Note: This document has been translated from a part of the Japanese original for reference purposes only. In
the event of any discrepancy between this translated document and the Japanese original, the original shallprevail. The Company assumes no responsibility for this translation or for direct, indirect or any other formsof damages arising from the translation.
(Securities Code 7242)
June 1, 2017
To Shareholders with Voting Rights:
Yasusuke Nakajima
Representative Director,
President Executive Officer
KYB Corporation
World Trade Center Bldg.,
2-4-1, Hamamatsu-cho,Minato-ku, TokyoNOTICE OF
THE 95TH ORDINARY GENERAL MEETING OF SHAREHOLDERS
We would like to express our appreciation for your continued support and patronage.
You are cordially invited to attend the 95th Ordinary General Meeting of Shareholders of KYB Corporation(the “Company”). The meeting will be held for the purposes as described below.
If you are unable to attend the meeting, you can exercise your voting rights in writing or via
electromagnetic means (the Internet, etc.). Please exercise your voting rights by 5:15 p.m. on Thursday, June22, 2017 (Japan time), by following the instructions described in the “Guide for the Exercise of Voting Rights,”
on page 17, after taking the time to consult the attached reference documents for the General Meeting of
Shareholders.

1. Date and Time:

Friday, June 23, 2017 at 10:00 a.m. (Japan time)

2. Place:

2nd Floor, Annex Bldg., Shiba Park Hotel,
1-5-10, Shiba Koen, Minato-ku, Tokyo

3. Meeting Agenda:
Matters to be reported: 1. The Business Report, Consolidated Financial Statements for the Company’s
95th Fiscal Year (April 1, 2016 - March 31, 2017) and results of audits by the
Accounting Auditor and the Audit & Supervisory Board of the Consolidated
Financial Statements
2. Non-consolidated Financial Statements for the Company’s 95th Fiscal Year
(April 1, 2016 - March 31, 2017)
Proposals to be resolved:
Appropriation of the Surplus
Proposal 1:
Consolidation of Shares
Proposal 2:
Partial Amendment to the Articles of Incorporation
Proposal 3:
Election of eight (8) Members of the Board of Directors
Proposal 4:
Election of one (1) Substitute Audit & Supervisory Board Member
Proposal 5:
Payment of performance-linked bonuses to Members of the Board of Directors
Proposal 6:-1-

4. Exercise of voting rights:
If you vote both in writing on the Voting Rights Exercise Form and via the Internet, only your vote
placed via the Internet will be counted.
If you vote multiple times via the Internet, only the last vote will be counted.

-------------------------------------------------------------------------------------------------------------------------------------------- When attending the meeting, please submit the enclosed Voting Rights Exercise Form at the reception
desk. For the purpose of saving resources, please bring this Notice and the Business Report for the 95th
Fiscal Year to the meeting.

- The following items have been posted on the Company’s website (http://www.kyb.co.jp/) in accordance with laws
and regulations and the provisions of Article 15 of the Articles of Incorporation of the Company and areaccordingly not included in the attached the Business Report for the 95th Fiscal Year.
・Notes to the Consolidated Financial Statements
・Notes to the Non-consolidated Financial Statements- Any updates to the Reference Documents for the General Meeting of Shareholders, the Business Report,
the Non-consolidated Financial Statements, or the Consolidated Financial Statements will be posted on
the Company’s website (http://www.kyb.co.jp/).

-2-

Reference Documents for the General Meeting of Shareholders

Proposal 1: Appropriation of the Surplus
Appropriate shareholder return is an important management policy of the Company. In accordance with theCompany’s basic policy, and in consideration of the results for the fiscal year ended March 31, 2017, future
capital investments and other factors, the Company proposes the payment of the year-end dividends asfollows.
Matters concerning the year-end dividend:
1. Type of dividend assets
Cash
2. Allocation of dividend assets and the total amount of dividends
7 yen per share of common stock of the Company
Total amount of dividends: 1,788,216,353 yen
3. Effective date of appropriation of surplus
June 26, 2017-3-

Proposal 2: Consolidation of Shares
1.

