Code No. 1662
June 2, 2011
Osamu Watanabe, President
Japan Petroleum Exploration Co., Ltd. (JAPEX)
1-7-12 Marunouchi, Chiyoda-ku, Tokyo
To All Shareholders:

Notification of the Convocation to
the 41st Ordinary General Meeting of the Shareholders
The 41st Ordinary General Meeting of the Shareholders of Japan Petroleum Exploration Co., Ltd. (hereinafterreferred to as the “JAPEX”) will be held according to the details below, and we kindly ask for your attendance.
If you cannot attend on the day of the meeting, you may exercise your voting rights through a written document.
Please review the “Reference Documents for Shareholders Meeting” described below, and express your vote on
the enclosed Voting Right Exercise Form. When sending the Voting Right Exercise Form, please send so it will
arrive at our office by Thursday, June 23, 2011.
Thank you very much for your attention and cooperation.
Details:
1. Date and Time:
2. Location:
3. Agenda:
Announcements:

10:00 a.m., June 24, 2011 (Friday)
Tokyo Station Conference “Sapia Hall” (Sapia Tower 5F)
1-7-12 Marunouchi, Chiyoda-ku, Tokyo
1) Business report and consolidated financial report of the 41st Term (from April 1,2010 to March 31, 2011), and audit reports from the accounting auditor and Boardof Corporate Auditors on the consolidated financial report2) Financial report of the 41st Term (from April 1, 2010 to March 31, 2011)

Resolution items:
Item 1: Appropriation of Surplus
Item 2: Election of Fourteen (14) Directors
Item 3: Election of One (1) Corporate Auditor
Item 4: Awarding Retirement Benefits to Retiring Director
Item 5: Payment of Bonuses to Directors and Corporate Auditors
Item 6: Renewal of the Measures to Prevent Large-scale Acquisition of Our Company Shares (Takeover
Defense Measures)*Upon on your arrival at the Ordinary General Meeting of Shareholders, please submit the enclosed Voting Rights
Exercise Form to the venue reception. Thank you.
*In case the Reference Documents for Shareholders Meeting, or business report, financial report or consolidated
financial report is modified, such modification shall be posted on the JAPEX website. (http://www.japex.co.jp/)
NOTE: This document is an abridged translation of the Japanese “Notification of the Convocation to the 41st
Ordinary General Meeting of the Shareholders” “Reference Documents for Shareholders Meeting” and“Financial Report” of JAPEX. This translation is intended for reference and convenience purposes only. In theevent of any discrepancy between this translation and the Japanese original, the original shall prevail. JAPEX
does not guarantee the accuracy and/or the completeness of this translation and shall have no liability for any
errors or omissions therein.

1

Reference Documents for Shareholders Meeting
Item 1: Appropriation of Surplus
JAPEX employs the basic policy of long-term, stable distribution of dividends in considering the retained
earnings for investment in new oil and gas reserves and the development of transportation systems, including
pipelines, as well as respecting the return of profits to our shareholders.
The 41st term dividends will be as follows:
Details Concerning the Year-End Dividends(1) Type of dividend property: Money(2) Distribution and total amount of dividend property:
20 yen per share of common stock
Total amount of dividends: 1,143,053,420 yen(3) Effective date of distribution of surplus: June 27, 2011
Item 2: Election of Fourteen (14) Directors
Upon closing of this general meeting of shareholders, the terms of office of all thirteen (13) Directors of theBoard: Yuji Tanahashi, Osamu Watanabe, Katsuo Suzuki, Norihiko Sawara, Hiroshi Sato, Shoichi Ishii,
Toshio Ibi, Mitsuru Saito, Junichi Matsumoto, Nobuyuki Ogura, Nobuaki Moritani, Hitoshi Yamatoya andKazuo Kawakami will expire. We kindly ask our shareholders to elect fourteen (14) Directors―the current
thirteen (13) Directors plus one (1) more Director. The total number of Directors will be increased to enhance
the future management structure.
The candidates for the Directors are as listed below:
Candidate
No.

Name(Date of birth)

Brief history, Position and responsibilities in JAPEX or
Significant positions concurrently held
April 1958

June 1991
1

Yuji Tanahashi(October 13, 1934)

Aug. 1997
June 2001
June 2008

April 1964
July 1997
July 2002
2

Osamu Watanabe June 2007
(December 6, 1940) June 2008

JAPEX shares
ownedJoined The Ministry of International Tradeand Industry (hereinafter referred to as the“MITI”)
Vice Minister of International Trade andIndustry
Chairman at New Energy Foundation
President at JAPEX
Chairman(up to the present date)<Significant positions concurrently held>
Director at Canada Oil Sands Co., Ltd.
Director at JAPEX Offshore, Ltd.

11,900 shares

Joined MITI
Vice Minister of International Trade andIndustry
Chairman at Japan External Trade
Organization
Executive Vice President at JAPEX
President(up to the present date)<Significant positions concurrently held>
President at Japex Garraf Ltd.
President at JAPEX Offshore, Ltd.

9,100 shares

2Candidate
No.

Name
(Date of birth)

Brief history, Position and responsibilities in JAPEX or
Significant positions concurrently held
April 1969
June 1996
April 2001

June 2002

Feb. 2005
June 2005
3

Katsuo Suzuki(April 26, 1945)

June 2006
Oct. 2006
June 2007
Feb. 2010

June 2010

April 1970
June 1999
June 2002

4

Hiroshi Sato
(January 22, 1947)

June 2005
June 2006
June 2007
June 2010

April 1973
June 1999
June 2003

5

Shoichi Ishii(September 23,
1949)

June 2005
June 2006
June 2007

Joined JAPEX
General Manager of International Oil & Gas
Division, Second Project Dept.
General Manager of International Oil & Gas
Division and General Manager of Middle
East Project Dept.
Director, General Manager of International
Oil & Gas Division and General Manager ofMiddle East Project Dept.
Director, Assistant President ofInternational Oil & Gas Division
Managing Director, Assistant President ofInternational Oil & Gas Division
Managing Director, President ofInternational Oil & Gas Division
Senior Managing Director, President ofInternational Oil & Gas Division
Executive Vice President, President ofInternational Oil & Gas Division
Executive Vice President, President ofInternational Oil & Gas Division
and President of Iraq Business
Executive Vice President , President of Iraq
Project Division(up to the present date)<Significant positions concurrently held>
Director at Japex Garraf Ltd.
Joined JAPEX
General Manager of Finance &Accounting Dept.
Director, General Manager of Finance &Accounting Dept.
Managing Executive Officer
Managing Director
Senior Managing Director
Executive Vice President(up to the present date)<Significant positions concurrently held>
Director at Sakhalin Oil and Gas
Development Co., Ltd.
Auditor at Japex Garraf Ltd.
Auditor at TOHOKU NATURAL GAS Co.,
Inc.
Auditor at INPEX Corporation
Joined JAPEX
General Manager of Corporate Planning
Dept.
Director, General Manager of Corporate
Planning Dept.
Managing Executive Officer, General
Manager of Nagaoka Division Office
Managing Director, General Manager ofNagaoka Division Office
Managing Director(up to the present date)<Significant positions concurrently held>
Director at Japex Energy Co., Ltd.

3

JAPEX shares
owned

3,300 shares

3,600 shares

2,700 shares

Candidate
No.

Name
(Date of birth)

Brief history, Position and responsibilities in JAPEX or
Significant positions concurrently held
May 1972
Jan. 2001
Sep. 2004
June 2005
Jan. 2006
June 2006

6

Toshio Ibi(March 4, 1949)

June 2007
Nov. 2008

April 1973
June 1999
June 2003
June 2005
7

Mitsuru Saito(June 19, 1950)

June 2006
June 2007
June 2010

April 1973
June 2006
June 20078

June 2008
Junichi Matsumoto(September 27,1949) April 2009

April 1975
April 2001
April 2003

9

Nobuyuki Ogura(May 14, 1952)

June 2006
June 2008
June 2010

JAPEX shares
ownedJoined MITI
Director-General for Technology Policy
Coordination at MITI
Advisor at JAPEX
Executive Officer
Executive Officer, General Manager of
Sapporo Division Office
Managing Executive Officer, General
Manager of Sapporo Division Office
Managing Director, General Manager of
Sapporo Division Office
Managing Director, General Manager ofInternational Oil & Gas Division(up to the present date)<Significant positions concurrently held>
President at Japan CBM Limited
President at Universe Gas & Oil Company
Inc.
Director at Canada Oil Sands Co., Ltd.
Director at Energi Mega Pratama Inc.

2,300 shares

Joined JAPEX
General Manager of Administration Dept.
General Manager of Personnel Dept.
Executive Officer, General Manager of
Personnel Dept.
Managing Executive Officer
Managing Director
Managing Director, President ofInternational Oil & Gas Division(up to the present date)<Significant positions concurrently held>
President at Canada Oil Sands Co., Ltd.

