kyushu University)
Nov. 2001 President of Kyushu University
Nov. 2008 President of Independent Administrative Institution
Japan Student Services Organization
Jun. 2010 Outside Corporate Auditor of the Company
Apr. 2011 Chairman, Board of Trustees and President of Public
University Corporation Fukuoka Women’s University(to the present)
Jun. 2014 Outside Director of the Company (to the present)(Position and responsibilities in the Company)
Outside Director(Significant position concurrently held)
Chairman, Board of Trustees and President of Public University
Corporation Fukuoka Women’s University

15,200Name(Date of birth)
Jun. 1969

Tisato Kajiyama(May 13, 1940)
Reelection
Outside Director

7

Independent Officer

Attendance atmeetings of theBoard of Directors
12/12

Reason for the nomination of the candidate for Outside Director
Mr. Tisato Kajiyama currently serves as Outside Director of the Company, and the Company proposes his
reelection so that his expertise as a Doctor of Engineering and his wide-ranging knowledge and experience
gained as the President of Kyushu University, President of Japan Student Services Organization, andChairman, Board of Trustees of Fukuoka Women’s University will continue to be reflected in the
management of the Company from an outside perspective and from an objective and neutral standpoint.
Although Mr. Kajiyama has no experience of involvement in corporate management other than having
served in the past as Outside Officer, the Company judges that Mr. Kajiyama will continue to appropriately
perform his duties as Outside Director.

11

No.

Name
(Date of birth)

Career summary
Apr. 1969
Apr. 1989

Tadashi Ohe(May 20, 1944)

8

Reelection
Outside Director
Independent Officer

Qualified for attorney-at-law
Instructor for the Legal Training and Research Instituteof Japan (court representation in civil proceedings)
Mar. 1994 Outside Corporate Auditor of Canon Inc.
Jun. 2004 Outside Corporate Auditor of Marui Group Co., Ltd. (tothe present)
Jun. 2006 Outside Corporate Auditor of Kao Corporation
Jun. 2011 Outside Director of JECO Co., Ltd. (to the present)
Jun. 2015 Outside Director of the Company (to the present)(Position and responsibilities in the Company)
Outside Director(Significant position concurrently held)
Attorney-at-law at Tadashi Ohe & Yutaka Tanaka Law Office,Outside Corporate Auditor of Marui Group Co., Ltd., andOutside Director of JECO Co., Ltd.

Number of theCompany’s
shares held

3,000

Attendance atmeetings of theBoard of Directors
12/12

Reason for the nomination of the candidate for Outside Director
Mr. Tadashi Ohe currently serves as Outside Director of the Company, and the Company proposes his
reelection so that his abundant experience and specialist knowledge as an attorney-at-law will continue to bereflected in the management of the Company from an outside perspective and from an objective and neutral
standpoint. Though Mr. Ohe does not have a past experience being involved in corporate management otherthan becoming an Outside Officer, up until the present, he has experience being involved in the corporate
management of multiple companies as Outside Officer. Therefore, the Company judges that Mr. Ohe willcontinue to appropriately perform his duties as Outside Director.

12

No.

Name
(Date of birth)

Career summary

Number of theCompany’s
shares held

Apr. 1969
Oct. 2001
Jun. 2003

9

Joined Hitachi, Ltd.
Director of Hitachi High-Technologies Corporation
Vice President and Executive Officer of Hitachi HighTechnologies Corporation
Apr. 2006 Representative Executive Officer, Senior Vice President
and Executive Officer of Hitachi High-Technologies
Corporation
Apr. 2007 Director, Representative Executive Officer, President
0and Chief Executive Officer of Hitachi HighHidehitoTechnologies Corporation
Obayashi(April 22, 1944)
Jun. 2011 Chairman of the Board of Hitachi High-Technologies
Corporation
New Candidate
Jun. 2013 Chairman Emeritus of Hitachi High-Technologies
Outside Director
Corporation (to the present)
Independent Officer(Significant positions concurrently held)
Chairman Emeritus of Hitachi High-Technologies Corporation
Reason for the nomination of the candidate for Outside Director
Mr. Hidehito Obayashi served as Chairman of the Board of Hitachi High-Technologies Corporation andafter that he has been serving as Chairman Emeritus of the company. Accordingly, he has abundant
experience and wide-ranging insight as an experienced manager of a corporate group active in diverse
sectors of global business. In order to reflect these in the Company’s management from an outside
perspective and from an objective and neutral standpoint, the Company has nominated him as a candidate
for Outside Director.

