This document has been translated from a part of the Japanese original for the convenience of non-Japanese shareholders.
In the event of any discrepancy between this translation and the Japanese original, the original shall prevail.

(Securities identification code: 4027)
June 5, 2020

To our shareholders:
Masao Nagita
Representative Director, President
Executive Officer
Tayca Corporation
1-3-47 Funamachi, Taisho-ku, Osaka(Head Office: 3-6-13 Kitahama, Chuo-ku, Osaka)

Notice of the 154th Ordinary General Meeting of Shareholders
We are pleased to announce the 154th Ordinary General Meeting of Shareholders of Tayca Corporation (the“Company”), which will be held as described below.
If you are unable to attend the meeting in person, you may exercise your voting rights by either of thefollowing methods. Please exercise your voting rights no later than 5:40 p.m., Wednesday, June 24, 2020
(Japan Standard Time) after reviewing the attached Reference Documents for the General Meeting of
Shareholders.
To avoid risk of infections of the novel coronavirus disease (COVID-19) at this General Meeting of
Shareholders, you are asked to exercise your voting rights beforehand if possible, and refrain from
attending the General Meeting of Shareholders in person.
Exercising Voting Rights in Writing
Please indicate your approval or disapproval for the proposals on the enclosed voting form and then returnit to us so that it arrives by the above deadline.
Exercising Voting Rights by Electromagnetic Method (Internet)
Please access the Company’s designated voting site (https://evote.tr.mufg.jp/). Next, please use the login ID
and provisional password given on the enclosed voting form and then input your approval or disapproval
for the proposals by the above deadline in accordance with the instructions on the screen.

-1-Meeting Details
1. Date and time:Thursday, June 25, 2020 at 10:00 a.m. (Japan Standard Time)

2. Venue:

Banquet, TKP Garden City Premium Shinsaibashi
3rd floor, Hulic Shinsaibashi Building, 4-3-2 Minamisenba, Chuo-ku, Osaka(Please note that the venue is changed from the last year’s meeting.)*If future developments necessitate any changes in the way the General Meeting of
Shareholders will be run, shareholders will be informed on the Company’s website(http://www.tayca.co.jp/). Shareholders who plan to attend the meeting are asked tocheck it before the General Meeting of Shareholders.

3. Purposes:
Items to be reported:
1. Report on the contents of Business Report, Consolidated Financial Statements andNon-consolidated Financial Statements for the 154th Term (from April 1, 2019 toMarch 31, 2020)
2. Results of audit of the Consolidated Financial Statements by the Accounting
Auditor and the Audit & Supervisory Committee for the 154th Term
Items to be resolved:
Proposal 1:
Election of Five (5) Directors (Excluding Directors Who Are Audit & Supervisory
Committee Members)
Proposal 2:
Continuation of the Response Policy on Large-Scale Purchases of the Company’s Shares(Takeover Defense Measures)
We ask that you please present the enclosed voting form to the reception desk in the venue when attending themeeting in person.
<Requests to Shareholders> Among the documents which we should provide when giving notice of this meeting, the notes to theconsolidated financial statements and the notes to the non-consolidated financial statements have been postedon the Company’s website (http://www.tayca.co.jp/) according to the provisions of laws and regulations andthe Company’s Articles of Incorporation. Therefore, they are not given in the documents accompanying thisnotice. Accordingly, the consolidated financial statements and non-consolidated financial statements auditedby the Accounting Auditor and the Audit & Supervisory Committee include the notes to the consolidated
financial statements and notes to the non-consolidated financial statements posted on the Company’s website
in addition to the documents accompanying this notice.
 We will post any changes made to the matters described in the business reports, consolidated financial
statements, non-consolidated financial statements and Reference Documents for General Meeting of
Shareholders on the Company’s website (http://www.tayca.co.jp/).
[Measures to prevent the infection of COVID-19 at the General Meeting of Shareholders] We kindly ask shareholders who attend the meeting in person to cooperate in having their body temperaturechecked, wearing of face masks and using hand sanitizer.
 Shareholders will be seated at a distance from each other, and therefore there will be fewer seats available
than usual. For that reason, even shareholders who come to the venue may not be allowed to enter.
 We will not be handing out gifts to shareholders who attend the General Meeting of Shareholders this year.
Thank you for your understanding.

-2-

Reference Documents for the General Meeting of Shareholders
Proposals and Reference Matters
Proposal 1:

Election of Five (5) Directors (Excluding Directors Who Are Audit & Supervisory
Committee Members)

The terms of office for all five (5) Directors (excluding, however, Directors who are Audit & Supervisory
Committee Members) will expire at the conclusion of this meeting. The Company proposes the election offive (5) Directors.
Furthermore, the Company confirmed that there are no matters that need to be stated by the Audit &Supervisory Committee at the General Meeting of Shareholders with regard to this proposal
The candidates for Directors are as follows:
Candidates for Directors
No.

Name
(Date of birth)

Masao Nagita(April 13, 1950)
1

Career summary, position and responsibilities(Significant concurrent positions outside the Company)
April 1973

Joined the Company

June 2004

General Manager of the Tokyo Branch of theCompany

June 2005

Director and General Manager of the Tokyo
Branch of the Company

June 2009Managing Director and General Manager of
the Tokyo Branch of the Company

June 2010

President of Tayca Trading Co., Ltd.

October 2010

Managing Director and General Manager of
the Sales Department of the Company

October 2011

Managing Director of the Company

June 2013

Senior Managing Director of the Company

June 2014

President of the Company

June 2014

President of Tayca Warehousing Co., Ltd.

April 2017

President of Japan Sericite Corporation

June 2019

Representative Director, President Executive
Officer of the Company (present position)

Number of theCompany’s
shares owned

27,590(Current responsibilities)
In charge of the Internal Auditing Department, the Osaka
Research Laboratory and Okayama Research Laboratory
Reasons for nomination as a candidate for Director:
Masao Nagita has accumulated a wealth of business experience and achievements in research departments andsales departments since joining the Company. In addition, he has been responsible for management as Presidentof the Company since June 2014. The Company proposes his reelection as a candidate for Director with the
expectation that he will make appropriate management judgments by utilizing these experiences andachievements.

-3-

No.

Name
(Date of birth)

Career summary, position and responsibilities(Significant concurrent positions outside the Company)
April 1979

Joined Dai-Ichi Kangyo Bank, Ltd.

October 1999

General Manager of Komazawa Branch of
Dai-Ichi Kangyo Bank, Ltd.

May 2005

General Manager of Yokohama-Nishiguchi
Branch of Mizuho Bank, Ltd.

Number of theCompany’s
shares owned

December 2006 Senior Executive Officer of Mizuho Credit
Guarantee Co., Ltd.

Hirofumi Yamazaki(July 4, 1955)
2

June 2009Managing Director of Mizuho Credit
Guarantee Co., Ltd.

May 2011

Joined the Company as Adviser

June 2011

Director of the Company

November 2013 Director and General Manager of the
Accounting Department of the Company
June 2014

Managing Director and General Manager ofthe Accounting Department of the Company

June 2014

President of Tayca Trading Co., Ltd.

April 2015

Managing Director of the Company

June 2018

Senior Managing Director of the Company

June 2019

Representative Director, Senior Managing
Executive Officer of the Company (present
position)

10,500(Current responsibilities)
In charge of the General Affairs Department, the Materials
Compilation Department, the Personnel Department, the
Accounting Department, Okayama Factory and Kumayama
Factory
Reasons for nomination as a candidate for Director:
Hirofumi Yamazaki has extensive insight into finance and corporate management cultivated in his previous
employment. Moreover, he has accumulated plenty of achievements in management departments and factory
departments since joining the Company. The Company proposes his reelection as a candidate for Director withthe expectation that he will use these insights and achievements in the management of the Company.