Reasons for the proposal
The Japanese Stock Exchanges Conference requests all listed domestic companies to unify sharetrading units (number of shares constituting one unit) into 100 shares, based on its “Action Plan for
Consolidating Trading Units.” In view of the purport of this approach, the Company decided tochange the number of Company shares constituting one unit from 1,000 shares to 100 shares,
effective from October 1, 2017.
In changing the number of shares constituting one unit to 100 shares, 10 shares shall be consolidated
into 1 share, in order to maintain the Company’s share price per trading unit after the change andavoid any change in the number of voting rights of shareholders.

2.

Type of shares and consolidation ratio
10 shares of common stock of the Company shall be consolidated into 1 share.
Any fraction of less than one share caused by the share consolidation shall be disposed in a lumppursuant to the provisions of the Companies Act and the proceeds accrued therefrom shall be
distributed to the shareholders in proportion to the fractions attributed to them.

3.

Effective date of the share consolidation
October 1, 2017

4. Total number of shares authorized to be issued by the Company as of the effective date of the shareconsolidation
Fifty-seven million three hundred thousand (57,300,000) shares
5.

Other matters(1)
The method for disposing of fractional shares and other necessary matters shall bedelegated to the Board of Directors of the Company.
(2)
Although the share consolidation will decrease the total number of shares issued of theCompany to one-tenth, the amount of assets and capital of the Company will remain thesame. Therefore, apart from other factors such as stock market trends, the asset value ofthe shares held by shareholders will not change.
(3)
The share consolidation in this proposal shall take effect subject to the approval of
Proposal 3: “Partial Amendment to the Articles of Incorporation” as proposed.

-4-Proposal 3: Partial Amendment to the Articles of Incorporation
1.

Reasons for the proposed amendments
Subject to the approval of Proposal 2: “Consolidation of Shares” as proposed at this General
Meeting of Shareholders, the Company proposes amendments to the current provisions of Article 7(Number of shares constituting one unit) of the Articles of Incorporation in order to change thetrading unit (number of shares constituting one unit) of the common stock and Article 6 (Total
number of shares to be issued by the Company) of the same in order to decrease the total number ofshares to be issued by the Company in proportion to the ratio of the share consolidation, in view ofthe purport of the “Action Plan for Consolidating Trading Units” announced by the Japanese Stock
Exchanges Conference. The Company also proposes the establishment of Supplementary Provisions
to the effect that these amendments are to take effect on the same date as the effective date of theshare consolidation proposed in Proposal 2.

2.

Details of the proposed amendment
Details of the proposed amendment are as follows:(Amended parts are underlined.)
Proposed amendment

Current
Article 1 to Article 5 (Omitted)

Article 1 to Article 5 (Unchanged)(Total number of shares to be issued by theCompany)
Article 6 The total number of shares authorized
to be issued by the Company shall befive hundred seventy three million(573,000,000) shares.

(Total number of shares to be issued by theCompany)
Article 6 The total number of shares authorized
to be issued by the Company shall be
fifty seven million three hundred
thousand (57,300,000) shares.

(Number of shares constituting one unit)
Article 7 The number of shares constituting one
unit of shares of the Company shall be
1,000 shares.

(Number of shares constituting one unit)
Article 7 The number of shares constituting one unitof shares of the Company shall be 100
shares.

Articles 8 to 40 (Omitted)

Articles 8 to 40 (Unchanged)(New)

Supplementary Provisions:
Article 1 The amendments to the provisions ofArticle 6 (Total number of shares to beissued by the Company) and Article 7(Number of shares constituting one unit)
shall take effect on October 1, 2017.
Article 2 These Supplementary Provisions shall bedeleted when the amendments to theprovisions of Article 6 (Total number ofshares to be issued by the Company) and
Article 7 (Number of shares constituting
one unit) take effect according to Article
1 of these Supplementary Provisions.