Notes: 1. Mr. Hitoshi Suzuki serves as the Representative Director of NCK Co., Ltd. The Company has a
trading relationship with NCK Co., Ltd. that includes the sale of products. No conflicts of interest
exist between any of the other candidates and the Company.
2. Messrs. Tisato Kajiyama, Tadashi Ohe and Hidehito Obayashi are candidates for Outside Director.
3. Mr. Tisato Kajiyama’s term of office as Outside Corporate Auditor of the Company aggregated to four
years and term of office as Outside Director of the Company will aggregate to five years as of theconclusion of this Ordinary General Meeting of Shareholders. Mr. Tadashi Ohe’s term of office as
Outside Director of the Company will aggregate to four years as of the conclusion of this Ordinary
General Meeting of Shareholders.
4. The Company entered into agreements with Messrs. Tisato Kajiyama and Tadashi Ohe respectively
that limit their liability when they perform their duties concerning the responsibilities under Paragraph
1, Article 423 of the Companies Act in good faith with no serious negligence to the minimum liability
provided for by the relevant laws and regulations. If their reelection is approved, the Company plansto renew the same limited liability agreement with them. Likewise, if Mr. Hidehito Obayashi’s
election is approved, the Company plans to enter into the same limited liability agreement with him.
5. Mr. Hidehito Obayashi serves as the Chairman Emeritus of Hitachi High-Technologies Corporation.
The Company has transactions with Hitachi High-Technologies Corporation that includes purchase ofanalytical instruments. However, the amount paid by the Company as consideration for thosetransactions with Hitachi High-Technologies Corporation is deemed insignificant given that when
averaged over the past three fiscal years, the payments amounted to less than 0.1% of annual
consolidated revenues of Hitachi High-Technologies Corporation.
6. The Company has notified the Tokyo Stock Exchange of status of Messrs. Tisato Kajiyama andTadashi Ohe as independent officers. If their reelection is approved, the Company plans to notify thestock exchange of status of Messrs. Kajiyama and Ohe as independent officers again. Likewise, if Mr.
Hidehito Obayashi’s election is approved, the Company plans to notify the stock exchange of Mr.
Obayashi’s status as an independent officer.

13

Proposal No. 3: Election of One (1) Corporate Auditor
The term of office of Corporate Auditor, Mr. Yasuyuki Nakajima will expire at the conclusion of thisOrdinary General Meeting of Shareholders. Accordingly, election of one (1) Corporate Auditor is proposed.
The Audit & Supervisory Board has already given its approval to this proposal.
The candidate for Corporate Auditor is as follows:
Name(Date of birth)

Career summary

Number of theCompany’s
shares held

Joined the Company
General Manager of Toxicology & Environmental
Science Department, Biological ResearchLaboratories of the Company
Dec. 2007 General Manager of Analysis Research
Department, Chemical Research Laboratories of
the Company
Jun. 2011 Head of Biological Research Laboratories of theCompany
Jun. 2013 Director, Head of Biological Research
6,700
Laboratories of the Company
Apr. 2014 Director, Executive Officer, Head of Research
Hiroshi Onitsuka
Planning Department of the Company(February 19, 1958)
Jun. 2014 Executive Officer, Head of Research Planning
Department of the Company
New Candidate
Apr. 2016 Executive Officer, Head of Chemical ResearchLaboratories of the Company (to the present)(Position and responsibilities in the Company)
Executive Officer
Head of Chemical Research Laboratories
Reason for the nomination of the candidate for Corporate Auditor
Mr. Hiroshi Onitsuka has engaged in research for many years, with a focus on agricultural chemicals. From
June 2011, he served as Head of Biological Research Laboratories, and from April 2016, as Head ofChemical Research Laboratories, contributing to the continued growth of the Company Group primarily inthe life sciences sector. Considering his abundant work experience and specialized knowledge, the Company
has determined that he is suited to serve as a Corporate Auditor with responsibility for ensuring theappropriateness of Directors’ execution of duties, and has nominated him as a candidate for Corporate
Auditor.
Apr. 1981
Jun. 2001

Note: No special conflicts of interest exist between the Corporate Auditor candidate Mr. Hiroshi Onitsuka andthe Company.

