Note: The following press release is an English translation of the Japanese-language original

May 12, 2014
Company Name: Japan Petroleum Exploration Co., Ltd.
Listing: Tokyo Stock Exchange, First Section
Securities Code: 1662
President: Osamu Watanabe
Inquiries: Shoji Mihara, General Manager, Media and Investor Relations Department
TEL: +81-3-6268-7110

Renewal of the Measures to Prevent Large-scale Acquisition of Our Company Shares(Takeover Defense Measures)Japan Petroleum Exploration Co., Ltd. (hereinafter the “Company” or “JAPEX”) renewed, in our
Board of Directors Meeting, held on May 13, 2011, and the 41st Ordinary General Meeting of the
Shareholders, held on June 24, 2011, the “Measures to Prevent Large-scale Acquisition of Our
Company Shares (Takeover Defense Measures)” (hereinafter the renewed measures are referred to as
the “Former Plan”). However, as the effective period of the Former Plan was determined to be until
the close of the Ordinary General Meeting of the Shareholders regarding the latest fiscal year ending
within three years after the close of the above-mentioned Ordinary General Meeting of the
Shareholders, the Former Plan will expire at the close of the 44th Ordinary General Meeting of the
Shareholders (hereinafter the “Annual Shareholders’ Meeting”) to be held on June 25, 2014.
Prior to expiry of the effective period of the Former Plan, JAPEX has, in our Board of Directors’Meeting held on May 12, 2014, decided to partially revise the content of the Former Plan and renew
it (hereinafter the “Renewal” and the plan after the Renewal is the “Plan”) as undertakings based on
the basic policy regarding the person controlling decisions relative to policies for our finances andbusiness (refers to the policies in the provision in Article 118, Clause 3 of the Ordinance for
Enforcement of the Companies Act, hereinafter the “Basic Policy”) to prevent the controlling ofdecision of policies of our finances and business by inappropriate persons (Article 118, Clause 3 (b)(2) of the Ordinance for Enforcement of the Companies Act), subject to the approval of ourshareholders at the Annual Shareholders’ Meeting, and therefore notifies the aforementioned
Renewal as follows. The attending Directors unanimously approved and adopted the Renewal at the
aforementioned Board of Directors’ Meeting. Furthermore, all Corporate Auditors including two
Outside Corporate Auditors attended the Board of Directors’ Meeting and expressed no objection to
the Renewal.
The major points that have changed in the Renewal compared to the Former Plan are that (1) the
contents of the Intent Statement (defined in (b) under III 3. (1) “Procedure for the Implementation of
the Plan”; hereinafter the same applies) have been reviewed; and (2) the items of information thatJAPEX requests the acquirers to provide have been re-examined.

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I.

Basic Policy Regarding the Person Controlling Decisions Relative to Policies for Our Financesand Business

JAPEX considers that the person controlling our financial and business policy decisions
should fully understand the content of our finances and business and the source of our corporate
value, and is eligible to ensure and improve the corporate value and consequently, the common
interest of the shareholders in a continuing, sustainable manner.
JAPEX believes the decision on an acquisition proposal with which is associated the transfer
of corporate control should ultimately be made based on the general decision of ourshareholders. Furthermore, JAPEX does not disapprove of large-scale share acquisition that
contributes to our corporate value and consequently the common interest of the shareholders.
Nevertheless, among large-scale share acquisitions, there are many that do not contribute to
the corporate value and the common interest of the shareholders, in the light of their purpose,including such that cause a clear infringement on the corporate value and the common interestof the shareholders, such that has the risk of a de facto coercion against the shareholders to sell
their shares, such that does not provide sufficient time and/or information for the Board of
Directors and the shareholders consideration of the content of the large-scale share acquisitionor for the Board of Directors to propose an alternative plan, and such that require consultationand negotiation with the acquirer to draw out a more favorable condition than the conditions
presented from the acquirer.
The large-scale share acquirer should understand the source of our corporate value as
described in the following II 1. not to mention the content of JAPEX’s finances and business,and unless he or she ensures and improves them for the medium-and-long term, our corporate
value, and consequently the common interest of the shareholders will be damaged.
JAPEX considers such a large-scale acquirer that does not contribute to our corporate value
and the common interest of our shareholders inappropriate as the controlling person todetermine the policies of our finances and business, and thus consider necessary to protect our
corporate value and consequently the common interest of our shareholders by taking essential
and substantial measures against such attempts.

II.

Special Undertakings that Contribute to the Source of Our Corporate Value and to theRealization of the Basic Policy

1. Source of Our Corporate ValueJAPEX has developed its business focusing on the improvement of the self-sufficiency of oil
and natural gas since its foundation in 1955. Starting out with zero reserves, JAPEX has

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established its current business base in the compounding discoveries of new oil and gas fields
one after another, and is operating the businesses of exploration, development, and distributionof oil and natural gas resources as its core business.
The source of our corporate value lies in our business model where we conduct exploration,
development, and distributing in continuity, upon our ownership of oil and natural gas interests.
Moreover, JAPEX conducts a business with a highly public nature, as well as taking on a
crucially important responsibility in terms of maintaining and ensuring stable supply and safe
operation as an enterprise involved in the supply of energy, which is the bloodstream ofindustrial activity and civic life.
This business model is backed with JAPEX’s 1) advanced exploration technology for oil andnatural gas, 2) oil/gas field development technology and operation know how in and out ofJapan, and 3) construction of a natural gas pipeline network in Japan, as well as trust
relationships with customer, stockholder and community stakeholders, based on the buildup ofa stable, long-term supply record due to the aforementioned network.
It is not uncommon for it to take more than 10 years to reach the production stage from thediscovery of a new oil or gas field. A social contribution with considerations given toenvironmental conservation as well as business deployment with a long-term perspective, areneeded. Also, in the view of today’s international energy situation, in which the global
competition with regard to the securement of energy resources is expected to intensify,
improvement of corporate technology and know how, securing human resources, and efforts forthe further enrichment of trust relationships with each stakeholder are essential for thecontinuing growth of the business and enhancement of our corporate value. This, we believe, isstill what brings the future maintenance and improvement of our corporate value and thus of thecommon interest of our stockholders.

2. Undertakings for the Improvement of Corporate Value

We consider it extremely critical to sustain and increase our reserves, which otherwise only
decrease due to production and sales. And bolstering our long-term, secure oil and natural gas
supply system is equally critical for a company like ours whose business is centered around
exploration, development and distribution of these resources. And to keep pace with changes inbusiness conditions surrounding the Company, such as the intensified competition in thedomestic natural gas business and the sense of priority concerning global warming issues, theCompany announced, in May 2008 its Mid-Term Business Plan, setting out three basic policies
as key management tasks: 1) Sustaining and increasing reserves through exploration anddevelopment, 2) Strengthening our natural gas integrated operation system and 3) Pursuing
technological R&D activities and initiatives to address global environmental challenges. The

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Company is thus determined to further enhance our corporate value by identifying primarybusiness objectives from a long-term perspective and establish policies to accomplish theseobjectives.
In this above Mid-Term Business Plan, specific quantitative targets were set to be achieved
by fiscal 2013 for proved reserves of oil and gas, natural gas sales volume etc. (The target
concerning natural gas sales volume was set to be achieved by fiscal 2014.) With diverse
initiatives taken during recent years, all these targets are estimated to be achieved during fiscal
2012. Given these circumstances, the Company has newly formulated the new Medium-TermBusiness Plan covering five years from fiscal 2012 to fiscal 2016. (Please refer to the press
release dated as of May 13, 2011 “Notice of the Medium-Term Business Plan of the JAPEXGroup”.)The Company anticipates increasing global competition for resource development, unstableenergy prices, intensifying competition in the domestic natural gas business and the risingsocial consciousness of environmental issues. The E&P (the exploration, development andproduction of crude oil and natural gas) business, the domestic natural gas business, and theenvironment and innovative technology business will remain as basic policies to pursue forfurther expansion. The Company aims to raise its profitability through new investment in thesethree basic policies (especially overseas business) and maximize the value of its existing assets
in Japan and overseas.
In the E&P business, three stages of quantitative targets are set toward the realization of our
growth story: 1) Increasing the ratio of overseas investment in the period from fiscal 2012
through fiscal 2016, 2) Expanding consolidated daily production to 70,000 barrels of crude oil
by fiscal 2016 and 3) Expanding the consolidated proved reserves to 450 million barrels of
crude oil equivalent by fiscal 2021.

