This document has been translated from a part of the Japanese original for reference purposes only. In theevent of any discrepancy between this translated document and the Japanese original, the original shall prevail.
The Company assumes no responsibility for this translation or for direct, indirect or any other forms ofdamages arising from the translation.
Securities code: 4218
June 8, 2022

To Shareholders with Voting Rights:
Toshiaki Takatsu
President
Nichiban Co., Ltd.
2-3-3, Sekiguchi, Bunkyo-ku, Tokyo,
Japan

NOTICE OF
THE 118th ANNUAL GENERAL MEETING OF SHAREHOLDERS
Dear Shareholders:
We would like to express our appreciation for your continued support and patronage.
We cordially inform you that the 118th Annual General Meeting of Shareholders of Nichiban Co., Ltd.
(the “Company”) will be held as described below. Instead of attending the meeting in person, you can
exercise your voting rights in writing (by mail) or via the Internet. Please review the attached Reference
Documents for the General Meeting of Shareholders and exercise your voting rights by no later than 5:30
p.m. on Monday, June 27, 2022, Japan time.
1. Date and Time:
2. Place:

Tuesday, June 28, 2022 at 10:00 a.m. Japan time
KOCHO banquet hall, Banquet Bldg. 1F, Hotel Chinzanso Tokyo,
2-10-8, Sekiguchi, Bunkyo-ku, Tokyo, Japan

3. Meeting Agenda:
Matters to be reported:1. The Business Report and Consolidated Financial Statements for theCompany’s 118th Fiscal Year (April 1, 2021 - March 31, 2022) andresults 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 118th Fiscal
Year (April 1, 2021 - March 31, 2022)
Proposals to be resolved:
Appropriation of Surplus
Proposal 1:
Partial Amendments to the Articles of Incorporation
Proposal 2:
Election of Eight (8) Directors
Proposal 3:
Election of One (1) Audit & Supervisory Board Member and One (1)Proposal 4:
Substitute Audit & Supervisory Board Member
Determination of Compensation for the Allotment of Restricted Stock to
Proposal 5:
Directors (excluding Outside Directors)
When attending the meeting, please submit the enclosed Voting Rights Exercise Form at the reception desk ofthe meeting venue. If any change has been made to the Reference Documents for the General Meeting of
Shareholders, Business Report, Non-consolidated Financial Statements, and the Consolidated Financial
Statements, the revision will be posted on the Company’s website (https://www.nichiban.co.jp/corp/).

-1-

Guide to Exercising Voting Rights
Voting rights may be exercised by the following three methods. If you attend the meeting in person, you will not
be required to follow the procedure of “Exercising voting rights in writing or via the Internet” mentioned below.
(1) Exercising voting rights by attending the General Meeting of Shareholders
Please bring the Voting Rights Exercise Form enclosed herein and submit it at the reception desk of the meetingvenue.
Also, please bring this convocation notice to the venue on the day of the meeting.
Date and time: Tuesday, June 28, 2022 at 10:00 a.m. Japan time (Reception starts at 9:00 a.m. Japan time)
Place: KOCHO banquet hall, Banquet Bldg. 1F, Hotel Chinzanso Tokyo, 2-10-8, Sekiguchi, Bunkyo-ku,
Tokyo, Japan(Exercising voting rights in writing or via the Internet)(2) Exercising voting rights in writing (Voting Rights Exercise Form)
Please exercise your voting rights by indicating whether you approve or disapprove of the proposals on the Voting
Rights Exercise Form enclosed herein and mailing it so that it is received by the Company no later than 5:30 p.m.
on Monday, June 27, 2022, Japan time. If you fail to indicate your approval or disapproval of each proposal, youwill be deemed to have indicated your approval of each proposal.
Deadline for exercising voting rights: 5:30 p.m. on Monday, June 27, 2022, Japan time(3) Exercising voting rights via the Internet
Please enter your approval or disapproval of the proposals on the voting rights exercise website designated by
the Company (https://soukai.mizuho-tb.co.jp/).
Deadline for exercising voting rights: Enter your approval or disapproval by 5:30 p.m. on Monday, June27, 2022, Japan time
Note
If you exercise your voting rights both in writing and via the Internet, your vote exercised via the Internet will betreated as valid.
Also, if you exercise your voting rights more than once via the Internet, your last vote will be treated as valid.

-2-Reference Documents for the General Meeting of Shareholders
Proposals and References
Proposal 1:

Appropriation of Surplus

The Company proposes to appropriate surplus as described below.
The Company considers return of profits to shareholders as a corporate management priority. Its policyof profit distribution focuses on the performance-linked dividend payment with the consolidated payout
ratio aimed at 25%, based on stable dividend payments, while also increasing internal reserves necessary tostrengthen the Company’s financial standing and to fund capital investment and technology development
for higher cost competitiveness, among others. Under this policy and taking consideration for the
performance of this fiscal year, the Company proposes to distribute a year-end dividend as described below.
1. Items relating to year-end dividend(1) Type of dividend
Cash(2) Items relating to the appropriation of dividend property and total amount thereof¥30 per share of common stock of the Company, totaling ¥621,634,770.
(3) Effective date of dividend of surplus
June 29, 2022
2. Other matters relating to the appropriation of surplus(1) Item of surplus to be decreased and amount of decrease thereof
Retained earnings brought forward¥1,000,000,000(2) Item of surplus to be increased and amount of increase thereof
General reserve¥1,000,000,000
Proposal 2:

Partial Amendments to the Articles of Incorporation

1. Reasons for amendments
The amended provisions stipulated in the proviso of Article 1 of the supplementary provisions of
the “Act Partially Amending the Companies Act” (Act No. 70 of 2019) will be enforced on
September 1, 2022. Accordingly, in order to prepare for the introduction of the system for electronic
provision of materials for general meetings of shareholders, the Articles of Incorporation of theCompany shall be amended as follows.
(1) The proposed Article 14, Paragraph 1 provides that information contained in the reference
documents for the general meeting of shareholders, etc. shall be provided electronically.
(2) The purpose of the proposed Article 14, Paragraph 2 is to establish a provision to limit the scopeof matters to be included in the paper copy to be sent to shareholders who have requested it.
(3) The provisions related to the Internet disclosure and deemed provision of the reference
documents for the general meeting of shareholders, etc. (Article 14 of the current Articles ofIncorporation) will become unnecessary and will therefore be deleted.
(4) In line with the above establishment and deletion of the provisions, supplementary provisions
related to the effective date, etc. shall be established.
-3-

2. Details of amendments
The details of the amendments are as follows.
(Amended parts are underlined.)
Proposed Amendments

Current Articles of Incorporation(Internet Disclosure and Deemed Provision ofReference Documents for the General Meeting of
Shareholders, Etc.)
Article 14 The Company may, when convening a<Deleted>
general meeting of shareholders, deem that it has
provided information to shareholders pertaining
to matters to be described or indicated in thereference documents for the general meeting ofshareholders, business report, non-consolidated
financial statements, and consolidated financial
statements, by disclosing such information
through the Internet in accordance with theprovisions provided in the Ordinance of the
Ministry of Justice.
<Newly established>(Measures for Electronic Provision, Etc.)
Article 14 The Company shall, when convening
a general meeting of shareholders, provide
information contained in the reference
documents for the general meeting ofshareholders, etc. electronically.
2. Among the matters to be provided
electronically, the Company may choose not
to include all or part of the matters stipulated
in the Ordinance of the Ministry of Justice inthe paper copy to be sent to shareholders who
have requested it by the record date for voting
rights.
<Newly established>(Supplementary provisions)

1. The deletion of Article 14 (Internet
Disclosure and Deemed Provision ofReference Documents for the General
Meeting of Shareholders, Etc.) of the Articles
of Incorporation before the amendment andthe new establishment of the amended Article
14 (Measures for Electronic Provision, Etc.)
shall come into effect on September 1, 2022.
2. Notwithstanding the provisions of thepreceding paragraph, Article 14 (Internet
Disclosure and Deemed Provision ofReference Documents for the General
Meeting of Shareholders, Etc.) of the Articles
of Incorporation before the amendment shallremain in force with respect to a general
meeting of shareholders to be held on or
before February 28, 2023.
3. These supplementary provisions shall bedeleted on March 1, 2023 or after the lapse of
three months from the date of the general
meeting of shareholders set forth in thepreceding paragraph, whichever is later.
-4-

Proposal 3:

Election of Eight (8) Directors

The terms of office of all eight (8) Directors will expire at the conclusion of this Annual General Meetingof Shareholders. Accordingly, the Company proposes to elect eight (8) Directors, including four (4) Outside
Directors.
The candidates for Director are as follows:
Attendanceat theCurrent position at theNo.
Name
Board ofCompany
Directors
meetings
100%
1
Reappointment
Toshiaki Takatsu
President(15/15)100%
2Reappointment
Hironori Sakai
Executive Director(15/15)
Director, Managing
100%
3
Reappointment
Hideaki Hara
Officer(15/15)
Director, Managing
100%
4Reappointment
Yasuhiko Takahashi
Officer(11/11)
Outside100%
5Reappointment
Yoji Shimizu
Director(15/15)
Independent
Outside100%
6
Reappointment
Tatsuo Ishihara
Director
Independent(15/15)
Outside100%
7
Reappointment
Akihiro Sato
Director
Independent(15/15)
Outside8
New appointment Hiromi Sanada
Independent

-5-

No.

Name
(Date of birth)

Career summary, positions, responsibilities,
and significant concurrent positions
April 1990
June 2015
April 2017

Toshiaki Takatsu(November 13, 1966)

1[Attendance at theBoard of Directors
meetings]
15/15 (100%)[Assumption of officeof Director]
June 2019[Reappointment]

April 2018
April 2019
June 2019

Number ofshares of theCompany held

Joined the Company
General Manager of Purchase Department,
Business Management Division
General Manager of Middle Japan Sales
Department, Industrial Product Sales Management
Department
Operating Officer and General Manager ofMedical Specialty Sales Department
Senior Operating Officer, Assistant to President
President, responsible for overall corporate
management (current position)[Reason for nomination as candidate for Director]
14,200 shares
Since assuming the office of President of the Company in June 2019,
Mr. Toshiaki Takatsu has led its business, demonstrated leadership to
all officers and employees based on knowledge and experience
concerning overall management acquired until now, and has played an
important role in making decisions on important matters of theCompany and supervising business execution. We have determinedthat he will be qualified to be responsible for management decision
making and supervision of business execution in the future too, andtherefore renominated him as a candidate for Director.