14

(Reference) The Company’s stance towards independency for Outside Directors and Outside Corporate
Auditors
The Company’s independence standards for Outside Officers are as follows.
The Company’s independent Outside Officers (Directors and Corporate Auditors) and independent Outside
Officer candidates fulfill the Companies Act’s requirements for Outside Officers, as well as the following
independence standards.
(1) Not being an executive (a person who executes business; hereinafter, the same) of the Company or its
subsidiaries, nor having been an executive of the Company or its subsidiaries for the past 10 years (ifhowever, a non-executive director or corporate auditor of the Company or its subsidiaries at some point in thepast 10 years, the 10 years prior to being appointed to that role).
(2) Not being one of the Company’s major shareholders (a shareholder with 10% or more of voting rights) or an
executive thereof.
(3) Not being an executive of a corporation of which the Company is a major shareholder (a shareholder with
10% or more of voting rights).
(4) Not being a major client or supplier (a client or supplier from whom the value of average payments fortransactions to the Company or its subsidiaries over the past 3 fiscal years exceeds 2% of the average annual
consolidated net sales of the Company over the past 3 fiscal years) of the Company or its subsidiaries or an
executive thereof.
(5) Not being a party whose major client or supplier is the Company or its subsidiaries (a party to whom the valueof average payments for transactions by the Company or its subsidiaries over the past 3 fiscal years exceeds
2% of the average annual consolidated net sales of that party over the past 3 fiscal years), or an executive
thereof.
(6) Not being an executive of a major financial institution with which the Company has borrowings (a financial
institution from whom the average amount of the Company’s consolidated fiscal-year-end balance ofborrowings over the past 3 fiscal years exceeds 2% of the Company’s average annual consolidated fiscal-yearend total assets over the past 3 fiscal years) nor having been an executive thereof for the past 3 years.
(7) Not being an attorney, certified public accountant, certified public tax accountant, other consultant, researcheror educator in receipt from the Company of a large amount of monetary consideration or other property (anaverage annual amount over the past 3 fiscal years of over ¥10 million for individuals or, in the event therecipient is a corporation or other organization that said individual is affiliated with or retained by, of anamount in excess of 2% of that organization’s average annual total revenues over the past 3 fiscal years) otherthan Director or Corporate Auditor remuneration.
(8) Not being a close relative (spouse, person within the second degree of kinship or relative living together) of
an executive (limited to key personnel) of the Company or its subsidiaries.
(9) In addition to items (1) through (8) above, being such person as the Board of Directors determines to be a
person whose independence as an independent Outside Officer is unquestionable and for whom there is norationally determined risk of a conflict of interest with the general shareholders of the Company.