3. Fortification of Corporate Governance

JAPEX plans to implement the above measures, and intends to acquire and improve ourcorporate value and consequently the common interest of our shareholders. Furthermore, we
recognize the importance of corporate governance in order to earn profits from efficientmanagement and to stay, as an enterprise, socially accepted as a valuable entity. Thus we aim todevelop and enhance the relevant system as described hereinafter.
First of all, JAPEX introduced a system of non-statutory executive officers for clarificationof the business execution system and appointed one Outside Director in addition to the two
Outside Corporate Auditors in an effort to strengthen the supervisory function of the Board of
Directors.
Currently, the Board of Directors hold a monthly general meeting, where decisions on

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important business executions are made, and reports on the business execution situation is
given by the Directors or Executive Officers, redeeming the supervisory function. Corporate
Auditors attend the Board of Directors’ Meeting and the Standing Auditors also attend the otherimportant meetings as well as exchange opinions with Directors who execute business
operations or Executive Officers as appropriate, thus serving in the supervisory function.
Furthermore, as an internal audit, the Audit Dept. under the direct control of the President
supervises compliance with the laws and corporate regulations and conducts audits on whether
business operations are properly conducted, including the verification of effectiveness ofinternal control in the departments.
On the other hand, concerning the internal control, JAPEX developed the frameworknecessary to ensure due business operation as set forth in the Companies Act and the Ordinancefor Enforcement of the Companies Act in May 2006, and the Internal Control Committee,
which was established in April 2006 as the main actor, is continuing its inspection anddevelopment of the framework to ensure due business operation.
Furthermore, in addition to such corporate governance in management mechanism, we
anticipate to attain the optimal business execution appropriately, through improved
transparency of management brought by IR activities such as results briefings and enrichmentof the website.

III. Undertakings Based on the Basic Policy to Prevent the Controlling of Decision of Policies of
Our Finances and Business by Inappropriate Persons (the Plan)

1. Purpose of the Renewal

The Plan shall be renewed according to the Basic Policy described above I for the purpose of
ensuring and improving our corporate value and the common interests of our shareholders.
The Board of Directors, as set forth in the Basic Policy, considers a person who performs thelarge-scale acquisition of JAPEX share certificates, etc., without contributing to our corporate
value and/or the common interests of our shareholders inappropriate for making financial andbusiness policy decisions regarding the Company. The Plan aims to prevent the control of our
financial and business policies by such inappropriate persons and deter large-scale acquisition
that is detrimental to our corporate value and/or the common interests of our shareholders. At
the same time, the Plan shall allow the Company’s Board of Directors to ensure the necessary
information and time required to propose an alternative plan to our shareholders or for ourshareholders to sufficiently judge whether such a large-scale acquisition of JAPEX sharecertificates, etc., is acceptable and/or allow negotiation and other measures to be taken on
behalf of our shareholders.

5Meanwhile, the state of major shareholders as of March 31, 2014, is as shown in the separate
document 4, “Overview of Shareholding of JAPEX Shares”. As of today, we have received no
proposals concerning the act of large-scale acquisition of JAPEX shares.
JAPEX was listed on the first section of the Tokyo Stock Exchange market due to thepartially sell-out of shares owned by then-Japan National Oil Corporation (JNOC) in December
2003, but as a result, the ratio of share owned by JNOC was reduced from 65.74% to 49.94%.
Furthermore, JAPEX shares owned by JNOC were succeeded by the state (Minister of
Economy, Trade and Industry) as of April 1, 2005, upon the abolition of JNOC. These shareswere then sold to be delivered as of June 15, 2007, and as a result of the sale of shares valued at
15.94% of relevant owned shares, the ratio of share ownership of the Minister has decreased to
34.00% and remains so up to this date. 1

2. Overview of the Plan

The Plan determines the necessary procedure for achieving the aforementioned purpose, suchas demanding the prior provision of information from the acquirer, upon the emergence of aperson who intends to acquire 20% or more of JAPEX share certificates, etc.
In case the decision of not implementing the Plan has been made by the Board of Directors
based on the procedures of the Plan, the acquirer shall be authorized to make a large-scaleacquisition of JAPEX share certificates, etc., only after such a board decision.
In case the acquirer does not comply with the procedure set forth in the Plan or the intended
large-scale acquisition of JAPEX share certificates, etc., has a risk of impairing our corporate
value and/or the common interest of our shareholders and if the predetermined requirements forthe implementation of the Plan are satisfied, JAPEX shall allot share options with exercise
conditions in which the exercise of rights by the acquirer is, in principle, impermissible or withacquisition clauses where JAPEX may, in principle, acquire share options from persons otherthan the acquirer in exchange for JAPEX shares to all shareholders excluding JAPEX at thatpoint of time, through an allotment of share options without contribution.
In the event that the allotment of share options without contribution is executed according to
the Plan, and associated by its execution or acquisition by JAPEX, when JAPEX shares areissued to all shareholders except for the acquirer, the percentage of voting rights the acquirer
holds may be diluted up to a maximum of approximately 50%.
1After the endorsement of the “Reorganization and Rationalization Plan for Special Public Corporations” by the
Cabinet in December 2001, the assets related with the development of oil and natural gas (Assets) (including JAPEX
shares) of JNOC went through due handling, including reorganization or sale, upon impartial asset evaluation, under
this Plan, alongside with the enactment of the Abolishment Act of JNOC in July 2002. Under such policies, theMinistry of Economy, Trade and Industry designed the “Policy for the Handling of Assets held by the JNOC” at theAdvisory Committee on Energy and Natural Resources in March 2003. As described in this document, the sale of
JAPEX shares has been proceeded due to the public listing (December 2003) of JAPEX shares and the sell-out that
followed (June 2007). The remaining JAPEX shares could possibly be sold out in the future.

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With regard to the decision whether to implement or not implement the allotment of shareoptions without contribution, or to acquire, according to the Plan, in order to eliminate thearbitrary decision of the Board of Directors, it shall undergo the objective decision of the
Independent Committee constituted only of Outside Director etc., who are independent fromthe Company’s Board of Directors pursuant to the Independent Committee Provision. Moreover,in any of the predetermined cases in the Plan, the Board of Directors may convoke a general
meeting of the shareholders to confirm the decision of the shareholders concerning theimplementation of the allotment of share options without contribution.
We aim to ensure transparency of the process of these procedures through the timely
disclosure of appropriate information to our shareholders.