2,400 shares

Joined JAPEX
Executive Officer
Managing Executive Officer, General
Manager of Development Division
Managing Director, General Manager ofDevelopment Division
Managing Director(up to the present date)<Significant positions concurrently held>
President at Kangean Energy Indonesia
Ltd.
Joined JAPEX
General Manager of Overseas Exploration
Dept. II, Exploration Division
General Manager of Overseas Exploration
Dept., Exploration Division
Executive Officer
Managing Director, General Manager ofExploration Division
Managing Director, President of
Exploration Division(up to the present date)<Significant positions concurrently held>
Director at JGI, Inc.
Director at JAPEX Offshore, Ltd.
4

500 shares

3,200 shares

Candidate
No.

Name
(Date of birth)

Brief history, Position and responsibilities in JAPEX or
Significant positions concurrently held
April 1974
June 2004
June 2007
Nov. 200810

Nobuaki Moritani(February 2, 1952)
June 2010

April 1976
June 1999

Dec. 2001
June 2007
June 2009
Nov. 200911

Hitoshi Yamatoya(June 5, 1951)
May 2010
June 2010

April 1973
June 2007

12

Kazuo Nakayama(August 4, 1950)

June 2009

Feb. 2010

April 1977
May 2007
July 2008
June 200913

Kiyoshi Ogino(October 22, 1950)

April 2010
June 2010

Joined JAPEX
General Manager of Operations Dept.,
Development Division
Managing Executive Officer
Managing Executive Officer, General
Manager of Sapporo Division Office (later
General Manager of Hokkaido Division
Office)Managing Director, General Manager of
Hokkaido Division Office(up to the present date)
Joined JAPEX
General Manager of Marketing & Sales
Development Dept., Marketing & Sales
Division
General Manager of Marketing & Sales
Dept. I, Marketing & Sales Division
Executive Officer, General Manager ofMarketing & Sales Division
Managing Executive Officer, General
Manager of Marketing & Sales Division
Managing Executive Officer, General
Manager of Marketing & Sales Division andGeneral Manager of Marketing & Sales
Dept. IIManaging Executive Officer, General
Manager of Marketing & Sales Division
Managing Director, President of Marketing& Sales Division(up to the present date)<Significant positions concurrently held>
Director at TOHOKU NATURAL GAS
Co., Inc.
Director at Kitakyushu LNG Sales andLorry Transport Corp.
Joined JAPEXManaging Executive Officer, AssistantPresident of Exploration Division
Managing Executive Officer, General
Manager of International Oil & Gas
DivisionManaging Executive Officer, AssistantPresident of Iraq Project Division(up to the present date)
Joined JAPEX
General Manager of Second Project Dept.,
International Oil & Gas Division
General Manager of First Project Dept.,
International Oil & Gas Division
Executive Officer, General Manager ofDevelopment Division
Executive Officer, President ofDevelopment Division
Managing Executive Officer, President ofDevelopment Division(up to the present date)<Significant positions concurrently held>
Director at JAPEX Offshore, Ltd.
5JAPEX shares
owned

1,500 shares

1,300 shares

1,300 shares

800 shares

Candidate
No.

Name
(Date of birth)

Brief history, Position and responsibilities in JAPEX or
Significant positions concurrently held
April 1958
Jan. 1983
Sep. 1989

Kazuo Kawakami(April 26, 1933)

14

May 1991

June 2007(Note)

Appointed prosecutor
Head of Special Investigation Force, The
Tokyo District Public Prosecutors Office
Chief of Trial Proceedings, Supreme
Public Prosecutors‟ Office
Recorded attorney (Daiichi Tokyo Bar
Association)(up to the present date)Director at JAPEX(up to the present date)<Significant positions concurrently held>
Attorney

JAPEX shares
owned

1,000 shares

1. Junichi Matsumoto, a candidate, is concurrently serving as the President of Kangean Energy Indonesia Ltd., towhich JAPEX is lending funds. No significant interest-based relationship exists between other candidates for
Directors and JAPEX.
2. Kazuo Kawakami is a candidate for Outside Director. We submitted to the Tokyo Stock Exchange a report that
we had elected him as Independent Officer. If he is reelected, he will continue to work as Independent Officer.
3. While having no experience of being directly involved in corporate management, Kazuo Kawakami is judged tobe qualified to be an Outside Director and appointed as a candidate for that post in the hope that he will enablefurther appropriate execution of our business by supervising our management and making extensive proposals
on the basis of knowledge and experience as a legal expert.
4. At the end of this general meeting of shareholders, Kazuo Kawakami will have served as Outside Director of
JAPEX for four (4) years.

Item 3: Election of One (1) Corporate Auditor
Upon closing of this general meeting of shareholders, the term of office of Corporate Auditor Masahiko
Kadotani will expire. We kindly ask our shareholders to elect one (1) Corporate Auditor.
The candidate for Corporate Auditor as listed below:
The Board of Corporate Auditors consented to this proposal.
Candidate
No.

1

Name
(Date of birth)

Brief history, Position and responsibilities in JAPEX or
JAPEX shares
Significant positions concurrently held
owned
April 1958
Joined the Ministry of Finance
June 1990
Director-General of the National Tax
AgencyDec. 1994
President of Japan Finance Corporation for
Small Business
April 2002
Advisor at Mizuho Corporate Bank, Ltd.
Masahiko Kadotani June 2003
Corporate Auditor at JAPEX—(Feb 14, 1936)(up to the present date)<Significant positions concurrently held>
Outside auditor of Mizuho Securities Co.,Ltd.
Outside auditor of HEIWA REAL ESTATE
CO., LTD.
Outside auditor of PRONEXUS Inc.

(Notes) 1. No significant interest-based relationship exists between the candidate Masahiko Kadotani and JAPEX.
2. He is a candidate for Outside Auditor. We submitted to the Tokyo Stock Exchange a report that we had elected
him as Independent Officer. If he is reelected, he will continue to work as Independent Officer.
3. We nominated him as a candidate for Outside Auditor because we judged that he has rich experience ingovernment offices and private companies and deep insight, is in an objective position independent from the top
management implementing business operations, and can therefore greatly contribute to the management of ourcompany as Outside Auditor.
4. He has never been directly involved in business management. However, we nominated him as a candidate for
Outside Auditor again because he has given us proper advice on the business execution of our company based on
his rich experience and deep insight.
5. He will have served as Outside Auditor of JAPEX for eight (8) years at the end of this general meeting ofshareholders.
6. In October 2007, the Financial Services Agency ordered Mizuho Securities Co., Ltd., for which he worked as
Part Time Auditor, to improve business operations. However, he was not involved in the incidents. After theoccurrence of the incidents he performed his duties by expressing his opinion to help prevent the recurrence ofthe problem.
6

Item 4: Awarding Retirement Benefits to Retiring Director
Upon closing of this general meeting of shareholders, Direcor Norihiko Sawara will be resigning from his
post.
Therefore, retirement benefits shall be awarded according to the standards specified by JAPEX inrecognition of services during his tenure. We kindly ask our shareholders to allow deliberation by the Board of
Directors with regard to the specific amount, period and method of payment, etc.
His brief histories are as follows:
Name

Brief history
June 2004
June 2005

Norihiko Sawara

Oct. 2006
June 2008

Director, General Manager of Nagaoka
Division Office
Managing Director, President of
Exploration Division
Senior Managing Director, President of
Exploration Division
Executive Vice President(up to the present date)