-6-

No.

Name
(Date of birth)

Career summary, positions, responsibilities,
and significant concurrent positions
April 1985
April 2008

Hironori Sakai(July 6, 1961)

2[Attendance at theBoard of Directors
meetings]
15/15 (100%)[Assumption of officeof Director]
June 2009[Reappointment]

Number ofshares of theCompany held

Joined the Company
Operating Officer and General Manager of
Administration Department
June 2009
Director, Operating Officer, and General Manager
of Administration Department
June 2015
Managing Director, responsible for CSR andcorporate management
June 2019
Executive Director, responsible for Promotion
Unit and CSR, and General Manager of Public
Relations Department
April 2020
Executive Director, responsible for administration
and CSR (current position)[Reason for nomination as candidate for Director]
29,300 shares
Mr. Hironori Sakai assumed the office of Director of the Company inJune 2009 and has served in positions such as General Manager of
Administration Division and has been responsible for CSR andcorporate management. He has outstanding management execution
ability, in addition to diverse experiences and knowledge. The
Company has determined that he will play an important role in the
Company’s important management decision making and supervisionof business execution, and therefore renominated him as a candidate
for Director.

-7-

No.

Name
(Date of birth)

Career summary, positions, responsibilities,
and significant concurrent positions
April 1984
April 2011
April 2012

Hideaki Hara
(January 13, 1962)

3[Attendance at theBoard of Directors
meetings]
15/15 (100%)[Assumption of officeof Director]
June 2012[Reappointment]

June 2012
April 2020
April 2022

Number ofshares of theCompany held

Joined the Company
Operating Officer and General Manager ofManagement Department, Tape Business Division
Operating Officer and General Manager of Tape
Business Division
Director, Operating Officer, and General Manager
of Tape Business Division
Director, Managing Officer, responsible for sales,
and General Manager of Business Management
Division
Director, Managing Officer, responsible for sales
and development, and General Manager of
14,700 shares
Domestic Business Division (current position)[Reason for nomination as candidate for Director]
Mr. Hideaki Hara assumed the office of Director of the Company inJune 2012 and has a wide range of knowledge and experience in the
Tape Business segment. The Company has determined that he isqualified to be responsible for not only promoting business overall,
especially the sales and development segments and supply chain, butalso important decision making at the Company’s Board of Directors
meetings and supervision of business execution based on such wealthof knowledge and experience and broad perspective, and therefore
renominated him as a candidate for Director.

-8-

No.

Name
(Date of birth)

Career summary, positions, responsibilities,
and significant concurrent positions
April 1986
April 2011

Yasuhiko Takahashi(January 9, 1963)

4[Attendance at theBoard of Directors
meetings]
11/11 (100%)[Assumption of officeof Director]
June 2021[Reappointment]

June 2013
April 2016
April 2020
June 2021

Number ofshares of theCompany held

Joined the Company
Operating Officer and General Manager of Anjo
Factory
President of Nichiban Techno Co., Ltd.
Senior Operating Officer and General Manager of
Administration Division of the Company
Managing Officer, General Manager of Corporate
Planning Division and Public Relations
Department
Managing Officer, General Manager of Corporate
Planning Division (current position)[Reason for nomination as candidate for Director]
Mr. Yasuhiko Takahashi has a wide range of experience in thecorporate planning, administration and production segments sincejoining the Company, and assumed the office of Director of theCompany in June 2021. The Company has determined that he isqualified to be responsible for important decision making at theCompany’s Board of Directors meetings and supervision of businessexecution based on such wealth of knowledge and experience andbroad perspective, and therefore renominated him as a candidate for
Director.

-9-9,800 shares

No.

Name
(Date of birth)

Career summary, positions, responsibilities,
and significant concurrent positions

Number ofshares of theCompany held

April 1970
March 2005
Yoji Shimizu(August 24, 1946)[Attendance at theBoard of Directors
meetings]
15/15 (100%)
5[Assumption of officeof Director]
June 2014[Reappointment][Outside][Independent]

Joined the ASATSU INC.*
Director, Operating Officer of ASATSU-DK
INC.*March 2010
Representative Director, President of ASATSUDK INC.*
March 2013
Director, Advisor of ASATSU-DK INC.*
June 2014
Outside Director of the Company (current
position)* Current ADK Marketing Solutions Inc.

[Reason for nomination as candidate for Outside Director and summaryof expected roles]
Mr. Yoji Shimizu has served as Representative Director, President, andAdvisor of ASATSU-DK INC. (current ADK Marketing Solutions
Inc.), and has a wealth of experience, accomplishments and knowledge
as a corporate manager. He has provided advice and recommendations
from a standpoint that is objective and independent from theCompany’s management in order to ensure the legality and validity ofdecision making at the Company’s Board of Directors meetings. The
Company therefore renominated him as a candidate for Outside
Director.