3. Content of the Plan

(1) Procedure for the Implementation of the Plan (please refer to the separate document 1 “Flowof Procedures in the Plan” for the overview)(a) Share purchases that are the subject of the Plan’s application
The Plan shall be applied when a purchase or other acquisition of JAPEX sharecertificates, etc., that falls under 1) or 2) described subsequently or a similar act (including
any proposal thereof) is pursued (excluding those on which the Board of Directors hasotherwise approved of not applying the Plan); hereinafter the “Acquisition(s)”).
1) Share purchase or other acquisition with an ownership ratio 2 of 20% or more of theholder 3 with regard to share certificates, etc., 4 issued by JAPEX.
2) Tender offers 5 with a total ownership ratio 6 of 20% or more of the persons pursuingtender offers and their special associated persons 7 with regard to share certificates,
etc., 8 issued by JAPEX.
Persons who intend to perform the Acquisitions (hereinafter the “Acquirer(s)”) shallcomply with the procedures set forth in the Plan, and they must not perform the2

Defined in Article 27-23-4 of the Financial Instruments and Exchange Act. The term herein is subject to its
definition.
3
Includes persons included in holders, based on Article 27-23-3 of the Financial Instruments and Exchange Act(includes persons the Board of Directors deemed that they will fall under the definition). The term herein is subject toits definition.
4
Defined in Article 27-23-1 of the Financial Instruments and Exchange Act. The term herein is subject to its
definition, unless otherwise specified.
5
Defined in Article 27-2-6 of the Financial Instruments and Exchange Act. The term herein is subject to its definition.
6
Defined in Article 27-2-8 of the Financial Instruments and Exchange Act. The term herein is subject to its definition.
7
Defined in Article 27-2-7 of the Financial Instruments and Exchange Act (includes persons the Board of Directors
deemed that they will fall under the definition). However, with regard to the persons stipulated in Article 27-2-7 (1),those who fall under Article 3-2 of the Cabinet Office order concerning the disclosure of tender offers of sharecertificates, etc. by persons other than the issuer, shall be excluded. The term herein is subject to its definition.
8
Defined in Article 27-2-1 of the Financial Instruments and Exchange Act.

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Acquisitions before the Company’s Board of Directors passes a resolution not to
implement the allotment of the share options without contribution based on the Plan.

(b) Submission of the Intent Statement
The Acquirers shall, prior to the relevant Acquisitions, submit a legally binding
document (on which the signature or the seal of the Acquirers’ representative is placed andno conditions or reservations imposed) including covenant wordings, etc., that expresses
the intention to comply with the procedure set forth in the Plan and a qualification
certificate of the representative signed or sealed thereby, in a format specified by JAPEX(hereinafter collectively the “Intent Statement”) to JAPEX. The Intent Statement shallspecify the name or designation, the address or location such as the head office and officesof the Acquirers, the governing law for incorporation, the name of the representative, thecontact in Japan and the outline of the intended Acquisition. The language used in the
Intent Statement and the Acquisition Statement, which is set forth in the following (c), andany other material that is submitted by the Acquirers to JAPEX or the Independent
Committee must be only Japanese.

(c) Demand for information provision towards the Acquirers
JAPEX will deliver a form of the Acquisition Statement (defined below) (including alist of information items to be provided by the Acquirers to JAPEX) within 10 businessdays after receiving the Intent Statement. The Acquirers are required to submit a written
statement, which provides the information stipulated in the following (hereinafter the“Required Information”) (hereinafter collectively the “Acquisition Statement”), to theCompany’s Board of Directors in a format specified by JAPEX.
Upon receiving the Acquisition Statement, the Company’s Board of Directors will
immediately send it to the Independent Committee (the appointment criteria of committee
members, the requirements for adopting resolutions and matters for resolution are as
described in the separate document 2 “Overview of the Independent Committee Provision”
and personal careers of the members in the separate document 3 “Brief History of
Independent Committee Members”).
When the Independent Committee has decided that the description on the Acquisition
Statement falls short as Required Information, JAPEX may request the Acquirer to provide
additional information, with an appropriate reply deadline. In this case, the Acquirers are
required to additionally submit such information to JAPEX by the relevant deadline.

1) Details (including names, capital relationship, financial content, business performance,compliance with laws and other regulations, details of previous trade similar to the8Acquisition of the relevant Acquirers, and the previous transactions of JAPEX sharecertificates, etc.) of the Acquirers, and their group (including joint shareholders 9,
special associated persons, and special associated persons of the parties whose
controlled incorporations 10 are the Acquirers) 11
2) Purpose, method, and content of the Acquisition (includes value and type inconsideration of the Acquisition, time of Acquisition, mechanism of related trade,legality of the method of Acquisition, and information on the feasibility of theAcquisition)
3) Price and basis of the valuation of the relevant Acquisition
4) Whether there have been agreements on JAPEX share certificates, etc. between the
Acquirers and a third party, and other communication on the Acquisition
5) Proof of funds for the Acquisition (includes the specific names of providers of thefunds for the Acquisition (including the beneficial providers), procurement methods,
content of related trade, etc.)
6) Management policy, business plans, capital policy, and dividend policy, for JAPEXGroup after the Acquisition
7) Post-acquisition policy regarding our shareholders, employees, labor union, business
partners, customers, and other stakeholders related to JAPEX Group8) Specific information regarding the risk of infringement by the Acquirers to the laws
and regulations in and out of Japan (includes the Act of Prohibition of Private
Monopolization and Maintenance of Fair Trade and foreign competition law)
9) Information regarding relationships with antisocial forces or organizations related toterrorism
10) Specific measures to prevent conflicts of interest with other shareholders of JAPEX
shares11) Other information reasonably decided by the Independent Committee as necessary(d) Consideration of the content of Acquisition / Consideration of negotiation with theAcquirer or of an alternative plan
1) Request to the Board of Directors for the submission of information
The Independent Committee shall, when the Acquisition Statement and (ifapplicable) the additional information are submitted by the Acquirer, determine anappropriate reply deadline (in principle, 60 days maximum in view of the scale,

9
Refers to the joint holders stipulated in Article 27-23-5 of the Financial Instruments and Exchange Act, and includes
persons deemed joint holder based on Article 27-23-6 (includes persons the Board of Directors deemed that they will
fall under the definition). The term herein is subject to its definition.
10
Defined in Article 9-5 of the Enforcement Order of the Financial Instruments and Exchange Act.
11
In case of funds, includes the information equivalent to that in 1) above for each union member or other members.

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characteristics and diversity of the JAPEX Group) with due consideration to the timerequired for the collection of information and the review and/or valuation of materials
by the Board of Directors (including such examination by outside experts, as required).
The Independent Committee may also request the Board of Directors to present its
opinion (including suspension of opinion; hereinafter the same applies.) on the content
of the Acquisition proposed by the Acquirer and the supporting materials, (if available)
alternative plans, and other information deemed necessary by the Independent
Committee, as appropriate, with the appropriate reply deadline.
2) Reviews and other considerations by the Independent Committee
The Independent Committee shall, within an appropriate period (in principle, amaximum of 60 days in view of the scale, characteristics and diversity of the JAPEXGroup) (hereinafter the “Reviewing Period of the Independent Committee”) after thereceipt of the information (including the additional information requested) from theAcquirer and the Board of Directors (if the provision of information has been requested
to the Company’s Board of Directors as described in 1) above), review the content of
the Acquisition, collect information on and comparatively investigate the management
and business plans of the Acquirer and the Board of Directors, and review thealternative plan provided by the Board of Directors.
In order to ensure that the Independent Committee makes the decision to the benefitof the corporate value and the common interest of our shareholders, the Independent
Committee may seek advice from financial advisors, certified public accountants,
lawyers, certified tax accountants, consultants and other experts at the expense of theCompany.
In addition, the Independent Committee may, directly or indirectly, consult and/or
negotiate with the Acquirer, if necessary, to improve the content of the relevant
Acquisition in view of ensuring and improving our corporate value and thus thecommon interest of our shareholders. The Acquirer shall promptly respond to the direct
or indirect request of the Independent Committee to provide reviewing materials orother information, or for consultation and/or negotiation.
Furthermore, the Independent Committee may extend the Reviewing Period of the
Independent Committee, within a reasonable range (however, the total extendable
period shall, in principle, be up to 30 days at a maximum) required for the reviewing of
the content of the Acquisition by the Acquirer, for the consideration of the alternativeplan, and for consultation and/or negotiation with the Acquirer.