Item 5: Payment of Bonuses to Directors and Corporate Auditors
A total bonus amount of 69,490,000 yen (64,690,000 yen to Directors, 4,800,000 yen to Corporate
Auditors) will be paid to seventeen (17) Directors (including one (1) Outside Director) and four (4) Corporate
Auditors tenured during the fiscal year ended March 31, 2011, in view of the traditionally paid bonus amounts
and the performance of the fiscal year ended March 31, 2011.
Item 6: Renewal of the Measures to Prevent Large-scale Acquisition of Our Company Shares (Takeover
Defense Measures)
We obtained the approval of our shareholders for the “Measures to Prevent Large-scale Acquisition of Our
Company Shares (Takeover Defense Measures)” (hereinafter the “Former Plan”) at the ordinary general
meeting of shareholders for the 38th financial year held on June 25, 2008. The Former Plan will expire at theclose of the ordinary general meeting of shareholders for the 41st financial year (hereinafter the “Annual
Shareholders‟ Meeting”) to be held on June 24, 2011.
Prior to the expiry of the effective period of the Former Plan, we have, in our Board of Directors meeting
held on May 13, 2011, decided to partially revise the content of the Former Plan and renew it as anundertaking based on the basic policy (refers to the policies in the provision in Article 118 Clause (3) of theOrdinance for Enforcement of the Companies Act, hereinafter the “Basic Policy”) to prevent the controlling ofdecisions relating to the policies of our finances and business by inappropriate persons (hereinafter the“Renewal,” and the plan after the Renewal is the “Plan”) (Article 118 Clause 3 (2) of the Ordinance for
Enforcement of the Companies Act), subject to the approval of our shareholders at the Annual Shareholders‟Meeting.
Therefore, we would like to request our shareholders to delegate to our Board of Directors the right todetermine the matters related to the “allotment of share options without contribution” pursuant to theprocedure mentioned in the following Item 2 “Details of the Proposal” in accordance with Article 12 of the
Articles of Incorporation of our company.
1. Cause of the Proposal(1) Basic Policy Regarding the Person Controlling Decisions Relative to Policies for Our Finances andBusiness
JAPEX considers that the person controlling our financial and business policy decisions should fully
understand the content of our finances and business and the source of our corporate value, and is eligible toensure and improve the corporate value and consequently, the common interest of the shareholders in acontinuing, sustainable manner.
JAPEX believes the decision on an acquisition proposal with which is associated the transfer of corporate
control should ultimately be made based on the general decision of our shareholders. Furthermore, JAPEX
does not disapprove of large-scale share acquisition that contributes to our corporate value and consequently
the common interest of the shareholders.
Nevertheless, among large-scale share acquisitions, there are many that do not contribute to the corporate
value and the common interest of the shareholders, in the light of their purpose, including such that cause aclear infringement on the corporate value and the common interest of the shareholders, such that has the riskof a de facto coercion against the shareholders to sell their shares, such that does not provide sufficient time
and/or information for the Board of Directors and the shareholders consideration of the content of thelarge-scale share acquisition or for the Board of Directors to propose an alternative plan, and such that require7consultation and negotiation with the acquirer to draw out a more favorable condition than the conditions
presented from the acquirer.
The large-scale share acquirer should understand the source of our corporate value, not to mention thecontent of JAPEX‟s finances and business, and unless he or she ensures and improves them for the
medium-and-long term, our corporate value, and consequently the common interest of the shareholders will
be damaged.
JAPEX considers such a large-scale acquirer that does not contribute to our corporate value and thecommon interest of our shareholders inappropriate as the controlling person to determine the policies of our
finances and business, and thus consider necessary to protect our corporate value and consequently thecommon interest of our shareholders by taking essential and substantial measures against such attempts.
(2) Purpose of the Renewal
The Plan shall be renewed according to the Basic Policy described above (1) for the purpose of ensuring
and improving our corporate value and the common interests of our shareholders.
The Board of Directors, as set forth in the Basic Policy, considers a person who performs the large-scaleacquisition of JAPEX share certificates, etc., without contributing to our corporate value and/or the common
interests of our shareholders inappropriate for making financial and business policy decisions regarding theCompany. The Plan aims to prevent the control of our financial and business policies by such inappropriate
persons and deter large-scale acquisition that is detrimental to our corporate value and/or the common
interests of our shareholders. At the same time, the Plan shall allow the Company‟s Board of Directors toensure the necessary information and time required to propose an alternative plan to our shareholders or forour shareholders to sufficiently judge whether such a large-scale acquisition of JAPEX share certificates, etc.,
is acceptable and/or allow negotiation and other measures to be taken on behalf of our shareholders.
2. Content of the Proposal(1) Overview of the Plan
The Plan determines the necessary procedure for achieving the aforementioned purpose, such as
demanding the prior provision of information from the acquirer, upon the emergence of a person who intends
to acquire 20% or more of JAPEX share certificates, etc.
In case the decision of not implementing the Plan has been made by the Board of Directors based on theprocedures of the Plan, the acquirer shall be authorized to make a large-scale acquisition of JAPEX sharecertificates, etc., only after such a board decision.
In case the acquirer does not comply with the procedure set forth in the Plan or the intended large-scaleacquisition of JAPEX share certificates, etc., has a risk of impairing our corporate value and/or the common
interest of our shareholders and if the predetermined requirements for the implementation of the Plan aresatisfied, JAPEX shall allot share options with exercise conditions in which the exercise of rights by theacquirer is, in principle, impermissible or with acquisition clauses where JAPEX may, in principle, acquire
share options from persons other than the acquirer in exchange for JAPEX shares to all shareholders
excluding JAPEX at that point of time, through an allotment of share options without contribution.
In the event that the allotment of share options without contribution is executed according to the Plan, andassociated by its execution or acquisition by JAPEX, when JAPEX shares are issued to all shareholders
except for the acquirer, the percentage of voting rights the acquirer holds may be diluted up to a maximum of
approximately 50%.
With regard to the decision whether to implement or not implement the allotment of share options without
contribution, or to acquire, according to the Plan, in order to eliminate the arbitrary decision of the Board of
Directors, it shall undergo the objective decision of the Independent Committee constituted only of outside
director etc., who are independent from the Company‟s Board of Directors pursuant to the Independent
Committee Provision. Moreover, in any of the predetermined cases in the Plan, the Board of Directors may
convoke a general meeting of shareholders to confirm the intention of the shareholders concerning theimplementation of the allotment of share options without contribution.
We aim to ensure transparency of the process of these procedures through the timely disclosure of
appropriate information to our shareholders.
(2) Procedure for the Implementation of the Plan(a) Share purchases that are the Subject of the Plan‟s Application
The Plan shall be applied when a purchase or other acquisition of JAPEX share certificates, etc., that falls
under 1) or 2) described subsequently or a similar act (including any proposal thereof) is pursued(excluding those on which the Board of Directors has otherwise approved of not applying the Plan;
hereinafter the “Acquisition(s)”).
1) Share Purchase or other acquisition with an ownership ratio1 of 20% or more of the holder2 with regard8to share certificates, etc.,3 issued by JAPEX.
2) Tender offers4 with a total ownership ratio5 of 20% or more of the persons pursuing tender offers andtheir special associated persons6 with regard to share certificates, etc.,7 issued by JAPEX.
Persons who intend to perform the Acquisitions (hereinafter the “Acquirer(s)”) shall comply with theprocedures set forth in the Plan, and they must not perform the Acquisitions before the Company‟s Board of
Directors passes a resolution not to implement the allotment of the Share Options without contribution
based on the Plan.
(b) Submission of the Intent Statement
The Acquirers shall, prior to the relevant Acquisitions, submit a document (on which the signature or theseal of the Acquirers‟ representative is placed) including covenant wordings, etc., that express the intention
to comply with the procedure set forth in the Plan and a qualification certificate of the representative signed
or sealed thereby, in a format specified by JAPEX (hereinafter collectively the “Intent Statement”) to
JAPEX. The Intent Statement shall specify the name or designation, the address or location such as the head
office and offices of the Acquirers, the governing law for incorporation, the name of the representative, thecontact in Japan and the outline of the intended Acquisition. The language used in the Intent Statement andthe Acquisition Statement, which is set forth in the following (c), must be only Japanese.
(c) Demand for Information Provision towards the Acquirers
JAPEX will deliver a form of the Acquisition Statement (defined below) (including a list of information
items to be provided by the Acquirers to JAPEX) within 10 business days after receiving the Intent
Statement. The Acquirers are required to submit a written statement, which provides the information
stipulated in the following (hereinafter the “Required Information”) (hereinafter collectively the“Acquisition Statement”), to the Company‟s Board of Directors in a format specified by JAPEX.
Upon receiving the Acquisition Statement, the Company‟s Board of Directors will immediately send it to
the Independent Committee (the appointment criteria of committee members, the requirements for adopting
resolutions and matters for resolution are as described in the separate document 1 “Overview of the
Independent Committee Provision” and personal careers of the members in the separate document 2 “Brief
History of Independent Committee Members”).
When the Independent Committee has decided that the description on the Acquisition Statement falls
short as Required Information, JAPEX may request the Acquirer to provide additional information, with anappropriate reply deadline. In this case, the Acquirers are required to additionally submit such information
to JAPEX by the relevant deadline.
1) Details (including names, capital relationship, financial content, business performance, compliancewith laws and other regulations, details of previous trade similar to the Acquisition of the relevant
Acquirers, and the previous transactions of JAPEX share certificates, etc.) of the Acquirers, and theirgroup (including joint shareholders8, special associated persons, and special associated persons of theparties whose controlled incorporations9 are the Acquirers)102) Purpose, method, and content of the acquisition (includes value and type in consideration of theacquisition, time of acquisition, mechanism of related trade, legality of the method of acquisition, andinformation on the feasibility of the Acquisition)
3) Price and basis of the valuation of the relevant Acquisition
4) Proof of funds for the acquisition (includes the specific names of providers of the funds for theacquisition (including the beneficial providers), procurement methods, content of related trade, etc.)
5) Management policy, business plans, capital policy, and dividend policy, for JAPEX Group after theacquisition
6) Post-acquisition policy regarding our shareholders, employees, labor union, business partners,
customers, and other stakeholders related to JAPEX Group7) Specific information regarding the risk of infringement by the Acquirers to the laws and regulations inand out of Japan (includes the Act of Prohibition of Private Monopolization and Maintenance of Fair
Trade and foreign competition law)8) Specific measures to prevent conflicts of interest with other shareholders of JAPEX shares
9) Other information reasonably decided by the Independent Committee as necessary(d) Consideration of the Content of Acquisition / Consideration of Negotiation with the Acquirer or of an
Alternative Plan
1) Request to the Board of Directors for the submission of information
The Independent Committee shall, when the Acquisition Statement and (if applicable) the additional
information are submitted by the Acquirer, determine an appropriate reply deadline (in principle, 60 days
maximum in view of the scale, characteristics and diversity of the JAPEX Group) with due consideration
to the time required for the collection of information and the review and/or valuation of materials by the9Board of Directors (including such examination by outside experts, as required). The Independent
Committee may also request the Board of Directors to present its opinion (including suspension of
opinion; hereinafter the same applies.) on the content of the Acquisition proposed by the Acquirer and the
supporting materials, (if available) alternative plans, and other information deemed necessary by the
Independent Committee, as appropriate, with the appropriate reply deadline.
2) Reviews and other considerations by the Independent Committee
The Independent Committee shall, within an appropriate period (in principle, a maximum of 60 days inview of the scale, characteristics and diversity of the JAPEX Group) (hereinafter the “Reviewing Periodof the Independent Committee”) after the receipt of the information (including the additional information
requested) from the Acquirer and the Board of Directors (if the provision of information has beenrequested to the Company‟s Board of Directors as described in 1) above), review the content of theAcquisition, collect information on and comparatively investigate the management and business plans of
the Acquirer and the Board of Directors, and review the alternative plan provided by the Board of
Directors. Furthermore, the Independent Committee shall, directly or indirectly, consult and/or negotiatewith the Acquirer, if necessary, to improve the content of the relevant Acquisition in view of ensuring andimproving our corporate value and the common interest of our shareholders.
In order to ensure that the Independent Committee makes the decision to the benefit of the corporate
value and the common interest of our shareholders, the Independent Committee may seek advice from an
independent third party (includes financial advisors, certified public accountants, lawyers, certified tax
accountants, consultants and other experts) at the expense of the Company. The Acquirer shall promptly
respond to the direct or indirect request of the Independent Committee to provide reviewing materials orother information, or for consultation, negotiation, or other communication.
(e) Procedure of advisory of the Independent Committee
The Independent Committee shall advise the Board of Directors as follows in compliance with the above
procedure.
1) When advising the implementation of the Plan
When the Independent Committee judges that the Acquisition by the Acquirer falls under any of thecauses for implementation (hereinafter collectively the “Cause for Implementation”) set forth in thefollowing (3) “Requirements for the allotment of the Share Options without contribution,” theIndependent Committee shall advise the implementation of the allotment of the share options (of which
the major content shall be as set forth in the following (4) “Overview of the Allotment of the Share
Options without Contribution”; hereinafter the “Share Options”) without contribution to the Board of
Directors, except under special circumstances through which the further provision of information by andconsultation and/or negotiation with the Acquirers are necessary. Meanwhile, the Independent Committee
may issue a reservation that the shareholders‟ intention should be heard and decided if the applicability ofthe second cause for implementation (hereinafter the “Second Cause for Implementation”) of the twocauses specified in the following (3) “Requirements for the allotment of the Share Options without
contribution” has come into question with regard to a certain Acquisition.
Regardless of the foregoing paragraph, even after the implementation of the allotment of the Share
Options without contribution has been advised, if the Independent Committee deems that any of theconditions specified below applies, the Independent Committee may pause the allotment of the Share
Options without contribution by two business days before the ex-rights day of the allotment of the Share
Options without contribution, or, may issue a new advisory to acquire all the Share Options without
contribution by one day before the date of commencing the Period of Exercise after the effective date of
the allotment of the Share Options without contribution.
(i)