-4-

No.

Name
(Date of birth)

Career summary, position and responsibilities(Significant concurrent positions outside the Company)
April 1984

Number of theCompany’s
shares owned

Joined Nissho Iwai Corporation

September 2003 Joined Sun Chlorella Corporation

Masahiko Nishino(October 9, 1959)
3

August 2010

Joined the Company

October 2011

General Manager of the Sales Department of
the Company

April 2015

General Manager of the Tokyo Branch of theCompany

June 2015

Director and General Manager of the Tokyo
Branch of the Company

June 2017

Director of the Company

June 2017

President of Tayca Trading Co., Ltd. (present
position)

June 2019

Director, General Manager of the Corporate
Planning Department of the Company

June 2019

Director, Senior Executive Officer andGeneral Manager of the Corporate Planning
Department of the Company

April 2020

Director, Senior Executive Officer of theCompany (present position)

3,700(Current responsibilities)
In charge of the Corporate Planning Department,
Environmental and Quality Department, the Intellectual
Property Department, and the Purchasing Department[Significant concurrent positions outside the Company]
President of Tayca Trading Co., Ltd.
Reasons for nomination as a candidate for Director:
Masahiko Nishino has accumulated a wealth of sales experience and overseas work achievements in working attrading companies over many years. In addition, he has accumulated plenty of achievements in sales departments
and management departments since joining the Company. The Company proposes his reelection as a candidate
for Director with the expectation that he will use these insights and achievements in the management of theCompany.

-5-

No.

Name
(Date of birth)Shunji Idei
(March 24, 1964)
4

Career summary, position and responsibilities(Significant concurrent positions outside the Company)
April 1986

Joined the Company

April 2012

General Manager of the Okayama ResearchLaboratory of the Company

April 2015

General Manager of the Sales Department of
the Company

June 2017

General Manager of the Tokyo Branch of theCompany

June 2018

Director and General Manager of the Tokyo
Branch of the Company

August 2018

President of TFT Corporation (present
position)

June 2019

Director, Senior Executive Officer andGeneral Manager of the Tokyo Branch of theCompany (present position)

Number of theCompany’s
shares owned

2,200(Current responsibilities)
In charge of the Sales Department and the Electronic Ceramics
and Devices Department, General Manager of the Tokyo
Branch[Significant concurrent positions outside the Company]
President of TFT Corporation
Reasons for nomination as a candidate for Director:
Shunji Idei has accumulated a wealth of business experience and achievements in research departments and sales
departments since joining the Company. The Company proposes his reelection as a candidate for Director withthe expectation that he will use these experiences and expertise in the management of the Company.

-6-

No.

Name
(Date of birth)

Tamataro Iwasaki(March 29, 1967)
5

Career summary, position and responsibilities(Significant concurrent positions outside the Company)
April 1989

Joined the Company

April 2010

Assistant General Manager of the Tokyo
Branch of the Company

January 2016

General Manager of Sales Department of
Tayca Warehousing Co., Ltd.

October 2016

General Manager of Sales Warehouse
Supervising Department of Tayca
Warehousing Co., Ltd.

June 2017

President of Tayca Warehousing Co., Ltd.
(present position)

Number of theCompany’s
shares owned

1,500[Significant concurrent positions outside the Company]
President of Tayca Warehousing Co., Ltd.
Reasons for nomination as a candidate for Director:
Tamataro Iwasaki has accumulated a wealth of business experience and achievements in sales departments andfactory departments since joining the Company. In addition, he has been responsible for management as
President of an associate, Tayca Warehousing Co., Ltd., since June 2017. The Company proposes his election asa candidate for Director with the expectation that he will use these experiences and expertise in the managementof the Company.

Note: There is no special interest between each of the candidates and the Company.

-7-

Proposal 2:

Continuation of the Response Policy on Large-Scale Purchases of the Company’s
Shares (Takeover Defense Measures)

The Company has operated the “Response Policy on Large-Scale Purchases of the Company’s Shares(Takeover Defense Measures)” (hereinafter referred to as the “Current Response Policy”) following theshareholders’ approval at the Ordinary General Meeting of Shareholders held on June 27, 2008, andsubsequently shareholders’ approval on the partial amendment and continuation at the Ordinary General
Meeting of Shareholders held on June 28, 2017. However, the Current Response Policy will expire at theconclusion of this meeting.
The Company has continued to consider the ideal form for increasing corporate value and common
interests of shareholders since the continuance of the Current Response Policy. As a result, at the Board of
Directors held on May 12, 2020, the Company decided to partially amend and continue the Current
Response Policy (hereinafter the response policy after the amendment is referred to as the “Response
Policy”), subject to the approval of the shareholders at this meeting. Therefore, the Company requests theshareholders’ approval to continue the Response Policy.
For details of the Response Policy, please refer to the attached material “Continuation of the Response
Policy on Large-Scale Purchases of the Company’s Shares (Takeover Defense Measures).”-8-

(Attached material: From material publically disclosed by the Company on May 12, 2020)

Continuation of the Response Policy on Large-Scale Purchase of the Company’s Shares(Takeover Defense Measures)
In accordance with the resolution passed at the Board of Directors meeting held on May 12, 2017, andapproved at the Ordinary General Meeting of Shareholders held on June 28, 2017, Tayca Corporation (the“Company”) has maintained its policy (hereinafter referred to as the “Current Policy”) to address purchasesof the Company’s share certificates, etc. (Note 1) by a specific group of shareholders (Note 2) with anintent to raise their voting rights ratio (Note 3) to twenty percent (20%) or more of the total voting rightsof the Company, or purchases of the Company’s share certificates, etc. that result in a specific group ofshareholders holding twenty percent (20%) or more of the total voting rights of the Company (hereinafter,such purchase is referred to as “Large-Scale Purchase” with the party intending to make such a purchasereferred to as “Large-Scale Purchaser”). As the Current Policy is set to expire at the conclusion of theOrdinary General Meeting of Shareholders to be held on June 25, 2020, the Company spent a lot of timeon deliberation by taking into account subsequent changes in laws and the situation of discussions on
takeover defense measures takeover defense measures. The Company hereby announces that the Board of
Directors of the Company, at its meeting held today, resolved to continue the Current Policy the “Handlingof Large-Scale Purchase of the Company’s Shares (Takeover Defense Measures)” (hereinafter the plan as
so revised is referred to as the “Response Policy”) for an additional three years.
The continuation of the Response Policy shall be subject to a proposal to and the approval at theOrdinary General Meeting of Shareholders to be held on June 25, 2020.
The status of the Company’s shares as of March 31, 2020 is as described in Exhibit 1, and as of today
the Company has not received any proposal regarding a Large-Scale Purchase of the Company’s shares.
The provisions of the laws and regulations cited in this document are assumed to be effective as of May
12, 2020. In the event that the laws and regulations are revised on or after the same date and the revised
laws and regulations are enacted subsequently, the provisions cited in this Policy can be interpreted throughthe amended provisions in the revised laws and regulations or any new clauses that substantially inherit
their meaning, unless specified otherwise separately by the Board of Directors of the Company.

