These documents have been translated from Japanese originals for reference purposes only.
In the event of any discrepancy between these translated documents and the Japanese originals, theoriginals shall prevail. RaQualia Pharma Inc. assumes no responsibility for these translations or for
direct, indirect or any other forms of damages arising from the translations.
Securities Code 4579
Date of sending by postal mail: March 8, 2023
Start date of measures for electronic provision: March 3, 2023
Hirobumi Takeuchi
Representative Director

RaQualia Pharma Inc.
1-21-19 Meieki Minami,
Nakamura-ku, Nagoya, JapanCONVOCATION NOTICE OF
THE 15TH ORDINARY GENERAL MEETING OF SHAREHOLDERS
Dear Shareholders:
We are pleased to announce the 15th Ordinary General Meeting of Shareholders (the “Meeting”) of
RaQualia Pharma Inc. (the “Company”) to be held as indicated below.
In holding the Meeting, the Company provides information that constitutes the content of Reference
Materials for the Ordinary General Meeting of Shareholders, etc. (“Electronically Provided Items”) in anelectronic format. As the information is posted in each of the websites on the internet below, please accessany of the websites and confirm the information.
[The Company’s website]
https://www.raqualia.co.jp (in Japanese only)(Please access the website above, and choose “IR Information,” and then “General Meeting of
Shareholders,” to confirm the information.)[Website for posting the materials for the general meeting of shareholders]
https://d.sokai.jp/4579/teiji/ (in Japanese only)[The Tokyo Stock Exchange’s website (Listed Company Search)]https://www2.jpx.co.jp/tseHpFront/JJK010010Action.do?Show=Show (in Japanese only)(Please access the TSE’s website above, search for the Company by putting “RaQualia Pharma” in the“name of stock (name of company)” or the securities code “4579” in “code,” select “basic information”
and “public documents/PR information,” and confirm the information in the list of “convocation noticesof ordinary general meetings of shareholders/materials for ordinary general meetings of shareholders” inthe “public documents.”)
In order to prevent the spread of novel coronavirus (COVID-19), you are strongly encouraged to refrainfrom traveling to the venue on the date of the Meeting and exercise your voting rights prior to the Meeting inwriting (by mail) or via the internet, if at all possible. Please review the attached Reference Materials for theOrdinary General Meeting of Shareholders and exercise your voting rights no later than 5:30 p.m., Thursday,
March 23, 2023 (Japan Standard Time).

11. Date and Time:

March 24, 2023 (Friday) at 10:30 a.m. (Reception desk is scheduled to open at
9:30 a.m.)

2. Place:

Sakae Gas Hall, Sakae Gas Building 5F,
3-15-33 Sakae, Naka-ku, Nagoya, Japan

3. Meeting Agenda:
Report matters:

1. The Business Report and the Consolidated Financial Statements for the 15th
Fiscal Year (January 1, 2022 to December 31, 2022), and the results of auditsof the Consolidated Financial Statements by the Accounting Auditor and the
Audit and Supervisory Committee
2. Non-consolidated Financial Statements for the 15th Fiscal Year (January 1,
2022 to December 31, 2022)

Resolution matters:
Proposal 1:
Proposal 2:
Proposal 3:

Election of Four (4) Directors (excluding Directors Serving on the Audit andSupervisory Committee)
Election of Three (3) Directors Serving on the Audit and Supervisory
Committee
Election of One (1) Substitute Director Serving on the Audit and Supervisory
Committee

4. Guidance for Exercising Please refer to the “Guidance for Exercising Voting Rights.”
Voting Rights----------------------------------------------------------------------------------------------------------------------------- If you plan to attend the Meeting, please submit the enclosed Voting Right Exercise Form to thereceptionist at the Meeting.
- If any amendments are made to the Electronically Provided Items, the Company will post the items before
and after the amendments on each of the internet websites above.
- To the shareholders who requested the delivery of paper-based documents, the Company has sent the
documents that contain the Electronically Provided Items. However, in accordance with laws andordinances and Article 18, Paragraph 2 of the Articles of Incorporation, the following documents are notposted in those documents: System for Ensuring the Appropriateness of Business Operations andSummary of Status of Implementation of System (Internal Control System) for Ensuring theAppropriateness of Business Operations in the Business Report; the Consolidated Statement of Changes in
Equity, the Basis of Preparing Consolidated Financial Statements and Other Notes in the Consolidated
Financial Statements; and Non-consolidated Statement of Changes in Equity and Significant Accounting
Policies and Other Notes in the Non-consolidated Financial Statements. Therefore, the Business Report,
the Consolidated Financial Statements, and the Non-consolidated Financial Statements attached thereto
constitute a part of the documents audited by the Accounting Auditor to prepare the Accounting Audit
Report and those audited by the Audit and Supervisory Committee to prepare the Audit Report.

