Note: This document has been translated from a part of the Japanese original for reference purposes only. In
the event of any discrepancy between this translated document and the Japanese original, the original shallprevail. The Company assumes no responsibility for this translation or for direct, indirect or any other formsof damages arising from the translation.
(Stock Exchange Code 4619)
June 2, 2021
To Shareholders with Voting Rights:
Jun TayaPresident, COO & CFONIHON TOKUSHU TORYO CO., LTD.
3-23-2, Oji, Kita-ku, TokyoNOTICE OF
THE 115th ORDINARY GENERAL SHAREHOLDERS MEETING
Dear Shareholders:
We would like to express our appreciation for your continued support and patronage.
We are pleased to announce that the 115th Ordinary General Shareholders Meeting of NIHON TOKUSHUTORYO CO., LTD. (the “Company” or “Nittoku”) will be held for the purposes as described below.
In lieu of attending the meeting, you can exercise your voting rights in writing or via an electronic method(the Internet, etc.). Please review Reference Documents for the General Shareholders Meeting below, andexercise your voting rights by following the Instructions for the Exercise of Voting Rights on pages 3 and 4 of
the Japanese version of this document, no later than 5:20 p.m. on Wednesday, June 23, 2021, Japan time.
1. Date and Time:

June 24 (Thursday), 2021 at 10:00 a.m. Japan time

2. Place:

Conference room of Corporate Headquarters located at
3-23-2, Oji, Kita-ku, Tokyo* Please refer to the map to the venue for the meeting provided at the end of theJapanese version of this document. Note that venue has changed from last year.

3. Meeting Agenda:
Matters to be reported: 1. The business report, consolidated financial statements for the Company’s
115th fiscal term (the fiscal year from April 1, 2020 to March 31, 2021) andresults of audits by the Accounting Auditor and the Board of Auditors of theconsolidated financial statements
2. Non-consolidated financial statements for the Company’s 115th fiscal term(the fiscal year from April 1, 2020 to March 31, 2021)
Proposals to be resolved:
Appropriation of Retained Earnings
Proposal 1:
Appointment of Ten Directors
Proposal 2:
Appointment of One Reserve Auditor
Proposal 3:
Determination of Compensation for Granting Restricted Shares to Directors
Proposal 4:(Excluding Outside Directors)-1-

When attending the meeting, please submit the enclosed Voting Rights Exercise Form at the reception desk.
Of the documents to be provided with this Notice, the consolidated statement of changes in equity, notes toconsolidated financial statements, statement of changes in equity and notes to non-consolidated financial
statements are posted on the Company’s website (https://www.nttoryo.co.jp [available only in Japaneseversion]) in accordance with provisions of laws and regulations as well as the Company’s Articles ofIncorporation and therefore are not provided in the appendix of this Notice. Auditors and Accounting Auditors
audited the consolidated statement of changes in equity, notes to consolidated financial statements, statementof changes in equity and notes to non-consolidated financial statements posted on the above Company’s
website as the consolidated financial statements and non-consolidated financial statements, in addition to
documents provided in the appendix of this Notice.
Should the appendix and the Reference Documents for the General Shareholders Meeting require revisions,the revised versions will be posted on the Company’s website (https://www.nttoryo.co.jp).
<Requests to Shareholders>• For preventing the spread of COVID-19, shareholders attending the meeting are asked to check the status
of infection and their physical condition on the date of the meeting, and wear a mask or take otherinfection prevention measures.
• Please understand that infection prevention measures may be taken at the venue of the meeting, including
operation staff wearing masks and installation of alcohol disinfectant.
• The above measures may change depending on the status of the pandemic and announcements from thegovernment, etc. In the event that any major change is made to the operation of the meeting, such changes
will be announced on the Company’s website (https://www.nttoryo.co.jp). Please check the website asnecessary.
• No gifts will be provided to shareholders attending the meeting. Also, no drinks will be served before thestart of the meeting this year and no products will be displayed at the venue. We appreciate yourunderstanding.