(e) Procedure of advisory of the Independent Committee
The Independent Committee shall advise the Board of Directors as follows in

10compliance with the above procedure.

1) When advising the implementation of the Plan
When the Independent Committee judges that the Acquisition by the Acquirer falls
under any of the causes for implementation (hereinafter collectively the “Cause for
Implementation”) set forth in the following (2) “Requirements for the Allotment of the
Share Options Without Contribution,” the Independent Committee shall advise theimplementation of the allotment of the share options (of which the major content shallbe as set forth in the following (3) “Overview of the Allotment of the Share Options
Without Contribution”; hereinafter the “Share Options”) without contribution to theBoard of Directors, except under special circumstances through which the further
provision of information by or consultation and/or negotiation with the Acquirers isnecessary. Meanwhile, the Independent Committee may issue a reservation that theshareholders’ decision should be heard and decided if the applicability of the second
cause for implementation (hereinafter the “Second Cause for Implementation”) of thetwo causes specified in the following (2) “Requirements for the Allotment of the Share
Options Without Contribution” has come into question with regard to a certain
Acquisition.
Regardless of the foregoing paragraph, even after the implementation of theallotment of the Share Options without contribution has been advised, if the
Independent Committee deems that any of the conditions specified below applies, theIndependent Committee may pause the allotment of the Share Options without
contribution by two business days before the ex-rights day of the allotment of the Share
Options without contribution, or, may issue a new advisory to acquire all the Share
Options without contribution by one day before the date of commencing the Period of
Exercise after the effective date of the allotment of the Share Options without
contribution.

(i) When the Acquisition is withdrawn by the Acquirer after the advisory or whenthe Acquisition is otherwise no longer existent; or(ii) When the Cause for Implementation is no longer existent due to such reason that,for example, any change has occurred in the facts the decision of the advisory
was based on.

2) When advising not to implement the Plan
When the Independent Committee determines that the Acquisition does not fallunder any Cause for Implementation, the Independent Committee shall advise not to11

implement the allotment of the Share Options without contribution to the Board of
Directors, irrespective of whether the Reviewing Period of the Independent Committee
has commenced or has finished.
Regardless of the foregoing paragraph, even after the non-implementation of theallotment of the Share Options without contribution has been advised, if the Cause for
Implementation becomes existent as a result of any change that occurred in the facts
the decision of the advisory was based on, the Independent Committee may issue a newadvisory to implement the allotment of the Share Options without contribution.

(f)

Resolution of Board of Directors
In case an advisory as outlined above has been given by the Independent Committee,
the Board of Directors shall make a resolution as a body under the Companies Act
regarding the implementation or non-implementation of the allotment of the Share Options
without contribution, in utmost deference to the above advisory of the Independent
Committee.
However, in the case a general meeting of the shareholders for decision hearing is held
according to the following (g), the Board of Directors shall prepare a resolution based on
the resolution of the general meeting of the shareholders for decision hearing.

(g) Holding of the general meeting of the shareholders for decision hearing
With regard to the implementation of the allotment of the Share Options without
contribution according to the Plan, the Board of Directors may convoke a general meetingof the shareholders (hereinafter the “General Meeting of the Shareholders for Decision
Hearing”) to hear the shareholders’ decision regarding the implementation of the allotmentof the Share Options without contribution in the case (i) where the Independent Committee
issued a reservation that shareholders’ decision be heard in advance with regard to theimplementation of the allotment of the Share Options pursuant to the procedure in (e)above, or (ii) where the applicability of the Second Cause for Implementation has comeinto question with regard to a certain Acquisition and the Independent Committee judges it
appropriate to hear the shareholders’ decision in light of various factors such as the timerequired for holding the general meeting of the shareholders and the duty of care of a goodmanager.

(h) Information disclosure
In operating the Plan, JAPEX shall timely disclose the appropriate information as
enumerated below in accordance with the governing laws and regulations and/or
applicable rules and regulations of the stock exchanges: progress status of the respective

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procedures set forth in the Plan (including the fact of the Intent Statement and theAcquisition Statement submitted; the fact of the revealed existence of an Acquirer who
intends to make the Acquisition without submitting the Intent Statement or the Acquisition
Statement; the fact of the commenced Reviewing Period of the Independent Committee;
and the fact of the extended Reviewing Period of the Independent Committee together
with the extended period and the reason therefor), outline of the advisory of the
Independent Committee, outline of the resolution adopted by the Company’s Board of
Directors, outline of the resolution at the General Meeting of the Shareholders for
Decision Hearing, and any other matters deemed appropriate by the Independent
Committee or the Board of Directors.

(2) Requirements for the Allotment of the Share Options Without Contribution
The requirements for the implementation of the allotment of the Share Options without
contribution pursuant to the Plan shall be as follows. As was described in (e) under (1)“Procedure for the Implementation of the Plan”, whether the Acquisition falls under thefollowing requirements shall be always be decided with and after the advisory of the
Independent Committee.

First Cause for Implementation
When the Acquisition is not in conformity with the procedures prescribed in the Plan(including the case where time and/or information reasonably required to make judgmentson the content of the Acquisition have not been provided by the Acquirer) and it is deemedsuitable to implement the allotment of the Share Options without contribution;

Second Cause for Implementation
When the Acquisition by the Acquirer falls under any of the following and it is deemedsuitable to implement the allotment of the Share Options without contribution;(a) When the Acquisition clearly risks infringing on our corporate value and consequently
to the common interest of our shareholders, by reason of the acts listed below:
1) Act in which the Acquirer corners the share certificates, etc., and demands thatJAPEX or parties related to JAPEX purchase such share certificates at a high price;2) Act in which the Acquirer temporarily controls the management of JAPEX to
perform management for the benefit of the Acquirer that is based on the sacrifice of
JAPEX, such as acquiring JAPEX’s important assets and other properties at low
cost;3) Act in which the Acquirer appropriates the assets of JAPEX Group as collateral for
debt and/or as a resource to perform obligations of the Acquirer or its group

13

companies, etc.; or
4) Act in which the Acquirer temporarily controls the management of JAPEX todispose of expensive assets and/or other properties that are not active in thebusiness of JAPEX Group for the foreseeable future, and with the disposal income,perform temporary high dividend payouts or sell-out of shares on the occasion of
sharp rises in share prices due to such temporary high dividend payouts.
(b) When the Acquisition has a risk of a de facto coercion towards the shareholders to sell
their shares, such as coercive two-tiered tender offers (refers to an act in which sharesare purchased in tender offers and such, without soliciting/offering the purchase of allshares in the initial purchase, but set the second tier purchase condition
disadvantageously or without clarifying the second tier purchase condition);(c) When the Acquisition is such that the condition of the Acquisition (including value andtype in consideration, time, legality of the method, feasibility, post-acquisition
management policy and business plans, post-acquisition shareholders other than
JAPEX, and policy regarding the employees, customers, business partners, and otherstakeholders related to JAPEX Group) is insufficient or inadequate with consideration
to JAPEX’s intrinsic value; or(d) When the Acquisition might cause significant damage to our corporate value andconsequently to the common interest of our shareholders, with a risk of causing aserious hindrance in ensuring a stable supply of energy or ensuring customer
convenience, due to the insufficiency or inadequacy of the content of post-acquisition
management policy or business plans.