-9-

I

The Company’s initiatives to increase corporate value
The Tayca Group’s management philosophy is to “create materials that impress customers with thepower of chemistry and deliver dreams and smiles to the world.” Under the slogan “earnest in creating
impressive materials,” we persist in our efforts to create technology and products that contributeextensively to society by ensuring better solution through sincere responses to customers and adherence tothe research principle of uncompromising, repeated trials and errors. In line with these basic ideas, theTayca Group has been producing titanium dioxide and surfactants based on sulfuric acid-related
technology since its foundation. In addition, we make full use of surface treatment, dispersion andsulfonation technologies, which we have perfected over many years in our products, to create highly valueadded products, including micro titanium dioxide for cosmetics, surface treatment products, and medicalpiezoelectric materials, as a part of efforts to increase our corporate value.
In December 2019, the Tayca Group celebrated the 100th anniversary of its foundation. As a first stepto the next 100 years, we established a long-term management vision covering the next 10 years through2029. In this long-term management vision, we will strive to help ensure a sustainable society and increase
our corporate value by further exploring the market with existing products, impressing customers, andcreating new value, taking into consideration the realities of the global environment. Currently, the Tayca
Group is in the process of establishing a three-year medium-term management plan starting from FY2020,
the year of pass point in our long-term management vision, which includes the setting of clear interim
goals shared by all employees.
For our corporate governance system, the transfer to the company with audit and supervisory committee
system was approved at the Ordinary General Meeting of Shareholders held on June 26, 2019. Herein, theaim was to further enhance the system through reinforcement of the supervisory function of the Board of
Directors, improvement of management transparency and soundness with the further utilizing of outside
directors, etc. Furthermore, in order to clearly divide the management decision-making from supervisory
function and business execution function, we have introduced the executive officer system and promoteddelegation of business execution authority to establish an agile management system that can promptly
respond to rapid changes in the business environment. These system transfer and introduction have helped
us address the aspiration to further increase our corporate value.
II
Purpose of introduction of the Response Policy
If the Company is subject to a Large-Scale Purchase, we shall not necessarily disallow such a transaction
if it contributes to our corporate value and shareholders’ common interests. Since the Company, as a listedcompany, allows the free purchase and sale of the Company’s shares, we believe that the decision to sell
the Company’s shares in response to a Large-Scale Purchase offer should ultimately be left to the judgmentof the shareholders.
However, we believe that it is difficult for the shareholders to adequately judge whether the acquisition
price for the Company’s shares offered by the Large-Scale Purchaser is reasonable or not on such short
notice following a sudden Large-Scale Purchase offer. Therefore, we believe that it is necessary for theLarge-Scale Purchaser to provide an adequate amount of information and ensure that the shareholders havesufficient time for examining the offer.
In addition, it is essential for the shareholders to understand the Company’s expertise and know-howthat we have accumulated since our foundation and sufficiently recognize the relationship, etc. that wehave built with such stakeholders as customers, suppliers, and employees in order to judge our future
corporate value accurately, and not depend only on the information provided by the Large-Scale Purchaser
in a unilateral way. It is the Board of Directors of the Company that sufficiently understands our corporate
value. Hence, we believe that it is critical to provide the Board’s evaluation and opinion of the said LargeScale Purchase to the shareholders.
Based on the above-mentioned idea, the Board of Directors of the Company believes that a Large-Scale
Purchase should be conducted in accordance with certain reasonable rules to safeguard shareholders’common interests. Accordingly, the Company determined to establish rules on Large-Scale Purchase, thecontents of which are outlined below.

- 10 -

III
1

Details of the Response Policy
Outline of the Response Policy
The purposes of the Response Policy are to provide in advance procedures that the Large-Scale
Purchaser should comply with and to ensure that the Company has necessary and sufficient time tonegotiate with the Large-Scale Purchaser regarding the Large-Scale Purchase or an offer thereof, collectand examine the details of the proposal made by the Large-Scale Purchaser, inform the shareholders aboutthe Large-Scale Purchase offer, and present an alternative proposal and the plan of the Board of Directorsof the Company so that the shareholders of the Company can make a proper decision regarding whether
or not to accept the said Large-Scale Purchase offer based on sufficient information, including impact, etc.
of the said Large-Scale Purchase on the Company’s corporate value and shareholders’ common interests.
This Response Policy requires the Large-Scale Purchaser to comply with the procedures prescribed by
the Company (hereinafter referred to as the “Large-Scale Purchase Rules”) when conducting the LargeScale Purchase, and the Company may take an appropriate countermeasure in case of non-compliance with
the Large-Scale Purchase Rules by the Large-Scale Purchaser, or in the event that the said Large-Scale
Purchase is deemed to damage the Company’s corporate value and shareholders’ common interests even
if the Large-Scale Purchaser is in compliance with the said rules.
This Response Policy applies only to Large-Scale Purchases that do not have the prior consent of theBoard of Directors of the Company, and is not applicable to Large-Scale Purchases that are executed withthe agreement of the Board of Directors of the Company.

2

Procedures to continue the Response Policy
The continuation of the Response Policy was unanimously approved at the meeting of the Board of
Directors held on May 12, 2020, which included four independent outside directors.
To ensure that the shareholders have an opportunity to express their opinion on the continuation of the
Response Policy, the Company will request the shareholders to vote on the Response Policy at the Ordinary
General Meeting of Shareholders to be held on June 25, 2020, and the effectuation of this Policy is subject
to their approval.

3

Details of Large-Scale Purchase Rules(1) Request for provision of Large-Scale Purchase Information
The Large-Scale Purchase Rules require a Large-Scale Purchaser, before starting a Large-Scale
Purchase, to provide necessary and sufficient information (hereinafter referred to as “Large-Scale
Purchase Information”) to the Board of Directors of the Company for the judgment of theshareholders and for evaluation and examination by the Board of Directors of the Company.
i)
Submission of Statement of Intent
Where a Large-Scale Purchaser attempts to carry out a Large-Scale Purchase, a statement of intent
regarding the execution of the Large-Scale Purchase (hereinafter referred to as the “Statement ofIntent”) must first be submitted to the Board of Directors of the Company in accordance with theLarge-Scale Purchase Rules.
The Statement of Intent shall include the Large-Scale Purchaser’s name, address, governing law,
representative name, and contact information within Japan; type and number of the Company’s sharecertificates, etc. that the Large-Scale Purchaser currently owns; trading status of the Company’s
shares by the Large-Scale Purchaser for sixty (60) days before the submission of the Statement ofIntent; a summary of the proposed Large-Scale Purchase; and covenants that adhere to the LargeScale Purchase Rules in implementing the Large-Scale Purchase. Only the Japanese language shallbe used for any and all other opinions and responses to be submitted or forwarded to the Company
by the Large-Scale Purchaser, including the Statement of Intent.
ii)