-5-Proposal 4: Election of eight (8) Members of the Board of Directors
The terms of office of all the seven (7) Members of the Board of Directors will expire at the conclusion ofthis meeting. We propose election of eight (8) Members of the Board of Directors, with an increase of thenumber of members by one in order to reinforce the management structure.
The candidates for the Members of the Board of Directors are as follows:
List of candidates for Members of the Board of Directors
Current positions in the
Company

No.

Name

1

Yasusuke Nakajima(Reappointment)

2

Takaaki Kato

(Reappointment)

Member of the Board of
Directors, Senior Managing
Executive Officer

3

Morio Komiya(Reappointment)

Member of the Board of
Directors, Executive Vice
President Executive Officer

4

Keisuke Saito(Reappointment)

Member of the Board of
Directors, Senior Managing
Executive Officer

5

Takafumi Shoji(Reappointment)

Senior Managing Executive
Officer-

6

Masao Ono

(New appointment)

Senior Managing Executive
Officer-

7

8

Rokurou Tsuruta

Shuhei Shiozawa

Attributes

Attendanceof themeetings ofthe Board of
Directors(Reappointment)(Reappointment)(Candidate forMember of the Boardof Directors(Outside))(Independent Officer)(Candidate forMember of the Boardof Directors(Outside))(Independent Officer)-6-

Representative Director,

100%

President Executive Officer(18/18)

Member of the Board of
Directors (Outside)100%(18/18)100%（(18/18)94%(17/18)94%(17/18)100%

Member of the Board of
Directors (Outside)(14/14)(after hisassumption of officeon June 24, 2016)

No.

Name
(Date of birth)

Career summary, positions, responsibilities at the Company,
and significant concurrent positions
April 1979
April 2005
June 2005

April 2007
June 2009
June 2010
Yasusuke Nakajima(November 2, 1955)(Reappointment)

1June 2011

Term of office as a April 2012
Member of the Boardof Directors: 12 years
April 2014
Attendance of themeetings of the Boardof Directors: (18/18) June 2015

Joined the Company
General Manager, Hydraulics Sales & Marketing Headquarters,
Hydraulic Components Operations
Member of the Board of Directors, General Manager, Hydraulics
Sales & Marketing Headquarters, Hydraulic Components
Operations
Member of the Board of Directors, General Manager, Hydraulics
Sales Headquarters, Hydraulic Components Operations
Managing Member of the Board of Directors, General Manager,
Hydraulic Components Operations
Senior Managing Member of the Board of Directors, in chargeof purchasing, general affairs and human resources
Member of the Board of Directors, Senior Managing Executive
Officer, in charge of purchasing, general affairs and humanresources
Member of the Board of Directors, Senior Managing Executive
Officer, in charge of purchasing, General Manager, HydraulicComponents Operations
Member of the Board of Directors, Senior Managing Executive
Officer, in charge of purchasing, General Manager, Corporate
Planning Div.
Member of the Board of Directors, President Executive Officer(current position)[Reasons for proposing him as a candidate for Member of the Board of Directors]
He has a wealth of experience and deep knowledge in management acquired
through his long-time career as a corporate manager and has steadily promoted
management reforms, including reinforcements of corporate governance, since
assuming the office of President. We expect that his insight and achievements will
be useful for the decision-making on important matters and the supervision ofbusiness execution of the whole Group. Consequently, we reappoint him as a
candidate for Member of the Board of Directors.

-7-

Number ofshares of theCompany held

35,000No.

Name(Date of birth)

Career summary, positions, responsibilities at the Company,
and significant concurrent positions
April 1980
March 2005
April 2008
April 2009
April 2011
April 2013
June 2014

Takaaki Kato
(June 12, 1957)(Reappointment)

2

Term of office as a
Member of the Boardof Directors: 2 years

April 2015
June 2015

April 2016

Attendance of themeetings of the Board
April 2017of Directors: (18/18)