- 10 -

0 shares

No.

Name
(Date of birth)

Career summary, positions, responsibilities,
and significant concurrent positions

Number ofshares of theCompany held

October 1977
April 1980

Tatsuo Ishihara(March 1, 1952)[Attendance at theBoard of Directors
meetings]
15/15 (100%)
6[Assumption of officeof Director]
June 2016[Reappointment][Outside][Independent]

Passed the National Bar Examination
Appointed as Public Prosecutor of Tokyo District
Public Prosecutors Office
April 1987
Registered as an attorney-at-law
January 1989
Established Okinobu & Ishihara Law Office*(current position)
June 2016
Outside Director of the Company (current
position)* Currently renamed to Spring Partners[Significant concurrent positions]Representative of Spring Partners[Reason for nomination as candidate for Outside Director and summaryof expected roles]
After being appointed as Public Prosecutor of Tokyo District Public
Prosecutors Office in 1980, Mr. Tatsuo Ishihara was registered as an
attorney-at-law in 1987. As Representative of Spring Partners, he iscurrently dealing with corporate legal cases covering a broad range ofindustries from a highly professional standpoint, in addition to generalcivil cases. He has a wealth of legal experience, accomplishment andknowledge, and the Company therefore renominated him as a
candidate for Outside Director as it expects him to provide advice andrecommendations from a standpoint that is objective and independent
from the Company’s management in order to ensure the legality andvalidity of decision making at the Company’s Board of Directors
meetings.

- 11 -

0 shares

No.

Name
(Date of birth)

Career summary, positions, responsibilities,
and significant concurrent positions

Number ofshares of theCompany held

October 1987
April 1990
April 1990
May 1995

Akihiro Sato
(June 25, 1959)[Attendance at theBoard of Directors
meetings]
15/15 (100%)
7[Assumption of officeof Director]
June 2019[Reappointment][Outside][Independent]

Passed the National Bar Examination
Registered as an attorney-at-law
Joined Marunouchi Kyoritsu Law Firm
Established Akihiro Sato Law Office*Representative of Akihiro Sato Law Office(current position)
December 2016 Outside Audit & Supervisory Board Member of
the Company
June 2019
Outside Director of the Company (current
position)* Currently renamed to Sato Sogo Law Office[Significant concurrent positions]Representative of Sato Sogo Law Office[Reason for nomination as candidate for Outside Director and summaryof expected roles]
After being registered as an attorney-at-law in 1990, Mr. Akihiro Satohas built experience focusing on the business legal field, and, after
establishing a law office in 1995, continued to build a successful career
dealing mainly with business legal cases from a highly professional
standpoint. In addition, he served as Vice President of the Dai-Ichi
Tokyo Bar Association and as Executive Governor of the Japan
Federation of Bar Associations from April 2015 to March 2016, andhe has been serving as a member of the Public Interest Commission of
the Cabinet Office since April 2019. Furthermore, he served as an
Outside Audit & Supervisory Board Member of the Company for two
years and six months from December 2016, and acquired deep insightof the Company. He has a wealth of business legal as well as general
legal experience, accomplishments and insight with extensive
knowledge about the Company, and the Company therefore
renominated him as a candidate for Outside Director as it expects him
to provide advice and recommendations from a standpoint that is
objective and independent from the Company’s management in orderto ensure the legality and validity of decision making at the Company’s
Board of Directors meetings.

- 12 -

0 shares

No.

Name
(Date of birth)

Career summary, positions, responsibilities,
and significant concurrent positions
April 1979
April 1980
April 1981
April 1987
April 1988
November 1998
April 2004
April 2017

Hiromi Sanada(May 20, 1956)
8[New appointment][Outside][Independent]

April 2022

Number ofshares of theCompany held

Internal Medicine Ward, St. Luke’s International
Hospital
Surgical Ward, Kanazawa University Hospital
Assistant and Associate Professor of Departmentof Nursing, School of Allied Medical Sciences,
Kanazawa University
Research Student of Faculty of Medicine,
Kanazawa University(March 1997 - Doctor of Medicine)
Graduate School of Nursing, University of
Illinois, U.S.A. (Special Training)(- March 1990)
Professor of the School of Health Sciences,
Faculty of Medicine, Kanazawa University
Division of Health Sciences and Nursing,
Graduate School of Medicine, The University ofTokyo
Director of Global Nursing Research Center,
Graduate School of Medicine, The University ofTokyo
President of Ishikawa Prefectural Nursing
University (current position)[Reason for nomination as candidate for Outside Director andsummary of expected roles]
Dr. Hiromi Sanada was appointed as Professor of the School of Health
Sciences, Faculty of Medicine, Kanazawa University in 1998. She wassubsequently appointed as the first professor in the fields of Health
Sciences, Nursing, and Gerontological Nursing at the Graduate Schoolof Medicine, The University of Tokyo in 2004, where she was actively
engaged in a range of research activities for the prevention and early
convalescence of pressure ulcer, diabetic foot, and other conditions. In
the past, she has also served as the Chairperson of Japanese Society ofPressure Ulcers, the President of the Japanese Society of Wound,
Ostomy & Continence Management, the Chairperson of the Society for
Nursing Science and Engineering, and the Chairperson of the Japan
Academy of Nursing Science. The Company therefore nominated her
as a candidate for Outside Director as it expects her to utilize her wealthof experience to provide opinions on improving the quality of life in
the wound care field and promoting industry-academia collaboration,
as well as provide advice and recommendations from a standpoint thatis objective and independent from the Company’s management inorder to ensure the validity of decision making.

