[Translation]
February 2, 2009
To whom it may concern:
Company Name:
Representative:
Code No.:
Contact:

Tel:

Systems Engineering Laboratory Co., Ltd.
Masayuki Takahashi, Director and President
4789
Katsuya Tanaka, Operating Officer andChief of Planning Division,
Administrative Headquarters
03-6736-4789

Announcement Concerning Expression of Opinion Regarding theTender Offer for Shares of the Company by IT Holdings Corporation.
Systems Engineering Laboratory Co., Ltd. (hereinafter the “Company”) is pleased to announce thatthe Board of Directors of the Company, at its meeting held on February 2, 2009, adopted a resolution
expressing approval of a tender offer (hereinafter the “Tender Offer”) for the common shares of theCompany by IT Holdings Corporation (hereinafter the “Tender Offeror”), as described below.

1. Outline of the Tender Offeror(1)

Corporate name

IT Holdings Corporation(2)

Business

Operation and management of its subsidiary companies
and the whole group, and other incidental businesses(3)FoundedApril 1, 2008

(4)

Head office5-5, Ushijima-Shinmachi, Toyama-shi, Toyama(5)

Name and title ofSusumu Okamoto,representative

Representative Director and President(6)

Capital¥10,000,000,000 (as of April 1, 2008)(7)

Major shareholders

Japan Trustee Services Bank, Ltd.

15.9%

and shareholding ratio

The Master Trust Bank of Japan, Ltd.

11.7%

(As of September 30,

Trust & Custody Services Bank, Ltd.

3.0%

Nippon Life Insurance Company

3.0%

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

2.4%

INTEC Holdings, Ltd.

1.5%

2008) (*1)

1

Obayashi Corporation

1.3%

JCB Co., Ltd.

1.3%

Sanshin Co., Ltd.

1.3%

Citibank London Standard Life Investment Fund

1.2%

Ltd. (Standing proxy: Citibank Japan Ltd.)(8)

Relationship, etc.

Capital relationship

As of September 30, 2008, thebetween the Tender

Tender Offeror indirectly holds

Offeror and the

51.0% (1,937,000 shares) of theCompany

total shares of the Company.
(*2)
Personnel relationship

2 directors out of 4 directors and
1 company auditor out of 3
company

auditorsoftheCompany are either a company
auditor or an operating officer of
TIS Inc. (hereinafter “TIS”),
which

is

a

whollyowned

subsidiary of the Tender Offeror.
1 company auditor of 3 company
auditors of the Company is acompany auditor at TIS Solution
Business Co., Ltd. and at TIS
System Service Inc., both of
which

are

subsidiaries
Offeror.

whollyownedofTenderthe

One of the employees

at TIS, which is a wholly owned
subsidiary of the Tender Offeror,
has

been

secondedtotheCompany.
Transaction

The Company provides systems

relationshipengineering

services

which

a

is

wholly

to

TIS,
owned

subsidiary of the Tender Offeror.
Relevant party status

2

The Tender Offeror is a parent

company of the Company, and istherefore a relevant party.
(*1)
Pursuant to Article 67, Paragraph 1 of the Enforcement Regulations of the Companies Act of Japan,
exercising of the voting rights on the shares held by INTEC Holdings, Ltd. (hereinafter “INTECHD”) is restricted.
(*2)
A copy of the Report Concerning the Status on Possession of Larger Volume of Shares, etc. dated
October 7, 2008 has been delivered by the Tender Offeror and its joint holders TIS System Service
Inc., BM Consultants Inc., and TIS Leasing Co., Ltd., which reports that as of October 1, 2008, theTender Offeror has acquired 977,000 shares from TIS by an absorption-type split and is currently
holding the same.
The above-mentioned Report Concerning the Status on Possession of Larger Volume describes
shareholdings as follows:
Ratio of Shares Held to
Name/ Company Name

Address / Location

Shares Heldthe Total Number of(thousand)

Outstanding Shares(%)

IT Holdings Corporation

5-5, Ushijima-Shinmachi,
Toyama-shi, Toyama

977

25.7

340

9.0

340

9.0

280

7.4

11-30, Enoki-cho,
TIS System Service Inc.

BM Consultants Inc.

TIS Leasing Co., Ltd.

Suita-shi, Osaka

1-14-5, Kaigan, Minato-ku,
Tokyo
2-7-15,

Hamamatsu-cho,Minato-ku, Tokyo

2. Opinion concerning the Tender Offer and grounds and reasons for the opinion(1) Opinion concerning the Tender Offer

The Board of Directors of the Company, at its meeting held on February 2, 2009, adopted aresolution expressing approval of the Tender Offer by the Tender Offeror and recommending theCompany’s shareholders to tender shares in the Tender Offer.

3

(2) Grounds for the judgment that it is appropriate to recommend that the Company’s shareholders
tender shares in the Tender Offer(i) Purpose and background of the Tender Offer
The Tender Offeror was established in April 2008 as a joint holding company through a joint
share transfer for the purpose of combining the business of TIS and INTEC HD. The Tender
Offeror consists of numerous companies such as TIS and INTEC HD, which are a part of theinformation technology industry, which has an important role in the improvement of the social
infrastructure, and together form a corporate body with several comprehensive businesses(hereinafter “IT Holdings Group”). The Tender Offeror optimizes group synergy and is in theprocess of establishing a group organization that is most optimal to the maintenance of acohesive group structure.

The Company was established in 1979 for the purpose of developing software for computersmanufactured by IBM Japan Ltd. (hereinafter “IBM Japan”) for growing and midsizedcompanies. In 1990, the Company concluded a license agreement with Aspect Computing Pty.,
the copyright holder of LANSA, in connection with the exclusive right to distribute LANSA,
which is a case tool for IBM Japan’s business server AS/400 for growing and midsizedcompanies, in Japan. Thereafter, business related to LANSA has become the core business of
the Company.
The shares of the Company became listed on NASDAQ Japan (currently Hercules) of the
Osaka Securities Exchange Co., Ltd. (hereinafter the “OSE”) in 2000. In July 2001, theCompany agreed to a business and capital alliance with TIS, which is a major systems
integrator, and became a consolidated subsidiary of TIS in order to improve its position in theiSeries (an integrative application server of IBM Japan) business. Upon establishment of theTender Offeror, the Company vigorously strived to expand its business as a consolidated
subsidiary of the Tender Offeror, to become the “No.1 system provider of the iSeries.” As aresult, out of approximately 10,000 users of IBM Japan servers in Japan that are growing andmidsized companies, which are the primary target customers for the Company, more than
1,200 users have already installed LANSA. Moreover, the Company is considered to be one of
the top software companies that specialize in the iSeries software.
In today’s fast-moving and globally depressed economy, each user is faced with the need toreduce costs while improving services in order to survive intense competition. There areopportunities for the Company to expand its business since further improvement of
information technology for each user directly serves such purpose. On the other hand, options
for clients have increased concurrently with the advancement of information technology in4

recent years, and competition is intensifying for the Company.
Under such circumstances, the Tender Offeror has come to the conclusion that it is best to
merge the Company with TIS Solution Business Co., Ltd. on the target merger date (scheduled
to be July 1, 2009) after completing the Tender Offer and the procedures (described below) to
make the Company into a wholly owned subsidiary, in order to achieve quicker decision
making based on the long to middle term strategies of the entire IT Holdings Group. The
Tender Offeror expects to expand business by improving group synergies and maximizing thetotal power of the group in order to maximize the corporate value of the entire IT HoldingsGroup, as well as formulating an optimal organizational system for the IT Holdings Group in
the forthcoming interim management plan, which is being prepared at this time.
In recent years, when the economic environment around the Company as described above isbecoming increasingly difficult, the Company also understands the need to reorganize its
business more flexibly within IT Holdings Group, beyond the group of the Company, in orderto solidify the cooperative relationship with IBM Japan and business partners of IBM Japan,
and to execute “the strategy of improving clients’ satisfaction in the SE service business byutilizing its competitive superiority in the areas of LANSA, e-PACK and Pliant, all of which
are part of the package business” more precisely and effectively. Since execution of such
expedited business reorganization and maximization of group synergy are considered to benecessary for the growth of the Company in the long and middle run, as well as for the
maximization of corporate value, in order to further make use of the IT Holdings brand andthereby strengthen the systems of accepting orders, the Company has determined that
becoming a wholly owned subsidiary of the Tender Offeror (the holding company of theCompany) and merging with TIS Solution Business Co., Ltd., with which the Company is able
to mutually complement its customer base, and whose specialized solutions are compatible
with the Company’s, is the best option, and has determined to agree to the Tender Offer to belaunched by the Tender Offeror.

Note: Both AS/400 and iSeries above are similar business servers of IBM Japan for growing andmidsized companies.

(ii) Basis of calculation
In determining the tender offer price for the Tender Offer, the Tender Offeror considered theValuation Report submitted by Nomura Securities Co., Ltd. (hereinafter ”Nomura”), which is
the Tender Offeror’s financial advisor and a third party assessment entity, on January 30, 2009.
After studying calculation methods for the Tender Offer, Nomura assessed the value of sharesof the Company using each of the market average share price method, the comparable

5

company method and the discounted cash flow method (hereinafter the “DCF Method”).

According to the Valuation Report, the range of the value of a common share of the Company
is assessed based on such methods as follows:(A) Market Average Share Price Method: Ranges from JPY 180 to JPY 181
Period during which share prices were taken
Closing price of the calculation

January 30, 2009reference date
Average of the immediately

From January 28,

preceding 3 business day period

2009 to January

Per share value
JPY 180

JPY 18130, 2009
Ranges from
Calculation results

JPY 180 to JPY
181(Note): The most recent material announcement is referred to as the “Notice regarding
Revisions of the Business Performance Forecast” announced by the Company on January 27,
2009.

(B) Comparable Company Method: Ranges from JPY 240 to JPY 312(C) DCF Method: Ranges from JPY 323 to JPY 518

Under (A), the market average share price method, the share price and the volume of tradingwere observed, and the per-share value was calculated to range from JPY 180 to JPY 181 when
the average of the immediately preceding 3 business day period following the most recent
material announcement and the closing price of the reference date, which is January 30, 2009,were valuated.

Under (B), the comparable company method, the market share price and the financial
indicators indicating the profitability, etc., of listed companies engaged in comparably similarbusiness as the Company were compared, and the share value of the Company was evaluated.
The per-share value was calculated to range from JPY 240 to JPY 312.

Under (C), the DCF Method, the Company’s free cash flow expected in the future is thendiscounted at a fixed discount rate to obtain the present value, based on the expected profit of6the Company from the financial year ending in March 2009 to the financial year ending inMarch 2013, also taking into account various factors such as business plans, recent
performance and publicly available information about the Company. The corporate value aswell as the share price are analyzed with it. As a result, the per-share value was calculated torange from JPY 323 to JPY 518.

The Tender Offeror determined that it was reasonable to offer to the shareholders of theCompany a tender offer price increased by with an appropriate premium, with the market shareprice of the Company when the past cases in which a premium was attached to a tender offer
price in a tender offer offered by a person other than the issuer of the shares, the Company’s
agreement or opposition to the Tender Offer, the movement of the market price of theCompany’s shares, the future prospects of the Tender Offer and the results of consultation andnegotiation with the Company taken into consideration.