Business Briefing for Shareholders
After this Ordinary General Meeting of Shareholders, we will continue to hold a Business Briefing for
Shareholders to explain our medium-term strategies and other matters to our shareholders. The Business
Briefing for Shareholders will be broadcast live on the Internet following this Ordinary General Meeting of
Shareholders.
1.

Date and Time: March 24, 2023 (Friday), after the Ordinary General Meeting of Shareholders(scheduled for about 30 minutes)

2.

Place:The same venue as this Ordinary General Meeting of Shareholders

Please note that the above Business Briefing for Shareholders is intended for shareholders who will attend
this Ordinary General Meeting of Shareholders or view it via live webcast.
For details on how to watch the live webcast, please refer to [Information on Live Webcast and Pre-Q&A
Reception].

2

Guidance for Exercising Voting Rights
Exercise of voting rights at the Meeting is shareholders’ important right.
Please review the attached Reference Materials for the Ordinary General Meeting of Shareholders andexercise your voting rights.
You may exercise your voting rights by the following three methods.
Voting via the Internet
Please enter your vote “for” or “against” for each of the proposals by following the guidance on the next
page.
Deadline:
All data entry to be completed no later than 5:30 p.m., Thursday, March 23,2023 (Japan Standard Time)
Voting in Writing (by Mail)
Please indicate “for” or “against” for each of the proposals in the enclosed Voting Right Exercise Form.
Deadline:
To be received no later than 5:30 p.m., Thursday, March 23, 2023 (Japan
Standard Time)
Attending the Meeting
Please submit the enclosed Voting Right Exercise Form to the receptionist at the Meeting.
Date and Time: March 24, 2023 (Friday) at 10:30 a.m.
(Reception desk is scheduled to open at 9:30 a.m.)

How to Fill out the Voting Right Exercise Form
Proposal 3- If you approve:
Put a circle in the box marked 賛 [For]- If you disapprove:
Put a circle in the box marked 否 [Against].
Proposals 1, 2
- If you approve of all of the candidates:
Put a circle in the box marked 賛 [For]- If you disapprove of all of the candidates:
Put a circle in the box marked 否 [Against].
- If you disapprove of some of the candidates:
Put a circle in the box marked 賛 [For] and indicate the number of the candidate that you disapprove.
If there is no indication of approval or disapproval of the Proposals on the Voting Right Exercise Form, it
shall be deemed that it indicates approval.
If you exercise voting rights in duplicate, both in writing (by mail) and via the internet, the voting rights
exercised via the internet shall be deemed effective. Also, if you exercise voting rights several times via theinternet, only your final vote shall be deemed effective.

3

Guidance for Exercising Voting Rights via the Internet
By scanning the QR Code (“smart voting”)
You can login to the website for exercising voting rights without entering the voting right exercise code andpassword.
1. Please scan the QR Code printed on the Voting Right Exercise Form at the bottom right.
* QR Code is a registered trademark of DENSO WAVE INCORPORATED.
2. Then please follow the on-screen instructions to enter your vote “for” or “against” for each of the
proposals.
The exercise of voting right by “smart voting” is available only once.
In case if you want to change your vote after exercising your voting right, please access the website for a
personal computer and login by entering the “voting right exercise code” and “password” supplied on the Voting
Right Exercise Form, to exercise your voting right again.
* You will be transferred to the website for a personal computer by scanning the QR Code again.
By entering the voting right exercise code and password
Website for exercising voting rights: https://www.web54.net (in Japanese only)
1. Please access the website for exercising voting rights.
- Click “Proceed to the next”
2. Please enter the “voting right exercise code” supplied on the Voting Right Exercise Form.
- Enter the “voting right exercise code”- Click “Login”
3. Please enter the “password” supplied on the Voting Right Exercise Form.
- Enter the “initial password”- Enter the new password that you will actually use- Click “Register”
4. Then please follow the on-screen instructions to enter your vote “for” or “against” for each of the
proposals.
In case you need instructions for how to operate yourpersonal computer/smartphone/mobile phone in order
to exercise your voting rights via the internet, pleasecontact:

4

Sumitomo Mitsui Trust Bank, Limited,
Stock Transfer Agency Web Support (dedicated line)
Telephone: 0120-652-031 (toll free, available onlyin Japan) (Support in Japanese only)[9:00 a.m. to 9:00 p.m. (Japan Standard Time)]

Reference Materials for the Ordinary General Meeting of Shareholders
Proposal 1: Election of Four (4) Directors (excluding Directors Serving on the Audit and Supervisory
Committee)
The terms of office of all four (4) Directors (excluding Directors serving on the Audit and Supervisory
Committee; the same shall apply hereinafter in this proposal) will expire upon conclusion of this Meeting.
Therefore, it is proposed that four (4) Directors be elected.
The candidates for Directors are as follows.
No.

Name
(Date of birth)

Hirobumi Takeuchi(Dec. 21, 1971)

Career summary, position and responsibilities in the Company(Important concurrent positions)Apr. 1994

Joined Kyowa Co., Ltd.

Feb. 2004

Joined Skylight Biotech, Inc.
General Manager, Sales Department

Sep. 2005

Director in charge of Business Promotion and
FinanceJul. 2006

Director and CFO in charge of Administrative
Division

May 2009

Joined Sumisho Realty Management Co., Ltd.
Manager, Administration Department

Jan. 2013

Joined Cyfuse Biomedical K.K.
Board Director in charge of Corporate Planningand Business Administration

Jan. 2014

Joined the Company
Assistant General Manager, Accounting
Department

Apr. 2014

General Manager, Accounting Department

Oct. 2014

General Manager, Finance and Accounting
Department, Finance and Corporate Planning
Division

Apr. 2018

President, UBiENCE Inc.

Mar. 2021

Joined the Company
Representative Director (to present)

1Mar. 2021

President and CEO, TMRC Co., Ltd. (to present)

Jun. 2021

Director, UBiENCE Inc. (to present)

Number ofshares of theCompany held

5,431 shares<Important concurrent position>
President and CEO, TMRC Co., Ltd.
Director, UBiENCE Inc.
[Reason for the nomination as candidate for Director]
Mr. Hirobumi Takeuchi has abundant business experience and knowledge of corporate management andfinance as a bioventure manager. After joining the Company in 2014, he played a central role in formulatingplans, including the reduction of business expenses as a member of the turnaround team. He has also served as
the Company’s Representative Director since March 2021, and has demonstrated his ability in the top
management of the Company. Expecting that he will continue to manage the Company based on theperspectives of growth, efficiency, and shareholder returns, he has once again been nominated as a candidate
for Director.

5

No.

Name
(Date of birth)

Michihiro Tsuchiya(Jul. 12, 1947)2

Career summary, position and responsibilities in the Company(Important concurrent positions)Apr. 1976

Joined Tanabe Seiyaku Co., Ltd. (currently
Mitsubishi Tanabe Pharma Corporation)

Jun. 2001

Director, General Manager, Corporate Strategic
Planning Department

Jun. 2003

Managing Director, Research Headquarters

Jun. 2006

Representative Director, Senior Executive
Corporate Officer, Research Headquarters

Oct. 2007

Board Director, Executive Vice President,
Mitsubishi Tanabe Pharma Corporation

Jun. 2009

President & Representative Director

Jun. 2014

Chairman of the Board & Representative Director

Jun. 2016

Chairman of the Board & Director

Jun. 2017

Senior Executive Adviser

Jun. 2018

Outside Director, Sumitomo Electric Industries,
Ltd. (to present)

Jun. 2018

Outside Director, Kyoto University Innovation
Capital Co., Ltd. (to present)

Mar. 2020

Outside Director, the Company (to present)

Number ofshares of theCompany held

– shares<Important concurrent position>
Outside Director, Sumitomo Electric Industries, Ltd.
Outside Director, Kyoto University Innovation Capital Co., Ltd.
[Reason for selection as candidate for Outside Director and outline of expected role]
Mr. Michihiro Tsuchiya has abundant experience as a senior manager and broad insight into global operations.
Expecting to utilize Mr. Tsuchiya’s knowledge in the senior management of the Company, so that he may
promote further revitalization of the Board of Directors, improve transparency of senior management andstrengthen corporate governance, he has once again been nominated as a candidate for Outside Director.