Provision of Large-Scale Purchase Information
Within ten (10) business days (excluding the first day) of receipt of the Statement of Intent fromthe Large-Scale Purchaser, the Board of Directors of the Company will, with the assistance of the
Independent Committee established later, prepare and send a list to the Large-Scale Purchaser- 11 -

specifying the Large-Scale Purchase Information required initially to enable the Board of Directorsof the Company to form an opinion and the shareholders to make a judgment. In principle, the LargeScale Purchaser is required to submit the Large-Scale Purchase Information to the Board of Directorsof the Company no later than ten (10) business days (excluding the first day) after the receipt of therequest. In case the Large-Scale Purchaser requests to extend the submission deadline on a reasonablebasis, however, the deadline may be extended.
Where the information submitted by the Large-Scale Purchaser is deemed to be insufficient as
Large-Scale Purchase Information, the Board of Directors of the Company may ask the Large-Scale
Purchaser to submit additional information until sufficient Large-Scale Purchase Information is
obtained. In principle, the Large-Scale Purchaser is required to complete the submission of the LargeScale Purchase Information no later than sixty (60) days after the delivery of the list of Large-Scale
Purchase Information from the Board of Directors of the Company (hereinafter referred to as the“Large-Scale Purchase Information Submission Period”). The Board of Directors of the Company
may, however, extend the Large-Scale Purchase Information Submission Period up to thirty (30)days, depending on the recommendation of the Independent Committee, taking into consideration
the content and scale of the Large-Scale Purchase as well as the specific submission status of theLarge-Scale Purchase Information.
The facts that the Company has received a Large-Scale Purchase offer and the Large-Scale
Purchase Information submitted to the Board of Directors of the Company shall be disclosed on atimely and adequate basis if it is deemed necessary for the Company’s shareholders to make a
judgment. Where the Board of Directors of the Company has determined that the submission of theLarge-Scale Purchase Information has been completed, the Company shall promptly disclose the fact
to the Company’s shareholders. The means of disclosure and announcement to the Company’s
shareholders in accordance with the Large-Scale Purchase Rules shall be carried out via the
Company’s website unless otherwise provided by the said rules and the Board of Directors of theCompany.
While the Large-Scale Purchase Information that the Company requests the Large-Scale Purchaser
to submit may vary based on the details of the Large-Scale Purchase, the general elements of theLarge-Scale Purchase Information are outlined below. The following information shall be provided
only in Japanese.
[1] Overview of Large-Scale Purchaser and its group
Specific name, business description, major shareholders or investors, investment ratio,
financial conditions, and names of officers and their career summaries. Where a Large-Scale
Purchaser and its group are a fund or an entity in which they have invested, names aboutmajor partners, investors, and other constituent members as well as executive partners andpersons who continue to provide investment advice shall be included.
[2] Purpose, method, and details of Large-Scale Purchase
Type and value of purchase consideration for the Large-Scale Purchase, timing of the LargeScale Purchase, structure of related transactions, lawfulness of the method of the Large-Scale
Purchase, and feasibility of the Large-Scale Purchase and relevant transactions, and whether
there is a possibility of the Company’s shares being delisted after the completion of theLarge-Scale and the reasons therefor. Regarding lawfulness of the Large-Scale Purchase, theCompany will request a written opinion from a lawyer to be submitted.
[3] Presence or absence of any contact made with a third party in the Large-Scale Purchase; if
there is contact, an overview of the third party and specific mode and details of such contact[4] Basis for the calculation of the purchase consideration
Facts and assumptions that form the premise of the calculation of the purchase considerationin the Large-Scale Purchase, calculation method, numerical information used in thecalculation, and the amounts or the details of synergies that are expected to be createdthrough the series of transactions relating to the Large-Scale Purchase, and basis of thecalculation therefor.

- 12 -

[5] Financial support for Large-Scale PurchaseSpecific names, capital structure, financing methods, and the terms of any relatedtransactions of providers of funds for the Large-Scale Purchaser (including indirect providersof funds).
[6] Management policy, business plan, capital policy, dividend policy, and asset utilization policy
for the Company and the Tayca Group planned to be implemented after the completion of theLarge-Scale Purchase;
Including plans related to the sale of the Company’s business or assets, provision of collateral,or other dispositions after the completion of the Large-Scale Purchase.
[7] Measures to increase the Company and the Tayca Group’s corporate value continuously andstably, and the justification that such measures will increase the Company and the Tayca
Group’s corporate value[8] Policy on the treatment of the Company and the Tayca Group’s employees, suppliers, local
community, and other stakeholders after the completion of the Large-Scale Purchase;
Including whether the employment relationship will be continued, and whether there is any
plan of changing the relationship with suppliers and, if yes, the details of such a plan.
[9] Specific measures to avoid any conflict of interest with the Company’s other shareholders[10] Presence or absence of any relationship with antisocial forces or terrorism-relatedorganizations (directly or indirectly) and policies for dealing with them[11] Other information that the Board of Directors of the Company or the Independent Committee
deems necessary on a reasonable basis(2)

Period of review by the Board of Directors of the Company
The Board of Directors of the Company shall be granted the following period for assessment,
review, negotiation, forming of opinions, and submission of alternative plans by the Board of
Directors of the Company (hereinafter referred to as the “Board Assessment Period”) depending on
the difficulty of evaluation and review of the Large-Scale Purchase after the completion ofsubmission of the Large-Scale Purchase Information.
[1] Sixty (60) days (excluding the first day) in case of the purchase of all of the Company’s
shares by tender offer with cash-only (Japanese yen) consideration; or[2] Ninety (90) days (excluding the first day) in case of any other Large-Scale Purchase.
The Large-Scale Purchase shall be initiated only after the Board Assessment Period has
elapsed.
In case of unavoidable circumstances due to which the Board of Directors of the Company did notpass a resolution for implementation or non-implementation of countermeasures within the Board
Assessment Period for reasons such as the Independent Committee did not reach a recommendation
for implementation or non-implementation of the countermeasures within the Board Assessment
Period, the Board of Directors of the Company can, by its resolution, extend the Board Assessment
Period for a maximum of thirty (30) days within the necessary range. Where the Board of Directorsof the Company resolves to extend the Board Assessment Period, the Company shall promptly
disclose the specific period of extension and the reason for such extension to the shareholders inaccordance with relevant laws and regulations as well as financial instrument exchange regulations.
The Board of Directors of the Company will fully evaluate and review the Large-Scale Purchase
Information provided, while receiving advice, as deemed necessary, from financial advisors, certified
public accountants, lawyers, consultants, and other outside experts, and shall carefully organize andpublicly announce the Board’s opinion on the Large-Scale Purchase. The Board of Directors of theCompany may, if it deems it necessary, negotiate with the Large-Scale Purchaser concerning
improvements in the terms of the Large-Scale Purchase and may also, as the Board of Directors of
the Company, present alternative proposals to the through a public announcement.

- 13 -

4

Policies in the event of Large-Scale Purchase(1) Where a Large-Scale Purchaser does not comply with the Large-Scale Purchase Rules
If a Large-Scale Purchaser carries out a Large-Scale Purchase without complying with the LargeScale Purchase Rules, in principle, the Board of Directors of the Company will consider the LargeScale Purchase to be a takeover that might damage the Company's corporate value and shareholders’common interests and will implement a gratis allotment of stock acquisition rights ascountermeasures, with the condition that only non-qualified parties cannot exercise such rights. An
outline of the gratis allotment of stock acquisition rights that would be implemented by the Board of
Directors of the Company as countermeasures is provided in Exhibit 2.
The Board of Directors of the Company shall place the highest value on the recommendation of
the Independent Committee in implementing such countermeasures and follow the said
recommendation unless the observance of the recommendation violates the Directors’ obligation ofdue care of a prudent manager.
(2)