(3) Overview of the Allotment of the Share Options Without Contribution
The overview of the allotment of the Share Options without contribution planned to be
implemented based on the Plan is as follows:(a) Number of the Share Options
The number of the Share Options shall be equal to the final total number of shares(provided, however, that the number of JAPEX shares held by JAPEX at point of certain
date is deducted) issued as of a certain date (hereinafter the “Allotment Date”) otherwise
decided by resolution of the Board of Directors or by resolution at a general meeting of theshareholders concerning the allotment of the Share Options without contribution(hereinafter the “Resolution for the Allotment of Share Options Without Contribution”).

(b) Shareholders eligible for allotment
The Share Options shall be allotted to shareholders other than JAPEX who are

14

registered on the final shareholder registry (hereinafter the “Shareholders Eligible for
Allotment”) as of the Allotment Date, in proportion of one Share Option per one JAPEX
share held by the shareholder.

(c) Effective date of allotment of the Share Options without contribution
The effective date shall be otherwise decided by the Resolution for the Allotment of
Share Options Without Contribution.

(d) Number of shares as object of the Share Options
The number of JAPEX shares as object of each Share Option (hereinafter the “Target
Share Number”) is, in principle, one share.

(e) Value of assets contributed upon the exercise of the Share Options
The object of contribution upon the exercise of the Share Options shall be money. The
value per JAPEX share of the property to be contributed upon the exercise of the Share
Options shall be otherwise decided in the Resolution for the Allotment of Share Options
Without Contribution, within the value range of one yen as lower limit and one half of themarket value of one JAPEX share as higher limit. Furthermore, “market value” isequivalent to the value corresponding to the average closing price (includes quotations) for
90 days (excludes dates without contracted trade) of ordinary exchange dates for ordinary
JAPEX shares at the Tokyo Stock Exchange, prior to the Resolution for the Allotment of
Share Options Without Contribution, and fractions shall be rounded up.

(f)Period of exercise of the Share Options
The date otherwise prescribed in the Resolution for the Allotment of Share Options
without Contribution shall be the initial date (hereinafter the initial date of such period of
exercise shall be the “Commencing Date of the Period of Exercise”) of the Period of
Exercise, and in principle the period otherwise prescribed in the Resolution for the
Allotment of Share Options Without Contribution within the range of one to six months
shall be the Period of Exercise. However, in case JAPEX acquires the Share Options basedon the provision of the following clause (i), the Period of Exercise of the Share Options forsuch acquisition shall be until the business day before such acquisition date. Furthermore,
if the final date of the Period of Exercise falls on a non-business day of the payment
handling institution where the money shall be paid upon the exercise, the last business day
before such date shall be the final date of the Period of Exercise.

15

(g) Conditions of exercise of the Share Options( I ) Specific large-scale holders 12, ( II ) joint holders of specific large-scale holders,( III ) specific large-scale acquirers 13, ( IV ) special associated persons of specific largescale acquirers, or ( V ) persons who was assigned or succeeded the Share Options frompersons that fall under ( I ) or ( IV ) without the approval of the Board of Directors, or( VI ) persons who are in relation 14 to persons that fall under ( I ) or ( V ) (hereinafter
persons that fall under ( I ) or ( VI ) collectively shall be the “Unqualified Persons”) may
not, excluding cases where certain exceptional causes 15 exist, exercise the Share Options.
Furthermore, under the applicable foreign law, non-residents, as they require prescribed
procedures for the exercise of the Share Options, may not, in principle, exercise the Share
Options. (However, on the condition that it is confirmed that the Share Options held by the
non-resident does not infringe on the applicable law, they may become the object ofacquisition by JAPEX in consideration of JAPEX shares as described in the following (i)2)). In addition, persons who do not submit a covenant in a form prescribed by JAPEX
containing a representation warrant clause with regard to that the person satisfies therequirements for exercise of the Share Options, compensation clause and other covenant
12

In principle, refers to holders of share certificates, etc. issued by JAPEX and the ratio of whose ownership of suchshares is 20% or more (includes persons the Board of Directors deemed that they will fall under the definition).
However, persons whose acquisition or holding of the shares are deemed harmless to our corporate value or thecommon interest of our shareholders by the Board of Directors, and other persons who are otherwise designated by
the Board of Directors in the Resolution for the Allotment of Share Options without Contribution, shall not fall under
specific large-scale holders. The term herein is subject to its definition.
13
In principle, refers to persons who made a public notice to purchase (defined in Article 27-2-1 of the Financial
Instruments and Exchange Act. The term herein is subject to its definition.) shares issued by JAPEX (defined in
Article 27-2-1 of the Financial Instruments and Exchange Act. The term herein is subject to its definition.) by tender
offer and whose ratio of share ownership (as pursuant to this, shall include cases stipulated in Article 7-1 of the
Enforcement Order of the Financial Instruments and Exchange Act) combined that of the person’s special associatedperson become 20% or more after such purchase (includes persons the Board of Directors deemed that they will fallunder the definition). However, persons whose acquisition or holding of the shares are deemed harmless to our
corporate value or the common interest of our shareholders by the Board of Directors, and other persons who areotherwise designated by the Board of Directors in the Resolution for the Allotment of Share Options without
Contribution, shall not fall under specific large-scale acquirers. The term herein is subject to its definition.
14“Those who are in relation” to refers to a person who substantially control the other person, or is controlled by theother person, or under the same control as the other person (includes persons the Board of Directors deemed that they
will fall under the definition), or a person approved by the Board of Directors as acting substantially in cooperation
with the other person. Furthermore, “control” refers to “the case where controlling the determination of financial andbusiness policies” of another organization (defined in Article 3-3 of the Ordinance for Enforcement of the Companies
Act).
15
Specifically, the following case is deemed to fall under such exceptional causes: (x) In case the Acquirer pauses orwithdraws the Acquisition after the Resolution for the Allotment of Share Options without Contribution is adopted orif the Acquirer and other Unqualified Persons have pledged that they do not intend to make the Acquisitions
subsequently and have delegated a disposition of JAPEX shares to a securities company that JAPEX admits, andadditionally (y) in case a ratio authorized by JAPEX (hereinafter the “Unqualified Persons’ Ownership Ratio of
JAPEX Share Certificates, etc.”) as the Acquirer’s ownership ratio of JAPEX share certificates, etc. (provided,
however, that in calculating the ownership ratio of the JAPEX share certificates, etc., the Unqualified Persons otherthan the Acquirers and Joint Holders thereof shall be deemed to be the joint holders of the Acquirers, and the Share
Options that do not satisfy the exercise conditions shall be excluded), is less than either (i) the Unqualified Persons’
Ownership Ratio of JAPEX Share Certificates, etc., prior to the Acquisition or (ii) 20%, whichever is lower, theAcquirer of the Acquisition and other Unqualified Persons who have made the disposition may exercise the Share
Options targeting the number of shares that correspond to the disposed shares within the range below said lowering
ratio. The exercise conditions for the Share Options to be exercised by the Unqualified Persons and the details of

16

wordings, cannot exercise the Share Options.

(h) Restriction on assignment of the Share Options
The acquisition of the Share Options through assignment requires the approval of our
Board of Directors.