6

No.

Name
(Date of birth)

Masaki Sudo
(Jul. 29, 1971)

3

Career summary, position and responsibilities in the Company(Important concurrent positions)Apr. 1996

Joined TEIJIN LIMITED

Sep. 1999

Joined Pfizer Seiyaku K.K. (currently Pfizer JapanInc.)

Apr. 2004

Principal Scientist, Discovery Chemistry, Pfizer
Global Research and Development Nagoya
Laboratories

Apr. 2006

Senior Principal Scientist, Discovery Chemistry,
Pfizer Global Research and Development Nagoya
Laboratories

Jul. 2008

Joined the Company
Principal Scientist, Research Division

Oct. 2012

General Manager, Chemistry Research
Department, Discovery Research Division

Apr. 2016

Designated Associate Professor, Institute ofTransformative Bio-Molecules, Nagoya University

Jul. 2018

Visiting Professor, Nagoya University

Jul. 2018

Manager, Business Planning Office, Stem Cell &Device Laboratory, Inc.

Jan. 2020

Chief Manager, Business Development
Department

Jun. 2021

Joined the Company
General Manager, Business Strategy Department

Oct. 2021

Vice President (in charge of Administration andCorporate Planning & Strategy) (to present)

Mar. 2022

Director (to present)

Number ofshares of theCompany held

12,747 shares[Reason for the nomination as candidate for Director]
As Director and Vice President (in charge of Administration and Corporate Planning & Strategy), Mr. Masaki
Sudo has been involved in overseeing the Administration Division, including human resources and generalaffairs, formulation of medium-term management plans, and investor relations, as well as in the formulationand implementation of strategies for the entire Company as the person in charge of corporate planning.
Expecting that, going forward, Mr. Sudo will continue to plan and implement the Company’s growth strategy,
he has once again been nominated as a candidate for Director.

7

Name
(Date of birth)No.

Katsuhiro Uto(Mar. 31, 1974)

Career summary, position and responsibilities in the Company(Important concurrent positions)
May 2005

Joined Nippon Boehringer Ingelheim Co., Ltd.

Jan. 2013

Joined Asahi Kasei Pharma Corporation
Senior Researcher

Jul. 2013

A unit leader, Pharmacology Research Department

May 2017

Joined Maruho Co., Ltd.

Oct. 2018

Project Manager, Project Management Unit

Jun. 2020

Project Manager, Research Planning and Strategy
Office, Drug Discovery Research Department

Jan. 2021

Joined the Company
General Manager, Research Planning, Discovery
Research

Mar. 2021

Vice President (in charge of Research Planning)

Mar. 2022

Vice President (in charge of Discovery Research)(to present)
Director (to present)

4

Number ofshares of theCompany held

4,354 shares[Reason for the nomination as candidate for Director]
As Director and Vice President (in charge of Discovery Research), Mr. Katsuhiro Uto has demonstrated his
prowess in discovery research that is central to drug development and research, the Company’s core business.
Expecting that Mr. Uto will perform roles that are central to drug development and research to continue toachieve research results, he has once again been nominated as a candidate for Director.

(Notes)1. No conflict of special interests exists between the Company and each candidate.
2. Mr. Michihiro Tsuchiya is a candidate for Outside Director.
3. Mr. Michihiro Tsuchiya’s tenure as Outside Director of the Company will be three (3) years at
the conclusion of this Ordinary General Meeting.
4. The Company has designated Mr. Michihiro Tsuchiya as an independent officer based on theregulations stipulated by the Tokyo Stock Exchange and has notified the Tokyo Stock
Exchange accordingly. If the reelection of Mr. Tsuchiya is approved, the Company will
designate him again as an independent officer.
5. Under the provision of Article 427, Paragraph 1, of the Companies Act, the Company hasentered into an agreement with Mr. Michihiro Tsuchiya to limit his liability for damages
specified in Article 423, Paragraph 1 of the said Act. The maximum amount of liability fordamages under the agreement shall be the amount provided for by laws and ordinances. If thereelection of Mr. Tsuchiya is approved, the Company plans to continue this agreement withhim.
6. The Company has entered into a contract of Directors and Officers Liability Insurance (D&O
Insurance) with an insurance agency, as provided for in Article 430-3, Paragraph 1 of theCompanies Act. This insurance policy covers damages from claims, etc. borne by the insured
persons pertaining to the pursuit of liability arising in the course of execution of duties. The
candidates for the reappointment will continue to be included as the insured persons in thisinsurance policy. Furthermore, the Company plans to renew this insurance policy with thesame details at the time of the next renewal.