When the Acquisition is withdrawn by the Acquirer after the advisory or when the Acquisition isotherwise no longer existent; or(ii) When the Cause for Implementation is no longer existent due to such reason that, for example, anychange has occurred in the facts the decision of the advisory was based on.
2) When advising not to implement the Plan
When the Independent Committee determines that the Acquisition does not fall under any Cause for
Implementation, the Independent Committee shall advise not to implement the allotment of the Share
Options without contribution to the Board of Directors, irrespective of whether the Reviewing Period of
the Independent Committee has commenced or has finished.
Regardless of the foregoing paragraph, even after the non-implementation of the allotment of the Share
Options without contribution has been advised, if the Cause for Implementation becomes existent as aresult of any change that occurred in the facts the decision of the advisory was based on, the Independent
10

Committee may issue a new advisory to implement the allotment of the Share Options without
contribution.
3) When extending the Reviewing Period of the Independent Committee
When the Independent Committee judges that issuing an advisory of implementation or
non-implementation of the allotment of the Share Options without contribution is not necessary before theexpiration of the initial Reviewing Period of the Independent Committee (if already has been extended,
include the term after the extension; hereinafter the same applies.), the Independent Committee may
extend the Reviewing Period of the Independent Committee, within the reasonable range (however, thetotal extendable period shall, in principle, be up to 30 days at a maximum) required for the reviewing of
the content of the Acquisition by the Acquirer and/or for the consultation and/or negotiation or othercommunication with the Acquirer.
In case the Reviewing Period of the Independent Committee is extended, the Independent Committee
shall continue on with the collection of information, reviewing, consultation and/or negotiation and otheractivities, and shall exert its upmost effort to issue the advisory of implementation or non-implementationof the allotment of the Share Options without contribution within the extended period.
(f) Resolution of Board of Directors
In case an advisory as outlined above has been given by the Independent Committee, the Board of
Directors shall make a resolution as a body under the Companies Act regarding the implementation or
non-implementation of the allotment of the Share Options without contribution, in utmost deference tothe above advisory of the Independent Committee.
However, in the case a general meeting of shareholders for decision hearing is held according to thefollowing (g), the Board of Directors shall prepare a resolution based on the resolution of the General
Meeting of Shareholders for Decision Hearing.
(g) Holding of the general meeting of shareholders for decision hearing
With regard to the implementation of the allotment of the Share Options without contribution
according to the Plan, the Board of Directors may convoke a general meeting of shareholders (hereinafter
the “General Meeting of Shareholders for Decision Hearing”) to hear the shareholders‟ decision regarding
the implementation of the allotment of the Share Options without contribution in the case (i) where theIndependent Committee issued a reservation that shareholders‟ decision be heard in advance with regard
to the implementation of the allotment of the Share Options pursuant to the procedure in (e) above, or (ii)where the applicability of the Second Cause for Implementation has come into question with regard to acertain Acquisition and the Independent Committee judges it appropriate to hear the shareholders‟
decision in light of various factors such as the time required for holding the general meeting ofshareholders and the duty of care of a good manager.
(h) Information disclosure
In operating the Plan, JAPEX shall timely disclose the appropriate information as enumerated below inaccordance with the governing laws and regulations and/or applicable rules and regulations of the stock
exchanges: progress status of the respective procedures set forth in the Plan (including the fact of theIntent Statement and the Acquisition Statement submitted; the fact of the revealed existence of an
Acquirer who intends to make the Acquisition without submitting the Intent Statement or the Acquisition
Statement; the fact of the commenced Reviewing Period of the Independent Committee; and the fact of
the extended Reviewing Period of the Independent Committee together with the extended period and thereason therefore), outline of the advisory of the Independent Committee, outline of the resolution adopted
by the Company‟s Board of Directors, outline of the resolution at the General Meeting of Shareholders for
Decision Hearing, and any other matters deemed appropriate by the Independent Committee or the Boardof Directors.
(3) Requirements for the allotment of the Share Options without contribution
The requirements for the implementation of the allotment of the Share Options without contribution
pursuant to the Plan shall be as follows. As was described in (e) under (2) “Procedure for the Implementationof the Plan”, whether the Acquisition falls under the following requirements shall be always be decided withand after the advisory of the Independent Committee.
First Cause for Implementation
When the Acquisition is not in conformity with the procedures prescribed in the Plan (including the casewhere time and/or information reasonably required to make judgments on the content of the Acquisition havenot been provided by the Acquirer) and it is deemed suitable to implement the allotment of the Share Options
without contribution;
11