Where a Large-Scale Purchaser complies with the Large-Scale Purchase Rules
If a Large-Scale Purchaser complies with the Large-Scale Purchase Rules, the Board of Directorsof the Company will examine within the Board Assessment Period whether the Large-Scale Purchasewill contribute to the maintenance and enhancement of the Company’s corporate value and anincrease in shareholders’ common interests. Only if it is determined that the Large-Scale Purchasewould significantly damage the Company’s corporate value and shareholders’ common interests, theBoard of Directors of the Company would trigger a gratis allotment of stock acquisition rights witha view to securing the Company’s corporate value and shareholders’ common interests. An outlineof the gratis allotment of stock acquisition rights is provided in Exhibit 2, same as in the case ofIII4(1) mentioned above.
A Large-Scale Purchase is considered to be significantly damaging to the Company’s corporate
value and shareholders’ common interests if it falls under any of the following categories:[1] Where it is determined that the acquisition of the Company’s shares is being conducted forthe sole purpose of driving up the stock price to have those shares repurchased by related
persons of the Company at a premium, with the acquirer having no intention of truly
participating in the management of the Company (so-called “greenmailing”)[2] Where it is determined that the purchase of the Company’s shares is being carried out for the
purpose of temporarily controlling the management of the Company so that the intellectual
property rights, know-how, trade secrets, principal suppliers, customers, and other items thatare necessary for the Company or the Tayca Group companies’ business operations can betransferred to the Large-Scale Purchaser, its group companies, or other third parties;[3] Where it is determined that the purchase of the Company’s shares is being conducted after
obtaining a controlling interest in the management of the Company with the intention of
appropriating the Company or the Tayca Group’s assets to secure or pay off the debts of theLarge-scale Purchaser and its group companies, etc., causing irreparable damage to theCompany;[4] Where it is determined that the purchase of the Company’s shares is being conducted for the
purpose of temporarily controlling the management of the Company and having theCompany or the Tayca Group companies sell or otherwise dispose of expensive assets suchas real property and securities to make temporary high dividends with the profits of suchdisposal, or for the purpose of taking the opportunity of the rapid increase in a stock pricedue to the temporary high dividends and selling the Company’s shares at a premium, causing
irreparable damage to the Company;[5] Where it is determined that the purchasing method of the Company’s shares proposed by aLarge-Scale Purchaser will restrict the shareholders’ opportunity and freedom to makedecisions, such as oppressive two-stage purchases (executing purchases of shares, such as
tender offers, whereby no solicitations for purchasing all the shares are made in the initialpurchase, and disadvantageous purchase terms are set or the purchase terms are not made- 14 -

explicitly clear in the second stage), whereby shareholders may essentially be forced to sell
their shares of the Company (provided that partia tender offers shall not always correspond
hereto);Whereas, if a Large-Scale Purchase does not fall under any of the above-mentioned categories anda category causing a significant damage on the Company’s corporate value and shareholders’common interests, the Board of Directors of the Company will not trigger a gratis allotment of stockacquisition rights as countermeasures. Even in this case, if the Board of Directors of the Company
opposes the Large-Scale Purchase, it may express its dissenting opinion on the Large-Scale Purchase,offer alternative plans, persuade the Company’s shareholders, etc.
In determining whether a Large-Scale Purchase falls under any category causing significant
damage on the Company’s corporate value and shareholders’ common interests, the Board of
Directors of the Company shall place the highest value on the recommendation of the Independent
Committee and follow the recommendation unless the observance of the said recommendation
violates the obligation of due care of a prudent manager.
5

Convocation of Shareholders’ Meeting for Confirmation of Shareholders’ Opinion
As described in III4, the Board of Directors of the Company shall, while placing the highest value on
the recommendation of the Independent Committee, pass a resolution for the implementation, nonimplementation or suspension of countermeasures, or other matters.
However, where the Independent Committee recommends the implementation of the countermeasuressubject to obtaining approval at a shareholders’ meeting of the Company in advance, or where the Boardof Directors of the Company decides, at its discretion, to convene a shareholders’ meeting of the Company
to take a vote on whether or not to implement countermeasures regardless of the recommendation of the
Independent Committee, the Board of Directors of the Company shall promptly convene a shareholders’meeting of the Company (hereinafter referred to as “Shareholders’ Meeting for Confirmation of
Shareholders’ Opinion”). Where the Board of Directors of the Company has passed a resolution forconvening a Shareholders’ Meeting for Confirmation of Shareholders’ Opinion, a Large-Scale Purchaser
shall not commence a Large-Scale Purchase until the completion of the Shareholders’ Meeting for
Confirmation of Shareholders’ Opinion.
Upon convening the Shareholders’ Meeting for Confirmation of Shareholders’ Opinion, the Board of
Directors of the Company shall adopt a resolution concerning the implementation of countermeasures inaccordance with the resolution (ordinary resolution) at the Shareholders’ Meeting for Confirmation of
Shareholders’ Opinion.
Even if convocation procedures for the Shareholders’ Meeting for Confirmation of Shareholders’Opinion have been taken, where the Board of Directors of the Company subsequently passes a resolution
on the non-implementation of the countermeasures or determines that it is necessary to resolve
implementation of the countermeasures, the Company may cancel call procedures for the Shareholders’Meeting for Confirmation of Shareholders’ Opinion. Where such resolution has been passed, the Company
shall promptly disclose to shareholders the opinion of the Board of Directors of the Company and thereason thereof along with other appropriate information in accordance with relevant laws and regulations
as well as financial instrument exchange regulations.

6

Cancellation or revocation of countermeasures
Where, after the Board of Directors of the Company has passed a resolution implementing thecountermeasures according to procedures set forth in III4 or 5, the Large-Scale Purchaser cancels or
revokes the Large-Scale Purchase, or any changes occur in the facts on which the decision on whether or
not to trigger the countermeasures is based, the Board of Directors of the Company may cancel or revoke
the implementation of the countermeasures.

7

Establishment of Independent Committee(1) Overview of the Independent Committee- 15 -

The Board of Directors of the Company shall establish an independent committee as an entity that is
independent of the Board of Directors of the Company in accordance with the Independent Committee
Regulations (for the outline, refer to Exhibit 3) in a bid to prevent the Board from making any arbitrary
decisions regarding the implementation of the countermeasures.
(2)Composition of the Independent Committee
The Independent Committee shall consist of at least three (3) members who are selected andappointed by the Board of Directors of the Company from among outside directors, lawyers, certified
public accountants, academic experts, or/and outside business experts having experience as a director
or auditor in order to ensure fair and neutral judgments.
The career summary of the Independent Committee members is set out in Exhibit 4.

(3)

Role of Independent Committee
Where the Board of Directors of the Company makes a judgment regarding whether or not to trigger
the countermeasures, the following procedures shall be pursued to ensure the fairness of such judgment.
Prior to triggering the countermeasures, the Board of Directors of the Company shall seek the
Independent Committee’s opinion regarding the appropriateness of such countermeasures, whereupon
the Independent Committee shall make a recommendation to the Board of Directors of the Company
on the suitability of implementing such countermeasures while accepting advice from outside experts
based on the said inquiries. The recommendation shall determine whether the Large-Scale Purchaser
complies with the Large-Scale Purchase Rules or the presence or absence of reasons set forth inIII4(2)[1] to [5].
In principle, a resolution on the recommendation shall be made by a resolution of the Independent
Committee. In determining whether or not to trigger the countermeasures, the Board of Directors of theCompany shall place the highest value on the recommendation of the Independent Committee andfollow the recommendation unless the observance of the said recommendation violates the obligationof due care of a prudent manager.