On the other hand, in consideration of the fact that the Tender Offeror is the parent company of
the Company, in order to ensure the appropriateness and fairness of the tender offer price in theTender Offer, the Company requested, independently of the Tender Offeror, SN Corporate
Advisory Co., Ltd., a third party calculation institution independent from the Company and fromthe Tender Offeror (hereinafter the “SN Corporate Advisory”), to calculate the share value of theCompany, and received from SN Corporate Advisory a Valuation Report on the share value of
the Company.

In the Valuation Report, SN Corporate Advisory calculates the share value of

the Company by means of the DCF method, market average share price method (volume
weighted average price for (a) the period commencing from the business date immediately
following January 27, 2009, on which the latest Notice regarding Revisions of the Business
Performance Forecast was announced until the basis date of calculation, January 30, 2009, andfor (b) the periods of the last one (1) month, three (3) months, and six (6) months until the basis
date of calculation), and the comparable company method.

The calculation results of the valueof the common share of the Company per share ranged from JPY 283 to JPY 356 in the DCF
method, JPY 181 to JPY 207 in the market average share price method, and JPY 269 to JPY 275
in the comparable company method.

Also, the tender offer price in the Tender Offer is (i) the closing price of the common shares of
the Company of JPY 180 in the Osaka Securities Exchange Hercules Market (hereinafter the“Hercules”) as of January 30, 2009, with an added premium of 65.56% (rounded to the second
decimal place), (ii) the simple average value of the closing price of the common shares of theCompany in the Hercules for the past one (1) month until the same date, which is JPY 191

7

(rounded off to the nearest whole number) with an added premium of about 56.02% (rounded tothe second decimal place), (iii) the simple average value of the closing price of the commonshares of the Company in the Hercules for the past three (3) months until the same date, which is
JPY 195 (rounded off to the nearest whole number) with an added premium of 52.82% (rounded
to the second decimal place), (iv) the simple average value of the closing price of the commonshares of the Company in the Hercules for the past six (6) months until the same date, which is
JPY 205 (rounded off to the nearest whole number) with an added premium of about 45.37%(rounded to the second decimal place). A premium of 49.75% (rounded to the second decimal
place) will also be added to the closing price of the common shares of the Company of JPY 199
in the Hercules as of January 27, 2009, immediately prior to the Company’s release of ”Notice
regarding Revisions of the Business Performance Forecast” as of the same date.

In light of the results of the Valuation Report by SN Corporate Advisory, and in considerationof the financial conditions of the Company, market value trends of the common shares of theCompany, and the amount of premium over the market value of the common shares of theCompany in the tender offer price in the Tender Offer, etc., the Company determined that thetender offer price of JPY 298 per common share of the Company in the Tender Offer isappropriate from a financial perspective.

(iii) Process of calculation
The Tender Offeror was established in April 2008 as a joint holding company through a joint
share transfer for the purpose of combining the business of TIS and INTEC HD. The Tender
Offeror consists of numerous companies such as TIS and INTEC which are a part of theinformation technology industry, which has an important role in the improvement of the social
infrastructure, and together form IT Holdings Group. The Tender Offeror optimizes groupsynergy and is in the process of establishing a group organization that is most optimal to themaintenance of a cohesive group structure.

In July 2001, the Company agreed to a business and capital alliance with TIS, which is a major
systems integrator, and became a consolidated subsidiary of TIS in order to improve its positionin the iSeries (an integrative application server of IBM Japan) business. Upon establishment of
the Tender Offeror, the Company vigorously strived to expand its business as a consolidated
subsidiary of the Tender Offeror to become the “No.1 system provider of the iSeries.”

In today’s rapid and worldwide recessionary economy, each user is faced with the need toreduce costs while improving services in order to survive the intense competition. There are8

opportunities for the Company to expand its business since further improvement of
information technology has been necessitated to serve such purpose. On the other hand,
options for clients have increased concurrently with the advancement of information
technology in recent years, and the competition with competitors is intensifying for theCompany.

Under such circumstances, the Tender Offeror has come to the conclusion that it is best to
merge the Company with TIS Solution Business Co., Ltd. on the target merger date scheduled
to be July 1, 2009 after completing the Tender Offer and the Procedures for Turning theCompany into a Wholly Owned Subsidiary (as defined below) to make the Company into awholly owned subsidiary in order to achieve quicker decision making based on the long to
middle term strategies of IT Holdings Group.

(A) Name of the third party whose Valuation Opinion was obtained upon calculation
In determining the tender offer price of the Tender Offer, the Tender Offeror obtained an
Evaluation Report on the value of shares of the Company from Nomura on January 30, 2009.
The Tender Offeror did not obtain an opinion on the fairness of the tender offer price (fairness
opinion) from Nomura. Nomura is an assessment entity independent of the Tender Offeror andis not a relevant party of the Tender Offeror.

(B) Summary of the Valuation Opinion
Nomura assessed the value of shares of the Company using the market average share pricemethod, the comparable company method and the DCF method, the range of per-share value
calculated for each method is as follows:

Market Average Share Price Method:
Ranges from JPY 180 to JPY 181
Comparable Company Method:
Ranges from JPY 240 to JPY 312
DCF Method:
Ranges from JPY 323 to JPY 518(C) Process of determining the Tender Offer Price in consideration of the Valuation Opinion
In consideration of the calculation result of each method in the Valuation Report, the Tender
Offeror determined that it is reasonable to offer to the shareholders of the Company a tender
offer price that is increased by an appropriate premium, with the market share price of the9Company when the past cases in which a premium was attached to a tender offer price in atender offer offered by a person other than the issuer of the shares, the Company’s agreement
or opposition to the Tender Offer, the movement of the market price of the Company’s shares,
the future prospects of the Tender Offer and the results of consultation and negotiation with theCompany, etc. taken into consideration. It was determined at the Tender Offeror’s Board of
Directors’ meeting held on February 2, 2009 that the tender offer price per share at the Tender
Offer would be JPY 298.

On the other hand, in consideration of the fact that the Tender Offeror is the parent company of
the Company, in order to ensure appropriateness and fairness in the tender offer price in theTender Offer, the Company requested, independently of the Tender Offeror, SN Corporate
Advisory, a third party calculation institution independent from the Company and from theTender Offeror, to calculate the share value of the Company, and received from SN Corporate
Advisory on January 30, 2009 a Valuation Report on the share value of the Company.

The

Company has not obtained from SN Corporate Advisory any opinion concerning fairness in thetender offer price in the Tender Offer (fairness opinion).

In the Valuation Report, SN Corporate

Advisory calculates the share value of the Company by means of the DCF method, market
average share price method (volume weighted average price for (a) the period commencing fromthe business date immediately following January 27, 2009, on which the latest Notice regarding
Revisions of the Business Performance Forecast was announced, until the basis date ofcalculation, January 30, 2009, and for (b) the periods of the last one (1) month, three (3) months,
and six (6) months until the basis date of calculation), and the comparable company method.
The calculation results of the value of the common share of the Company per share ranged from
JPY 283 to JPY 356 in the DCF method, JPY 181 to JPY 207 in the market average share pricemethod, and JPY 269 to JPY 275 in the comparable company method.

Also, the tender offer price in the Tender Offer is (i) the closing price of the common share of
the Company of JPY 180 in the Hercules as of January 30, 2009 with an added premium of
about 65.56% (rounded to the second decimal place), (ii) the simple average value of the closing
price of the common share of the Company in the Hercules for the past one (1) month until thesame date, which is JPY 191 (rounded off to the whole number) with an added premium of
about 56.02% (rounded to the second decimal place), (iii) the simple average value of theclosing price of the common share of the Company in the Hercules for the past three (3) months
until the same date, which is JPY 195 (rounded off to the whole number) with an added
premium of about 52.82% (rounded to the second decimal place), (iv) the simple average valueof the closing price of the common share of the Company in the Hercules for the past six (6)10months until the same date, which is JPY 205 (rounded off to the whole number) with an added
premium of about 45.37% (rounded to the second decimal place). Premium of about 49.75%(rounded to the second decimal place) will also be added to the closing price of the commonshare of the Company of JPY 199 in the Hercules as of January 27, 2009 immediately prior to
the Company’s release of ”Notice regarding Revisions of the Business Performance Forecast” asof the same date.

As a result of discussions and negotiations with the Tender Offeror, and in light of the results of
the Valuation Report by SN Corporate Advisory, the Board of Directors of the Company
determined at its meeting held on February 2, 2009 that, in consideration of the financial
conditions of the Company, market value trends of the common shares of the Company, and theamount of premium over the market value of the common shares of the Company in the tender
offer price in the Tender Offer, etc., the tender offer price of JPY 298 per common share of theCompany in the Tender Offer is appropriate from a financial perspective, and in consideration of
the conditions described in (3) (ii) below, decided, upon agreeing with the Tender Offer, torecommend that the shareholders of the Company tender shares in the Tender Offer.

(iv) Relationship with calculation institution
Neither Nomura nor SN Corporate Advisory is applicable as a relevant party of the Tender
Offeror or the Company.

(3) Measures to ensure fairness in the tender offer price, etc. and to prevent conflicts of interest in
the Tender Offer

The Company is a consolidated subsidiary of the Tender Offeror, and thus the Company and theTender Offeror have made the following efforts to ensure fairness in the tender offer price, etc. andto prevent conflicts of interest in the Tender Offer:(i) Measures to secure the fairness of the tender offer priceIn order to secure the fairness of the tender offer price for the shares of the Company in theTender Offer, the Tender Offeror obtained the Valuation Report from Nomura, which is a third
party assessment entity independent of the Tender Offeror and the Company, in order todetermine the tender offer price. However, the Tender Offeror did not obtain an opinion on thefairness of the tender offer price (fairness opinion) from Nomura. The tender offer price of JPY
298 per share has been determined after comprehensive consideration of Nomura’s Valuation
Report, the past cases in which a premium was attached to a tender offer price in a tender offer

11

offered by a person other than the issuer of the shares, the Company’s agreement or opposition
to the Tender Offer, the movement of the market price of the Company’s shares, the future
prospects of the Tender Offer and the result of the consultation and negotiation with theCompany, etc.

On the other hand, in consideration of the fact that the Tender Offeror is the parent company of
the Company, in order to ensure appropriateness and fairness in the tender offer price in theTender Offer, the Company requested, independently of the Tender Offeror, SN Corporate
Advisory, a third party calculation institution independent from the Company and from theTender Offeror, to calculate the share value of the Company, and received from SN Corporate
Advisory the Valuation Report on the share value of the Company.

The Company has not

obtained from SN Corporate Advisory any opinion concerning fairness in the tender offer pricein the Tender Offer (fairness opinion). We have relied on the Valuation Report in determining
whether to agree with the Tender Offer.

In the Valuation Report, SN Corporate Advisorycalculated the share value of the Company by means of the DCF method, market average shareprice method (volume weighted average price for (a) the period commencing from the businessdate immediately following January 27, 2009, on which the latest Notice regarding Revisions of
the Business Performance Forecast is announced, and until the basis date of calculation, whichshall be January 30, 2009, and for (b) the periods of the last one (1) month, three (3) months,
and six (6) months until the basis date of calculation), and the comparable company method.
The calculation results of the value of the common share of the Company per share ranged from
JPY 283 to JPY 356 in the DCF method, JPY 181 to JPY 207 in the market average share pricemethod, and JPY 269 to JPY 275 in the comparable company method.

In light of the results of the Valuation Report by SN Corporate Advisory, and taking into
account legal advice from the Company’s legal advisor City-Yuwa Partners regarding thelegality of the tender offer procedures and the appropriateness of the decisions of the Board of
Directors of the Company as to such decisions, the Company determined that, in considerationof the financial conditions of the Company, market value trends of the common shares of theCompany, and the amount of premium over the market value of the common shares of theCompany in the tender offer price in the Tender Offer, etc., the tender offer price of JPY 298 percommon share of the Company in the Tender Offer is appropriate from a financial perspective.