0 shares

Notes: 1. There is no special interest between the candidates and the Company.
2. The Company has entered into a directors and officers liability insurance contract stipulated in
Article 430-3, Paragraph 1 of the Companies Act with an insurance company. This contract- 13 -

covers legal dispute fees and damages, etc. to be borne by the insured arising from company
lawsuits, third-party lawsuits, shareholder derivative actions and other lawsuits. Each candidate
will be included in the insured of this insurance contract. The Company plans to renew thisinsurance contract with the same terms and conditions at the time of the next renewal.
3. Messrs. Yoji Shimizu, Tatsuo Ishihara and Akihiro Sato and Dr. Hiromi Sanada are candidates
for Outside Director.
4. Mr. Yoji Shimizu will have served as Outside Director for eight (8) years at the conclusion ofthis Annual General Meeting of Shareholders, Mr. Tatsuo Ishihara for six (6) years, and Mr.
Akihiro Sato for three (3) years.
5. The Company has registered Messrs. Yoji Shimizu, Tatsuo Ishihara and Akihiro Sato as
Independent Officers as provided for under the rules of the Tokyo Stock Exchange. In addition,
if the election of Dr. Hiromi Sanada is approved, the Company plans to register her as
Independent Officer as provided for under the rules of the Tokyo Stock Exchange.
6. Pursuant to the provisions of Article 427, Paragraph 1 of the Companies Act, the Company hasentered into agreements with Messrs. Yoji Shimizu, Tatsuo Ishihara and Akihiro Sato, which
limit their liabilities for damages under Article 423, Paragraph 1 of the same Act. The maximum
amount of liabilities under the said agreements shall be the amount set forth in laws andregulations. The limitation of liability specified in these agreements shall be applicable only
when Outside Directors perform their duties in good faith and without gross negligence. If this
proposal is approved, the Company will continue the said agreements with Messrs. Yoji Shimizu,
Tatsuo Ishihara and Akihiro Sato, and will enter into a new agreement with Dr. Hiromi Sanada
which similarly will limit her liability for damages.

- 14 -

Proposal 4:

Election of One (1) Audit & Supervisory Board Member and One (1) Substitute Audit &Supervisory Board Member

The term of office of Audit & Supervisory Board Member Mr. Naoto Yokoi will expire at the conclusion ofthis Annual General Meeting of Shareholders. Accordingly, the Company proposes to elect one (1) Audit &Supervisory Board Member. The Company also proposes to elect one (1) substitute Audit & Supervisory
Board Member, in preparation for the case in which the number of Audit & Supervisory Board Members
would fall below the statutory minimum.
The substitute Audit & Supervisory Board Member shall assume his office only when the number ofAudit & Supervisory Board Members falls below the required number, and his term of office shall be theremaining period of the term of office of his predecessor. The resolution for this proposal shall be effective
until the beginning of the next Annual General Meeting of Shareholders.
The Audit & Supervisory Board has consented to the proposal.
The candidate for Audit & Supervisory Board Member and the candidate for substitute Audit &Supervisory Board Member are as follows:
Candidate for Audit & Supervisory Board Member
No.

Name
(Date of birth)

Career summary, positions, and significant concurrent positions
October 1985
April 1989
May 2006
June 2021

Number ofshares of theCompany held

Joined Asahi Shinwa & Co. (currently KPMG
AZSA LLC)
Registered as a certified public accountant
Appointed as Representative Partner (currently
Partner) of KPMG AZSA LLC
Retired from KPMG AZSA LLC[Significant concurrent positions]
Atsushi Fukuda(January 24, 1959)
1[New appointment][Outside][Independent]

Outside Audit & Supervisory Board Member of SANYO SHOKAI
LTD.
[Reason for nomination as candidate for Audit & Supervisory Board
Member]After being registered as a certified public accountant in 1989, Mr.
Atsushi Fukuda worked in the area of accounting and audit for many
years and served as a Partner of an auditing firm. The Company
therefore nominated him as a candidate for Outside Audit &Supervisory Board Member as it expects him to utilize his wealth ofexperience, accomplishments and knowledge into corporate
accounting and corporate auditing to provide advice andrecommendations from a standpoint that is objective and independent
from the Company’s management in order to ensure the legality andvalidity of decision making at the Company’s Board of Directors
meetings.

0 shares

Notes: 1. There is no special interest between the candidate and the Company.
2. Mr. Atsushi Fukuda is a candidate for Outside Audit & Supervisory Board Member.
3. If the election of Mr. Atsushi Fukuda is approved, the Company plans to register him as
Independent Officer as provided for under the rules of the Tokyo Stock Exchange.