15

Proposal No. 4: Determination of Amount and Other Details of Performance-Linked Stock Compensation
for Directors, etc.
1. Reasons for the proposal
This proposal is to request the introduction of a Board Benefit Trust (BBT) as a new performance-linked
stock compensation plan (the “Plan”) for Directors (excluding Outside Directors; the same applies
hereinafter unless otherwise specified) and Executive Officers and Associate Executive Officers(collectively, the “Directors, etc.”) of the Company.
The proposal is intended to increase awareness about improving earnings over the medium-to long-termand contributing to improve corporate value by clarifying the relationship between the compensation of
Directors, etc. and the Company’s performance and the stock price, and by having Directors, etc. share withthe shareholders not only the benefits of increases in the stock price, but also the risk of decreases in thestock price. In light of this purpose, the Company considers the content of the proposal to be appropriate.
The proposal requests approval for the amount of compensation, etc. to be paid as new stockcompensation to be provided to the Directors of the Company, separately from the amount of compensationof Directors approved at the 139th Ordinary General Meeting of Shareholders held on June 25, 2009 (within¥45 million per month, not including employee salary). The Company intends to leave determination ofdetails of the system to the Board of Directors, within the framework given in 2. below.
In addition, if Proposal 2 “Election of Nine (9) Directors” is approved without change, the number of
Directors subject to the system will be six.
2. Amount and details of remuneration under the Plan, etc.
(1) Outline of the Plan
The Plan is a performance-linked stock compensation plan under which money contributed by theCompany is used as funds to acquire the Company’s shares through a trust (hereinafter the trust set up under
the Plan is referred to as the “Trust”) and the Company’s shares and the cash equivalent to the market priceof the Company’ shares (the “Company’s Shares, etc.”) are provided through the Trust to Directors, etc. inaccordance with director stock benefit rules established by the Company. The Directors, etc. will receive
benefit of the Company’s Shares etc. as of the date of their retirement from office, as a rule.
(2) Individuals subject to the Plan
Directors (Outside Directors are not subject to the Plan), Executive Officers and Associate Executive
Officers(3) Period of trust
From August 2019 (tentative) until the Trust ends. (With respect to the period of the Trust, the Trust shallcontinue without a specific ending period, continuing for as long as the Plan continues. The Plan shall end if
the Company’s shares are delisted, the director stock benefit rules are discontinued, or similar grounds arise.)(4) Money left in the Trust (Amount of compensation)
On the condition that this proposal is approved, the Company shall introduce the Plan targeting the threebusiness years from the business year ending March 31, 2020 to the business year ending March 31, 2022
(hereinafter the period of the three business years concerned is referred to as the “Initial Covered Period”
and the Initial Covered Period and each three-business year period that begins after the Initial Covered
Period has elapsed are referred to as the “Covered Period” respectively) and, in order to distribute theCompany’s Shares, etc. to Directors, etc., the Company will provide the money described below to the Trust
as funds to acquire the Company’s shares via the Trust.
Firstly, at the time of setting up the Trust (August 2019 (Scheduled)), the Company will contribute to theTrust funds up to an upper limit of ¥800 million (of which ¥300 million is for Directors) as the necessary
funds corresponding to the Initial Covered Period.
Furthermore, even after the Initial Covered Period has elapsed, until such time as the Plan ends, theCompany shall for each Covered Period additionally contribute to the Trust funds up to an upper limit of¥800 million (of which ¥300 million is for Directors), as a rule. However, in the case where such an
16