Second Cause for Implementation
When the Acquisition by the Acquirer falls under any of the following and it is deemed suitable toimplement the allotment of the Share Options without contribution;(a) When the Acquisition clearly risks infringing on our corporate value and consequently to the common
interest of our shareholders, by reason of the acts listed below:
1) Act in which the Acquirer corners the share certificates and such, and demands that JAPEX purchasesuch share certificates for a high price;2) Act in which the Acquirer temporarily controls the management of JAPEX to perform management forthe benefit of the Acquirer that is based on the sacrifice of JAPEX, such as acquiring JAPEX‟s
important assets and other properties at low cost;3) Act in which the Acquirer appropriates the assets of JAPEX Group as collateral for debt and/or as aresource to perform obligations of the Acquirer or its group companies, etc.; or
4) Act in which the Acquirer temporarily controls the management of JAPEX to dispose of expensive
assets and/or other properties that are not active in the business of JAPEX Group for the foreseeable
future, and with the disposal income, perform temporary high dividend payouts or sell-out of shares on
the occasion of sharp rises in share prices due to such temporary high dividend payouts.
(b) When the Acquisition has a risk of a de facto coercion towards the shareholders to sell their shares, suchas coercive two-tiered tender offers (refers to an act in which shares are purchased in tender offers andsuch, without soliciting/offering the purchase of all shares in the initial purchase, but set the second tierpurchase condition disadvantageously or without clarifying the second tier purchase condition);(c) When the Acquisition is such that the condition of the Acquisition (including value and type inconsideration, time, legality of the method, feasibility, post-Acquisition management policy and businessplans, post-Acquisition shareholders other than JAPEX, and policy regarding the employees, customers,
business partners, and other stakeholders related to JAPEX Group) is insufficient or inadequate withconsideration to JAPEX‟s intrinsic value; or(d) When the Acquisition might cause significant damage to our corporate value and consequently to thecommon interest of our shareholders, with a risk of causing a serious hindrance in ensuring a stablesupply of energy or ensuring customer convenience, due to the insufficiency or inadequacy of the content
of post-Acquisition management policy or business plans.
(4) Overview of the Allotment of the Share Options without Contribution
The overview of the allotment of the Share Options without contribution planned to be implemented basedon the Plan is as follows:(a) Number of the Share Options
The number of the Share Options shall be equal to the final total number of shares (provided, however,that the number of JAPEX shares held by JAPEX at point of certain date is deducted) issued as of a certain
date (hereinafter the “Allotment Date”) otherwise decided by resolution of the Board of Directors or byresolution at a general meeting of shareholders concerning the allotment of the Share Options without
contribution (hereinafter the “Resolution for the Allotment of Share Options without Contribution”).
(b) Shareholders eligible for allotment
The Share Options shall be allotted to shareholders other than JAPEX who are registered on the final
shareholder registry (hereinafter the “Shareholders Eligible for Allotment”) as of the Allotment Date, in
proportion of one Share Option per one JAPEX share held by the shareholder.
(c) Effective date of allotment of the Share Options without contribution
The effective date shall be otherwise decided by the Resolution for the Allotment of Share Options
without Contribution.
(d) Number of shares as object of the Share Options
The number of JAPEX shares as object of each Share Option (hereinafter the “Target Share Number”)
is, in principle, one share.
(e) Value of assets contributed upon the exercise of the Share Options
The object of contribution upon the exercise of the Share Options shall be money. The value per
JAPEX share of the property to be contributed upon the exercise of the Share Options shall be otherwise
12decided in the Resolution for the Allotment of Share Options without Contribution, within the value rangeof one yen as lower limit and one half of the market value of one JAPEX share as higher limit.
Furthermore, “market value” is equivalent to the value corresponding to the average closing price(includes quotations) for 90 days (excludes dates without contracted trade) of ordinary exchange dates forordinary JAPEX shares at the Tokyo Stock Exchange, prior to the Resolution for the Allotment of Share
Options without Contribution, and fractions shall be rounded up.
(f) Period of Exercise of the Share Options
The date otherwise prescribed in the Resolution for the Allotment of Share Options without
Contribution shall be the initial date (hereinafter the initial date of such period of exercise shall be the“Commencing Date of the Period of Exercise”) of the Period of Exercise, and in principle the period
otherwise prescribed in the Resolution for the Allotment of Share Options without Contribution within
the range of one to six months shall be the Period of Exercise. However, in case JAPEX acquires the Share
Options based on the provision of the following clause (i), the Period of Exercise of the Share Options forsuch acquisition shall be until the business day before such acquisition date. Furthermore, if the final dateof the Period of Exercise falls on a non-business day of the payment handling institution where the money
shall be paid upon the exercise, the last business day before such date shall be the final date of the Periodof Exercise.
(g) Conditions of exercise of the Share Options( I ) Specific large-scale holders11, ( II ) joint holders of specific large-scale holders, ( III ) specificlarge-scale acquirers12, ( IV ) special associated persons of specific large-scale acquirers, or ( V ) persons
who was assigned or succeeded the Share Options from persons that fall under ( I ) or ( IV ) without theapproval of the Board of Directors, or ( VI ) persons who are in relation13 to persons that fall under ( I ) or
( V ) (hereinafter persons that fall under ( I ) or ( VI ) collectively shall be the “Unqualified Persons”) may
not, excluding cases where certain exceptional causes14 exist, exercise the Share Options. Furthermore,
under the applicable foreign law, non-residents, as they require prescribed procedures for the exercise of
the Share Options, may not, in principle, exercise the Share Options. (However, on the condition that the
Share Options held by the non-resident shall also comply with the applicable law, they may become theobject of acquisition by JAPEX in consideration of JAPEX shares as described in the following (i) 2).) In
addition, persons who do not submit a covenant in a form prescribed by JAPEX containing a
representation warrant clause with regard to that the person satisfies the requirements for exercise of the
Share Options, compensation clause and other covenant wordings, cannot exercise the Share Options.
(h) Restriction on assignment of the Share Options
The acquisition of the Share Options through assignment requires the approval of our Board of
Directors.
(i) Acquisition of the Share Options by JAPEX
1) In case the Board of Directors deem it appropriate for JAPEX to acquire the Share Options, JAPEX may
any time acquire all the Share Options without contribution upon the coming of the date otherwiseprescribed by the Board of Directors, until the day before the Commencing Date of the Period of
Exercise.
2) JAPEX may, upon the coming of the date otherwise prescribed by the Board of Directors, acquire all the
Share Options held by persons other than the Unqualified Persons, which are not exercised by the day
before the date prescribed by the Board of Directors, and in exchange of such unexercised Share
Options, may delivery the number of JAPEX shares equivalent to the Target Share Number per one
Share Option.
Furthermore, in the event that the Board of Directors acknowledges the presence of persons otherthan the Unqualified Persons among the holders of the Share Options after the date of such anacquisition, upon the coming of the date prescribed by the Board of Directors that is after the date of theabove acquisition, all the Share Options held by such persons that remained unexercised as of one
business day before the date assigned by the Board of Directors shall be acquired by JAPEX and in
exchange for this, JAPEX may deliver shares equivalent to the Target Share Number per one Share
Option, and the same principle shall apply hereafter.
(j) Delivery of share options in case of merger, demerger, incorporation-type company split, share exchange,and stock transfer
They shall be otherwise prescribed in the Resolution for the Allotment of Share Options without
Contribution.

13

(k) Issuance of share option certificates
Share option certificates will not be issued for the Share Options.
(l) Other
Details on the content of the Share Options (includes matters concerning the handling of the Share
Options held by the Unqualified Persons) other than prescribed above shall be otherwise stipulated in the
Resolution for the Allotment of Share Options without Contribution.
(5) Effective period, abolition, and modification of the Plan
The effective period of the Plan shall be until the close of the ordinary general meeting of shareholders
regarding the latest fiscal year ending within three years after the close of the Annual Shareholders‟ Meeting,which is the same as the delegation period of the authority to decide the matters concerning the allotment of
the Share Options without contribution in the Plan to be in accordance with the resolution of the Annual
Shareholders‟ Meeting.
However, even before the expiration of the effective period, 1) if a resolution for withdrawing the above
delegation to the Board of Directors with regard to the decision on matters concerning the allotment of the
Share Options without contribution in the Plan is made at a general meeting of shareholders, or 2) if aresolution to abolish the Plan is made by the Board of Directors, the Plan shall be abolished at that point intime.
Furthermore, even during the effective period of the Plan, when an addition, revision, and/or abolishmentof laws, financial instruments, or stock exchange rules concerning the Plan are appropriate to reflect on thePlan, when appropriate to correct the wordings by reason of typographical errors, or when the change of thePlan does not act against the intention to delegate based on the resolution of the Annual Shareholders‟Meeting, such as when such changes are not detrimental to our shareholders, the Board of Directors may
revise or modify the Plan upon the approval of the Independent Committee.
JAPEX shall promptly disclose information regarding the fact of the abolition, revision or modification of
the Plan, (in case of a revision and/or a modification) the content of such revision and/or modification, andother matters.
(6) Revision due to amendments in law
The provision of law referenced in the Plan is assumed as the provision in effect as of May 13, 2011, andshould any addition, revision, or abolition of the law occur after the date and thus necessitates a revision to
the clauses prescribed above or meaning of terms, such clauses or meaning of terms shall be appropriatelyinterpreted within a reasonable range, upon consideration of the intention of the addition, revision, or
abolition.