8Proposal 2: Election of Three (3) Directors Serving on the Audit and Supervisory Committee
The terms of office of all three (3) Directors serving on the Audit and Supervisory Committee will expire
upon conclusion of this Meeting. Therefore, it is proposed that three (3) Directors serving on the Audit andSupervisory Committee be elected. The Audit and Supervisory Committee has already given its consent tothis proposal.
The candidates for Directors serving on the Audit and Supervisory Committee are as follows.
No.

Name
(Date of birth)

Kosuke Ishii(Aug. 31, 1982)

1

Career summary, position and responsibilities in the Company(Important concurrent positions)Jan. 2005

Joined Arcadia Group Co., Ltd.

Nov. 2005

Joined Shin Nihon & Co. (currently Ernst & Young
ShinNihon LLC)

Jun. 2008

Registered as certified public accountant

Sep. 2013

General Manager, Administrative Department,
Megakaryon Corporation (seconded)

Mar. 2015

Joined Megakaryon Corporation

Mar. 2018

Executive Officer, General Manager, Corporate
Administrative Department

Jul. 2019

Representative, Kosuke Ishii Accounting Office (topresent)

May 2020

Outside Auditor, Metagen Therapeutics, Inc. (topresent)

Sep. 2020

Representative Director, BioAid Corporation (topresent)

Mar. 2021

Outside Auditor, miRaX Therapeutics K.K. (topresent)

Mar. 2021

Outside Director (Audit and Supervisory
Committee Member), the Company (to present)

Jun. 2021

Auditor, Chordia Therapeutics Inc.

Nov. 2022

Outside Director (Audit and Supervisory
Committee Member), Chordia Therapeutics Inc.
(to present)

Number ofshares of theCompany held

- shares<Important concurrent position>
Representative, Kosuke Ishii Accounting OfficeOutside Auditor, Metagen Therapeutics, Inc.
Representative Director, BioAid Corporation
Outside Auditor, miRaX Therapeutics K.K.
Outside Director, Chordia Therapeutics Inc.
[Reason for selection as candidate for Outside Director and outline of expected role]
Mr. Kosuke Ishii has experience in accounting audits at an audit firm, has considerable knowledge of financeand accounting as a certified public accountant, and can reflect his specialist viewpoint on accounting in the
Company’s auditing. In addition, he has achievements in establishing internal controls, etc. in bioventure.
Accordingly, he has once again been nominated as a candidate for Outside Director serving on the Audit andSupervisory Committee. Mr. Ishii’s tenure as Outside Director (Audit and Supervisory Committee Member)will be two (2) years at the conclusion of this Meeting.

9

No.

Name
(Date of birth)

Yuichi Kakinuma(Nov. 16, 1977)

2

Career summary, position and responsibilities in the Company(Important concurrent positions)Apr. 2005

Joined the Legal Training and Research Institute,
Supreme Court of Japan

Jan. 2007

Registered as a member of Saitama Bar
Association

Jan. 2007

Joined Takashino Law Office (currently Takashino
Kakinuma Law Office)Oct. 2010

Partner (to present)

Jun. 2014

Substitute Auditor, TSUTSUMI JEWELRY Co.,
Ltd.

Jun. 2015

Outside Director

Jun. 2017

Outside Director (Audit and Supervisory
Committee Member) (to present)

Mar. 2021

Outside Director (Audit and Supervisory
Committee Member), the Company (to present)

Number ofshares of theCompany held

2,384,700
shares<Important concurrent position>
Partner, Takashino Kakinuma Law OfficeOutside Director, TSUTSUMI JEWELRY Co., Ltd.
[Reason for selection as candidate for Outside Director and outline of expected role]
Mr. Yuichi Kakinuma has actively practiced as an attorney at law in a broad range of areas, and although he has
never been directly involved in the management of a company other than as an outside officer, it is expected toreceive his multifaceted advice on corporate legal affairs and compliance that he can offer from his specialist
viewpoint. In addition, he is the largest shareholder of the Company and has many years of investment
experience as an individual investor in bioventure. It is believed that he is a suitable person to achieve
shareholder corporate governance, and accordingly he has again been nominated as a candidate for Outside
Director serving on the Audit and Supervisory Committee. Mr. Kakinuma’s tenure as Outside Director (Audit
and Supervisory Committee Member) will be two (2) years at the conclusion of this Meeting.