Joined The Fuji Bank, Limited (present Mizuho Bank, Ltd.)
General Manager, Hong Kong Branch, Mizuho Corporate Bank,
Ltd.
Executive Officer, Mizuho Securities Co., Ltd.
Managing Executive Officer, dittoManaging Executive Officer, ditto and Chairman, Mizuho
Securities Asia Limited
Joined the Company, Managing Executive Officer, Deputy
General Manager, Finance & Accounting Div.
Managing Executive Officer, General Manager, Finance &Accounting Div.
Senior Managing Executive Officer, General Manager, Finance& Accounting Div.
Member of the Board of Directors, Senior Managing Executive
Officer, in charge of audit, in charge of CSR, General Manager,
Finance & Accounting Div., General Manager, Corporate
Planning Div.
Member of the Board of Directors, Senior Managing Executive
Officer, in charge of global finance, General Manager, Finance& Accounting Div.
Member of the Board of Directors, Senior Managing Executive
Officer, in charge of global finance (current position)[Reasons for proposing him as a candidate for Member of the Board of Directors]
He has deep knowledge of finance, accounting, and IR, and has promoted IR
activities on a global basis based on the wealth of international experience andinsight he has acquired and cultivated while working in financial institutions. We
expect that his knowledge and achievements will be useful for the administration offinance, strengthening of IR activities, and the supervision of business execution of
the general management of the whole Group. Consequently, we reappoint him as a
candidate for Member of the Board of Directors.

-8-

Number ofshares of theCompany held

8,000

No.

Name
(Date of birth)

Career summary, positions, responsibilities at the Company,
and significant concurrent positions
April 1973
October 2001
January 2005
April 2005
June 2006
June 2007
April 2009
June 2009
June 2011
April 2014

Morio Komiya(November 5, 1950)(Reappointment)

3

June 2014
June 2015

Term of office as a
Member of the Board April 2016of Directors: 7 years
June 2016
Attendance of themeetings of the Boardof Directors: (18/18)
April 2017

Joined the Company
General Manager, Quality Assurance Dept., Sagami Plant
General Manager, Manufacturing Dept., Sagami Plant
Hydraulic Components Operations, General Manager,
Manufacturing Dept., Sagami Plant
Hydraulic Components Operations, General Manager, Sagami
Plant
Member of the Board of Directors, Hydraulic Components
Operations, General Manager, Sagami Plant
Member of the Board of Directors, General Manager, Quality
Div. and General Manager, Quality Control Dept., Quality Div.
Member of the Board of Directors, General Manager, Quality
Div.
Managing Executive Officer, General Manager, Quality Div.
Senior Managing Executive Officer, in charge of production,
General Manager, Quality Div.
Member of the Board of Directors, Senior Managing Executive
Officer, in charge of production, General Manager, Quality Div.
Member of the Board of Directors, Senior Managing Executive
Officer, in charge of production, in charge of purchasing, General
Manager, Quality Div.
Member of the Board of Directors, Executive Vice President
Executive Officer, in charge of production, in charge of quality
Member of the Board of Directors, Executive Vice President
Executive Officer, in charge of production, in charge of quality,
in charge of domestic subsidiaries and affiliates, in charge ofSpecial Purpose Vehicles Div.
Member of the Board of Directors, Executive Vice President
Executive Officer, in charge of production, in charge of quality,
in charge of domestic subsidiaries and affiliates, in charge ofSpecial Purpose Vehicles Div., in charge of engineering (current
position)[Reasons for proposing him as a candidate for Member of the Board of Directors]
He has deep knowledge of monozukuri (manufacturing) acquired through his
long-time engagement in the areas of quality, production and engineering and has
promoted ongoing activities for quality improvement and productivity improvement.
We expect that his knowledge and achievements will be useful for realizing further
improvements in quality and productivity and for the supervision of businessexecution of the general management of the whole Group, a company groupengaged in manufacturing. Consequently, we reappoint him as a candidate forMember of the Board of Directors.

-9-

Number ofshares of theCompany held

21,000No.