Furthermore, by setting 30 business days as a tender offer period for the Tender Offer, theTender Offeror allows other purchasers the opportunity to purchase the shares of the Company.
In this way, the Tender Offeror also assures the fairness of the Tender Offer.

12

(ii) Measures to prevent conflicts of interest in the Tender Offer
In consideration of the fact that the Tender Offeror is the parent company of the Company, inorder to ensure fairness in the discussions and negotiations, etc. between the Tender Offeror andthe Company regarding the Tender Offer and to encourage the transparency and objectivity ofthe transactions, the Company requested SN Corporate Advisory, a third party calculation
institution independent from the Company and from the Tender Offeror, to calculate the sharevalue of the Company, and received from SN Corporate Advisory on January 30, 2009 theValuation Report on the share value of the Company.

Also, the Company received legal advice

from its legal advisor City-Yuwa Partners regarding the legality of the tender offer procedures
and the appropriateness of the decisions of the Board of Directors of the Company as of this date,
and taking into account such advice and the results of discussions and negotiations with theTender Offeror, the Company carefully evaluated the conditions of the Tender Offer at themeeting of the Board of Directors held on February 2, 2009.

As a result of careful evaluation, the Board of Directors of the Company has determined that,as described in (2) (iii) and (3) (i) above, the conditions of the Tender Offer, including the tender
offer price are reasonable, that the Tender Offer offers an opportunity for the shareholders of theCompany to sell their shares of the Company at a reasonable price, and that implementation of
the Tender Offer and the procedures to make the Company a wholly owned subsidiary of theTender Offeror, as expected after the completion of the Tender Offer will contribute to thereinforcement of the business infrastructure of the Company, the restructuring of the Company’sbusiness, and future development of the Company, thereby realizing medium and long term
growth and maximization of the corporate value of the Company.

Therefore, the Board of

Directors of the Company decided, upon agreeing with the Tender Offer, to recommend that theshareholders of the Company tender shares in the Tender Offer.

The resolution at the meetingof the Board of Directors of the Company was made with the unanimous consent of theparticipating directors.

In order to prevent conflict of interests between the Tender Offeror and the Company, two of
the directors of the Company, Mr. Yasuo Goto and Mr. Akira Kato, who are operating officers of
TIS, a wholly owned subsidiary of the Tender Offeror, did not participate in the discussions andresolution at the meeting of the Board of Directors described above, and did not participate in
the discussions and negotiations with the Tender Offeror (in its capacity as a director of theCompany), on the ground that they are in a position to be able to take part in the Tender Offer.

13

Among the company auditors of the Company, Mr. Kazumoto Onizuka, who is a full-time
company auditor of the Company, has expressed his agreement with the Company’s Board of
Directors’ decision to agree to the Tender Offer.

Other company auditors of the Company, Mr.

Osamu Takemura and Mr. Yasuaki Kawamura did not participate in the discussion of the Tender
Offer at the Board of Directors’ meeting

based on the facts that Mr. Takemura is also a

company auditor at TIS (a wholly owned subsidiary of the Tender Offeror) and that Mr.
Kawamura is also a company auditor at TIS Solution Business Co., Ltd. and TIS System Service,
Inc. (wholly owned subsidiaries of the Tender Offeror).

(4) Future acquisition of the shares of the Company by the Tender Offeror after the Tender Offer(Items on So-called Two-Tier Buyout)

As provided above, the Tender Offeror will launch the Tender Offer for the acquisition of allissued shares of the Company (excluding shares that the Tender Offeror already owns ortreasury shares owned by the Company) for the purpose of making the Company into a wholly
owned subsidiary of the Tender Offeror. In this Tender Offer, the Tender Offeror has not set
any maximum or minimum number of shares to be purchased; therefore, the Tender Offeror
intends to purchase all shares tendered for sale. If the Tender Offeror is unable to acquire allissued shares of the Company (exclusive of treasury shares and shares of the Company that theTender Offeror already owns) through the Tender Offer, the Tender Offeror plans to proceedwith the acquisition of all issued shares of the Company (exclusive of treasury shares) after
completion of the Tender Offer while continuing to provide to shareholders of the Company
other than the Tender Offeror opportunities to sell their shares through the following methods(hereinafter the “Procedures for Turning the Company into a Wholly Owned Subsidiary”).

Specifically, after completion of the Tender Offer, the Tender Offeror intends to request theCompany to: (i) amend a part of the Company’s Articles of Incorporation to designate theCompany as a corporation with class shares, as provided under the Companies Act of Japan;(ii) amend a part of the Company’s Articles of Incorporation, as amended under (i), to stipulate
a provision that allows the Tender Offeror to call on all of its common shares that the Tender
Offeror issued (hereinafter the “Wholly Call,” as provided in Article 108 (1) (vii) of theCompanies Act; (iii) issue shares of the Company that are different in class in exchange foracquisition of all shares subject to the Wholly Call; and (iv) hold an extraordinary general
meeting of shareholders in which (i) , (ii) and (iii) above are submitted as proposals(hereinafter the “Extraordinary General Meeting of Shareholders”). In regard to proceedingwith the Procedures for Turning the Company into a Wholly Owned Subsidiary, if (i) above is

14

approved at the Extraordinary General Meeting of Shareholders, the Company will become acorporation with class shares, as provided under the Companies Act. However, in order toapprove(ii) above, a general meeting of class shareholders, which members consist ofholders of common shares of the Company that are subject to the Wholly Call, must be held
pursuant to Article 111 (2) (i) of the Companies Act (hereinafter the “Class Meeting”) in
addition to the Extraordinary General Meeting of Shareholders. Therefore, the Tender Offeror
plans to request the Company to hold the Extraordinary General Meeting of Shareholders andthe Class Meeting on the same day. The Tender Offeror plans to agree to the abovementioned
proposals at the Extraordinary General Meeting of Shareholders and the Class Meeting.

If the above proposals are approved, all common shares issued by the Company become
subject to the Wholly Call, and all such shares (exclusive of treasury shares) will be acquiredby the Company. The shareholders of the Company will be compensated by receiving a
different class of shares issued by the Company. If issuance of the different class of shares as
consideration for acquisition of all shares results in any fractional shares, the amount of cash
obtained by selling the sum of all such fractional shares (including instances where theCompany purchases all or part of such shares) (provided that any fraction resulting from suchsummation of fractional shares is dropped; the same shall apply hereinafter) is expected to beprovided to the shareholders of such fractional shares pursuant to Article 234 of the Companies
Act and other relevant regulations. The purchase price for the sum of such fractional shares orthe amount of cash to be provided to the shareholders as a result of sales are expected to be
calculated based on the tender offer price, unless there are special circumstances. However,such price may be different from the tender offer price because the purchase price or theamount of cash is calculated at a different time. Although the class and the number of shares of
the Company to be issued in exchange for the common shares of the Company subject to theWholly Call have not been determined, the Tender Offeror plans to request the Company tocoordinate so that the Tender Offeror will own all issued shares of the Company (exclusive oftreasury shares) and so that the shares of the Company to be issued to the shareholders of theCompany other than the Tender Offeror will be fractional.

For the purpose of protecting the rights of minority shareholders, pertaining to the above
procedures (i) through (iv), the Companies Act provides that: (A) upon amendment of the
Articles of Incorporation to make the common shares of the Company subject to the Wholly
Call as provided in (ii) above, any objecting shareholders may make a claim to have the Tender
Offeror purchase their shares pursuant to Articles 116 and 117 of the Companies Act and otherrelevant regulations; and (B) if the Extraordinary General Meeting of Shareholders passes a15

resolution for acquisition of all shares subject to the Wholly Call as provided in (iii) above, theshareholders may petition to have their shares appraised pursuant to Article 172 of theCompanies Act and other relevant regulations. In either (A) or (B), since a court is entitled to
finally determine the per-share purchase price or acquisition price, such prices may be different
from the tender offer price. Shareholders are responsible for checking and ascertaining theprocedures available to them in order to make such claim or petition. Depending on theinterpretation, etc. of relevant regulations by the authoritative government agencies, the Tender
Offeror’s Shareholding Ratio after the Tender Offer, or the shareholding by shareholders of theCompany other than the Tender Offeror after the Tender Offer, etc., the Tender Offeror may
employ other methods in addition to the procedures (i) through (iv) above to effect the same
result. However, even in such cases, the Tender Offeror plans to arrange to provide a cash
amount as consideration for the shares of the Company, so that the Tender Offeror will own all
issued shares of the Tender Offeror (exclusive of treasury shares). Similarly, although the cash
amount to be provided to the shareholders of the Company in this case will be calculated basedon the tender offer price, it may be different from the tender offer price.

The Tender Offer will not solicit approval of the shareholders of the Company at theExtraordinary General Meeting of Shareholders and at the Class Meeting. Shareholders aresolely responsible for checking with tax experts in regard to tax issues that may arise from theProcedures for Turning the Company into a Wholly Owned Subsidiary, or with respect tomaking a claim to have the Tender Offeror purchase their shares through such procedures.

Further, the Company has resolved at the meeting of the Board of Directors held on February 2,
2009, that the Company will not pay any year-end dividend with a record date of March 31,
2009, on the condition that the Tender Offer is successfully completed, so as to avoid
differences in the financial results of shareholders who tendered shares in the Tender Offer andshareholders who did not.

(5) Expected delisting(i) Expected delisting and the reasons for the expected delisting
Currently, the shares of the Company are listed on the Hercules. Since the Tender Offer does
not set a maximum number of shares to be purchased, the shares of the Company may bedelisted from Hercules through certain prescribed procedures pursuant to the delisting standardsof the OSE after completion of the Tender Offer, depending on the result of the Tender Offer.
Even if the result of the Tender Offer does not meet such delisting standards, the shares of the16Company are likely to be delisted through certain prescribed procedures pursuant to the OSE’sdelisting standards, because the Tender Offeror is expected to own all issued shares of theCompany (exclusive of treasury shares) after the implementation of the Procedures for Turning
the Company into a Wholly Owned Subsidiary following the completion of the Tender Offer.
After delisting, the shares of the Company may no longer be traded on Hercules.

(ii) Reasons for recommending the subscription of the Tender Offer with the expected delisting
and review of alternative measures
The Company, as stated in (2) (i) above, has determined that in order for the Company tocontinue to develop its business, it is necessary to enhance the Company’s credibility to outside
parties and reinforce its business infrastructure by having the Tender Offeror make the Company
its wholly owned subsidiary.

The Company believes that by becoming a wholly owned

subsidiary of the Tender Offeror, the Company will be able to build a system under which
necessary decisions can be made promptly and efficiently by management, taking into accountthe

medium to long term perspective, to enhance the corporate value of the Company.

The Tender Offeror optimizes group synergy and is in the process of establishing a grouporganization that is most optimal to the maintenance of a cohesive group structure. In today’s
fast-moving and globally depressed economy, the Tender Offeror is committed to quicker
decision making based on the long to middle term strategies of the entire IT Holdings Group inorder to improve corporate value. Under such strategies and for the purpose of pursuingsynergies for the entire IT Holdings Group, and to achieve closer communication between theTender Offeror and the Company in the long to middle term, the Tender Offeror determined thatturning the Company into a wholly owned subsidiary of the Tender Offeror is desirable. The
purpose of the Tender Offer and the Procedures for Turning the Company into a Wholly Owned
Subsidiary is not to delist the shares of the Company, but to provide opportunities for theshareholders of the Company to receive cash amounts as consideration for the shares of theCompany, because the shares are expected to be delisted as part of the process of turning theCompany into a wholly owned subsidiary.