14

1. Defined in Article 27-23-4 of the Financial Instruments and Exchange Act. The term herein is subject to its definition.
2. Includes persons included in holders, based on Article 27-23-3 of the Financial Instruments and Exchange Act (includes
persons the Board of Directors deemed that they will fall under the definition). The term herein is subject to its definition.
3. Defined in Article 27-23-1 of the Financial Instruments and Exchange Act. The term herein is subject to its definition,
unless otherwise specified.
4. Defined in Article 27-2-6 of the Financial Instruments and Exchange Act. The term herein is subject to its definition.
5. Defined in Article 27-2-8 of the Financial Instruments and Exchange Act. The term herein is subject to its definition.
6. Defined in Article 27-2-7 of the Financial Instruments and Exchange Act (includes persons the Board of Directors deemedthat they will fall under the definition). However, with regard to the persons stipulated in Article 27-2-7 (1), those who fallunder Article 3-2 of the Cabinet Office order concerning the disclosure of tender offers of share certificates by persons otherthan the issuer, shall be excluded. The term herein is subject to its definition.
7. Defined in Article 27-2-1 of the Financial Instruments and Exchange Act.
8. Refers to the joint holders stipulated in Article 27-23-5 of the Financial Instruments and Exchange Act, and includes
persons deemed joint holder based on Article 27-23-6 (includes persons the Board of Directors deemed that they will fallunder the definition). The term herein is subject to its definition.
9. Defined in Article 9-5 of the Enforcement Order of the Financial Instruments and Exchange Act.
10. In case of funds, includes the information equivalent to that in 1) above for each union member or other members.
11. In principle, refers to holders of share certificates issued by JAPEX and the ratio of whose ownership of such shares is 20%
or more (includes persons the Board of Directors deemed that they will fall under the definition). However, persons whose
acquisition or holding of the shares are deemed harmless to our corporate value or the common interest of our shareholders
by the Board of Directors, and other persons who are otherwise designated by the Board of Directors in the Resolution for
the Allotment of Share Options without Contribution, shall not fall under specific large-scale holders. The term herein issubject to its definition.
12. In principle, refers to persons who made a public notice to purchase (Defined in Article 27-2-1 of the Financial Instruments
and Exchange Act. The term herein is subject to its definition.) shares issued by JAPEX (Defined in Article 27-2-1 of the
Financial Instruments and Exchange Act. The term herein is subject to its definition.) by tender offer and whose ratio ofshare ownership (as pursuant to this, shall include cases stipulated in Article 7-1 of the Enforcement Order of the Financial
Instruments and Exchange Act) combined that of the person‟s special associated person become 20% or more after such
purchase (includes persons the Board of Directors deemed that they will fall under the definition). However, persons whose
acquisition or holding of the shares are deemed harmless to our corporate value or the common interest of our shareholders
by the Board of Directors, and other persons who are otherwise designated by the Board of Directors in the Resolution for
the Allotment of Share Options without Contribution, shall not fall under specific large-scale acquirers. The term herein issubject to its definition.
13. “Those who are in relation” to refers to a person who substantially control the other person, or is controlled by the otherperson, or under the same control as the other person (includes persons the Board of Directors deemed that they will fallunder the definition), or a person approved by the Board of Directors as acting substantially in cooperation with the otherperson. Furthermore, “control” refers to “the case where controlling the determination of financial and business policies” ofanother organization (defined in Article 3-3 of Regulation for Enforcement of Companies Act).
14. Specifically, the following case is deemed to fall under such exceptional causes: (x) In case the Acquirer pauses orwithdraws the Acquisition after the Resolution for the Allotment of Share Options without Contribution is adopted or if theAcquirer and other Unqualified Persons have pledged that they do not intend to make the Acquisitions subsequently andhave delegated a disposition of JAPEX shares to a securities company that JAPEX admits, and additionally (y) in case aratio authorized by JAPEX (hereinafter the “Unqualified Persons‟ Ownership Ratio of JAPEX Share Certificates, etc.”) as
the Acquirer‟s ownership ratio of JAPEX share certificates, etc. (provided, however, that in calculating the ownership ratioof the JAPEX share certificates, etc., the Unqualified Persons other than the Acquirers and Joint Holders thereof shall bedeemed to be the joint holders of the Acquirers, and the Share Options that do not satisfy the exercise conditions shall be
excluded), is less than either (i) the Unqualified Persons‟ Ownership Ratio of JAPEX Share Certificates, etc., prior to theAcquisition or (ii) 20%, whichever is lower, the Acquirer of the Acquisition and other Unqualified Persons who have madethe disposition may exercise the Share Options targeting the number of shares that correspond to the disposed shares within
the range below said lowering ratio. The exercise conditions for the Share Options to be exercised by the Unqualified
Persons and the details of relevant procedures shall be otherwise prescribed by the Company‟s Board of Directors.
END

15

Separate Document 1
Overview of the Independent Committee Provision
・The Independent Committee shall be established by the resolution of the Board of Directors.
・The members of the Independent Committee shall be three or more, who are appointed by the Board of Directors
from persons who are independent of management involved in business operations of JAPEX and are any of thefollowing: (i) Outside director (includes persons planned to be elected), (ii) Outside auditor (includes persons
planned to be elected), or (iii) outside expert. However, an expert must be a proven business administrator,
post-bureaucrat, expert in investment banking, lawyer, certified public accountant, certified tax accountants, ora researcher with his or her main field of research as corporate law or such, or must be pursuant to theaforementioned. Furthermore, the members of the Independent Committee must enter into an agreement withJAPEX that includes provisions for the duty of care of a good manager, otherwise designated by the Board of
Director.
・The term of office for Independent Committee members shall be until the close of the ordinary general meetingof shareholders for the last fiscal year which ends within three years after the close of the Annual Shareholders‟Meeting, provided that there is no resolution by the Board of Directors otherwise determining the term.
Furthermore, in case a Independent Committee member who was a outsider director or outside auditor is nolonger an outsider director or outside auditor (excludes cases where he or she is re-elected as one), the term ofoffice as an Independent Committee member shall terminate at the same time.
・The Independent Committee shall decide on the matters with implementation or non-implementation of theallotment of the Share Options without contribution, pause of allotment of the Share Options without
contribution or Acquisition of the Share Options without contribution, matters to be decided by the Board of
Directors, on which the Board of Directors seeks the advice of the Independent Committee and other mattersthat may be executed by the Independent Committee as defined under the Plan.
・The resolution of the Independent Committee shall, in principle, be made upon the full attendance (includes
attendance by TV conferences and telephone conferences; hereinafter the same applies.) of the members of the
Independent Committee and with a majority vote. However, under unavoidable circumstances, a majority of thevoting rights of a majority attendance shall produce a resolution.

16

Separate Document 2
Brief History of Independent Committee Members
The members of the Independent Committee as of the Renewal of the Plan are planned to be the following three
persons:Kazuo Kawakami(Date of Birth: April 26, 1933)
April 1958
January 1983
September 1989
May 1991
June 2007

CAREER
Appointed prosecutor
Head of Special Investigation Force, The Tokyo District Public Prosecutors Office
Chief of Trial Proceedings, Supreme Public Prosecutors‟ Office
Recorded attorney at the Daiichi Tokyo Bar Association (up to the present date)Director at JAPEX (up to the present date)*Mr. Kazuo Kawakami is a candidate for outside director as stipulated in Article 2 Clause 15 of the Companies Act
and, will assume the office once he is elected at this general meeting of shareholders.
*No particular relationship is existent between Mr. Kawakami and JAPEX.

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

April 1958
June 1990
December 1994
April 2002
June 2003

CAREER
Joined the Ministry of FinanceDirector-General of the National Tax Agency
President of the Japan Finance Corporation for Small Business
Advisor at Mizuho Corporate Bank, Ltd.
Auditor at JAPEX (up to the present date)*Mr. Masahiko Kadotani is a candidate for outside auditor as stipulated in Article 2 Clause 16 of the Companies
Act and, will assume the office once he is elected at this general meeting of shareholders.
*No particular relationship is existent between Mr. Kadotani and JAPEX.
Keizo Sakata(Date of Birth: January 4, 1940)

April 1966
April 1969
June 1969
July 1974
April 1980
July 2006
July 2006
January 2010

CAREER
Appointed prosecutor
Full-time instructor at College of Law, Nihon University
Recorded attorney at Tokyo Bar Association (up to the present date)
Assistant professor at College of Law, Nihon University
Professor at College of Law, Nihon University
Dean of College of Law at Nihon University
Trustee of Nihon University
Professor emeritus of Nihon University (up to the present date)*No particular relationship is existent between Mr. Sakata and JAPEX.

17

(Reference)„Qs and As‟ about Allotment of Share Options without Contribution as Takeover Defense Measures
These „Qs and As‟ are attached hereto not as reference documents for the ordinary general meeting of shareholders
but as guide to plainly explain the Plan. For more accurate and detailed information, please refer to the
explanations made in and after page 7 and the press release dated May 13, 2011 “Renewal of the Measures toPrevent Large-scale Acquisition of Our Company Shares (Takeover Defense Measures).”
Q1.
A.

What is the purpose of renewing the Takeover Defense Measures?
The Plan, for which we kindly ask your approval in Item 6, describes procedures to be taken by JAPEX
when a large-scale acquisition of JAPEX shares occurs. It ensures the information and time necessary forour shareholders to decide whether to accept the acquisition or not and for the Board of Directors to propose
an alternative plan, as well as to secure the opportunities for consultation, negotiation, or any othercommunication with the Acquirer. As mentioned above, we believe the Plan will contribute to ensuring andimproving of our corporate value and the common interests of our shareholders. Therefore, we decided torenew the current Takeover Defense Measures, which will expire on the designated date.