Name(Date of birth)

Career summary, positions, responsibilities at the Company,
and significant concurrent positions
April 1983
August 2002
September 2005

July 2007

July 2008
July 2009

Keisuke Saito(August 18, 1959)(Reappointment)

4

Term of office as a
Member of the Boardof Directors: 6 years
Attendance of themeetings of the Boardof Directors: (17/18)

September 2010
June 2011

April 2014

January 2016

April 2017

Joined the Ministry of International Trade and Industry (present
Ministry of Economy, Trade and Industry)
General Manager, Beijing Office, Japan-China Economic
Association
Director, Industrial Revitalization Division, Economic andIndustrial Policy Bureau, Ministry of Economy, Trade andIndustry
Director, Industrial Science and Technology Policy Division,
Industrial Science and Technology Policy and Environment
Bureau, ditto
Director, Finance Division, Minister’s Secretariat, ditto
Director-General for Energy Conservation and Renewable
Energy Department, Agency for Natural Resources and Energy,
dittoSpecial Adviser of the Company
Member of the Board of Directors, Senior Managing Executive
Officer, General Manager, Engineering Div. and General
Manager, Corporate Planning Div.
Member of the Board of Directors, Senior Managing Executive
Officer, in charge of legal affairs and information technology
administration, General Manager, Engineering Div.
Member of the Board of Directors, Senior Managing Executive
Officer, in charge of Information Technology Administration, incharge of Aircraft Components Div., General Manager,
Engineering Div.
Member of the Board of Directors, Senior Managing Executive
Officer, in charge of Aircraft Components Div., General Manager,
Hydraulic Components Operations (current position)[Reasons for proposing him as a candidate for Member of the Board of Directors]
He has diverse experience gained through his career in the Ministry of Economy,
Trade and Industry and deep knowledge cultivated in the Company in the areas ofengineering, research and development and has promoted activities to accomplishbusiness assignments under his strong leadership since taking charge of the Aircraft
Components Div. and Hydraulic Components Operations. We expect that his
knowledge and achievements will be useful for stabilizing the profit base of
Hydraulic Components Operations and the supervision of business execution of thegeneral management of the Group. Consequently, we reappoint him as a candidate
for Member of the Board of Directors.

- 10 -

Number ofshares of theCompany held

21,000No.

Name(Date of birth)

Career summary, positions, responsibilities at the Company,
and significant concurrent positions
April 1978
April 2005
June 2005
June 2008
April 2009

June 2009

June 2010
June 2011

January 2015
Takafumi Shoji(January 10, 1956)(Reappointment)
5

April 2015

Term of office as a January 2016
Member of the Boardof Directors: 6 years(from 2005 to 2011)
April 2016

April 2017

Joined the Company
General Manager, Accounting Dept.
Member of the Board of Directors, General Manager,
Accounting Dept.
Member of the Board of Directors, General Manager, Finance& Accounting Div.
Member of the Board of Directors, General Manager, Finance& Accounting Div. and General Manager, Information
Technology Administration Div.
Managing Member of the Board of Directors, General Manager,
Finance & Accounting Div. and General Manager, Information
Technology Administration Div.
Managing Member of the Board of Directors, General Manager,
Information Technology Administration Div.
Managing Executive Officer, General Manager, Information
Technology Administration Div. and General Manager, Audit
Dept.
Managing Executive Officer, General Manager, Information
Technology Administration Div.
Managing Executive Officer, in charge of general affairs,
General Manager, Information Technology Administration Div.
and General Manager, Human Resources Div.
Managing Executive Officer, in charge of general affairs, incharge of legal affairs, General Manager, Information
Technology Administration Div. and General Manager, Human
Resources Div.
Senior Managing Executive Officer, in charge of general affairs,in charge of legal affairs, in charge of audit, General Manager,
Information Technology Administration Div. and General
Manager, Human Resources Div.
Senior Managing Executive Officer, in charge of CSR, General
Manager, Information Technology Administration Div. andGeneral Manager, Finance & Accounting Div. (current position)[Reasons for proposing him as a candidate for Member of the Board of Directors]
He has a wealth of business experience in finance & accounting, information
technology administration, audit and human resources and has promoted activities
for reinforcing corporate governance in performing his duties as an officer in chargeof general affairs and legal affairs. We expect that his knowledge and achievements
will be useful for the promotion of CSR activities, reinforcement of IT functions,and the supervision of business execution of the general management of the wholeGroup. Consequently, we reappoint him as a candidate for Member of the Board of
Directors.