Therefore, the Company has decided to recommend that the shareholders of the Company
tender shares in the Tender Offer, after the agreement to the Tender Offer by the Tender Offeror,
which will result in the delisting of shares of the Company.

If the common shares of the Company are delisted, the shares will not be traded on the
Hercules.

17

To protect the interests of the Company’s minority shareholders, the Tender Offeror intends tooffer the Company’s shareholders (other than the Tender Offeror) opportunities to sell the
Company’s shares through the procedures described in (4) above, as an alternative measure thatcan be taken prior to delisting. Although the amount of cash to be delivered to the Company’s
shareholders (again, other than the Tender Offeror) in the process of Turning the Company intoa Wholly Owned Subsidiary of the Tender Offeror is scheduled to be calculated based on thetender offer price for the common shares in the Tender Offer, the amount may differ from thetender offer price in the Tender Offer.

(6) Items related to the important agreements pertaining to the acceptance of the Tender Offer
between the Tender Offeror and the shareholders of the Company

As of today, the Tender Offeror has concluded the Tender Offer Acceptance Agreement withTDK Corporation, which is the major shareholder of the Company, and obtained TDK’s
agreement to accept the Tender Offer as to the 450,000 shares of the Company owned by TDK.

The Tender Offeror has also obtained agreements from TIS System Service Inc., BM
Consultants Inc. and TIS Leasing Co., Ltd., all of which are subsidiaries of the Tender Offeror,to accept the Tender Offer as to all shares owned by them (340,000 shares, 340,000 shares,
280,000 shares respectively; totaling 960,000 shares).

(7) Prospects of Company after the Tender Offer and after the Company becomes a wholly owned
subsidiary

The Tender Offeror believes that this business merger by way of merger with TIS Solution
Business Co., Ltd. after completionof the Tender Offer and the Company’s becoming thewholly owned subsidiary of the Tender Offeror, with the resulting collaboration of management
resources, will enable (a) prompt management decisions based on the medium and long termbusiness strategies of the whole IT Holdings Group and (b) the growth of the overall business by
fully realizing the combined potential from group synergy effects, which will result in the
improvement of the corporate value of the Company.

3. Content of offer of interest by the Tender Offeror or its specially related parties
Not applicable184. Policies for handling the basic policy regarding the rules of the Company
Not applicable

5. Questions to the Tender Offeror
Not applicable

6. Request for extension of the Tender Offer period
Not applicable

7. Summary of purchase, etc. by the Tender Offeror
Please refer to the attached materials.

19

（ATTACHMENT）[English Version]
February 2, 2009
Company Name: IT Holdings Corporation(Code No.: 3626, First Section of the Tokyo Stock Exchange)
Representative: Susumu Okamoto, Representative Director / President
Contact:
Iwao Sakuma, General Manager Public Relations
Department(Tel: 03-6738-7557)

Commencement of Tender Offer for Shares of
Systems Engineering Laboratory Co., Ltd., a Subsidiary of IT Holdings Corporation
IT Holdings Corporation (hereinafter the “Tender Offeror” or the “Company”) hereby
announces that the Board of Directors of the Company passed a resolution to acquire sharesof Systems Engineering Laboratory Co., Ltd. (Code No.: 4789, Osaka Securities ExchangeCo., Ltd. Hercules Market, hereinafter the “Target”) through a tender offer (hereinafter the“Tender Offer”) at its Board of Directors’ meeting held on February 2, 2009. The Company
plans to turn the Target into its wholly owned subsidiary by the Tender Offer and otherprocedures following the Tender Offer. In such event, the shares of the Target are expected to
be delisted. Any reference to “shares” herein refers to rights that are generally indicated onshare certificates, etc. including if share certificates are not issued for such shares (, as in thecase of, electronic shares).
1.

Purpose of the Tender Offer(1) Summary of the Tender Offer
The Company currently owns 977,000 common shares of the Target (25.74% of
the shareholding ratio against all issued shares, excluding treasury shares heldby the Target (hereinafter the “Shareholding Ratio”, provided that any fractionof less than a thousandth digit is rounded up or down to the closest hundredth
digit)) and the Company indirectly holds 960,000 shares (25.29% Shareholding
Ratio), totaling 1,937,000 shares (51.02% Shareholding Ratio), and the Target
is designated as a consolidated subsidiary of the Company. At this time, theCompany is launching a tender offer for the purpose of acquiring all issued
shares of the Target excluding shares already owned by the Company andtreasury shares owned by the Target.
1(2) Purpose and Background of Tender Offer
The Company was established in April 2008 as a joint holding company
through a joint share transfer for the purpose of combining the businesses of
TIS Inc. (hereinafter “TIS”) and INTEC Holdings, Ltd. (hereinafter “INTECHD”). The Company consists of numerous companies such as TIS and INTEC,
Inc., which are a part of the information technology industry, which has animportant role in the improvement of the social infrastructure, and together
form a corporate body with several comprehensive businesses (hereinafter “IT
Holdings Group”). The Company optimizes group synergy and is in the processof establishing a group organization that is most optimal to the maintenance ofa cohesive group structure.
The Target was established in 1979 for the purpose of developing software forcomputers manufactured by IBM Japan Ltd. (hereinafter “IBM Japan”) for
growing and midsized companies. In 1990, the Target concluded a license
agreement with Aspect Computing Pty., the copyright holder of LANSA, which
is a case tool for IBM Japan’s business server AS/400 for growing and midsizedcompanies in connection with the exclusive right to distribute LANSA, inJapan. Thereafter, business related to LANSA has become the core business of
the Target.
The shares of the Target became listed on NASDAQ Japan (currently Hercules)of the Osaka Securities Exchange Co., Ltd. (hereinafter the “OSE”) in 2000. In
July 2001, the Target agreed to a business and capital alliance with TIS, which
is a major systems integrator, and became a consolidated subsidiary of TIS inorder to improve its position in the iSeries (an integrative application server of
IBM Japan) business. Upon establishment of the Company, the Target
vigorously strived to expand its business as a consolidated subsidiary of theCompany, to become the “No.1 system provider of the iSeries.” As a result, outof approximately 10,000 users of IBM Japan servers in Japan that are growing
and midsized companies, which are the primary target customers for the Target,
more than 1,200 users have already installed LANSA. Moreover, the Target isconsidered to be one of the top software companies that specialize in the iSeries
software.
In today’s fast-moving and globally depressed economy, each user is faced with
the need to reduce costs while improving services in order to survive intensecompetition. There are opportunities for the Target to expand its business sincefurther improvement of information technology for each user directly serves
2such purpose. On the other hand, options for clients have increased
concurrently with the advancement of information technology in recent years,
and competition is intensifying for the Target.
Under such circumstances, the Company has come to the conclusion that it isbest to merge the Target with TIS Solution Business Co., Ltd. on the target
merger date (scheduled to be July 1, 2009), by completing the Tender Offer andthe procedures (described below) to make the Target into a wholly owned
subsidiary, in order to achieve quicker decision making based on the long to
middle term strategies of the entire IT Holdings Group. The Company expects
to expand business by improving group synergies and maximizing the total
power of the group in order to maximize the corporate value of the entire IT
Holdings Group, as well as to formulate an optimal organizational system for
the IT Holdings Group in the forthcoming interim management plan, which is
being prepared at this time for future implementation.
In recent years, when the economic environment around the Target as describedabove is becoming increasingly difficult, the Target also understands the needto reorganize its business more flexibly within IT Holdings Group, beyond thegroup of the Target, in order to solidify the cooperative relationship with IBM
Japan and business partners of IBM Japan, and to execute “the strategy ofimproving clients’ satisfaction in the SE service business by utilizing its
competitive superiority in the areas of LANSA, e-PACK and Pliant, all ofwhich are part of the package business” more precisely and effectively. Since
execution of such expedited business reorganization and maximization of groupsynergy are necessary for the growth of the Target in the long and middle run,as well as for the maximization of corporate value, the Target has determinedthat becoming a wholly owned subsidiary of the Company (the holding
company of the Target) in order to make use of the IT Holdings Group brandfurther and strengthen its systems, under which orders are received, andmerging with TIS Solution Business Co., Ltd., which has a customer base thatmutually supports the customer base of the Target and specializes in solutions
compatible with the solutions that the Target specializes in, is the best option,and has determined to agree to the Tender Offer to be launched by theCompany.
Note: Both AS/400 and iSeries above are similar business servers of IBM Japanfor growing and midsized companies.
3(3) Policies on Organizational Restructuring, etc. after the Tender Offer (Items on
So-called Two-Tier Buyout)
As provided above, the Company will launch the Tender Offer for acquisitionof all issued shares of the Target (excluding shares already owned by theCompany and treasury shares owned by the Target) for the purpose of making
the Target into a wholly owned subsidiary of the Company. In this Tender Offer,
the Company does not set any maximum or minimum number of shares to bepurchased; therefore, the Company intends to purchase all shares tendered forsale. If the Company is unable to acquire all issued shares of the Target(exclusive of treasury shares) through the Tender Offer, the Company plans toproceed with the acquisition of all issued shares of the Target (exclusive oftreasury shares) after completion of the Tender Offer while continuing toprovide to shareholders of the Target other than the Company opportunities tosell their shares through the following methods (hereinafter the “Procedures for
Turning the Target into a Wholly Owned Subsidiary”).
Specifically, after completion of the Tender Offer, the Company intends torequest the Target to: (i) amend a part of the Target’s Articles of Incorporation
to designate the Target as a corporation with class shares, as provided under theCompanies Act of Japan; (ii) amend a part of the Target’s Articles ofIncorporation, as amended under (i), to stipulate a provision applicable tocommon shares that allows the Company to call on all of its common sharesthat the Company issued (as provided in Article 108 (1) (vii) of the Companies
Act; hereinafter the “Wholly Call”); (iii) issue shares of the Target that are
different in class in exchange for acquisition of all shares subject to the Wholly
Call; and (iv) hold an extraordinary general meeting of shareholders in which(i), (ii) and (iii) above are submitted as proposals (hereinafter the“Extraordinary General Meeting of Shareholders”). In regard to proceedingwith the Procedures for Turning the Target into a Wholly Owned Subsidiary, if(i) above is approved at the Extraordinary General Meeting of Shareholders, theTarget will become a corporation with class shares, as provided under theCompanies Act. However, in order to approve (ii) above, a general meeting ofclass shareholders, which members consist of holders of common shares of theTarget that are subject to the Wholly Call, must be held pursuant to Article 111(2) (i) of the Companies Act (hereinafter the “Class Meeting”) in addition to theExtraordinary General Meeting of Shareholders. Therefore, the Company plansto request the Target to hold the Extraordinary General Meeting of Shareholders
and the Class Meeting on the same day. The Company plans to agree to theabovementioned proposals at the Extraordinary General Meeting of4