(i)Acquisition of the Share Options by JAPEX
1) In case the Board of Directors deem it appropriate for JAPEX to acquire the Share
Options, JAPEX may any time acquire all the Share Options without contribution upon
the coming of the date otherwise prescribed by the Board of Directors, until the day
before the Commencing Date of the Period of Exercise.
2) JAPEX may, upon the coming of the date otherwise prescribed by the Board of
Directors, acquire all the Share Options held by persons other than the Unqualified
Persons, which are not exercised by the day before the date prescribed by the Board of
Directors, and in exchange of such unexercised Share Options, may delivery the
number of JAPEX shares equivalent to the Target Share Number per one Share Option.
Furthermore, in the event 16 that the Board of Directors acknowledges the presence of
persons other than the Unqualified Persons among the holders of the Share Options
after the date of such an acquisition, upon the coming of the date prescribed by the
Board of Directors that is after the date of the above acquisition, all the Share Options
held by such persons that remained unexercised as of one business day before the dateassigned by the Board of Directors shall be acquired by JAPEX and in exchange for
this, JAPEX may deliver shares equivalent to the Target Share Number per one Share
Option, and the same principle shall apply hereafter.

(j)

Delivery of share options in case of merger, demerger, incorporation-type company split,
share exchange, and stock transfer
They shall be otherwise prescribed in the Resolution for the Allotment of Share Options
Without Contribution.

(k) Issuance of share option certificates
Share option certificates will not be issued for the Share Options.

relevant procedures shall be otherwise prescribed by the Company’s Board of Directors.
16
Examples include cases where persons who were initially special associated persons of specific large-scale acquirers
resolve their relationship with the relevant specific large-scale acquirer after the implementation of the Plan and cease to
be Unqualified Persons.

17

(l)

Other
Details on the content of the Share Options (includes matters concerning the handling of
the Share Options held by the Unqualified Persons) other than prescribed above shall beotherwise stipulated in the Resolution for the Allotment of Share Options Without
Contribution.

(4) Procedure for the Renewal
In accordance with Article 12 of the Articles of Incorporation, the Renewal shall be
subject to the approval of our shareholders at the Annual Shareholders’ Meeting on thedelegation of the authority to decide on the matters regarding the allotment of the Share
Options without contribution to the Company’s Board of Directors, according to theconditions set forth in the Plan.

(5) Effective Period, Abolition, and Modification of the Plan
The effective period of the Plan shall be until the close of the Ordinary General Meetingof the Shareholders regarding the latest fiscal year ending within three years after the closeof the Annual Shareholders’ Meeting, which is the same as the delegation period of theauthority to decide the matters concerning the allotment of the Share Options without
contribution in the Plan to be in accordance with the resolution of the Annual Shareholders’Meeting.
However, even before the expiration of the effective period, 1) if a resolution forwithdrawing the above delegation to the Board of Directors with regard to the decision onmatters concerning the allotment of the Share Options without contribution in the Plan ismade at a general meeting of the shareholders, or 2) if a resolution to abolish the Plan ismade by the Board of Directors, the Plan shall be abolished at that point in time.
Furthermore, even during the effective period of the Plan, when an addition, revision,
and/or abolishment of laws, financial instruments, or stock exchange rules concerning thePlan are appropriate to reflect on the Plan, when appropriate to correct the wordings byreason of typographical errors, or when the change of the Plan does not act against theintention to delegate based on the resolution of the Annual Shareholders’ Meeting, such as
when such changes are not detrimental to our shareholders, the Board of Directors may
revise or modify the Plan upon the approval of the Independent Committee.
JAPEX shall promptly disclose information regarding the fact of the abolition, revision or
modification of the Plan, (in case of a revision and/or a modification) the content of such
revision and/or modification, and other matters.

18

(6) Revision due to Amendments in Law
The provision of law referenced in the Plan is assumed as the provision in effect as of
May 12, 2014, and should any addition, revision, or abolition of the law occur after the date
and thus necessitates a revision to the clauses prescribed above or meaning of terms, such
clauses or meaning of terms shall be appropriately interpreted within a reasonable range,
upon consideration of the intention of the addition, revision, or abolition.

4. Impact on the Shareholders and Investors(1) Impact on Our Shareholders and Investors upon the Renewal
With regard to the Renewal, we have our shareholders only delegate the decision-making
authority concerning the allotment of the Share Options without contribution to the Board of
Directors based on a resolution of a general meeting of the shareholders and the allotment of
the Share Options without contribution itself will not be executed. Hence there is no direct
and specific impact on our shareholders and investors.

(2) Impact on Our Shareholders and Investors upon the Allotment of the Share Options Without
Contribution(i)

Procedure for the allotment of the Share Options without contribution
In case a resolution to allot the Share Options without contribution is made by the Boardof Directors, the Allotment Date shall be decided in the relevant resolution and publicly
notified. In this case, one Share Option shall be allotted without contribution for each
JAPEX share, to the Shareholders Eligible for Allotment. As the Shareholders Eligible for
Allotment will consequently become holders of the Share Options on the effective date of
the allotment of the Share Options without contribution, no application procedure isnecessary for them.
Even after the resolution of the allotment of the Share Options without contribution has
been made, JAPEX may, with utmost respect to the advisory of the Independent
Committee described in (e) under 3. (1) “Procedure for the Implementation of the Plan”,
pause the allotment of the Share Options without contribution until two business days
before the ex-rights day of the allotment of the Share Options without contribution, or may
acquire all the Share Options without contribution by the Commencing Date of the Periodof Exercise after the effective date of the allotment of the Share Options without
contribution. In such cases, the dilution of value per one share shall not occur and thus
shareholders purchasing and selling upon the assumption of such dilution may incur
unexpected loss due to fluctuations of share value.

19

(ii) Procedure for exercise of the Share Options
JAPEX shall, in principle, send the documents to be submitted for the exercise of the
Share Options (in the form prescribed by JAPEX including the content and number of the
Share Options to be exercised, required information such as the date of such exercise,clauses for the representation warrant concerning the eligibility of the shareholder toexercise the Share Options, compensation clause and other covenant wordings, as well as
information necessary for the money transfer regarding JAPEX shares into the accounts of
the Shareholders Eligible for Allotment) and other documents necessary for the exercise of
the rights of the Share Options, to the Shareholders Eligible for Allotment. After the
allotment of the Share Options without contribution, we ask our shareholders to submit
these necessary documents during the Period of Exercise of the Share Options. In principle,
JAPEX shares shall be issued, one share per one Share Option, by paying the money value
equivalent to one half of the exercising value decided in the Resolution for the Allotmentof Share Options Without Contribution within the range of one yen per one Share Option
as the lower limit and one half of the market value of one JAPEX share as the higher limit,
to the payment handling institution.
If the shareholders do not exercise the Share Options, or pay the money equivalent to
the exercising value, the JAPEX shares held by such shareholders will be diluted from theexercising of the Share Options by the other shareholders.
Nevertheless, JAPEX may deliver JAPEX shares in exchange for the Share Optionsacquired from the shareholders other than the Unqualified Persons, according to thedescription in the following (iii). In case JAPEX takes procedures for such acquisition, theshareholders other than the Unqualified Persons shall, in principle, receive JAPEX shares
without the exercise of the Share Options and the payment of money equivalent to theexercising value of the Share Options, and thus the dilution of share held will not, inprinciple, occur.