additional contribution is made, if the Company’s shares (excluding the Company’s shares equivalent to thenumber of points that have been granted to Directors, etc. in relation to any preceding Covered Period andthat have yet to be distributed to the Directors, etc.) and money (hereinafter referred to collectively as the“Remaining Shares, etc.”) remain in the Trust assets, the sum total of the value of the Remaining Shares, etc.
(the book value of the Company’s shares on the last day of the previous Covered Period) and the additionallycontributed money shall be not exceed ¥800 million (of which ¥300 million is for Directors).
Throughout the Covered Period, including the Initial Covered Period, the Company may make multiple
contributions of funds to the Trust until such time as the aggregate amount of contributions during the
Covered Period concerned reaches the upper limits set out above. The Company will disclose its decision to
make additional contributions in a timely and appropriate manner.
(5) Acquisition method of the Company’s shares and number of shares to be acquired
The Trust shall acquire the Company’s shares through the stock market or by underwriting the dispositionof the Company’s treasury stock, using the funds contributed in accordance with (4) above to finance theacquisitions and no new shares shall be issued.
As a reference, based on the assumption of the acquisition of the Company’s shares at the closing priceon March 25, 2019, the maximum number of shares that will be acquired using up to an upper limit of ¥800
million in funds contributed by the Company to finance the acquisition of the Company’s shares to be
distributed to Directors, etc. in relation to the Initial Covered Period will be 160,000 shares. The Company
will disclose details of acquisitions of the Company’s shares via the Trust in a timely and appropriatemanner.
(6) Calculation method for the number of the Company’s Shares, etc. to be distributed to Directors, etc.
For each business year, the Company shall provide Directors, etc. with points, the number of which isdetermined in light of factors such as their rank and level of performance in accordance with the director
stock benefit rules.
Points granted to Directors, etc. shall be converted at a ratio of one share of common stock per point
when providing the Company’s Shares, etc. as described in (7) below. (However, in the event of a stock split,
an allotment of shares without contribution, a stock consolidation or similar following the approval of this
proposal, the number of points already granted or the conversion ratio will undergo a rational adjustment
according to the ratio of the stock split, allotment of shares without contribution, stock consolidation orsimilar.)
The number of points that will serve as the basis for distribution of the Company’s Shares, etc. describedin (7) below shall, as a rule, be the number of points distributed to the Directors, etc. by the time of theirretirement (hereinafter, the number of points calculated in this manner is referred to as the “Final Number ofPoints”).
(7) Distribution of the Company’s Shares, etc.
In the case where Directors, etc. have retired from office and satisfy the beneficiary requirements set out
in the director stock benefit rules and the trust agreement of the Trust, the Directors, etc. concerned will,after retiring from office, receive distribution of the Company’s shares from the Trust in a number according
to the Final Number of Points as determined in accordance with the description in (6) above, as a rule, after
taking prescribed procedure for determining beneficiaries.
However, in the case where Directors, etc. meet the requirements stipulated in the director stock benefit
rules, they shall receive in respect of a certain percentage of the points granted to them an amount of cash
equivalent to the market price of the Company’s shares in place of distribution of the Company’s shares. The
Trust may sell the Company’s shares in order to provide the cash.
(8) Exercise of voting rights
In accordance with instructions from the trust administrator, the voting rights represented by theCompany’s shares held in the Trust’s account shall not be exercised without any exception. Adoption of thisapproach is intended to ensure neutrality in the management of the Company with respect to the exercise of
voting rights represented by the Company’s shares held in the Trust’s account.
17(9) Treatment of dividends
The Trust shall receive dividends from the Company’s shares held in the Trust’s account and shall use
them for payment to acquire the Company’s shares and for trust fees, etc. for the trustee of the Trust. In
addition, in the case where the Trust is terminated, dividends remaining in the Trust shall be distributed to
Directors, etc. in office at that time, according the number of points held by each on a pro rata basis, inaccordance with the provisions of the director stock benefit rules.
(10) Treatment upon termination of the Trust
The Trust shall terminate in the case where grounds such as a delisting of the Company’s shares or thetermination of the director stock benefit rules have arisen. The Company plans to acquire without
consideration all the Company’s shares included in the remaining assets of the Trust upon termination of theTrust and to then cancel them by a resolution of the Board of Directors. As for the cash included in theremaining assets of the Trust upon termination of the Trust, the balance after deduction of the cash
distributed to Directors, etc. in accordance with (9) above shall be distributed to the Company.
<Reference: Framework of the Plan>(i) Establishment of director
stock benefit rules[Trustor]
The Company(ii) Entrustmentof money(iii) Stockacquisition(iv) Granting of points(v) Non-exercise
of voting rights

Trust administrator
Instructions on
non-exercise of
voting rights[Trustee]Mizuho Trust & Banking(Re-trusted: Trust & Custody Services Bank)The Company’s shares

Directors, etc.

(vi) Distribution of theCompany’s Shares, etc.

Acquisition ofright to receive
benefits[Beneficiaries]
Retired Directors, etc. who meet thebeneficiary requirements(i) The Company establishes director stock benefit rules within the framework of approval of this proposal.
(ii) The Company entrusts the money within the amount approved at this proposal.
(iii) The Trust acquires the Company’s shares through the stock market or by underwriting the disposition of theCompany’s treasury stock using the money entrusted in (ii) as funds.
(iv) The Company grants points to the Directors, etc. based on the director stock benefit rules.
(v) In accordance with instructions from the trust administrator, who is independent from the Company, theTrust shall not exercise voting rights concerning the Company’s shares in the Trust account.
(vi) The Trust distributes to those among the retired Directors, etc. who meet the beneficiary requirements
stipulated in the director stock benefit rules and the trust agreement of the Trust (hereinafter referred to as
the “Beneficiaries”) the Company’s shares based on the number of points granted to the Beneficiaries.
However, in the case where Directors, etc. meet the requirements stipulated in the director stock benefit
rules, they shall receive in respect of a certain percentage of the points granted to them an amount of cash
equivalent to the market price of the Company’s shares.

18