Shareholders and the Class Meeting.
If the above proposals are approved, all common shares issued by the Target
become subject to the Wholly Call, and all such shares (exclusive of treasury
shares) will be acquired by the Target. The shareholders of the Target will becompensated by receiving a different class of shares issued by the Target. If
issuance of the different class of shares as consideration for acquisition of allshares results in any fractional shares, the amount of cash obtained by sellingthe sum of all such fractional shares (including instances where the Target
purchases all or part of such shares) (provided that any fraction resulting fromsuch summation of fractional shares is dropped; the same shall apply
hereinafter) is expected to be provided to the shareholders of such fractional
shares pursuant to Article 234 of the Companies Act and other relevant
regulations. The purchase price for the sum of such fractional shares or theamount of cash to be provided to the shareholders as a result of sales are
expected to be calculated based on the tender offer price, unless there are
special circumstances. However, such price may be different from the tender
offer price because the purchase price or the amount of cash is calculated at adifferent time. Although the class and the number of shares of the Target to beissued in exchange for the common shares of the Target subject to the Wholly
Call have not been determined, the Company plans to request the Target tocoordinate so that the Company will own all issued shares of the Target(exclusive of treasury shares) and so that the shares of the Target to be issued tothe shareholders of the Target other than the Company will be fractional.
For the purpose of protecting the rights of minority shareholders, pertaining to
the above procedures (i) through (iv), the Companies Act provides that: (A)upon amendment of the Articles of Incorporation to make the common sharesof the Target subject to the Wholly Call as provided in (ii) above, any objecting
shareholders may make a claim to have the Company purchase their sharespursuant to Articles 116 and 117 of the Companies Act and other relevant
regulations; and (B) if the Extraordinary General Meeting of Shareholders
passes a resolution for acquisition of all shares subject to the Wholly Call as
provided in (iii) above, the shareholders may petition to have their shares
appraised pursuant to Article 172 of the Companies Act and other relevant
regulations. In either (A) or (B), since a court is entitled to finally determine theper-share purchase price or acquisition price, such prices may be different fromthe tender offer price. Shareholders are responsible for checking andascertaining the procedures available to them in order to make such claim or5petition. Depending on the interpretation, etc. of relevant regulations by theauthoritative government agencies, the Company’s Shareholding Ratio after theTender Offer, or the shareholding by the shareholders of the Target other thanthe Company after the Tender Offer, etc., the Company may employ othermethods in addition to the procedures (i) through (iv) above to effect the same
result. However, even in such cases, the Company plans to arrange to provide acash amount as consideration for the shares of the Target, so that the Company
will own all issued shares of the Target (exclusive of treasury shares). Similarly,
although the cash amount to be provided to the shareholders of the Target inthis case will be calculated based on the tender offer price, it may be different
from the tender offer price.
The Tender Offer will not solicit approval of the shareholders of the Target atthe Extraordinary General Meeting of Shareholders and at the Class Meeting.
Shareholders are responsible for checking with tax experts in regard to tax
issues that may arise from the Tender Offer, the Procedures for Turning theTarget into a Wholly Owned Subsidiary, or with respect to making a claim tohave the Company purchase their shares through such procedures.
(4) Expected Delisting and Such Events
Currently, the shares of the Target are listed on the OSE Hercules Market(hereinafter “Hercules”). Since the Tender Offer does not set a maximum
number of shares to be purchased, the shares of the Target may be delisted from
Hercules through certain prescribed procedures pursuant to the delisting
standards of the OSE after completion of the Tender Offer, depending on the
result of the Tender Offer. Even if the result of the Tender Offer does not meetsuch delisting standards, the shares of the Target are likely to be delisted
through certain prescribed procedures pursuant to the OSE’s delisting standards,
because the Company is expected to own all issued shares of the Target(exclusive of treasury shares) after the implementation of the Procedures for
Turning the Target into a Wholly Owned Subsidiary following the completionof the Tender Offer. After delisiting, the shares of the Target may no longer be
traded on Hercules.
(5) Reason for Delisting
The Company optimizes group synergy and is in the process of establishing agroup organization that is most optimal to the maintenance of a cohesive groupstructure. In today’s fast-moving and globally depressed economy, theCompany is committed to quicker decision making based on the long to middle
6term strategies of the entire IT Holdings Group in order to improve corporate
value. Under such strategies and for the purpose of pursuing synergies within
the entire IT Holdings Group, and achieving closer communication between the
Company and the Target in the long to middle run, the Company determinedthat turning the Target into a wholly owned subsidiary is desirable.
The purpose of the Tender Offer and the Procedures for Turning the Target intoa Wholly Owned Subsidiary is not to delist the shares of the Target, but toprovide opportunities for the shareholders of the Target to receive cash amounts
as consideration for the shares of the Target, which are to be delisted, as part ofthe process of turning the Target into a wholly owned subsidiary.
(6) Measures to Assure Fairness of the Tender Offer Price and Measures to Prevent
any Conflicts of Interest
In order to assure the fairness of the tender offer price for the shares of theTarget, the Company has obtained and examined a statement of share value
assessment (hereinafter the “Valuation Report”) from Nomura Securities Co.,
Ltd. (hereinafter “Nomura”), which is a financial advisor to the Company, as
well as a third party assessment entity independent of the Company and theTarget as part of determining the tender offer price. The tender offer price of
JPY 298 per share has been determined after comprehensive consideration of
Nomura’s Valuation Report, the past cases in which a premium was attached toa tender offer price in a tender offer offered by a person other than the issuer ofthe shares, the Target’s agreement or opposition to the Tender Offer, themovement of the market price of the Target’s shares, the future prospects of theTender Offer and the results of consultation and negotiation with the Target, etc.
The tender offer price of JPY 298 was calculated by: (a) adding a premium of
56.02% (any fraction less than a thousandth digit is rounded up or down to theclosest hundredth digit) on JPY 191 (any fraction is rounded up or down to theclosest whole number), which is the simple average of closing prices of regulartransactions for the shares of the Target on Hercules for the period of one
month ending on January 30, 2009; (b) adding a premium of 52.82% (anyfraction less than a thousandth digit is rounded up or down to the closest
hundredth digit) on JPY 195 (any fraction is rounded up or down to the closest
whole number), which is the simple average of closing prices of regulartransactions for the shares of the Target on Hercules for the period of 3 months
ending on January 30, 2009; and (c) adding a premium of 65.56% (any fraction
less than a thousandth digit is rounded up or down to the closest hundredth
digit) on JPY 180, which is the closing price of regular transactions for the7shares of the Target on Hercules on January 30, 2009.
Since the Company is a holding company of the Target, the Target hasrequested SN Corporate Advisory Co., Ltd. (hereinafter “SN Corporate
Advisory”), which is a third party assessment entity independent of theCompany and the Target, to assess the value of shares of the Target in order toassure the fairness of the consultation and negotiation procedures between the
Company and the Target pertaining to the Tender Offer and to improve thetransparency and the objectivity of the transaction. The Target obtained thereport on valuation of shares from SN Corporate Advisory on January 30, 2009.
With regard to the legality of the tender offer procedures and theappropriateness of management’s decision at the time of passing the resolution
at the Board of Directors’ meeting of the Target, the Target obtained legal
advice from City-Yuwa Partners, which is the legal advisor of the Target, andreviewed the conditions of the Tender Offer at the Board of Directors’ meetingof the Target held on February 2, 2009 in consideration of such report and such
legal advice, as well as the result of consultation and negotiation with theCompany.
As a result, the Board of Directors of the Target determined that the conditionsof the Tender Offer, including the tender offer price, are fair and provide an
opportunity for the shareholders of the Target to sell their shares at a reasonable
price. The Board of Directors of the Target also determined that the Tender
Offer as well as the Procedures for Turning the Target into a Wholly Owned
Subsidiary, which is to be executed after the completion of the Tender Offer,serve to strengthen the management base of the Target, to reestablish theTarget’s business, to contribute to the Target’s future expansion, to facilitate thegrowth of the Target in the long to middle term and to maximize the corporate
value of the Target. Therefore, the Board of Directors passed a resolution toagree to the execution of the Tender Offer and to recommend to its shareholders
to sell their shares in the Tender Offer. The Company has been informed that allof the participating directors at the Board of Directors’ meeting of the Target
unanimously passed the resolution.
In order to prevent a conflict of interest between the Company and the Target,
two directors of the Target, Mr. Yasuo Goto and Mr. Akira Kato (who are theoperating officers of TIS, a wholly owned subsidiary of the Company), did notparticipate in the discussion and the voting at the Board of Directors’ meeting
based on the fact that they are in positions that may be involved in the Tender8Offer. They also did not participate in any part of the consultation or thenegotiation with the Company.
Among the company auditors of the Target, Mr. Kazutomo Onizuka, who is afull-time company auditor of the Target, has expressed his agreement with theTarget’s Board of Directors’ decision to agree to the Tender Offer. Other
company auditors of the Target, Mr. Osamu Takemura and Mr. Yasuaki
Kawamura, did not participate in the discussion of the Tender Offer at theBoard of Directors’ meeting based on the facts that Mr. Takemura is also a
company auditor at TIS (a wholly owned subsidiary of the Company) and that
Mr. Kawamura is also a company auditor at TIS Solution Business Co., Ltd.
and TIS System Service, Inc. (wholly owned subsidiaries of the Company).
Furthermore, by setting 30 business days as the tender offer period for theTender Offer, the Company ensures that other purchasers have the opportunity
to purchase the shares of the Target. In this way, the Company also assures thefairness of the Tender Offer.
(7) Items Related to Important Agreements Pertaining to the Acceptance of theTender Offer between the Company and the Shareholders of the Target
As of today, the Company has concluded the Tender Offer AcceptanceAgreement with TDK Corporation, which is the major shareholder of the Target,and obtained TDK’s agreement to accept the Tender Offer, with respect to the450,000 shares of the Target owned by TDK.
The Company has also obtained agreements of TIS System Service Inc., BM
Consultants Inc. and TIS Leasing Co., Ltd., all of which are subsidiaries of theCompany, to accept the Tender Offer, with respect to all shares owned by them
(340,000 shares, 340,000 shares, 280,000 shares respectively; totaling 960,000
shares).
2.

Overview of the Tender Offer(1) Overview of the Target① Trade Name

System Engineering Laboratory Co., Ltd.

② Businesses

1. Development, sales and maintenance ofcomputer software
2. Sales of computers and ancillary
products
93. Dispatchment of workers
4. Any other businesses relating to any of
the above③ Date of Incorporation

May 18, 1979

④ Address of Principal Office

SA Building 2-17-12, Kiba
Koto-ku, Tokyo⑤ Name and Title ofRepresentative

Representative Director / President
Masayuki Takahashi⑥ Capital AmountJPY 616,800,000(as of September 30, 2008)⑦ Major Shareholders andTheir Shareholding Ratio

TIS Inc. (Note 1)

25.7%

TDK Corporation

11.8%

TIS System Service Inc.

9.0%

BM Consultants Inc.

9.0%

TIS Leasing Co., Ltd.

7.4%

A&I System Co., Ltd.

5.5%

Andor Systems Co., Ltd.

5.3%

Employee
Shareholder’sCommittee
ofSystemEngineering Laboratory

2.3%

TISC Co., Ltd.

2.1%

Lansa Holdings Inc.

2.1%

(As of September 30, 2008)⑧ Relationship Between theTender Offeror and the Target

CapitalRelationship

The Company holds
1,937,000 shares of theTarget, consisting of
51.0% of the issued
shares of the Target,
through indirect
shareholding (as of
September 30, 2008)(Note 1).