- 11 -

Number ofshares of theCompany held

34,000No.

Name(Date of birth)

Career summary, positions, responsibilities at the Company,
and significant concurrent positions
April 1979
January 2004
April 2005
June 2006
June 2008
April 2012
April 2014
April 2016

6

Masao Ono
(November 7, 1956) April 2017
(New appointment)

Joined the Company
General Manager, Operations Planning Dept., Automotive
Devices Business Div.
General Manager, Operations Planning Dept., Automotive
Components Operations
General Manager, Purchasing Dept.
General Manager, Purchasing Div.
Executive Officer, General Manager, Purchasing Div.
Managing Executive Officer, General Manager, Purchasing Div.
Senior Managing Executive Officer, in charge of purchasing, incharge of CSR, General Manager, Corporate Planning Div.
Senior Managing Executive Officer, in charge of purchasing, incharge of audit, General Manager, Corporate Planning Div.
(current position)[Reasons for proposing him as a candidate for Member of the Board of Directors]
In addition to his contribution to the results of performance in the sales andpurchasing divisions, he has made efforts in formulating the medium-term plan
starting in fiscal 2017 and promoted various activities toward the achievement ofgoals, as General Manager of the Corporate Planning Div.
We expect that his knowledge and achievement will be useful for the improvementof performance and the supervision of business execution of the generalmanagement of the whole Group. Consequently, we appoint him as a candidate forMember of the Board of Directors.

- 12 -

Number ofshares of theCompany held

13,000No.

Name(Date of birth)

Career summary, positions, responsibilities at the Company,
and significant concurrent positions
April 1970
April 2005
June 2006
July 2006
June 2007

7

Number ofshares of theCompany held

Prosecutor, Tokyo District Public Prosecutors Office
Superintending Prosecutor, Nagoya High Public Prosecutors
OfficeRetired from office
Registered as an attorney (Daini Tokyo Bar Association)
Outside Director, TEIKOKU PISTON RING CO., LTD. (present
TPR Co., Ltd.) (current position)
Outside Audit & Supervisory Board Member, J. FRONTRETAILING Co., Ltd. (current position)
Outside Corporate Auditor, Sumitomo Mitsui Financial Group,
Inc. (current position)
Member of the Board of Directors (Outside) (current position)

Rokurou Tsuruta
September 2007
(June 16, 1943)(Reappointment)
June 2012(Candidate forMember of the Board
June 2015of Directors(Outside))[Reasons for proposing him as a candidate for Member of the Board of Directors(Independent Officer)(Outside)]
In consideration of his expertise and experience as an attorney, we expect him toTerm of office as acontinue giving us useful opinions and recommendations to strengthen the internal
Member of the Board
control, compliance, etc. of the Company. Consequently, we reappoint him as aof Directors(Outside):
candidate for Member of the Board of Directors (Outside).
2 years
Although he has not participated in corporate management other than as an outside
director or outside audit & supervisory board member, we judge that he will duly
Attendance of theperform his duties as an Member of the Board of Directors (Outside) for the
meetings of the Board
abovementioned reasons.
of Directors: (17/18)

2,000[Significant concurrent positions]
Attorney and representative, Tsuruta Rokurou Law OfficeOutside Director, TPR Co., Ltd.
Outside Audit & Supervisory Board Member, J. FRONT RETAILING Co., Ltd.
Outside Corporate Auditor, Sumitomo Mitsui Financial Group, Inc.