(iii) Procedure for the acquisition of the Share Options by JAPEX
In case the Board of Directors makes a decision to acquire the Share Options, JAPEX
may, according to the statutory procedures, upon the coming of the date otherwise
determined by the Board of Directors, acquire the Share Options from the shareholders
other than the Unqualified Persons and deliver JAPEX shares in exchange of the Share
Options. In this case, such shareholders shall receive, in principle, one JAPEX share foreach Share Option as consideration of the acquisition of the Share Options by JAPEX,
without the payment of money equivalent to the exercising value. However, in this case,such shareholders may be asked otherwise to submit a covenant in a form prescribed by
JAPEX containing a representation warrant clause with regard to that the shareholder is20

not an Unqualified Person, compensation clause and other covenant wordings, in addition
to information necessary for the money transfer regarding JAPEX shares into the accountsof the Shareholders Eligible for Allotment.
Furthermore, in a case where the acquisition of the Share Options held by the
Unqualified Shareholders and other acquisition-related matters are prescribed in the
Resolution for the Allotment of Share Options Without Contribution, JAPEX may takemeasures according to such provisions.
With regard to the details concerning the method of allotment, method of exercise andmethod of acquisition by JAPEX, please review the content of such details in theinformation disclosures or notifications released to the shareholders after their decision in
the Resolution of the Allotment of Share Options Without Contribution.

IV. Decision and its Reason of the Board of Directors Concerning the Plan

1. The Plan must be in accordance with the Basic Policy.
The Plan is a framework in accord with the Basic Policy that ensures our corporate value andconsequently the common interest of our shareholders, by enabling the decision-making ofshareholders concerning the acceptance of the Acquisition, or ensuring the information and timenecessary for the proposal of an alternative plan by the Board of Directors, and/or enablingnegotiation or other communication with the Acquirer on behalf of the shareholders, in theevent of Acquisition of JAPEX share certificates, etc.

2. The Plan must not be such that is detrimental to the common interest of our shareholders anddoes not serve the purpose of retaining the position of our corporate officers.
JAPEX considers the Plan to be not detrimental to the common interest of our shareholders
and that it does not serve the purpose of retaining the position of our corporate officers for thefollowing reasons:
1)

That the Plan satisfies the guiding requirements of the takeover defense measure:
The Plan satisfies the three principles (1) the principle of protecting and enhancing
corporate value and shareholders’ common interests; (2) the principle of prior disclosure andshareholders’ will; and (3) the principle of ensuring the necessity and reasonableness ofdefensive measures, set forth in the Guidelines Regarding Takeover Defense for the
Purposes of Protection and Enhancement of Corporate Value and the Shareholders’Common Interests announced by the Ministry of Economy, Trade and Industry and theMinistry of Justice on May 27, 2005.

21

2)

That the Plan respects the decision of the shareholders:
As described in III 1. “Purpose of the Renewal”, JAPEX shall conduct the Renewal,
subject to the approval of our shareholders at the Annual Shareholders’ Meeting on thedelegation of the authority to decide on the matters regarding the allotment of the Share
Options without contribution in accordance with the relevant provision of the Articles ofIncorporation.
Furthermore, in the case set forth in (g) under III 3. (1) “Procedure for the
Implementation of the Plan”, the Plan stipulates that the General Meeting of the
Shareholders for Decision Hearing be held to hear the shareholders’ decision regarding theimplementation of the Plan.
In addition, as described in III 3. (5) “Effective Period, Abolition, and Modification of thePlan”, the Plan contains a sunset provision that stipulates an effective period of
approximately three years. Alongside, even before the expiration of the effective period, if aresolution withdrawing the above delegation resolution is made at a general meeting of theshareholders or if a resolution abolishing the Plan is made by the Board of Directors, thePlan shall be abolished at that point of time. In that context, the intention of our shareholders
will be reflected on the prevalence of the Plan.

3)

Respect for the decision of the Outsider Directors and information disclosure
As described in (e) under III 3. (1) “Procedure for the Implementation of the Plan” and III
3. (2) “Requirements for the Allotment of the Share Options Without Contribution”, thepractical decisions on the operations of the Plan are executed by the Independent Committee
which only consists of Outside Directors who are independent.
Furthermore, the overview of the decision is to be disclosed to our shareholders, ensuring
the framework for a transparent operation of the Plan to serve the corporate value and thecommon interest of our shareholders.

4)

Establishment of reasonable objective requirements
As described in (e) under III 3. (1) “Procedure for the Implementation of the Plan” and III
3. (2) “Requirements for the Allotment of the Share Options Without Contribution”, the Plan
shall not be implemented if it does not meet the reasonable objective requirements, ensuring
the framework to prevent the arbitrary implementation by the Board of Directors.

5)

Hearing of opinions from third party experts
As described in (d) 2) under III 3. (1) “Procedure for the Implementation of the Plan”,
when an Acquirer emerges, the Independent Committee may receive advice from financial
advisors, certified public accountants, lawyers, certified tax accountants, consultants, and22

other experts at the expense of JAPEX. This creates a mechanism for securing fairness andobjectivity of the decisions given by the Independent Committee to a stronger degree.

6)

That the takeover defense measure is not a dead-hand or slow-hand type measure
As described in III 3. (5) “Effective Period, Abolition, and Modification of the Plan”, alarge-scale purchaser of JAPEX share certificates, etc. can appoint Directors of their own
designation in a general meeting of the shareholders and abolish this Plan through the Boardof Directors constituted of such Directors.
Therefore, the Plan is not a dead-hand type takeover defense measure (a takeover defense
measure of which implementation cannot be deterred even with the replacement of over halfof the constituting members of the Board of Directors). Furthermore, the assumption of
Directors at JAPEX does not employ the staggered system, which does not make the Plan aslow-hand type takeover defense measure (a takeover measure of which implementation
takes time to deter due to the impossibility of an all-together replacement of the constituting
members of the Board of Directors).

END

23

Separate Document 1
Flow of Procedures in the Plan
Non-conformity to the procedure of the Plan

Emergence of the Acquirer

Reception of the Intent Statement from the Acquirer

Delivery of a form of the Acquisition Statement to the Acquirer (within 10 business days
after receiving the Intent Statement)

Reception of the Acquisition Statement from the Acquirer (including additional
information)

Reviewing Period
Review by Board of Directors (60 days, in principle)

Review by Independent
Committee

Review by Independent Committee (60 days, in principle)
To be
implemented
in principle
Advisory of nonimplementation

Note 1: For other cases

Advisory of
implementation

Note 1: For certain cases
Board of Directors’
Resolution of nonimplementation

Veto

Non-implementation

Board of Directors’
Delegated Resolutionof implementation

General Meeting of the
Shareholders for Decision Hearing

Pass

Implementation(Note 1) With regard to the implementation of the allotment of the Share Options without contribution according to
the Plan, the Board of Directors may convoke a general meeting of the shareholders to hear the shareholders’ decision
regarding the implementation of the allotment of the Share Options without contribution (i) in the case where theIndependent Committee issued a reservation that shareholders’ decision be heard in advance with regard to theimplementation of the allotment of the Share Options without contribution, or (ii) where the applicability of theSecond Cause for Implementation has come into question and the Independent Committee judges it appropriate tohear the shareholders’ decision in the light of various factors such as the time required for holding the general
meeting of the shareholders and the duty of care of a good manager.
(Note 2) This flowchart was created for easy understanding of the flow of procedures in the Plan after having
simplified the content of the Plan. Please refer to the body of the press release for details of the Plan.