Personnel
Relationship

2 directors out of 4
directors and 1
company auditor out of
3 company auditors of
the Target are either acompany auditor or an

10

operating officer ofTIS, which is a wholly
owned subsidiary of
the Company. 1
company auditor out of
3 company auditors of
the Target is a company
auditor at TIS Solution
Business Co.,
Ltd. and at TIS System
Service, Inc., both ofwhich are wholly
owned subsidiaries of
the Company. One of
the employees at TIS,
which is a wholly
owned subsidiary of
the Company, has been
seconded to the Target.
Business
Transactional
Relationship

The Target provides
system engineering
services to TIS, which
is a wholly owned
subsidiary of theCompany.

Applicability asa Relevant
Party

The Target is a
consolidated subsidiaryof the Company and isapplicable as a relevant
party.

(Note 1): The Company and its co-holders, TIS System Service Inc, BM
Consultants Inc. and TIS Leasing Co., Ltd., have distributed a copy of the Report
Concerning the Status on Possession of Larger Volume of Shares, etc., dated
October 7, 2008, to the Target, and reported that the Company acquired 977,000
shares of the Target from TIS through an absorption-type split effective as of
October 1, 2008. The Shareholding Ratio of the Company is 25.7 %.
(2) Tender Offer Period
11

(i)

Initial Tender Offer Period at the Time of Filing
For 30 business days, from Tuesday February 3, 2009 to Tuesday March
17, 2009(ii)

Possibility of Extension upon Request of the Target
Not applicable(3) Tender Offer Price
JPY 298 per share(4) Basis of Calculation of Tender Offer Price(i)
Basis of Calculation
In determining the tender offer price for the Tender Offer, the Company
considered the Valuation Report submitted on January 30, 2009 by
Nomura, which is the Company’s financial advisor and a third party
assessment entity. After studying calculation methods for the Tender
Offer, Nomura assessed the value of shares of the Target using each of
the market average share price method, the comparable company
method and the discounted cash flow method (hereinafter the “DCF
Method”).
According to the Valuation Report, the range of the value of a commonshare of the Target is assessed based on such methods as follows:(A) Market Average Share Price Method: Ranges from JPY 180 to JPY
181
Period during which share prices were taken

Per share value

Closing price of thecalculation reference
dateJanuary 30, 2009

JPY 180

Average of theimmediately
preceding 3 business
day period

From January 28,
2009 to January 30,
2009

JPY 181Calculation results

Ranges from JPY
180 to JPY 181(Note): The most recent material announcement is referred to as the“Notice regarding Revisions of the Business Performance Forecast”
12announced by the Target on January 27, 2009.
(B) Comparable Company Method: Ranges from JPY 240 to JPY 312(C) DCF Method: Ranges from JPY 323 to JPY 518
Under (A), the market average share price method, the share price andthe volume of trading were observed, and the per-share value wascalculated to range from JPY 180 to JPY 181 based on the average ofthe immediately preceding 3 business day period following the mostrecent material announcement and the closing price of the reference date,
which is January 30, 2009.
Under (B), the comparable company method, the market share price andthe financial indicators indicating the profitability, etc., of listedcompanies engaged in comparably similar business as the Target werecompared, and the share value of the Target was evaluated. The
per-share value was calculated to range from JPY 240 to JPY 312.
Under (C), the DCF Method, the Target’s free cash flow expected in the
future is then discounted at a fixed discount rate to obtain the present
value, based on the expected profit of the Target from the financial year
ending in March 2009 to the financial year ending in March 2013,
taking into account various factors such as business plans, recent
performance and publicly available information about the Target. The
corporate value as well as the share price are analyzed with it. As aresult, the per-share value was calculated to range from JPY 323 to JPY
518.
The Company determined that it was reasonable to offer to theshareholders of the Target a tender offer price increased by anappropriate premium, with the market share price of the Target when thepast cases in which a premium was attached to a tender offer price in atender offer offered by a person other than the issuer of the shares, theTarget’s agreement or opposition to the Tender Offer, the movement of
the market price of the Target’s shares, the future prospects of theTender Offer and the results of consultation and negotiation with theTarget all being taken into consideration.
13

The tender offer price of JPY 298 was calculated by: (a) adding apremium of 56.02% (any fraction less than a thousandth digit is roundedup or down to the closest hundredth digit) on JPY 191 (any fraction isrounded up or down to the closest whole number), which is the simple
average of closing prices of regular transactions for the shares of theTarget on Hercules for the period of one month ending on January 30,
2009; (b) adding a premium of 52.82% (any fraction less than athousandth digit is rounded up or down to the closest hundredth digit)
on JPY 195 (any fraction is rounded up or down to the closest whole
number), which is the simple average of closing prices of regulartransactions for the shares of the Target on Hercules for the period of 3
months ending on January 30, 2009; and (c) adding a premium of
65.56% (any fraction less than a thousandth digit is rounded up or down
to the closest hundredth digit) on JPY 180, which is the closing price ofregular transactions for the shares of the Target on Hercules on January
30, 2009.
(ii)

Process of Calculation(A) Process of Consideration
The Company was established in April 2008 as a joint holding
company through a joint share transfer for the purpose of
combining the businesses of TIS and INTEC HD. The Company
consists of numerous companies such as TIS and INTEC, Inc.,
which are a part of the information technology industry, which has
an important role in the improvement of the social infrastructure,and together form IT Holdings Group. The Company optimizes
group synergy and is in the process of establishing a grouporganization that is most optimal to the maintenance of a cohesive
group structure.
In July 2001, the Target agreed to a business and capital alliancewith TIS, which is a major systems integrator, and became aconsolidated subsidiary of TIS in order to improve its position in
the iSeries (an integrative application server of IBM Japan)
business. Upon establishment of the Company, the Target
vigorously strived to expand its business as a consolidated
subsidiary of the Company to become the “No.1 system provider ofthe iSeries.”
14

In today’s fast-moving and globally depressed economy, each user
is faced with the need to reduce costs while improving services inorder to survive intense competition. There are opportunities for
the Target to expand its business since further improvement of
information technology directly serves this purpose. On the other
hand, options for clients have increased concurrently with theadvancement of information technology in recent years, andcompetition is intensifying for the Target.
Under such circumstances, the Company has come to theconclusion that it is best to merge the Target with TIS Solution
Business Co., Ltd. on the target merger date (scheduled to be July
1, 2009), after completing the Tender Offer and the Procedures for
Turning the Target into a Wholly Owned Subsidiary to make theTarget into a wholly owned subsidiary, in order to achieve quicker
decision making based on the long to middle term strategies of IT
Holdings Group.
(B) Name of the Third Party Whose Opinion Was Obtained upon
Calculation
In determining the tender offer price of the Tender Offer, theCompany obtained a Valuation Report on the value of shares of
the Target from Nomura on January 30, 2009. The Company did
not obtain an opinion on the fairness of the tender offer price(fairness opinion) from Nomura. Nomura is an assessment entity
independent of the Company and is not a relevant party withrelation to the Company.
(C) Summary of the Valuation Opinion
Nomura assessed the value of shares of the Target using themarket average share price method, the comparable company
method and the DCF method, and the range of per-share value
calculated for each method was as follows:
Market Average Share Price Method:
Ranges from JPY 180 to JPY 181
Comparable Company Method:
Ranges from JPY 240 to JPY 312
DCF Method:15

Ranges from JPY 323 to JPY 518(D) Process of Determining the Tender Offer Price in Consideration of
the Valuation Opinion
In consideration of the calculation result of each method in the
Valuation Report, the Company determined that it is reasonable tooffer to the shareholders of the Target a tender offer price that isincreased by an appropriate premium, with the market share priceof the Target when the past cases in which a premium was
attached to a tender offer price in a tender offer offered by aperson other than the issuer of the shares, the Target’s agreement
or opposition to the Tender Offer, the movement of the market
price of the Target’s shares, the future prospects of the Tender
Offer and the results of consultation and negotiation with theTarget, etc. all being taken into consideration. It was determined at
the Board of Directors’ meeting held on February 2, 2009 that thetender offer price per share for the Tender Offer would be JPY
298.
(E)

Other Measures to Assure the Fairness of the Tender Offer Price
In order to assure the fairness of the tender offer price for theshares of the Target in the Tender Offer, the Company obtainedand examined the Valuation Report from Nomura, which is a third
party assessment entity independent of the Company and theTarget, as part of determining the tender offer price. However, theCompany did not obtain an opinion on the fairness of the tender
offer price (fairness opinion) from Nomura. The tender offer priceof JPY 298 per share has been determined after comprehensive
consideration of Nomura’s Valuation Report, the past cases inwhich a premium was attached to a tender offer price in a tender
offer offered by a person other than the issuer of the shares, theTarget’s agreement or opposition to the Tender Offer, themovement of the market price of the Target’s shares, the future
prospects of the Tender Offer and the results of consultation andnegotiation with the Target, etc.
The Target obtained the report on valuation of shares” on the valueof the shares of the Target from SN Corporate Advisory, which is athird party assessment entity independent of the Company and the16Target. However, the Target did not obtain an opinion on thefairness of the tender offer price (fairness opinion) from SN
Corporate Advisory. With regard to the legality of the tender offer
procedures and the appropriateness of management’s decision at
the time of passing the resolution at the Board of Directors’
meeting of the Target, the Target obtained legal advice from
City-Yuwa Partners, which is the legal advisor of the Target, andreviewed the conditions of the Tender Offer at the Board of
Directors’ meeting of the Target held on February 2, 2009 inconsideration of such report and such legal advice, as well as theresult of consultation and negotiation with the Company.
As a result, the Board of Directors of the Target determined thatthe conditions of the Tender Offer, including the tender offer price,
are fair and provide an opportunity for the shareholders of theTarget to sell their shares at a reasonable price. The Board of
Directors of the Target also determined that the Tender Offer aswell as the Procedures for Turning the Target into a Wholly
Owned Subsidiary, which is to be executed after the completion of
the Tender Offer, serve to strengthen the management base of theTarget, to reestablish the Target’s business, to contribute to theTarget’s future expansion, to facilitate the growth of the Target in
the long to middle term and to maximize the corporate value of theTarget. Therefore, the Board of Directors passed a resolution toagree to the execution of the Tender Offer and to recommend to its
shareholders to sell their shares in the Tender Offer.
(F)

Measures to Prevent any Conflicts of Interest
In order to assure the fairness of the tender offer price for theshares of the Target, the Company obtained and examined theValuation Report from Nomura, which is a financial advisor to theCompany and a third party assessment entity independent of theCompany and the Target, as part of determining the tender offer
price. The tender offer price of JPY 298 per share has been
determined after comprehensive consideration of Nomura’s
Valuation Report, the past cases in which a premium was attached
to a tender offer price in a tender offer offered by a person otherthan the issuer of the shares, the Target’s agreement or opposition
to the Tender Offer, the movement of the market price of the17Target’s shares and the future prospects of the Tender Offer andthe results of consultation and negotiation with the Target, etc. The
tender offer price of JPY 298 was calculated by: (a) adding apremium of 56.02% (any fraction less than a thousandth digit isrounded up or down to the closest hundredth digit) on JPY 191(any fraction is rounded up or down to the closest whole number),which is the simple average of closing prices of regulartransactions for the shares of the Target on Hercules for the periodof one month ending on January 30, 2009; (b) adding a premiumof 52.82% (any fraction less than a thousandth digit is rounded up
or down to the closest hundredth digit) on JPY 195 (any fraction isrounded up or down to the closest whole number), which is thesimple average of closing prices of regular transactions for theshares of the Target on Hercules for the period of 3 months endingon January 30, 2009; and (c) adding a premium of 65.56% (anyfraction less than a thousandth digit is rounded up or down to theclosest hundredth digit) on JPY 180 (any fraction is rounded up or
down to the closest whole number), which is the closing price ofregular transactions for the shares of the Target on Hercules on
January 30, 2009.
Since the Company is a holding company of the Target, the Target
has requested SN Corporate Advisory, which is a third party
assessment entity independent of the Company and the Target, toassess the value of shares of the Target in order to assure thefairness of the consultation and negotiation procedures between
the Company and the Target pertaining to the Tender Offer and to
improve the transparency and the objectivity of the transaction.
The Target obtained the report on valuation of shares from SN
Corporate Advisory on January 30, 2009. With regard to thelegality of the tender offer procedures and the appropriateness ofmanagement’s decision at the time of passing the resolution at theBoard of Directors’ meeting of the Target, the Target obtained
legal advice from City-Yuwa Partners, which is the legal advisorof the Target, and reviewed the conditions of the Tender Offer at
the Board of Directors’ meeting of the Target held on February 2,
2009 in consideration of such report and such legal advice, as wellas the results of consultation and negotiation with the Company.
18