Shuhei Shiozawa(September 19, 1955)(Reappointment)(Candidate forMember of the Boardof Directors(Outside))(Independent Officer)
8

April 1981
April 1987
April 1994
January 2001
October 2005
March 2012
June 2016

Assistant, Faculty of Economics, Keio University
Associate Professor, Faculty of Economics, Keio University
Professor, Faculty of Economics, Keio University (current
position)
Director for International Economic Affairs, Cabinet Office
Dean, Faculty of Economics, Keio University
Member of the Board of Directors (Outside), Kenedix, Inc.
(current position)
Member of the Board of Directors (Outside) (current position)[Reasons for proposing him as a candidate for Member of the Board of Directors
Term of office as a (Outside)]
Member of the Board We expect him to give us useful opinions and recommendations on finance and CSRof Director(Outside)s: of the Company based on his wealth of knowledge and insight as a specialist in
1 yeareconomics. Consequently, we reappoint him as a candidate for Member of the Boardof Directors(Outside).
Attendance of the Although he has not participated in corporate management other than as an outside
meetings of the Board director or outside audit & supervisory board member, we judge that he will duly
of Directors after his perform his duties as an Outside Director for the above mentioned reasons.
assumption of officeon June 24, 2016: [Significant concurrent positions](14/14)
Professor, Faculty of Economics, Keio University
Member of the Board of Directors (Outside), Kenedix, Inc.

0

(Notes)1. No conflict of interests exists between any of the above candidates and the Company.
2. Mr. Rokurou Tsuruta and Mr. Shuhei Shiozawa are candidates for Members of the Board of Directors (Outside).
3. The Company has designated Mr. Rokurou Tsuruta and Mr. Shuhei Shiozawa as independent officers under the rules of- 13 -

4.
5.
6.

the Tokyo Stock Exchange and filed the designations with the Tokyo Stock Exchange. If the re-election of both Mr.
Rokurou Tsuruta and Mr. Shuhei Shiozawa is approved, the Company will continue to designate them as independent
officers.
The term of office of Mr. Rokurou Tsuruta from his assumption of office as a Member of the Board of Directors(Outside) (up to the conclusion of this meeting) will be two years.
The term of office of Mr. Shuhei Shiozawa from his assumption of office as a Member of the Board of Directors(Outside) (up to the conclusion of this meeting) will be one year.
Mr. Rokurou Tsuruta and Mr. Shuhei Shiozawa have each entered into an agreement with the Company to limit their
liabilities. The Company shall continue the agreement with each of them should they be reelected.
The outline of the agreement is as follows:・ If Mr. Rokurou Tsuruta/Mr. Shuhei Shiozawa becomes liable to the Company for failure to perform his duties as a
Member of the Board of Directors after the conclusion of this agreement, the maximum amount of his liability shallbe twice the value of the annual property benefits that he has received or should receive from the Company asconsideration for the execution of his duties during his term of office as calculated by the method provided in
Article 113 of the Ordinance for Enforcement of the Companies Act, and any amount in excess of the maximum
amount shall be exempted from the liability, provided that the he has conducted his duties in good faith and withoutgross negligence.

- 14 -

Proposal 5: Election of one (1) Substitute Audit & Supervisory Board Member
Mr. Atsushi Shigeta was elected as a Substitute Audit & Supervisory Board Member at the 94th Ordinary
General Meeting of Shareholders held on June 24, 2016 by its resolution effective until the commencementof this meeting. To prepare for any case where the number of Outside Audit & Supervisory Board Members
becomes less than the number required by laws and regulations, we propose to elect one (1) Substitute Audit& Supervisory Board Member.
Such Substitute Audit & Supervisory Board Member will assume the office of Audit & Supervisory
Board Member only if the number of Outside Audit & Supervisory Board Members becomes less than thenumber required by laws and regulations. His term of office shall be equal to the remaining term of office ofhis predecessor.
The Audit & Supervisory Board has given its consent to this proposal in advance.
The candidate for Substitute Audit & Supervisory Board Member is as follows:
Name(Date of birth)

Past experienceand significant concurrent positions
April 1979
March 2006
April 2008
May 2010
May 2011
April 2013
June 2015

Atsushi Shigeta(March 31, 1957)(Candidate for
Substitute Audit &Supervisory Board
Member (Outside))