8

Impact of continuation of Response Policy on shareholders and investors(1) Impact of continuation of Response Policy
Upon the continuation of the Response Policy, the Company will not implement a gratis allotment ofstock acquisition rights. Accordingly, it may not have any direct and specific impact on the rights andeconomic benefits of the shareholders and investors.
(2)

Impact of implementation of countermeasures
The Board of Directors of the Company may issue stock acquisition rights as countermeasures witha view to ensuring and/or increasing the Company’s corporate value and shareholders’ common
interests. Although the value per share of the Company will be diluted upon the implementation of thecountermeasures, the total value of the Company’s shares held by the shareholders will not be diluted.
Thus, the Company does not assume a situation in which the shareholders and investors will incur
material damages in respect of legal rights and/or financial terms. However, those who cannot exercise
stock acquisition rights in the countermeasures may incur legal and/or financial damage upon theimplementation of the countermeasures.
After the Board of Directors of the Company passes a resolution implementing a gratis allotment ofstock acquisition rights, the Company may cancel the gratis allotment of stock acquisition rights or
acquire the stock acquisition rights for free without delivering the Company’s shares to the holders of
the stock acquisition rights due to such situations as the Large-Scale Purchaser’s cancellation of theLarge-Scale Purchase. In that case, the shareholders and investors who traded the Company’s shares on
the premise that dilution of the value of the Company’s shares would occur may incur considerable
damage due to fluctuations in the stock price. The shareholders of the Company and investors shall pay
attention to the actions of the Large-Scale Purchaser.

- 16 -

(3) Necessary procedures for shareholders upon implementation of countermeasures
Where the Board of Directors of the Company has passed a resolution triggering the countermeasuresand, therefore, stock acquisition rights would be allotted, it will be necessary for the shareholders to berecorded in the final shareholder registry as of the record date since the stock acquisition rights will beallotted to shareholders who are recorded in the final shareholder registry as of the record date that isdetermined separately by the Board of the Company and publicly notified in proportion to the numberof their holding shares. Additionally, the shareholders need to complete the payment of a fixed sum
determined by the Board of Directors of the Company within the prescribed period in order to exercise
the stock acquisition rights.
If the stock acquisition rights have been allotted with an exercise condition of acquisition, theshareholders may acquire the Company’s common shares without paying money.
The Company shall notify the details of these procedures when they are actually required inaccordance with relevant laws and regulations as well as financial instrument exchange regulations.
9Expiration date, continuation, termination, and change of Response Policy(1) The expiration date of the Response Policy shall be on the completion of the General Meeting of
Shareholders to be held in June 2023, and at that time, the Company will seek the shareholders’opinion on the renewal of the Response Policy. Accordingly, the issue of whether or not to continue
the Response Policy and its details in case of continuation shall be determined by shareholders.
(2)

Even before the expiration of the effective period of the Response Policy mentioned above, where ageneral meeting of the shareholders of the Company approves a proposal for termination of the
Response Policy and where the Board of Directors of the Company passes a resolution to terminate
the Response Policy, the Response Policy shall lose its effect at that point of time. As describedabove, the Response Policy may be terminated at any time according to shareholders’ intention.
In addition, the Board of Directors of the Company may revise or change the details of the
Response Policy in consultation with the Independent Committee within the permitted scope, which
does not allow changes in essential matters, if it deems it necessary from the viewpoint of ensuring
and/or improving the Company’s corporate value and shareholders’ common interests.

(3)

Where a decision for the termination, change, etc. of the Response Policy is made, the Company
shall make appropriate and timely disclosures to shareholders regarding matters that the Board of
Directors of the Company or the Independent Committee deems appropriate in accordance with
relevant laws and regulations as well as financial instrument exchange regulations.

10 Rationality of Response Policy(1) Fulfillment of three principles set out in Guidelines Regarding Takeover Defense
The Response Policy fulfills the three principles (namely Principle of protecting and enhancing
corporate value and shareholders’ common interests; Principle of prior disclosure and shareholders’ will ;and Principle of ensuring the necessity and reasonableness of defensive measure) of the “Guidelines
Regarding Takeover Defense for the Purposes of Protection and Enhancement of Corporate Value andShareholders' Common Interests,” which were jointly announced by the Ministry of Economy, Trade andIndustry and the Ministry of Justice on May 27, 2005. It also conforms to the content of “Takeover Defense
Measures in Light of Recent Environmental Changes” released by the Corporate Value Study Group on
June 30, 2008.
(2) Introduction with a view to ensuring and/or improving shareholders’ common interests
The purpose of the Response Policy is to secure necessary information and time for the Company’s
shareholders to make a decision regarding the best course of action to ensure and/or improve theCompany’s corporate value and shareholders’ common interests, and to also ensure opportunities for the
Board of Directors of the Company to negotiate with the Large-Scale Purchaser and for shareholders to- 17 -

receive an alternative plan by the Board of Directors of the Company. Accordingly, the Company will
introduce the Response Policy with the aim of ensuring and/or improving its corporate value andshareholders’ common interests.
(3) Implementation of prior disclosure
Upon the continuation of the Response Policy, the Company discloses its purpose and the specific details
and effects of Takeover Defense Measures in advance to ensure the predictability of the shareholders,investors, and the Large-Scale Purchaser, and to also ensure that the shareholders have the opportunity tomake appropriate choices in the event of a Large-Scale Purchase.
In addition, the Company will disclose information on a timely and adequate basis when necessary inaccordance with relevant laws and regulations as well as financial instrument exchange regulations.
(4) Importance of shareholders’ intentions
The Response Policy will be continued subject to the vote and approval of the shareholders at theOrdinary General Meeting of Shareholders to be held in June 2020. If the proposal is rejected, it shall not
be effective. The effective period of the Response Policy is set for three years and it shall be automaticallyterminated if the shareholders do not approve its continuation at the General Meeting of Shareholders tobe held in 2023.
The Response Policy contains a mechanism to directly ask shareholders to vote on whether or not totrigger countermeasures by convening the Shareholders’ Meeting for Confirmation of Shareholders’Opinion should the Independent Committee recommend the implementation of countermeasures subject
to obtaining prior approval at a shareholders’ meeting, or where the Board of Directors of the Company
determines, at its discretion, to convene a shareholders’ meeting to hold a vote on whether or not to trigger
the countermeasures.
As seen above, the Response Policy adopts a mechanism that sufficiently reflects the intentions of theshareholders.
(5) Importance of the judgment of the highly independent third party
The Company prescribes, in the Response Policy, the establishment of an independent committee as anadvisory body to avoid an arbitrary activation of the countermeasures by the Board and to make anobjective decision for the sake of shareholders. The Independent Committee shall consist of at least three(3) members who are outside experts, etc. in order to ensure fair and neutral judgments.
If a Large-Scale Purchase offer is made, the Independent Committee shall determine whether the LargeScale Purchase might significantly damage the Company’s corporate value and shareholders’ common
interests. In determining whether or not to trigger the countermeasures, the Board of Directors of theCompany shall place the highest value on the recommendation of the Independent Committee and follow
the recommendation unless the observance of the said recommendation violates the obligation of due careof a prudent manager.
Thus, by respecting the recommendation of the highly autonomous Independent Committee, theCompany has put into place a framework to avoid the Board’s arbitrary judgment and to operate the
Response Policy in line with the objective of safeguarding the Company’s corporate value andshareholders’ common interests.
(6) Establishment of reasonable objective requirements
The Response Policy lists specific actions that may significantly damage the Company’s corporate value
and shareholders’ common interests in advance and specifies that countermeasures against the Large-Scale
Purchase shall be implemented only when the Purchase falls under these reasonable objective requirements.
Accordingly, the Company ensures that a framework is in place to prevent the Board’s arbitrary activationof the countermeasures.
(7) Does not have a potentially negative impact on shareholders regardless of the Purchase and ensures- 18 -