- 15 -

4. If the election of Mr. Atsushi Fukuda is approved, pursuant to the provisions of Article 427,
Paragraph 1 of the Companies Act and the Company’s Articles of Incorporation, the Company
plans to enter into an agreement with him, which limits his liabilities for damages under Article
423, Paragraph 1 of the same Act. The maximum amount of liabilities under the said agreement
shall be the amount set forth in laws and regulations. The limitation of liability specified in theagreement shall be applicable only when he performs his duties in good faith and without grossnegligence.
5. The Company has entered into a directors and officers liability insurance contract stipulated in
Article 430-3, Paragraph 1 of the Companies Act with an insurance company. This contract
covers legal dispute fees and damages, etc. to be borne by the insured arising from company
lawsuits, third-party lawsuits, shareholder derivative actions and other lawsuits. Mr. Atsushi
Fukuda will be included in the insured of this insurance contract.

- 16 -

Candidate for substitute Audit & Supervisory Board Member

No.

Name
(Date of birth)

Career summary, positions, and significant concurrent positions

Number ofshares of theCompany held

April 1983
October 1985

Ichiro Ichikawa(May 10, 1958)
2[Substitute][Outside][Independent (plan)]

Joined Canon Inc.
Joined Asahi Shinwa & Co. (current KPMG
AZSA LLC)
August 1989
Registered as a certified public accountant
September 2014 Retired from KPMG AZSA LLC
December 2014 Established SWEAT CAPITAL Inc.,
President of SWEAT CAPITAL Inc. (current
position)[Significant concurrent positions]
President of SWEAT CAPITAL Inc.
Outside Auditor of UNIMEDIA INC.
Outside Auditor of Mediagene Inc.
Outside Auditor of ITOHAM YONEKYU HOLDINGS INC.
[Reason for nomination as candidate for substitute Outside Audit &Supervisory Board Member]
After being registered as a certified public accountant in 1989, Mr.
Ichiro Ichikawa worked at an accounting firm for about 25 years andbuilt his career mainly in the area of accounting audit, and serves as
President of SWEAT CAPITAL Inc. He also has considerable
experience, accomplishments and knowledge not only in the area of
accounting audit but also as a corporate manager, and the Company
therefore nominated him as a candidate for substitute Outside Audit &Supervisory Board Member as it expects him to provide advice andrecommendations from a standpoint that is objective and independent
from the Company’s management in order to ensure the legality andvalidity of decision making at the Company’s Board of Directors
meetings.

0 shares

Notes: 1. There is no special interest between the candidate and the Company.
2. Mr. Ichiro Ichikawa is a candidate for substitute Outside Audit & Supervisory Board Member.
3. If the election of Mr. Ichiro Ichikawa is approved and he assumes the office of Audit &Supervisory Board Member, the Company plans to register him as Independent Officer as
provided for under the rules of the Tokyo Stock Exchange.
4. If the election of Mr. Ichiro Ichikawa is approved and he assumes the office of Audit &Supervisory Board Member, pursuant to the provisions of Article 427, Paragraph 1 of theCompanies Act and the Company’s Articles of Incorporation, the Company plans to enter into
an agreement with him, which limits his liabilities for damages under Article 423, Paragraph 1of the same Act. The maximum amount of liabilities under the said agreement shall be theamount set forth in laws and regulations. The limitation of liability specified in the agreement
shall be applicable only when he performs his duties in good faith and without gross negligence.
5. The Company has entered into a directors and officers liability insurance contract stipulated in
Article 430-3, Paragraph 1 of the Companies Act with an insurance company. This contract
covers legal dispute fees and damages, etc. to be borne by the insured arising from company
lawsuits, third-party lawsuits, shareholder derivative actions and other lawsuits. If Mr. Ichiro
Ichikawa assumes office, he will be included in the insured of this insurance contract.
- 17 -

(Reference) Skills Matrix of (prospective) Directors and Audit & Supervisory Board Members after theconclusion of this Annual General Meeting of Shareholders

NameToshiaki Takatsu

Hironori Sakai

Positions and Nomination &Legal/
responsibilities Compensation Corporate
Finance/
Risk
Accounting
at the Company Committee Management
management
President

Executive
Director

●

●

●

●

●

●

Skill
R&D

Manufacturing/Technology

Marketing
Sales

●

●

●

Internationality●

Director,
Hideaki Hara

Managing●●●

Officer
Director,
Yasuhiko Takahashi

Managing

●

●

●

●

●

Officer
Yoji Shimizu

Tatsuo Ishihara

Akihiro Sato

Hiromi Sanada

OutsideDirector
OutsideDirector
OutsideDirector

●

●

●

●

●

●

●

●

Outside●Director●

Audit &
Kazunori Takahashi

Supervisory

●

Board

●

●

●

MemberAudit &
Kazuhiko Tomioka

Supervisory

●

Board

●

MemberOutside Audit&
Yasushi Kodama

Supervisory

●

●

●

●

Board
MemberOutside Audit&
Atsushi Fukuda

Supervisory

●

Board
Member* The “●” symbol in the skills matrix are listed based on past knowledge and experience, and do not represent all the knowledge
and experience possessed by the subject.