10

Name
(Date of birth)No.

Megumi Uzu(Sep. 26, 1960)

3

Career summary, position and responsibilities in the Company(Important concurrent positions)Apr. 1983

Joined Chugai Pharmaceutical Co., Ltd.

Jun. 2010

Deputy General Manager, Oncology Lifecycle
Management Department, Project Lifecycle
Management Unit

Jan. 2015

General Manager, Oncology Lifecycle
Management Department, Project Lifecycle
Management Unit

Mar. 2021

Outside Director (Audit and Supervisory
Committee Member), the Company (to present)

Number ofshares of theCompany held

- shares[Reason for selection as candidate for Outside Director and outline of expected role]
Ms. Megumi Uzu has played the leading role in the R&D and lifecycle management at Chugai PharmaceuticalCo., Ltd., including tocilizumab (Actemra) and alectinib hydrochloride, which is selective ALK (anaplastic
lymphoma kinase) inhibitor. Although she has never been directly involved in the corporate management otherthan as an outside officer, she is expected to appropriately perform her duties such as monitoring of corporate
management and giving advice from an objective perspective with independence and fairness based on her highlevel of expertise and insight. Accordingly, she has again been nominated as a candidate for Outside Director
serving on the Audit and Supervisory Committee. Ms. Uzu’s tenure as Outside Director (Audit and Supervisory
Committee Member) will be two (2) years at the conclusion of this Meeting.

(Notes)1. No conflict of special interests exists between the Company and each candidate.
2. Mr. Kosuke Ishii, Mr. Yuichi Kakinuma, and Ms. Megumi Uzu are candidates for Outside
Directors.
3. The Company has designated Mr. Kosuke Ishii and Ms. Megumi Uzu as independent officers
based on the regulations stipulated by the Tokyo Stock Exchange and has notified the Tokyo
Stock Exchange accordingly. If the reelection of each of the candidates is approved, theCompany will designate them again as independent officers.
4. Under the provision of Article 427, Paragraph 1, of the Companies Act, the Company hasentered into an agreement with Mr. Kosuke Ishii, Mr. Yuichi Kakinuma, and Ms. Megumi Uzu
to limit their liability for damages specified in Article 423, Paragraph 1 of the said Act. The
maximum amount of liability for damages under the agreement shall be the amount provided
for by laws and ordinances. If the reelection of each of the candidates is approved, theCompany plans to continue this agreement with them.
5. The Company has entered into a contract of Directors and Officers Liability Insurance (D&O
Insurance) with an insurance agency, as provided for in Article 430-3, Paragraph 1 of theCompanies Act. This insurance policy covers damages from claims, etc. borne by the insured
persons pertaining to the pursuit of liability arising in the course of execution of duties. The
candidates for the reappointment will continue to be included as the insured persons in thisinsurance policy. Furthermore, the Company plans to renew this insurance policy with thesame details at the time of the next renewal.

11Proposal 3: Election of One (1) Substitute Director Serving on the Audit and Supervisory Committee
At the start of this Meeting, the term of effect of the elected status of substitute Director serving on the
Audit and Supervisory Committee, Mr. Akira Takagi, will expire. He was elected at the 13th Ordinary
General Meeting of Shareholders held on March 25, 2021. Accordingly, once again, as preparation for asituation where the number of incumbent Directors serving on the Audit and Supervisory Committee does
not satisfy the number prescribed by laws and ordinances, it is proposed that one (1) substitute Director
serving on the Audit and Supervisory Committee be elected as a substitute in advance for all of the Directors
serving on the Audit and Supervisory Committee. The Audit and Supervisory Committee has already given
its consent to this proposal.
The candidate for substitute Director serving on the Audit and Supervisory Committee is as follows.
Name(Date of birth)

Career summary, position and responsibilities in the Company(Important concurrent positions)Apr. 2009

Joined PricewaterhouseCoopers Aarata (currently
PricewaterhouseCoopers Aarata LLC)

Oct. 2014

Joined Sato Sogo Law OfficeJan. 2015

External Audit & Supervisory Board Member, i-mobile
Co., Ltd.