fairness
The Response Policy is reasonable as a takeover defense tool since it may not have a direct and specificimpact on the rights and economic benefits of the shareholders upon its continuation, and any situation inwhich the shareholders, excluding the Large-Scale Purchaser, will suffer material damages in respect oflegal rights or in financial terms is not assumed if the countermeasures are triggered according to the
Response Policy.
In addition, equality and fairness for all the shareholders other than the Large-Scale Purchaser are
ensured by a provision of the countermeasures which was designed therefor, to issue share acquisitionrights to all shareholders other than the Large-Scale Purchaser under the same condition without exception.
(8) Not a “dead-hand” or “slow-hand” takeover defense measure
The Response Policy may be terminated at any time at a general meeting of shareholders of the Company
or by the Board of Directors consisting of Directors elected at a general meeting of shareholders, and thus
it is not a so called head-hand takeover defense measure (a takeover defense measure in which theactivation of the measure cannot be stopped even if a majority of the Board members are replaced).
Furthermore, the Company has not adopted a system of staggered terms of office for Directors, meaning
the Response Policy is not a slow-hand takeover defense measure (a takeover defense measure in which
the replacement of the Board members cannot occur all at once and therefore it takes time to stop its
activation).
(Note 1) Share certificates, etc. mean:[1] For the specific group of shareholders specified in Note 2 [1], share certificates, etc. stipulated by
Article 27-23, Paragraph 1 of the same Act, or;[2] For the specific group of shareholders specified in Note 2 [2], share certificates, etc. stipulated by
Article 27-2, Paragraph 1 of the same Act.
(Note 2) A specific group of shareholders means:[1] Holders (meaning holders stipulated by Article 27-23, paragraph (1) of the Financial Instruments
and Exchange Act, including those deemed holders pursuant to Article 27-23, Paragraph 3 of thesame Act) of the Company’s share certificates, etc. (meaning share certificate, etc. stipulated by
Article 27-23, Paragraph 1 of the same Act) and their joint holders (meaning joint holders
stipulated by Article 27-23, Paragraph 5 of the same Act, including those who are considered as
joint holders pursuant to Article 27-23, Paragraph 6 of the same Act), or;[2] Persons who undertake the purchase, etc. (meaning purchase, etc. stipulated by Article 27-2,
Paragraph 1 of the same Act, including transactions conducted in stock exchanges or financial
product markets) of the Company’s share certificates, etc. (meaning share certificate, etc.
stipulated by Article 27-2, Paragraph 1 of the same Act) and their special interested parties(meaning special interested parties stipulated by Article 27-2, Paragraph 7 of the same Act).
(Note 3) The voting rights ratio means:[1] For the specific group of shareholders specified in Note 2 [1], the holding ratio of share certificates,etc. by the holder of the Company’s share certificates, etc. (meaning the holding ratio of sharecertificates, etc. stipulated by Article 27-23, Paragraph 4 of the same Act. In this case, the numberof share certificates, etc. held by joint holders of the said holder (meaning the number of sharecertificates, etc. held pursuant to Article 27-23, Paragraph 4 of the same Act) shall be included in
the calculation) or;[2] For the specific group of shareholders specified in Note 2 [2], the total holding ratio of sharecertificates, etc. by the purchaser of the Company’s share certificates, etc. and its special interested
parties (meaning the holding ratio of share certificate, etc. stipulated by Article 27-2, Paragraph
8 of the same Act).

- 19 -

Exhibit 1

Status of the Company’s shares (as of March 31, 2020)

1. Total number of authorized shares

75,000,000 shares

2. Total number of issued shares

25,714,414 shares (of which 2,538,313 shares are treasury
shares)3. Number of shareholders

3,995

4. Major shareholders
Name of shareholder

Number of shares
held (in thousands)

Ratio ofshareholding(%)

KBL EPB S.A. 107704

2,918

12.59

MITSUI & CO., LTD.

1,784

7.69

Mitsubishi Corporation

1,630

7.03

Yamada Sangyo Co., Ltd.

1,470

6.34

Retirement benefit trust (Mizuho Bank account) of
Mizuho Trust & Banking Co., Ltd. and re-trust trustees of 1,009
Trust & Custody Services Bank, Ltd.

4.35

Employee stock ownership plan of Tayca Group

976

4.21

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

864

3.73

NIPPON TOCHI-TATEMONO Co., Ltd.

694

2.99

Kansai Paint Co., Ltd.

612

2.64

Sumitomo Corporation

500

2.15

(Notes)1. The Company holds 2,538 thousand shares of treasury stock, which are not included in the above.
2. With regard to the 1,009 thousand shares held by “Retirement benefit trust (Mizuho Bank account) of
Mizuho Trust & Banking Co., Ltd. and re-trust trustees of Trust & Custody Services Bank, Ltd.,”
Mizuho Bank, Ltd., a trustor, retains the right to direct voting rights.
3. The shareholding ratio is calculated by excluding treasury shares.

- 20 -

Exhibit 2

Overview of gratis allotment of stock acquisition rights

1

Shareholders subject to the grant of stock acquisition rights and terms and conditions of issuance
Stock acquisition rights shall be allotted to shareholders who are registered in the final shareholder
registry as on the given date determined by the Board of Directors of the Company (hereinafter referred toas the “allotment date”) at the rate of one (1) stock acquisition right per one (1) holding share (excluding
the Company’s common shares held by the Company).

2

Type and number of shares underlying the stock acquisition rights
The type of shares underlying the stock acquisition rights shall be the Company’s common shares, andthe number of shares to be delivered upon exercise of one (1) stock acquisition right shall be one (1)common share of the Company; provided, however, if the Company carries out a stock split or reverse
stock split, the required adjustments shall be made.

3

Total number of stock acquisition rights to be issued
The Board of Directors of the Company shall determine the total number of stock acquisition rights tobe allotted, which shall not exceed the upper limit of the number of the latest issued shares of the Company.
However, common shares held by the Company as of the allotment date are excluded.

4

Effective date of gratis allotment of stock acquisition rights
The Board of Directors of the Company shall determine the date separately.

5Type and value of asset to be paid upon exercise of stock acquisition rights
The type of asset to be paid upon exercise of stock acquisition rights shall be money and the amountshall be one (1) yen or more as prescribed by the Board of Directors of the Company.

6

Restriction on transfer of stock acquisition rights
The transfer of stock acquisition rights shall require the approval of the Board of Directors of theCompany.

7

Conditions on exercise of stock acquisition rights[1] The Large-Scale Purchaser, [2] joint holders of the Large-Scale Purchaser (meaning parties who are
considered as joint holders in accordance with Article 27-23, Paragraphs 5 and 6 of the Financial
Instruments and Exchange Act, including parties recognized as falling in the category by the Board of
Directors the Company), [3] special interested parties of the Large-Scale Purchaser (meaning parties
stipulated by Article 27-2, Paragraph 7 of the Financial Instruments and Exchange Act, including parties
recognized as falling in the category by the Board of Directors of the Company), [4] parties who have got
or inherited stock acquisition rights allotted without compensation pursuant to the Response Policy fromparties who fall under any of the preceding three categories without approval of the Board of Directors of
the Company, or [5] related parties who fall under any of the preceding four categories (meaning parties
who substantially control or are controlled by the said party, or act in cooperation with the said party andwho are recognized as falling in such category by the Board of Directors of the Company. “Control” means“the authority to control decisions regarding financial and business policies of other companies, etc.”(Article 3, Paragraph 3 of the Regulation for Enforcement of the Companies Act) shall not exercise stockacquisition rights allotted without compensation pursuant to the Response Policy. The Board of Directorsof the Company shall specify the details separately.

- 21 -

8

Exercise period of stock acquisition rights
The Board of Directors of the Company shall specify the exercise period of the stock acquisition rights
separately.