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Proposal 5:

Determination of Compensation for the Allotment of Restricted Stock to Directors(excluding Outside Directors)

1. Reasons for the proposal
At the 103rd Annual General Meeting of Shareholders held on June 28, 2007, the amount ofcompensation, etc. for Directors was approved as the amount up to 240 million yen per year (notincluding the portion of employee’s salary for Directors concurrently serving as employees).
On this occasion, in order for Directors (excluding Outside Directors) to share the benefits andrisks of share price fluctuations with shareholders, and to further enhance their motivation tocontribute to increasing share price and corporate value, the Company proposes to allot commonshares that are subject to a certain period of restrictions on transfer and provision such as grounds
for the Company to acquire the shares without contribution (hereinafter referred to as “Restricted
Stocks”), to Directors (excluding Outside Directors), as follows.
As such, the Company requests approval for a new allotment of Restricted Stocks ascompensation, etc. to Directors (excluding Outside Directors) within the amount of compensation,etc. stated above, taking into overall consideration the contribution of Directors to the Company,and various other matters.
2. Overview of the Restricted Stock Compensation Plan
(1) Allotment and Payment of Restricted Stocks
Under the Restricted Stock Compensation Plan, the number of Restricted Stocks calculated bymultiplying a coefficient based on the degree of achievement of performance targets, etc. in one
fiscal year and a certain period based on the Company’s medium term management plan (hereinafterreferred to as the “Performance Evaluation Period”) by the base number of shares will be allotted
after the Performance Evaluation Period. The Company will grant Directors (excluding Outside
Directors) monetary compensation claims within the scope of the above-stated annual amount ascompensation, etc. for Restricted Stocks based on a resolution of the Board of Directors, and each
Director will be allotted Restricted Stock by paying all such monetary compensation claims in theform of contribution in kind. However, if Directors (excluding Outside Directors) resign after theend of the Performance Evaluation Period but prior to the Annual General Meeting of Shareholders
in June (including cases in which Directors resign at such Annual General Meeting of Shareholders)or during the Performance Evaluation Period, the Company will grant a cash amount reasonably
calculated by the Board of Directors as an equivalent amount, instead of allotting Restricted Stocks.
The paid-in amount for Restricted Stocks will be determined by the Board of Directors, withina scope in which the amount is not particularly favorable to Directors who accept such Restricted
Stocks. Such amount will be based on the closing price of the Company’s common shares on theTokyo Stock Exchange on the business day immediately preceding the date of the resolution by the
Board of Directors pertaining to the issue or disposal of such shares (or the closing price on themost recent trading day prior to that day if no transactions take place on that day).
In addition, the above-stated monetary compensation claims will be granted on the condition
that Directors (excluding Outside Directors) have consented to the above-stated contribution in kindand have executed an agreement on the allotment of Restricted Stocks that includes the details set
forth in (3) below.
There are currently eight (8) Directors (including three (3) Outside Directors), and there will
be eight (8) Directors (including four (4) Outside Directors) if Proposal 3 is approved.
(2) Total Number of Restricted Stocks- 19 -

The total number of Restricted Stocks to be allotted to Directors (excluding Outside Directors) will
be 50,000 shares, which is the maximum number of Restricted Stocks to be allotted each fiscal year.
However, the total number of such Restricted Stocks may be reasonably adjusted, if a share
split (including an allotment of common shares without contribution) or a share consolidation
involving the Company’s common shares is conducted after the date of the resolution for this
proposal, or if the total number of Restricted Stocks to be allotted requires adjustment in accordancewith similar circumstances.
(3) Details of the Agreement on the Allotment of Restricted Stocks
Upon the allotment of Restricted Stocks, agreements on the allotment of Restricted Stocks will beconcluded between the Company and Directors who will receive allotment of Restricted Stocks, inaccordance with a resolution of the Board of Directors. The Agreement shall include the following
details:(i) Details of Transfer Restrictions
Directors who are allotted Restricted Stocks may not transfer, pledge, establish security interests,
gift during their lifetime, or bequeath to any third party, or engage in any other act of disposal(hereinafter referred to as “Transfer Restrictions”) with regard to Restricted Stocks allotted to them(hereinafter referred to as “Allotted Stocks”) during the period from the date of allotment of
Restricted Stocks until the date they resign as Directors of the Company (hereinafter referred to as“Transfer Restriction Period”).
(ii) Acquisition of Restricted Stocks without Contribution
If a Director who is allotted Restricted Stocks resigns from his or her position as a Director of theCompany, the Company will automatically acquire the Allotted Stocks without contribution, unlessthere are grounds deemed justifiable by the Board of Directors.
In addition, if there are any Allotted Stocks for which Transfer Restrictions have not been
removed pursuant to the provisions of the grounds for removing Transfer Restrictions in (iii) below,
at the time when the Transfer Restriction Period in (i) above expires, the Company will also
automatically acquire such Allotted Stocks without contribution.
(iii) Removing of Transfer Restrictions
Upon the expiration of the Transfer Restriction Period, the Company will remove the Transfer
Restrictions for all of Allotted Stocks held by Directors who have received allotment of Restricted
Stock as of such time.
However, if a Director resigns from his or her position as a Director, due to grounds deemedjustifiable by the Board of Directors, the Company will make reasonable adjustments, as necessary,to the timing at which Transfer Restrictions will be removed.
(iv) Handling in the event of Reorganizing, etc.
If a proposal related to a merger agreement in which the Company is to be the absorbed company,a share exchange agreement or a share transfer plan in which the Company is to become a whollyowned subsidiary, or any other proposals pertaining to organizational restructuring, etc., is approvedby the General Meeting of Shareholders (or by the Board of Directors, where such organizational
restructuring, etc. does not require approval of the General Meeting of Shareholders) during theTransfer Restriction Period, the Company will remove the Transfer Restrictions for all of Allotted- 20 -