Separate Document 2
Overview of the Independent Committee Provision• The Independent Committee shall be established by the resolution of the Board of Directors.
• The members of the Independent Committee shall be three or more, who are appointed by the
Board of Directors from persons who are independent of management involved in business
operations of JAPEX and are any of the following: (i) Outside Director (includes persons planned
to be elected), (ii) Outside Corporate Auditor (includes persons planned to be elected), or (iii)
outside expert. However, an expert must be a proven business administrator, post-bureaucrat,
expert in investment banking, lawyer, certified public accountant, certified tax accountants, or a
researcher with his or her main field of research as corporate law or such, or must be pursuant tothe aforementioned. Furthermore, the members of the Independent Committee must enter into anagreement with JAPEX that includes provisions for the duty of care of a good manager, otherwise
designated by the Board of Director.
• The term of office for Independent Committee members shall be until the close of the ordinary
general meeting of the shareholders for the last fiscal year which ends within three years after theclose of the Annual Shareholders’ Meeting, provided that there is no resolution by the Board of
Directors otherwise determining the term. Furthermore, in case an Independent Committee
member who was an Outsider Director or Outside Corporate Auditor is no longer an Outsider
Director or Outside Corporate Auditor (excludes cases where he or she is re-elected as one), theterm of office as an Independent Committee member shall terminate at the same time.
• The Independent Committee shall decide on the matters described in the following, and issueadvisory to the Board of Directors with the content of the decision and its reasoning. The Board of
Directors shall pay utmost respect to the advisory of the Independent Committee described andadopt the resolution as a body under the Companies Act regarding the implementation or nonimplementation of the allotment of the Share Options without contribution. (However, for the
implementation of the allotment of the Share Options without contribution set forth in 1), if aresolution is otherwise adopted at the General Meeting of the Shareholders for Decision Hearing,then the Independent Committee shall abide by such resolution.) Furthermore, each member of the
Independent Committee and each Director of JAPEX is required to make such decisions from theperspective of whether it will contribute to the corporate value of JAPEX and the common interestof our shareholders, and shall not exclusively consider the personal benefits of the member or the
management.
1) Implementation or non-implementation of the allotment of the Share Options without
contribution2) Pause of allotment of the Share Options without contribution or acquisition of the Share
Options without contribution3) Other matters to be decided by the Board of Directors, which the Board of Directors seek theadvice of the Independent Committee• In addition to the above, the Independent Committee shall perform the matters listed below:
1) Judgment of whether the Acquisition falls under the object of the Plan
2) Decision on the information to be submitted to the Independent Committee by the Acquirer
and the Board of Directors and its reply deadline
3) Investigation and review on the content of the Acquisition by the Acquirer4) Consultation and/or negotiation with the Acquirer5) Request of submission of an alternative plan / Review of alternative plan to the Company’s
Board of Directors6) Decision on the extension of the Reviewing Period of the Independent Committee
7) Judgment on whether the General Meeting of the Shareholders for Decision Hearing should
be convoked with regard to the implementation or non-implementation of the allotment of the
Share Options without contribution8) Approval of the revision of or modifications to the Plan
9) Other matters prescribed in the Plan as executable by the Independent Committee10) Matters otherwise prescribed as executable by the Independent Committee at the Board of
Directors’ Meeting
・When the Independent Committee considers that the Acquisition Statement and information
provided by the Acquirer fall short as the Required Information, both the Board of Directors andthe Independent Committee shall be allowed to request the Acquirer to provide additional
information. Furthermore, when the Acquirer has submitted the Acquisition Statement and the
additional information requested by the Independent Committee, the Independent Committee may
also request as appropriate to the Board of Directors the submission of opinion on the content of
the Acquisition by the Acquirer and its supporting materials, (if available) alternative plans, andother information deemed necessary, within the prescribed period.
・The Independent Committee may disclose information received from the Acquirer to the Board of
Directors.
・The Independent Committee shall directly or indirectly hold consultations and/or negotiations
with the Acquirer and/or present the alternative plan of the Board of Directors to the shareholders,when it is necessary to improve the content of the Acquisition by the Acquirer from theperspective of ensuring and improving our corporate value and the common interest of ourshareholders.
• The Independent Committee may request the attendance of Directors, Corporate Auditors,
Executive Officers, employees, and other persons the Independent Committee deem necessary forthe collection of necessary information, and may request explanation regarding matters requestedby the Independent Committee.

• The Independent Committee may seek advice from financial advisors, certified public accountants,
lawyers, certified tax accountants, consultants, and other experts at the expense of the Company.
• Each member of the Independent Committee may convene the Independent Committee when an
Acquisition has taken place or at any other time.
• The resolution of the Independent Committee shall, in principle, be made upon the full attendance(includes attendance by TV conferences and telephone conferences; hereinafter the same applies.)of the members of the Independent Committee and with a majority vote. However, underunavoidable circumstances, a majority of the voting rights of a majority attendance shall produce
a resolution.

Separate Document 3
Brief History of Independent Committee Members
The members of the Independent Committee as of the Renewal of the Plan are planned to be thefollowing three persons:Kazuo Kawakami(Date of Birth: April 26, 1933)
CAREER
April 1958

Appointed prosecutor

January 1983

Head of Special Investigation Force, The Tokyo District Public
Prosecutors Office

September 1989

Chief of Trial Proceedings, Supreme Public Prosecutors’ Office

May 1991

Recorded attorney at the Daiichi Tokyo Bar Association (up to thepresent date)June 2007

Director at JAPEX (up to the present date)*Mr. Kazuo Kawakami is JAPEX’s Outside Director as stipulated in Article 2, Clause 15 of theCompanies Act.
*No particular relationship is existent between Mr. Kawakami and JAPEX.

Masahiko Kadotani(Date of Birth: February 14, 1936)

CAREER
April 1958

Joined the Ministry of Finance

June 1990

Director-General of the National Tax Agency

December 1994

President of the Japan Finance Corporation for Small Business

April 2002

Advisor at Mizuho Corporate Bank, Ltd.

June 2003

Corporate Auditor at JAPEX (up to the present date)*Mr. Masahiko Kadotani is JAPEX’s Outside Corporate Auditor as stipulated in Article 2, Clause 16of the Companies Act.
*No particular relationship is existent between Mr. Kadotani and JAPEX.

Keiichiro Tsuchiya(Date of Birth: December 23, 1946)

CAREER
April 1980

Lecturer of the School of Law, Meiji University

April 1986

Assistant Professor of the School of Law, Meiji University

April 1992

Professor of the School of Law, Meiji University (up to the present
date)

April 2004

Dean of the School of Law, Meiji University

April 2008

Executive Trustee at Meiji University*No particular relationship is existent between Mr. Tsuchiya and JAPEX.

Separate Document 4
Overview of Shareholding of JAPEX Shares (as of March 31, 2014)
1. Total number of authorized shares:

120,000,000

2. Total number of shares issued:

57,154,776 (including treasury shares: 2,139)

3. Number of shareholders:

17,646

4. Major shareholders (Top 10)
Rank

Name of shareholder

Stock ownership(shares)

Percentage of stocks
outstanding

1

Ministry of Economy, Trade and Industry

19,432,724

34.00%

2

INPEX Corporation

2,852,212

4.99%

3

Japan Trustee Services Bank, Ltd. (Trust)

2,231,700

3.90%

4

The Master Trust Bank of Japan, Ltd. (Trust)

2,218,700

3.88%

5

JFE Engineering Corporation

1,848,012

3.23%

6

JX Holdings, Inc.

1,149,984

2.01%

7

Mizuho Bank, Ltd.

720,152

1.26%

8

NIPPON STEEL & SUMITOMO METALCORPORATION

610,316

1.07%

9

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

600,000

1.05%

10State Street Bank and Trust Company 505103

499,167

0.87%(Note) Percentage of stocks outstanding is rounded to the nearest second decimal place.