9

The Company’s acquisition of stock acquisition rights
The Company may acquire stock acquisition rights that have not been exercised by a date prior to thegiven date determined separately by the Board of Directors of the Company by delivering one (1) commonshare of the Company in exchange for one (1) stock acquisition right, except for stock acquisition rights
held by parties who cannot exercise the stock acquisition rights according to item 7 mentioned earlier.
Where, after the date on which the acquisition takes place, the Board of Directors of the Company
recognizes the existence of any party holding the stock acquisition rights other than parties who cannot
exercise the stock acquisition rights according to item 7 mentioned earlier, the Company may, on a given
date determined by the Board of Directors of the Company after the date on which the acquisition by theCompany takes place, acquire the stock acquisition rights held by that party that have not been exercisedby the day prior to such given date by delivering one (1) common share of the Company in exchange forone (1) stock acquisition right. The same shall apply thereinafter.
In addition on a date determined separately by the Board of Directors, the Company may acquire stockacquisition rights, including the ones held by those who cannot exercise the rights according to item 7
mentioned earlier, over the period starting from the effective date of the allocation of the stock acquisitionrights to the date prior to either the first day of the execution period or the date of the acquisition mentioned
earlier, whichever is earlier, if the Board of Directors of the Company determines that it is appropriate for
the Company to acquire the stock acquisition rights.

- 22 -

Exhibit 3
1

Independent Committee Regulations (outline)

Establishment
The Independent Committee shall be established through a resolution of the Board of Directors.

2

Composition(1) The Independent Committee shall have at least three (3) members.
(2) Independent Committee members shall be selected and appointed from outside directors, or outside
experts (including business managers, those who have experience in business management, lawyers,certified public accountants, and academic experts) who are independent of the management team thatis responsible for the execution of the Company’s business.
(3) The appointment and dismissal of Independent Committee members shall be made by a resolution of
the Board of Directors. A resolution for dismissal of Independent Committee members shall require a
two-thirds majority vote of the directors present.

3

Term of office Independent Committee members
The term of the Independent Committee members shall be the period from the date of appointment tothe conclusion of the Ordinary General Meeting of Shareholders for the last fiscal year ending within three
years after the date of appointment. Where the continuation of the Response Policy is approved at the said
Ordinary General Meeting of Shareholders, the Independent Committee members shall be reappointed
without resolution. The same shall apply thereinafter, except as otherwise provided by a resolution of theBoard of Directors.

4

Role of Independent Committee
The Independent Committee shall make recommendations to the Board of Directors regarding whether
the Large-Scale Purchase may cause significant damage to the Company’s corporate value andshareholders’ common interests, and whether it is reasonable to trigger countermeasures against the LargeScale Purchase. In issuing such recommendations, the Independent Committee must make a judgmentfrom the viewpoint of whether the said action will contribute or not contribute to the Company’s corporate
value and shareholders’ common interests, and not with the purpose of pursuing the Committee members’
own personal benefit or the interests of the Company’s directors.

5

Requirements for resolution
Resolutions by the Independent Committee shall be made, as a general principle, with all members of
the Independent Committee in attendance and by a majority of those in attendance. However, if any
member is unable to attend due to an accident or other unavoidable circumstances, a resolution may passwith all members in attendance, excluding the said member, and by a majority of those in attendance.

6

Advice of third party
The Independent Committee may, at Company expense, obtain advice from independent third parties(including financial advisers, certified public accountants, lawyers, consultants, or any other outside
experts) when necessary.

- 23 -

Exhibit 4

Career summary of Independent Committee members

Narihito Maishi
Date of birth: January 13, 1953
CareerApril 1979
Registered as lawyer (Osaka Bar Association) and joined Irokawa Law
summary
Office (to present)
June 1993
Outside Auditor & Supervisory Board Member of ONO
PHARMACEUTICAL, CO., LTD.
August 2001
Human Rights Commissioner of Ministry of Justice of Japan
June 2003

Outside Auditor of OSAKA MONORAIL CO., LTD. (to present)

July 2007

Auditor-Secretary of TAMATEYAMA GAKUEN

June 2010

Outside Auditor of SUMITOMO DENSETSU CO., LTD. (to present)

April 2014

Commissioner of TAMATEYAMA GAKUEN (to present)

January 2015

Partner of Irokawa Legal Professional Corporation

December 2016

Outside Auditor of inQs Co., Ltd.

Koji Yamamoto
Date of birth: December 28, 1954
CareerApril 1983
Instructor of School of Business of University of Kagawa
summary
April 1984
Associate Professor of School of Business of University of Kagawa
October 1988
January 1996
April 2010
April 2012

Associate Professor of Faculty of Economics of Osaka Prefecture
University
Professor of Faculty of Economics of Osaka Prefecture University(Graduate School of Economics)
Chair of Faculty of Economics, Osaka Prefecture University

June 2012

Vice Chair, College of Sustainable System Sciences and Chair of Collegeof Management, Osaka Prefecture University
Extraordinary Vice President of Osaka Prefecture University

November 2013

Chairperson of Osaka Prefecture Bid Monitoring Committee

June 2014

Outside Audit & Supervisory Board Member of the Company

November 2014
July 2015

Chairperson of Council for Evaluation of Designated Finance
Organizations of Osaka Prefecture
Audit Commission member of Osaka Prefecture (to present)

March 2017

Emeritus Professor of Osaka Prefecture University (to present)

April 2017

Professor of Faculty of Business Administration of Osaka Gakuin
University (to present)
Director who is Audit & Supervisory Committee Member of the Company(to present)

June 2019- 24 -

Norikatsu Okada
Date of birth: July 7, 1953
CareerApril 1976
Joined The Dai-Ichi Kangyo Bank, Ltd.
summary
January 1997
General Manager of Nishiarai Branch of The Dai-Ichi Kangyo Bank, Ltd.
June 2000

Manager of Nishijin Branch of The Dai-Ichi Kangyo Bank, Ltd.

April 2002

Manager of Nishijin Branch of Mizuho Bank, Ltd.

March 2006

Executive Officer of NIPPON TOCHI-TATEMONO Co., Ltd.

November 2009Managing Executive Officer of NIPPON TOCHI-TATEMONO Co., Ltd.

June 2015

Outside Audit & Supervisory Board Member of the Company- 25 -

Exhibit 5 Details (flowchart) of Response Policy
With prior approval of theBoard of Directors of theCompany

Purchase without prior approval of the Boardof Directors of the Company

When the Large-Scale Purchaser does
not comply with the Response Policy

When the Large-Scale Purchaser
complies with the Response Policy

When the Large-Scale Purchaser has notcomplied with the Response Policy

Submission of Statement of Intent
by the Large-Scale Purchaser

Request for the Large-Scale
Purchase Information

Large-Scale Purchaser’s provisionof the Large-Scale Purchase
Information
Board Assessment Period(Evaluation of details of the purchase andexamination of alternative plans)

Examination by the Independent Committee(Evaluation and examination of the Large-Scale Purchase and theBoard’s alternative plans)

When the Large-Scale Purchase
may significantly damage theCompany’s corporate value andshareholders' common interests

As not applicableto the right

Independent Committee makes
recommendations on the nonimplementation of the countermeasures
to the Board of Directors

Independent Committee makes recommendations
on the implementation of the countermeasures tothe Board of Directors

Shareholders Meeting for Confirmationof Shareholders’ Opinion

Resolution of the Board of Directors (*)

Non-implementation ofcountermeasures*

Implementation ofcountermeasures

The Board of Directors of the Company shall follow the recommendation of the Independent Committee unlessthe observance of the said recommendation violates the obligation of due care of a prudent manager, or if the
Shareholders’ Meeting for Confirmation of Shareholders’ Opinion was held, follow the resolution of themeeting.

- 26 -