Q2.
A.

What are the differences between the Former Plan and the renewed Plan?
The main differences between the Former Plan and the Plan are as follows: (1) the procedures to be
employed by the Acquirers in conducting the Acquisitions have been organized: (2) the items of
information that JAPEX requests the Acquirers to provide have been summarized; (3) the requirements for
executing the Plan to allot the Share Options without contribution have been arranged: (4) the summary of
the Share Option has been clarified.

Q3.
A.

Please explain the outline of the Plan.
The Plan is a Prior Warning-type Rights Plan under which Share Options are allotted without contribution
in the case of threat of acquisition. In particular, the Plan includes the following.
(1) Acquirers who intend to acquire 20% or more of the shares issued by JAPEX, are required to submit,in advance, the Intent Statement containing covenant wordings, etc., that express the intention tocomply with the procedure set forth in the Plan and provide such information on the Acquisition
Statement, etc., that is needed for examining the content of the acquisition.
(2) The Board of Directors will immediately send the Acquisition Statement to the Independent
Committee. The Independent Committee may request the Board of Directors to present its opinion on
the content of the acquisition, the supporting materials and, (if available) alternative plans.
(3) After receipt of the information from an Acquirer and Board of Directors, Independent Committee
will review the content of the acquisition and the alternative plan provided by the Board of Directors
and consult and/or negotiate with the Acquirer, while seeking advice from outside experts, etc.
(4) JAPEX will reach a resolution concerning the implementation of the allotment of Share Options
without contribution, only after obtaining a judgment from the Independent Committee, under thesituation where Acquirers fail to comply with the procedures set forth in the Plan, or the Acquisition
clearly infringes on our corporate value and the common interests of our shareholders, and where
resist to such Acquisition is deemed appropriate. JAPEX may confirm the intention of ourshareholders concerning the implementation of the allotment of Share Options without contribution.
(5) The Share Options allotted in relation to the exercise of the Plan includes an exercising condition
which restricts the exercise of share option rights to Acquirers and an acquisition condition thatJAPEX can acquire share options in exchange for JAPEX shares from holders other than the Acquirer.
If JAPEX shares are issued to our shareholders other than the Acquirer according to this, the ratio ofthe voting rights of JAPEX held by the Acquirer may be diluted to a maximum of 50%.

18

Q4.
A.

The company‟s Takeover Defense Measures are deemed highly reasonable. In what specific ways is the
JAPEX‟s Takeover Defense Measure highly reasonable?
The characteristics representing the Plan‟s reasonableness are listed below:
Item
Shareholders‟ intention

Independent Committee

Condition for initiating theprocedure
Conditions for
implementation
Validity (sunset clause)
Members of the Board of
Directors
Abolition

Disclosure of purpose,conditions for
implementation, andprocedures
Delivery of notification of
the convocation

Q5.
A.

The company‟s Takeover Defense Measures
・The intention of our shareholders will be reflected by obtaining theapproval of the Plan at this shareholders meeting.
・Even before the expiration of its term, the Plan will be instantly
abolished, if the general meeting of shareholders or the Board of
Directors resolves to abolish the plan. Therefore, the continuity or
discontinuity of the Plan can depend on the shareholders.
・An Independent Committee comprised of independent Outside
Directors, etc., is established.
・The initial members of the Independent Committee are one (1) Outside
Director, one (1) Outside Auditor and one (1) outside expert, each withhigh independency.
・The implementation of the Plan must be made on the advice of the
Independent Committee, which is given after consideration of thespecific designated requirement.
・The Independent Committee may receive advice from an independent
third party at the expense of the Company.
Holding 20% or more of the voting rights, or a tender offer that intends
the acquisition of 20% or more of the voting rights
Reasonable and objective conditions are established.
Three (3) years
Fourteen (14) Directors (if all candidates of Directors mentioned in page
2 to page 6 of this notice are elected at this shareholders meeting),
including one (1) independent Outside Director
The Plan may be abolished at any time by resolution of the general
meeting of shareholders or the Board of Directors (the Plan is neither adead-hand type takeover defense measure [whereby the implementationof a takeover defense measure cannot be deterred even with thereplacement of over half of the constituting members of the Board of
Directors] nor a slow-hand type takeover defense measure [where theimplementation of a takeover defense measure takes time]).
Information is fully disclosed through press releases, resolution items andreference documents for the general meeting of shareholders, and at thegeneral meeting of shareholders.
The notification of convocation will be delivered on June 2 (Thursday),three (3) weeks before the day of the ordinary general meeting ofshareholders.

How will shareholders be impacted, if the Plan is renewed?
At the point of renewal of the Plan, the allotment of Share Options without contribution will not be made.
Therefore, there will be no direct and specific impact on shareholders.
If Acquirers appear and the Plan is implemented, Share Options will be allotted to shareholders other thanAcquirers without contribution. The shareholders to whom Share Options without contribution are allotted
are entitled to receive, on and after the commencing date of the period of exercise, in principle, one shareper one share option, by paying the money value equivalent to the exercising value decided in the
Resolution for the Allotment of Share Options without Contribution within the range of one yen per one
share for the purpose of the Share Options as the lower limit and one half of the market value of one JAPEX
share as the upper limit. If certain shareholders do not exercise their Share Options, the shares held by thoseshareholders will be diluted as a result of the exercise of the Share Options by other shareholders.
If JAPEX delivers JAPEX shares in exchange of acquiring the Share Options from shareholders,shareholders other than Acquirers will receive the corresponding JAPEX shares without following theexercising procedure on the part of the shareholders. If JAPEX follows such an acquisition procedure, theshareholders other than Acquirers will receive JAPEX shares without exercising their Share Options andpaying a monetary amount equivalent to the exercise price, and therefore the dilution of owned JAPEX
shares held will not, in principle, occur.
19

Q6.
A.

If an allotment of Share Options without contribution is implemented, what procedures should be followedby the shareholders?
(1) Exercise of Share Options
When exercising Share Options allotted through the allotment of share options without contribution,in principle, the shareholders will be required to submit, during the period of the exercise of the Share
Options, the documents necessary for the exercise of Share Options (in the form prescribed by JAPEX
which contains the clauses of representation, warrant, etc., that the shareholders meet the exercise
conditions) and other documents necessary for the exercise of Share Options, and pay, in principle
during the period of exercise of the Share Options, a monetary amount equivalent to the exercise price.
(2) Procedure for the Acquisition of the Share Options by JAPEX
If the Board of Directors makes the decision to deliver JAPEX shares to shareholders in exchange forthe acquisition of Share Options, JAPEX will, according to statutory procedures, acquire the Share
Options on the date determined by the Board of Directors, and deliver JAPEX shares in exchange for
the Share Options. In this case, the shareholders may be required to submit a document in the form
prescribed by JAPEX.

Q7.

A.

Among the conditions relating to the exercise of the Share Options allocated by the allotment of Share
Options without contribution, it is mentioned that non-residents (foreign residents), who are required under
the applicable foreign laws and regulations to follow the prescribed procedures for the exercise of Share
Options, may not, in principle, exercise their Share Options. Will non-residents be adversely affected by the
Plan?
First of all, if non-resident shareholders are not required under the applicable foreign laws and regulations
to follow the prescribed procedures for the exercise of the Share Options, such as obligations to register
securities, such non-residents may exercise their Share Options.
Secondly, even if non-resident shareholders are required under the applicable foreign laws and regulations
to follow the prescribed procedures for the exercise of Share Options, such as obligation to register
securities, but if an exemption clause applies, the non-residents may, in principle, exercise their Share
Options on condition that they meet the conditions of the said exemption clause.
Furthermore, if Share Options held by such non-residents are the objects of JAPEX acquisition and if it
does not violate applicable law and regulations, JAPEX will deliver JAPEX shares in exchange for the
Share Options to the non-residents.