March 2016

Number ofshares of theCompany held

Joined The Fuji Bank, Limited (present Mizuho Bank, Ltd.)
Executive Officer and General Manager, 7th Sales Dept., Mizuho
Corporate Bank, Ltd.
Managing Executive Officer, ditto
Senior Managing Director, Tobu Department Store Co., Ltd.
Representative Senior Managing Director, ditto
Representative Director and President, ditto
Representative Director and President, Tobu Hotel Management
Co., Ltd. (current position)
Part-time Audit & Supervisory Board Member, Tokyo Tatemono
Real Estate Sales Co., Ltd. (current position)[Reasons for proposing him as a candidate for Substitute Audit & Supervisory
Board Member (Outside)]
We expect that he will give us useful opinions and recommendations to securesoundness of the auditing and corporate management of the Company based on his
wealth of experience as a long-time corporate manager. Consequently, we appoint
him as a candidate for Substitute Outside Audit & Supervisory Board Member.

0[Significant concurrent positions]Representative Director and President, Tobu Hotel Management Co., Ltd.
Part-time Audit & Supervisory Board Member, Tokyo Tatemono Real Estate Sales
Co., Ltd.
Outside Audit & Supervisory Board Member, JCU CORPORATION (scheduled toassume office in June 2017)(Notes)1. No conflict of interests exists between the above candidate and the Company.
2. Mr. Atsushi Shigeta is a candidate for Substitute Audit & Supervisory Board Member.
3. The liability limitation agreement with a Substitute Audit & Supervisory Board Member:
The Company has entered into an agreement with Mr. Shigeta Atsushi to limit his liability on condition that he assumes
office as Substitute Audit & Supervisory Board Member. The outline of the agreement is as follows:・ If Mr. Atsushi Shigeta becomes liable to the Company for failure to perform his duties as an Audit & Supervisory
Board Member after the conclusion of this agreement, the maximum amount of his liability shall be twice the total
value of the annual property benefits that he has received or should receive from the Company as consideration for
the execution of his duties during his term of office as calculated by the method provided in Article 113 of theOrdinance for Enforcement of the Companies Act, and any amount in excess of the maximum amount shall be
exempted from the liability, provided that he has conducted his duties in good faith and without gross negligence.

- 15 -

Proposal 6:

Payment of performance-linked bonuses to Members of the Board of Directors

We propose the payment of bonuses in the total amount of ¥130.8 million to five (5) Members of theBoard of Directors in office as of the end of the current fiscal year (excluding two (2) Members of the Boardof Directors (Outside) from the seven (7) Members of the Board of Directors) in consideration of various
factors, including the business performance for the current fiscal year.
The decision on the amount payable to each Member of the Board of Directors shall be delegated to theBoard of Directors.
For the purpose of further promoting value-sharing with the shareholders through enhanced linkage
between the remuneration of Members of the Board of Directors and the business performance, theCompany decided to establish a new performance-linked bonus system with respect to the bonuses paid tothe Members of the Board of Directors (excluding Members of the Board of Directors (Outside)). The new
system is to apply to the bonuses to Members of the Board of Directors for the current fiscal year.
The policy for bonuses for Members of the Board of Directors of the Company after the introduction of
the above performance-linked bonus system is as follows:(Policy for bonuses for Members of the Board of Directors)
The total amount of bonuses payable to Members of the Board of Directors, the variable
remuneration linked to the performance of the Company, shall be calculated in accordance with thedegree of achievement of the performance forecast stated in the kessan tanshin (financial results
report) on the settlement of accounts for the end of the previous fiscal year. The amount payable toeach Member of the Board of Directors shall be decided based on the allotment ratio preliminarily
determined according to the position of each Member of the Board of Directors. However, themaximum amount of such bonuses shall be set in accordance with the relevant laws and regulations.
The amount for payment shall be decided by a resolution of the Board of Directors upon consultation
with the Remuneration Committee, a body consisting of the Representative Directors and theMembers of the Board of Directors (Outside), and thereupon shall be submitted to the ordinary
general meeting of shareholders every year for approval.
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