As a result, the Board of Directors of the Target determined thatthe conditions of the Tender Offer, including the tender offer price,
are fair and provide an opportunity for the shareholders of theTarget to sell their shares at a reasonable price. The Board of
Directors of the Target also determined that the Tender Offer aswell as the Procedures for Turning the Target into a Wholly
Owned Subsidiary, which is to be executed after the completion of
the Tender Offer, serve to strengthen the management base of theTarget, to reestablish the Target’s business, to contribute to theTarget’s future expansion, to facilitate the growth of the Target in
the long to middle term and to maximize the corporate value of theTarget. Therefore, the Board of Directors passed a resolution toagree to the execution of the Tender Offer and to recommend to its
shareholders to sell their shares in the Tender Offer. The Company
has been informed that all of the participating directors at theBoard of Directors’ meeting of the Target unanimously passed theresolution.
In order to prevent a conflict of interest between the Company and
the Target, two directors of the Target, Mr. Yasuo Goto and Mr.
Akira Kato (who are the operating officers of TIS, a wholly owned
subsidiary of the Company), did not participate in the discussion
and the voting at the Board of Directors’ meeting based on the factthat they are in a position to be able to take part in the Tender
Offer. They also did not participate in any part of the consultationor the negotiation with the Company.
Among the company auditors of the Target, Mr. Kazutomo
Onizuka, who is a full-time company auditor of the Target, has
expressed his agreement with the Target’s Board of Directors’decision to agree to the Tender Offer. Other company auditors of
the Target, Mr. Osamu Takemura and Mr. Yasuaki Kawamura, did
not participate in the discussion of the Tender Offer at the Boardof Directors’ meeting based on the facts that Mr. Takemura is also
a company auditor at TIS (a wholly owned subsidiary of theCompany) and that Mr. Kawamura is also a company auditor at
TIS Solution Business Co., Ltd. and TIS System Service, Inc.
(wholly owned subsidiaries of the Company).
19

Furthermore, by setting 30 business days as the tender offer period
for the Tender Offer, the Company ensures that other purchasers
have the opportunity to purchase the shares of the Target. In thisway, the Company also assures the fairness of the Tender Offer.
(iii)

Relationship with the Assessing Entity
Neither Nomura nor SN Corporate Advisory is applicable as a relevant
party of the Company or the Target.

(5) Number of Shares to be Purchased① Expected
number of shares
to be purchased② Expected
minimum
number ofshares to bepurchased③ Expected
maximum
number ofshares to bepurchased

2,819,295 shares- shares- sharesShare Acquisition Right
Certificates- shares- shares- shares

Bond Certificates with
Share Acquisition Rights- shares- shares- shares

Trust
Beneficiary
Certificates for Shares,etc.

- shares- shares- shares

Depository Receipts for
Shares, etc.

- shares- shares- sharesTotal

2,819,295 shares- shares- shares

Type of shares

Share Certificates(Note 1): In the Tender Offer, since there is no maximum or minimum number ofshares to be purchased, all shares tendered for the Tender Offer will be purchased.
The number of shares to be purchased by the Company in the Tender Offer, as
provided in ① Expected number of shares to be purchased, is calculated bydeducting the number of shares owned by the Company (977,000 shares as of
September 30, 2008, as provided in the report of the second quarter of the 30th termof the Target submitted on November 13, 2008) and the number of treasury shares
owned by the Target as of the date of this release (1,705 shares) from the total
number of issued shares of the Target, as of September 30, 2008 (3,798,000 shares).
(Note 2): Shares that are less than one unit are also subject to the Tender Offer.
When shareholders claim their right to have the Target purchase their shares that are20

less than one unit pursuant to the Companies Act, the Target may purchase suchshares during the tender offer period in accordance with the procedures under the
relevant laws and regulations.
(Note 3): The Target does not plan to purchase the treasury shares that it holds in theTender Offer.
(6) Change of Shareholding Ratio as a Result of the Tender Offer
Number of voting rights
represented by the shares heldby the Tender Offeror prior to
the Tender Offer

977 rights

Shareholding Ratio prior to
the Tender Offer
25.74%

1,008 rights

Shareholding Ratio prior to
the Tender Offer
26.55%

Number of voting rights
represented by the shares
expected to be purchased

2,819 rights

Shareholding Ratio after theTender Offer
100.00%Total number of voting rights
held by all shareholders of theTarget

3,796 rights

Number of voting rights
represented by the shares heldby specially related parties prior
to the Tender Offer(Note 1): The “number of voting rights represented by the shares expected to bepurchased” is the number of voting rights represented by the number of shares
expected to be purchased at the Tender Offer (2,819,295 shares).
(Note 2): The “number of voting rights represented by the shares held by speciallyrelated parties prior to the Tender Offer” is the sum of the number of voting rights
represented by the shares owned by each specially related party. Since the numberof shares owned by specially related parties (exclusive of treasury shares owned by
the Target) are also subject to the Tender Offer, the “number of voting rights
represented by the shares held by specially related parties prior to the Tender Offer”
is not included as part of the numerator in calculating the “Shareholding Ratio after
the Tender Offer.”(Note 3): The “number of voting rights held by all shareholders of the Target” is thenumber of voting rights of all shareholders as of September 30, 2008, as provided in
the report of the second quarter of the 30th term submitted by the Target on
November 13, 2008 (one unit of shares being 1,000 shares). However, since theshares that are less than one unit are also subject to the Tender Offer, the21

denominator used to calculate the “Shareholding Ratio prior to the Tender Offer”
and the “Shareholding Ratio after the Tender Offer” is deemed to be the “number ofvoting rights owned by the shareholders of the Target” (3,796 rights), which is thenumber of voting rights represented by the total number of issued shares as of
September 30, 2008 (3,798,000 shares, as provided in the report of the second
quarter of the 30th term of the Target), deducted by the number of treasury shares
owned by the Target (1,705 shares) as of September 30, 2008.
(Note 4): With respect to the “Shareholding Ratio prior to the Tender Offer” and the“Shareholding Ratio after the Tender Offer,” any fraction less than a thousandthdigit is rounded up or down to the closest hundredth digit.
(7) Tender Offer AmountJPY 840 Million(Note): The tender offer amount is the number of shares expected to bepurchased (2,819,295 shares) multiplied by the tender offer price per share(JPY 298).
(8) Settlement Method(i)Name and Address of the Principal Office of the Financial Instruments
Business Operator or Bank, etc. that Settles the Tender Offer
Nomura Securities Co., Ltd.
1-9-1 Nihonbashi, Chuo-ku, Tokyo
Joinvest Securities Co., Ltd. (subagent)
2-15-1 Konan, Minato-ku, Tokyo(ii)

Commencement Date of the Settlement
Wednesday, March 25, 2009(iii)

Settlement Method
Promptly after the end of the tender offer period, notices of purchase,
etc. through the Tender Offer are to be sent to the addresses of theshareholders that have accepted the Tender Offer through the tender
offer agent (or to the standing proxies in the case of foreign
shareholders). If the Tender Offer is accepted through the subagent,
Joinvest Securities Co., Ltd., the notice is to be given through anannouncement on the website of Joinvest Securities Co., Ltd.
(https://www.joinvest.jp/).
The purchase is to be settled in cash. The accepting shareholders may
22receive the sales price for their shares in a method which they designate,including wire transfer (please note that a wire transfer fee may apply).
(iv)

Method of Returning Shares
If it is determined that the tendered shares are not to be purchased
pursuant to the conditions provided in “(ii) Existence and Contents ofConditions of Withdrawal of the Tender Offer and Method ofAnnouncing Withdrawal” of “(9) Other Conditions and the Method of
Tender Offer,” the Company will return the tendered shares by revising
the record promptly after the commencement date of settlement (or thedate of withdrawal if the tender offer is withdrawn) so that the record
indicates the status immediately before the tendering of such shares (ifsuch shares are to be returned to an account of the accepting shareholder
opened with another financial instruments business operator, that should
accordingly be instructed).

(9) Other Conditions and the Method of Tender Offer(i)
Existence and Content of Conditions Provided in Each Item under Each
Item of Article 27-13 (4) of the Financial Instruments and Exchange Act
of Japan (Law No. 25 of 1948, as amended, hereinafter the “Act”)
There is no minimum or maximum number of shares to be purchased.
Therefore, the Tender Offeror will purchase all shares tendered in theTender Offer.
(ii)

Existence and Content of Conditions of Withdrawal of the Tender Offer
and Method of Disclosing Withdrawal
If any of the events provided in Article 14 (1) (i) (a) through (i) and (l)through (r) or Article 14 (1) (ii), Article 14 (1) (iii) (a) or (h), Article 14(1) (v) and Article 14 (2) (iii) through (vi) of the Enforcement Order of
the Financial Instruments and Exchange Act (Cabinet Order No. 321 of
1965, as amended, hereinafter the “Order”) occurs, the Company may
withdraw the Tender Offer. In order to withdraw the Tender Offer, apublic notice will be made electronically, and the fact of such notice
will be published in the Nihon Keizai Shimbun. However, if there isdifficulty in making such public notice by the end of the tender offer
period, an announcement may be made pursuant to Article 20 of the
Cabinet Office Ordinance on the Disclosure of Tender Offer of Sharesby a Person Other than the Issuer (Ministry of Finance Ordinance No.
38 of 1990, as amended, hereinafter the “Ministry Ordinance”), and23

public notice will be made promptly thereafter.
(iii)

Existence and Content of the Reduction of Tender Offer Price andMethod of Disclosing Reduction
Pursuant to Article 27-6 (1) (i) of the Act, if the Target commits any of
the acts provided in Article 13 (1) of the Order during the tender offer
period, the Company may reduce the tender offer price in accordancewith the standards provided in Article 19 (1) of the Ministry Ordinance.
If the Company plans to reduce the tender offer price, it will make apublic notice electronically, and the fact of such notice must be
published in the Nihon Keizai Shimbun. However, if there is difficultyin making such public notice by the end of the tender offer period, anannouncement may be made pursuant to Article 20 of the Ministry
Ordinance, and public notice will be made promptly thereafter. If thetender offer price is reduced, the tender offer price for the sharestendered for sale prior to the date of such public notice will also be
reduced accordingly.