Aug. 2017

Head, Takagi Certified Public Accountant Office (topresent)

Mar. 2019

Outside Corporate Auditor, bitbank, inc. (to present)

Nov. 2019

Outside Auditor, REXEV Inc. (to present)

Mar. 2020

Outside Auditor, LPIXEL Inc. (to present)

Jun. 2021

Outside Corporate Auditor, AVIX, Inc. (to present)

Aug. 2021

Outside Corporate Auditor, BUZZKURI INC. (topresent)

Oct. 2021

External Director (Audit & Supervisory Committee
Member), i-mobile Co., Ltd.
(to present)

Akira Takagi(Oct. 7, 1983)
Jan. 2022

Representative Director, KIC Co., Ltd. (to present)

Jun. 2022

Outside Audit & Supervisory Board Member, Algorithminc. (to present)

Number of sharesof the Company
held- shares<Important concurrent position>
Head, Takagi Certified Public Accountant OfficeOutside Corporate Auditor, bitbank, inc.
Outside Auditor, REXEV Inc.
Outside Auditor, LPIXEL Inc.
Outside Corporate Auditor, AVIX, Inc.
Outside Corporate Auditor, BUZZKURI INC.
External Director, i-mobile Co., Ltd.
Representative Director, KIC Co., Ltd.
Outside Audit & Supervisory Board Member, Algorithm inc.
[Reason for selection as candidate for a substitute Outside Director and outline of expected role]
Mr. Akira Takagi has experience in accounting audits at an audit firm, and has considerable knowledge of financeand accounting as a certified public accountant. It is judged that he will be able to audit the execution of duties of theCompany’s Directors from an objective standpoint based on his knowledge and experience. Accordingly, he has been
nominated as a substitute Outside Director serving on the Audit and Supervisory Committee.

(Notes)1. No conflict of special interests exists between the Company and the candidate.
2. Mr. Akira Takagi is a candidate for substitute Outside Director serving on the Audit andSupervisory Committee.
3. Under the provision of Article 427, Paragraph 1, of the Companies Act, the Company will enter
into an agreement with Mr. Akira Takagi to limit his liability for damages specified in Article
423, Paragraph 1, of the said Act, if he is elected as Outside Director serving on the Audit andSupervisory Committee and actually assumes the office. The maximum amount of liability fordamages under the agreement shall be the amount provided for by laws and ordinances.

12

4. The Company has entered into a contract of Directors and Officers Liability Insurance (D&O
Insurance) with an insurance agency, as provided for in Article 430-3, Paragraph 1 of theCompanies Act. This insurance policy covers damages from claims, etc. borne by the insured
persons pertaining to the pursuit of liability arising in the course of execution of duties. Mr.
Akira Takagi will be included in the insured persons covered by the contract of D&O Insurance
if he is elected as Outside Director serving on the Audit and Supervisory Committee andactually assumes the office. Furthermore, the Company plans to renew this insurance policy
with the same details at the time of the next renewal.

13[For Reference] Skills Matrix for Candidates for Directors
What is a skills matrix?
A skills matrix is a list of the combination of “skills” and “diversity” of each Director in terms ofknowledge, background, and experience to enable the Board of Directors to fulfill its supervisory function.
The purpose of the matrix is to contrast the knowledge and experience of current and prospective Directors
with those required by the Company in light of its management strategy, and to disclose the balanced
composition of the Board of Directors as a whole and the appropriateness of the appointment of Directors inaccordance with the management strategy.
The Company nominates candidates for Directors in consideration of the balance and diversity of theirknowledge, experience, capabilities, etc. If Proposals 1 and 2 of this Meeting are approved as proposed, theskills matrix of each Director will be as follows:
Areas in which the skills are expected to be particularly effective
Corporate
Management

Name

Hirobumi
Takeuchi
Michihiro
Tsuchiya

R&D●
OutsideDirector

Business
StrategyMarketing

Finance
Accounting

LegalIntellectual
Property

●

●

●

●

●

●

Masaki Sudo

●

●

●

Katsuhiro
Uto

●

●

Kosuke Ishii

OutsideDirector
Audit andSupervisory
Committee
Member●YuichiKakinuma

OutsideDirector
Audit andSupervisory
Committee
Member●Megumi Uzu

OutsideDirector
Audit andSupervisory
Committee
Member

●

●
●

●

●

●

●

●

14

Corporate
Governance●●Consolidated Financial Statements
Consolidated Balance Sheet