20

Consolidated Balance Sheets(As of March 31, 2011)(Unit: millions of yen)Accounting titles(Assets)
Current assets
Cash and deposits
Notes and accounts receivable-trade
Short-term investment securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Deferred tax assets
Short-term loans receivable
Other
Allowance for doubtful accounts
Noncurrent assets
Property, plant and equipment
Buildings and structures
Wells
Machinery, equipment and vehicles
Land
Construction in progress
Other
Intangible assets
Other
Investments and other assets
Investment securities
Long-term loans receivable
Deferred tax assets
Other
Allowance for doubtful accounts
Allowance for overseas investment
loss
AssetsAmountAccounting titles(Liabilities)
Current liabilities
Notes and accounts payable-trade
Provision for directors‟ bonuses
Provision for loss on disaster
Other

Amount102,455
26,89856,531
7,121
645

393,493
140,642

Noncurrent liabilities
Long-term loans payable
Deferred tax liabilities
Provision for retirement benefits
Provision for directors' retirement
benefits
Asset retirement obligations
Other

46,530Liabilities

122,408

13,58354,388
15,107
6,816
4,215
7,296
7,296
245,554
221,971
18,791
1,101
9,024
(42)
(5,291)(Net assets)
Shareholders’ equity
Capital stock
Retained earnings
Treasury stock
Accumulated other comprehensive
incomeValuation difference on
available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation
adjustment
Minority interests
Net assets

393,689

516,098

Liabilities and net assets

516,098

122,604
32,042
21,23528,186
4,535
102
5,579
2,150
24,087
4,685(1)(Amounts truncated to millions of yen)

21

19,953
5,057
87
1,444
13,363

9,524
1,734

293,861
14,288279,582(10)
91,566
95,51817(3,968)8,261

Consolidated Statements of Income
From April 1, 2010
To March 31, 2011
(Unit: millions of yen)Accounting titles
Net sales
Cost of sales
Gross profit
Exploration expenses
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividends income
Gain on sales of securities
Other
Non-operating expenses
Interest expenses
Loss on sales of securities
Loss on valuation of securities
Foreign exchange losses
Other
Ordinary income
Extraordinary income
Reversal of allowance for doubtful accounts
Gain on sales of noncurrent assets
Extraordinary loss
Loss on retirement of noncurrent assets
Loss on disaster
Loss on adjustment for changes of accounting
standard for asset retirement obligations
Other
Income before income taxes and minority interests
Income taxes-current
Income taxes-deferred
Income before minority interests
Minority interests in income
Net income(Amount truncated to millions of yen)

22

Amount199,651
144,919
54,732
9,798
31,084
13,849
520
3,074
181
1,795
199
2
1,060
669
369

14
28

5,572

2,300
17,122

42

273
1,591
2,339
4
1,256
904

4,209
12,955
2,161
10,794783
10,010Consolidated Statements of Changes in Net Assets
From April 1, 2010
To March 31, 2011
(Unit: millions of yen)
Shareholders‟ equity

Balance as ofMarch 31, 2010
Changes of items
during the period
Dividends fromsurplus
Net income
Purchase oftreasury stock
Net changes of items
other thanshareholders' equity
Total changes of items
during the period
Balance as ofMarch 31, 2011

Capitalstock

Retainedearnings

14,288271,858

Accumulated other comprehensive income

Valuationdifference
Total
Treasuryonshareholders‟stockavailableequity
for-salesecurities(10)286,137
106,896(2,286)
10,010(0)

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustment

Total
accumulated
othercomprehensive income

24(2,186)

104,733

Minority
interests

Total
net assets

7,876

398,747(2,286)(2,286)

10,010(0)

10,010(0)(11,377)(7)(1,781)(13,166)384(12,781)

－

7,724

(0)

7,723

(11,377)(7)(1,781)(13,166)384(5,057)

14,288279,582(10)

293,861

95,51817(3,968)91,566

8,261

393,689(Amount truncated to millions of yen)

23

Balance Sheets(As of March 31, 2011)(Unit: millions of yen)Accounting titles(Assets)
Current assets
Cash and deposits
Accounts receivable-trade
Short-term investment securities
Merchandise and finished goods
Raw materials and supplies
Prepaid expenses
Deferred tax assets
Accrued income
Short-term loans receivable
Short-term loans receivable fromsubsidiaries and affiliates
Accounts receivable-other
Advances paid
Other
Noncurrent assets
Property, plant and equipment
Buildings
Structures

Amount72,153
5,950
13,287
12,796
4,361
4,673
466
1,931
51
23,997
1,395
716
818
1,706
398,321
120,843
10,94929,510Wells

12,067

Machinery and equipment
Vessels
Vehicles

45,9691
5

Tools, furniture and fixtures
Land
Lease assets
Construction in progress
Wells in progress
Intangible assets
Leasehold right

2,965
12,570
113
6,644
45
1,264
154

Software
Other
Investment and other assets

1,062
47
276,213

Investment securities
Stocks of subsidiaries and affiliates
Long-term loans receivable

187,589
71,038897

Long-term loans receivable fromsubsidiaries and affiliates
Long-term prepaid expenses

22,092

Other

3,113

Allowance for doubtful accounts
Allowance for overseas investment loss
Assets1,360(19)(9,857)
470,475(Amount truncated to millions of yen)24

Accounting titles(Liabilities)
Current liabilities
Accounts payable-trade
Current portion of long-term loans
payableLease obligations
Accounts payable-otherAccrued expenses
Income taxes payable
Deposits received
Provision for directors‟ bonuses
Provision for loss on disaster
Asset retirement obligations

AmountOther
Noncurrent liabilities
Long-term loans payable
Lease obligations
Deferred tax liabilities
Provision for retirement benefits
Provision for directors' retirement
benefits
Provision for loss on business of
subsidiaries and affiliates
Asset retirement obligations
Other

097,611
26,89882
56,4636,290
579

Liabilities

109,723(Net assets)
Shareholders’ equity
Capital stock
Retained earnings
Legal retained earnings
Other retained earnings
Reserve for overseas investment
loss
Reserve for mine prospecting
Reserve for special depreciation
Reserve for advanced
depreciation of noncurrent assets
Reserve for exploration
General reserve
Retained earnings brought
forwardTreasury stock
Valuation and translation
adjustments
Valuation difference on
available-for-sale securities
Deferred gains or losses onhedgesNet assets
Liabilities and net assets

12,111
1,643
778
27
1,843
5,424
10
190
69
1,416
707

110
6,480
706

265,273
14,288250,995
3,572
247,423
1,946
18,36724
259
47,246
171,600
7,980(10)
95,47895,46117
360,752
470,475

Statements of Income
From April 1, 2010
To March 31, 2011
(Unit: millions of yen)Accounting titles
Net sales
Cost of sales
Gross profit
Exploration expenses
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Interest on securities
Dividends income
Other
Non-operating expenses
Interest expenses
Loss on valuation of securities
Provision of allowance for overseas investment loss
Foreign exchange losses
Other
Ordinary income
Extraordinary income
Gain on sales of noncurrent assets
Other
Extraordinary loss
Loss on retirement of noncurrent assets
Loss on sales of noncurrent assets
Loss on disaster
Loss on adjustment for changes of accounting
standard for asset retirement obligations
Income before income taxes
Income taxes-current
Income taxes for prior periods
Income taxes-deferred
Net income

Amount137,630
96,10041,5307,891
25,202
8,436
823
77
2,660
989
196
1,057
35
1,141
382

4,550

2,813
10,173

22
2

24

233
4
1,560
2,020

3,819
6,379

53
(398)
554

(Amount truncated to millions of yen)

25

209
6,169

Statements of Changes in Net Assets
From April 1, 2010
To March 31, 2011
(Unit: millions of yen)

Balance as of March 31, 2010
Changes of items during
the period
Provision of reserve foroverseas investment loss
Provision of reserve formine prospecting
Reversal of reserve formine prospecting
Reversal of reserve for
special depreciation
Reversal of reserve foradvanced depreciation of
noncurrent assets
Provision of general reserve
Dividends from surplus
Net income
Purchase of treasury stock
Net changes of items other thanshareholders' equity
Total changes of items
during the period
Balance as of March 31, 2011

14,2883,572

399

18,20548

271

47,246 156,600(10) 261,390(1,546)

－

－

5,400

(5,400)－－(5,237)

5,237

－

－

24

－

－

12

－

－

15,000 (15,000)(2,286)
6,169－(2,286)
6,169
(0)

－
(2,286)
6,169
(0)

(0)

3,883

(24)
(12)

－

－

1,546

162

(24)

(12)

14,288

3,572

1,946

18,36724259－

15,000 (12,788)

47,246 171,600

Deferred gains orlosses on hedges
24

Total valuation andtranslation
adjustments
106,760

Total net assets
368,151－－－－－(11,274)(7)(11,282)－(2,286)
6,169(0)(11,282)(11,274)(7)(11,282)(7,399)95,461

17

95,478360,752(Amounts truncated to millions of yen)

26

3,883

7,980 250,995

Valuation and translation adjustments

Balance as of March 31, 2010
Changes of items during
the period
Provision of reserve for overseas
investment loss
Provision of reserve formine prospecting
Reversal of reserve formine prospecting
Reversal of reserve for
special depreciation
Reversal of reserve for advanced
depreciation of noncurrent assets
Provision of general reserve
Dividends from surplus
Net income
Purchase of treasury stock
Net changes of items other thanshareholders' equity
Total changes of items during theperiodBalance as of March 31, 2011

Total shareholders‟ equity

20,768 247,112

1,546

Valuation difference on
available-for-salesecurities
106,736

Treasury stock

Total retained earnings

Retained earnings
brought forward

General reserve

Reserve for exploration

Reserve for advanced
depreciation of
noncurrent assets

Reserve for special
depreciation

Reserve for mineprospecting

Reserve for overseas
investment loss

Capital Stock

Legal retained earnings

Shareholders‟ equity
Retained earnings
Other retained earnings(10) 265,273