(iv)

Items on Accepting Shareholders’ Right to Terminate
Accepting shareholders may terminate the agreement pertaining to thetender offer at any time during the tender offer period. If any
shareholder is to terminate the agreement through the tender offer agent,
he or she must deliver or mail to the principal office or branch offices of
the agent who has received the acceptance of the Tender Offer a written
notice of termination of the agreement pertaining to the Tender Offer(hereinafter the “Termination Notice”), with the receipt of theacceptance of the Tender Offer attached, by 3:30 pm of the last day of
the tender offer period (provided that the Termination Notice must be
received by such agent by 3:30 pm of the last day of the tender offer
period in the case of notice via mail). In order to terminate theagreement for shares tendered for sale through the subagent, Joinvest
Securities Co., Ltd., the shareholders must proceed with the procedures
provided on the website of Joinvest Securities Co., Ltd.
(https://www.joinvest.jp/) by 3:30 pm of the last day of the tender offer
period. The Tender Offeror will not claim any damages or penalties
against accepting shareholders even if such shareholders terminate theiragreements. The Tender Offeror also bears the cost of returning theshares submitted.
24

(v)

Method of Disclosure upon the Change of Conditions of the Tender
Offer
In order to change the conditions of the Tender Offer, the Company will
make a public notice regarding such change of conditions and publish
the fact of such notice in the Nihon Keizai Shimbun. However, if there
is difficulty in making such public notice by the end of the tender offer
period, an announcement may be made pursuant to Article 20 of the
Ministry Ordinance, and public notice will be made promptly thereafter.
If the conditions of the Tender Offer are changed, the conditions of theTender Offer for the shares tendered for sales prior to such notice will
also be changed accordingly.

(vi)

Method of Disclosure upon Submission of Filing a Notice of Correction
If the Company files a correction statement with the Director-General of
the Kanto Finance Bureau, the Company will promptly announce
publicly the issues with respect to the content of the public noticedelivered at the commencement of the Tender Offer, out of the matters
contained in the correction statement by the method provided in Article
20 of the Ministry Ordinance. The Company will promptly makecorrections on the tender offer explanatory statement and deliver suchcorrected tender offer explanatory statement to such accepting
shareholders that had previously received the explanatory statement.
However, if the corrections are minimal, the Company will makecorrections by preparing a written document stating the reason for thecorrections, the corrected matters and the corrections, and deliveringsuch document to the accepting shareholders.

(vii)

Method of Disclosure of the Result of the Tender Offer
The result of the Tender Offer will be announced publicly on the day
following the last day of the tender offer period, pursuant to Article 9-4of the Order and Article 30-2 of the Ministry Ordinance.

(viii) Method of Accepting the Tender Offer for Foreign Shareholders
Shareholders who reside overseas and do not have active accounts withthe tender offer agent (including corporate shareholders, hereinafter the“Foreign Shareholders”), may accept the Tender Offer only throughtheir standing proxies in Japan. The subagent, Jointvest Securities Co.,
Ltd., will not handle acceptances of the Tender Offer by Foreign
Shareholders.
25(10) Date of Public Notice on the Commencement of the Tender Offer
Tuesday, February 3, 2009(11) Tender Offer Agent
Nomura Securities Co., Ltd.
1-9-1 Nihonbashi, Chuo-ku, Tokyo
Joinvest Securities Co., Ltd. (subagent)
2-15-1 Konan, Minato-ku, Tokyo
3.

Policies, etc., and Outlook after the Tender Offer(1) Policies, etc. after the Tender Offer
Please refer to “(3) Policies on Organizational Restructuring, etc. after theTender Offer (Items on So-called Two-Tier Buyout)” in “1. Purpose of Tender
Offer” with respect to the policies after the Tender Offer.
(2) Outlook for the Effects on Future Business Performance
The effects of the Tender Offer on the consolidated business performance andthe unconsolidated business performance of the Company are being carefully
examined. Should any correction in the forecast of business performance berequired or should any fact arise that requires an announcement, the Company
will promptly make such announcement pursuant to the Trading Participant
Regulations of the Tokyo Stock Exchange.

4.

Others(1) Existence and Content of the Agreement between the Tender Offeror and theTarget or the Tender Offeror and the Officers of the Target(i)
Existence and Content of the Agreement between the Tender Offeror
and the Target or the Tender Offeror and the Officers of the Target
The Target passed a resolution at its Board of Directors’ meeting held
on February 2, 2009, to agree to the Tender Offer and to recommend its
shareholders to sell their shares in the Tender Offer(ii)

Decision-Making Process of Determining the Launch of the Tender
Offer
For the decision-making process of determining the launch of the26

Tender Offer, please refer to “(2) Purpose and Background of theTender Offer” in “1. Purpose of the Tender Offer.”(iii)

Content of Measures to Prevent any Conflicts of Interest
For the content of the measures to prevent any conflicts of interest,
please refer to “(6) Measures to Assure Fairness of the Tender Offer
Price and Measures to Prevent any Conflicts of Interest” in “1. Purposeof the Tender Offer.”(2) Other Information Considered Necessary for Investors to Make a Decision on
Whether to Accept the Tender Offer(i)
Expected Delisting and Such Events
Since the Tender Offer does not set a maximum number of shares to bepurchased, the shares of the Target may be delisted from Hercules
through certain prescribed procedures pursuant to the delisting
standards of the OSE after completion of the Tender Offer, dependingon the result of the Tender Offer. Even if the result of the Tender Offer
does not meet the OSE’s delisting standards, the shares of the Target arelikely to be delisted through certain prescribed procedures pursuant to
the OSE’s delisting standards, because the Company is expected to own
all issued shares of the Target (exclusive of treasury shares) after theProcedures for Turning the Target into a Wholly Owned Subsidiaryfollowing the completion of the Tender Offer.
After delisiting, the shares of the Target may no longer be traded on
Hercules.
(ii)

Revisions of the Business Performance Forecast by the Target
The Target announced the “Notice regarding Revised Business
Performance Forecast” as of January 27, 2009. An overview of therevised values of this business performance forecast for the full year
ending on March 31, 2009 is discussed in the summary that follows.
Please refer to the “Notice regarding Revised Business Performance
Forecast” for details of the Target’s announcement.
Revisions of the Values of the Consolidated Business Performance
Forecast for the Full Year Ending in March 2009 (From April 1, 2008 to
March 31, 2009)27

SalesOperating
IncomeOrdinary
ProfitNet Profit
fortheCurrent
Term

Net Profit
fortheCurrent
Term Per
Share(Million
yen)
3,300

(Millionyen)
90(Millionyen)
90(Million
yen)
39

(Yen)

Forecast

2,950

-30

-30

-30

-7.90

Difference (B－A)

-350

-120

-120

-69

-18.17

IncreaseorDecrease Rate (%)

-10.6

－

－

－

－

(For reference)
Past performancefor the previous
financialyear
ending in March
2008

3,279

169

166

94

24.96

Previously
Announced
Forecast (A)Revised(B)

10.27

Revisions of the Values of the Unconsolidated Business Performance
Forecast for the Full Year Ending in March 2009 (From April 1, 2008 to
March 31, 2009)
Sales

Operating
IncomeOrdinary
ProfitNet Profit
fortheCurrent
Term

Net Profit
fortheCurrent
Term Per
Share(Million
yen)
3,280

(Millionyen)
85(Millionyen)
85(Million
yen)
38

(Yen)

Forecast

2,930

- 12

-12

-14

-3.69

Difference (B－A)

-350

-97

-97

-52

-13.70

IncreaseorDecrease Rate (%)

-10.7

－

－

－

－

(For reference)

3,269

161

157

88

23.36

Previously
Announced
Forecast (A)Revised
(B)

28

10.01

Past performancefor the previous
financialyear
ending in March
2008
(iii)

(iv)

Cessation of the End-of-the-Term Dividend Distribution
The Target passed a resolution at its Board of Directors’ meeting held on
February 2, 2009 stating that the Target will not distribute any
end-of-the-term dividend for the term ending on March 31, 2009, on thecondition that the Tender Offer is completed. Also, the Target’s Board of
Directors announced such resolution as of February 2, 2009. Pleaserefer to the Target’s announcement (the “Notice regarding the Revisionsof the Dividend Distribution Forecast for the Term Ending in March2009”) for details of the Target’s announcement.
Important Agreements Pertaining to the Acceptance of the Tender Offer
between the Company and the Shareholders of the Company
Please refer to “(7) Items in the Important Agreements Pertaining to the
Acceptance of the Tender Offer between the Company and theShareholders of the Target” in “1. Purpose of the Tender Offer.”

29

Restrictions on Insider Transactions
Please be advised that anyone who has viewed the information contained in this press release, as a first information
recipients for purposes of insider trading restrictions under Article 167 (3) of the Financial Instruments and Exchange Act
of Japan and Article 30 of the Enforcement Order of the Financial Instruments and Exchange Act, may be prohibitedfrom purchasing the shares of System Engineering Laboratory Co., Ltd. for 12 hours after the announcement of this press
release (from the time at which this press release is announced using the timely disclosed information viewing servicesof the Tokyo Stock Exchange in the afternoon of February 2, 2009). The Company will not be held responsible for any
criminal, civil or administrative liabilities that such person may be liable for as a result of his or her purchase of shares.

Restrictions on Solicitation
This press release is intended for the announcement of the Tender Offer to the general public and is not intended to solicit
sales of shares. If anyone desires to sell his or her shares, the shareholder should, at his or her own responsibility, review
the tender offer explanatory statement and accept the Tender Offer in his or her own discretion. This press release is notconsidered as an offer or solicitation of sales of securities or solicitation of this purchase offer and does not constitute any
such part. This press release (or any part of it) or the fact of its distribution does not provide a basis for any kind ofagreement pertaining to the Tender Offer, and it may not be relied upon when executing any such agreement.

Other Countries
Announcement, issuance or distribution of this press release may be subject to legal restrictions in certain countries orregions. In such case, you are required to be aware of and comply with such restrictions. In such countries or regions thatlegally prohibit the launch of the Tender Offer, this press release does not constitute an offer for purchase or solicitationfor offer or sales of shares regarding the Tender Offer, even if this press release or its translation is received in suchcountries or regions. In that case, it shall be considered as a mere distribution of informative materials.

Procedures and standards
The Tender Offer will be conducted in compliance with the procedures prescribed by the Financial Instruments andExchange Act of Japan and related disclosure standards; however, these procedures and standards are not necessarily
identical to those in the United States of America.

In particular, Sections 13(e) and 14(d) of the U.S. Securities

Exchange Act of 1934 and the Rules and Regulations thereunder shall not apply to the Tender Offer, and the Tender
Offer may or may not be conducted in compliance with any procedure or standard thereunder.

Language
Unless otherwise specified, all procedures concerning the Tender Offer shall be conducted in Japanese.

If all or a partof any document concerning the Tender Offer is prepared in English and there is any discrepancy between the English
version and the Japanese version, the Japanese version shall prevail.

30

Forward-Looking Statements
This statement contains forward-looking statements as defined in Section 27A of the U.S. Securities Act of 1933 andSection 21E of the U.S. Securities Exchange Act of 1934 (“Forward-Looking Statements”). Due to known or unknown
risks, uncertainties or other factors, actual results may materially differ from any forecast, expressly or implicitly,
indicated as a Forward-Looking Statement contained herein. Neither the Tender Offeror nor any of its affiliates guaranteethat any forecast, expressly or implicitly, indicated as a Forward-Looking Statement will turn out to be accurate.

Any

Forward-Looking Statement is prepared based on information held by the Tender Offeror as of the date hereof, and theTender Offeror and its affiliates do not intend, and disclaim any obligation, to update or modify any such statement toreflect future events or developments, except as may be required by any applicable laws and regulations.

31