Account title

15th Fiscal Year(As of December
31, 2022)

Assets

Account title(Thousands of yen)
15th Fiscal Year(As of December
31, 2022)

Liabilities

Current assets
Cash and deposits
Accounts receivable - trade, andcontract assets
Securities
Work in process

4,822,094

Current liabilities

3,675,450

Accounts payable - trade493,778
128,066

602,311

Current portion of long-termborrowings

2,620

250,599

Lease liabilities

42,887

Accounts payable - other

206,209

978Supplies

7,522

Accrued expenses

60,479Advance payments to suppliers

89,820

Income taxes payable

30,957

Prepaid expenses

108,633

Deposits received

18,922

Other

86,777

Other

3,635

Non-current assets

1,435,559

Non-current liabilities

266,893

391,024

Long-term borrowings

Buildings

154,158

Lease liabilities

167,661

Tools, furniture and fixtures

963,622

Asset retirement obligations

12,222

Leased assets

254,926

Provision for share awards

60,590(981,683)

Provision for share awards for
directors (and other officers)

14,49824,325

Deferred tax liabilities

2,750

Trademark right

4,268

Total liabilities

760,671

Software

19,984

Property, plant and equipment

Accumulated depreciation
Intangible assets

Other

9,170

Net assets

72

Shareholders’ equity

5,494,178

Investments and other assets

1,020,208

Share capital

2,265,697

Investment securities

987,962

Capital surplus

2,455,480

Other

32,245Retained earnings

773,021

Treasury shares
Accumulated other comprehensive
income(5,569)Valuation difference on availablefor-sale securities(5,569)

Share acquisition rights

Total assets

6,257,653

8,372

Total net assets

5,496,981

Total liabilities and net assets

6,257,653(Note) Figures less than one thousand yen are rounded down to the nearest thousand.

15

(21)

Consolidated Statement of Income(Thousands of yen)
15th Fiscal Year
(January 1, 2022 to December 31, 2022)

Account title
Business revenue

2,918,038

Business expenses

2,051,803

Cost of business revenue

231,586

Research and development expenses

1,248,678

Other selling, general and administrative expenses

571,538

Operating profit

866,235

Non-operating income

76,649Interest income

529

Interest on securities

13,127

Foreign exchange gains

43,697

Gain on valuation of derivatives

13,672

Other

5,622

Non-operating expenses

38,545Interest expenses

5,995

Commitment fees

5,833

Share issuance costs

15,897

Loss on valuation of compound financial instruments

10,820Ordinary profit

904,338

Extraordinary income

14,472Gain on sale of investment securities

10,268Gain on redemption of investment securities

4,203

Extraordinary losses

67,799Loss on valuation of investment securities

49,999Retirement benefits for directors (and other officers)

17,800

Profit before income taxes

851,011

Income taxes - current

129,034

Income taxes - deferred(1,413)

Profit723,390

Profit attributable to owners of parent

723,390(Note) Figures less than one thousand yen are rounded down to the nearest thousand.

16Consolidated Statement of Changes in Equity(15th Fiscal Year from January 1, 2022 to December 31, 2022)(Thousands of yen)
Shareholders’ equity

Balance at beginning of period

Share capital

Capital surplus

2,256,920

2,446,703

8,776

8,776

Retainedearnings

Treasury shares

Total
shareholders’equity(21)

4,753,234

49,631

Changes during period
Issuance of new shares

17,553

Profit attributable to owners ofparentNet changes in items other thanshareholders’ equity
Total changes during period
Balance at end of period

723,390

723,390
–

8,776

8,776

723,390–

740,9442,265,697

2,455,480

773,021(21)5,494,178

Accumulated other comprehensive income
Valuation difference Total accumulated Share acquisitionrightson available-for-sale other comprehensive
securities
incomeBalance at beginning of period

23,91923,91910,850Total net assets

4,788,004

Changes during period
Issuance of new shares
Profit attributable to owners ofparentNet changes in items other thanshareholders’ equity–

17,553–

723,390(29,489)(29,489)(2,477)(31,966)

Total changes during period(29,489)(29,489)(2,477)

708,977

Balance at end of period(5,569)(5,569)8,372

5,496,981(Note) Figures less than one thousand yen are rounded down to the nearest thousand.

17