Stocks prior to the effective date of such organizational restructuring, etc., by the resolution of theBoard of Directors.
3. Grounds for appropriateness of the allotment of Restricted Stocks
The purpose of this proposal is to allot Restricted Stocks as compensation, etc. to Directors(excluding Outside Directors) aiming for Directors (excluding Outside Directors) to share thebenefits and risks of share price fluctuations with shareholders, and to further enhance theirmotivation to contribute to increasing share price and corporate value.
At the meeting of the Board of Directors held on May 11, 2022, the Company resolved toamend its policies for determining the details of compensation, etc. for individual Directors at theend of the current fiscal year (page 35, in Japanese only), on the condition that this proposal isapproved as originally proposed (see below). Such policies provide for the allotment of Restricted
Stocks as compensation, etc. for Directors, and the details of the proposal is necessary andreasonable for the allotment of Restricted Stocks in line with such amended policies. Furthermore,
the ratio of the maximum number of shares to be issued or disposed of in one year under this
proposal to the total number of shares issued (as of March 31, 2022) is 0.24%, and the dilution ratio
is minimal.
Therefore, the Company has deemed that the details of this proposal are appropriate.

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(Reference) Overview of Policies for Determining the Details of Compensation, etc. for Individual
Directors (after the amendments)
The Company believes that having Directors (excluding Outside Directors) share the benefits and risks ofshare price fluctuations with shareholders, and further enhancing their motivation to contribute to increasing
share price and corporate value, will lead to the sustainable growth of the Company’s Group andimprovements to corporate value. Based on this policy, the Company has determined the composition ofcompensation for Directors (excluding Outside Directors) as follows:(1) Basic compensation
Basic compensation is fixed monthly compensation and follows operations before the amendments.
Basic compensation is determined and paid based on comprehensive consideration of position,
responsibilities, and experience, as well as the compensation level at companies of a similar businessscale and operating in related industries and business categories, the Company’s performance, and thelevel of employee salaries. At the end of the 117th fiscal year (before the amendments), a certain
percentage of basic compensation was set as compensation for the purpose of acquiring the Company’s
shares, and a certain amount was allocated each month by the Officers Shareholding Association toacquire the Company’s shares. However, after the amendments, said portion of compensation will betransferred to the Restricted Stock Compensation Plan as a medium- to long-term incentive (for details,see (2) below).
(2) Medium- to long-term incentives
The structure will be revised so that the applicable period will be once in a certain period based on themedium term management plan, and the result calculated by multiplying the “standard number of shares
to be allotted by position” by the “medium- to long-term company-wide performance coefficient[calculated according to the level of achievement of the medium- to long-term vision (new productratio/overseas ratio) and share growth rate],” will be paid in the form of the allotment of Restricted
Stocks (non-monetary compensation).
(3) Bonuses (short-term incentives)
At the end of the 117th fiscal year (prior to the amendments), performance-linked compensation, etc.
was paid at a certain time each year as a bonus, in an amount calculated according to the consolidated
and non-consolidated operating income margin (one of the KPIs in the medium term management plan)for each fiscal year, while also taking into account past records of employee bonuses. After theamendments, the structure will be revised so that the amount calculated by multiplying the “standard
amount by position” by the “company-wide performance coefficient [calculated according toconsolidated operating income and the consolidated operating margin level]” for one fiscal year will be
paid. The portion paid as the “standard amount by position” will be paid in cash, and the portion
exceeding the “standard amount by position” will be paid in the form of the allotment of Restricted
Stocks (non-monetary compensation).
* With regard to Restricted Stocks allotted in (2) and (3), the Transfer Restrictions will be removed
upon the expiration of the Transfer Restriction Period for all of Allotted Stocks held by Directors
who have received allotment of Restricted Stocks as of such time.
(4) The basic compensation, medium- to long-term incentives and bonuses (short-term incentives)- 22 -

pertaining to (1) to (3) above will be determined within the scope of the total amount of compensation
resolved at the Company’s 103rd Annual General Meeting of Shareholders held on June 28, 2007 (upto 240 million yen per year, not including the portion of employee’s salary for Directors concurrently
serving as employees). Furthermore, the stock-based compensation pertaining to (2) and (3) will be
determined within the scope of the total amount of compensation and within the scope of the numberof shares resolved at this Annual General Meeting of Shareholders (up to a total of 50,000 commonshares in the Company per year).

- 23 -