-2-

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

Appropriation of Retained Earnings

We position the substantial return of profit to our shareholders by strengthening profitability andmaintaining a sound financial condition focused on cash flow as an important management task.
On the other hand, the management environment surrounding the business of the Nittoku Group isexperiencing major changes such as price competition as well as intensifying competition in development ofhigh value-added paints with environmental and other measures, automobile technological innovation
including electrification, and advancement of globalization in automobile production. To maintaincompetitiveness and improve profitability in the future, we must aggressively and continually make R&D
and capital investment for new products and technologies, investment in overseas businesses for globallyenhancing technical and productive abilities, and furthermore, investment in human resources who will serveas the foundation of the above.
Accordingly, based on the medium- to long-term management plan, with a focus placed on maintaining
stable dividends and increasing internal funds for strategic investment described above, the distribution of
profits is decided in comprehensive consideration of factors such as financial condition, profit levels, and thepayout ratio as the Company’s basic policy.
Based on the above policy, the year-end dividend for this fiscal year is proposed to be as described below.
Items Related to the Year-end Dividend(1) Type of dividend property
Cash(2) Items related to the allocation of dividend property to shareholders and its total amount
21 yen per ordinary sharetotal 457,706,613 yen
Therefore, the annual dividend will be a total of 38 yen per share including the interim dividend.
(3) Date the distribution of retained earnings comes into effect:
June 25, 2021

-3-

Proposal 2:

Appointment of Ten Directors

Terms of office of all eleven Directors will expire at the closure of this General Shareholders Meeting.
Accordingly, the Board of Directors proposes the appointment of ten Directors (including two Outside
Directors), aiming for swifter and more flexible management strategy.
The candidates are as follows:
No.

Name

1

Masahiro Nojima

Position and responsibility in the
Company
ChairmanCEO

Candidate attributes[Reappointment]

President
COO
CFO
Chief Officer of Operation Planning &Coordination GroupManaging Director
Chief Officer of Automotive ProductsGroup
Director
General Manager of Legal Affairs Office
General Manager of Legal Compliance
OfficeDirector
General Manager of Overseas Planning
Division
Director
Head of Eastern Japan Sales Management,
Paints & Coatings Group2

Jun Taya

3

Hiroshi Onda

4

Hisaya Yamaguchi

5

Yoshihiko Yasui

6

Yoshihiko Doi

7

Hiroshi Suzuki

Director
Chief Officer of Paints & Coatings Group[Reappointment]

8

Shin Nakamura

Director
Head of Plant Production, Automotive
Products Group[Reappointment]

9Michihiro Nara

Director

10

Kozo Yabe

Director[Reappointment][Reappointment][Reappointment][Reappointment][Reappointment][Reappointment][Outside][Independent][Reappointment][Outside][Independent]

-4-

No.

Name
(Date of birth)

Past experience, positions, responsibilities
and significant concurrent positions
April 1969
March 1990

1

Number ofshares of theCompany held

Entered in Nittoku
General Manager of Nittoku Technical Division, Automotive
Products Group
March 1995
Deputy Chief Officer of Nittoku Automotive Products Group
March 1997
Deputy Chief Officer of Nittoku Paints & Coatings Group
June 1997
Director of Nittoku[Reappointment]
June 1998
Chief Officer of Nittoku Paints & Coatings Group
November 2002 Managing Director of Nittoku
94,100Masahiro Nojima
June 2005
President of Nittoku(May 1, 1945)
April 2008
Chief Officer of Nittoku R&D Group
June 2013
Chairman & CEO of Nittoku (in-service)[Significant concurrent positions]
・Chairman of UGN, Inc.
・Chairman of Autoneum Nittoku (Guangzhou) Automotive Sound-Proof Co., Ltd.
・Chairman of Tianjin Autoneum Nittoku Sound-Proof Co., Ltd.
・Chairman of Wuhan Nittoku Autoneum Sound-Proof Co., Ltd.
[Reason for nomination as candidate for Director]
Assuming the office of President in 2005 and currently working as Chairman, he has made significant contributions formany years to the building and expansion of the business foundations that are the source of the Group’s growth, and has
played an important role in improving corporate value of the entire Group. The Company believes that by leveraging his
abundant experience and broad insight in overall management including the main business of the Company, he is suitablefor Director of the Company. The Company therefore renominates him as a candidate for Director.

-5-

No.

Name
(Date of birth)

Past experience, positions, responsibilities
and significant concurrent positions
April 1976
January 2005

2

Number ofshares of theCompany held

Entered in the Mitsubishi Bank, Ltd.
Entered in Nittoku
General Manager of Nittoku Financial & Accounting Division,Operation Planning & Coordination Group
April 2005
Deputy Chief Officer of Nittoku Operation Planning &Coordination Group
June 2005
Director of Nittoku
April 2007
Chief Officer of Nittoku Operation Planning & Coordination[Reappointment]Group (in-service)
April 2007
General Manager of Nittoku Legal Compliance Office28,100Jun TayaJune 2009Managing Director of Nittoku(March 3, 1953)
June 2013
CFO of Nittoku (in-service)
June 2015
Senior Managing Director of Nittoku
June 2019
President and COO of Nittoku (in-service)[Significant concurrent positions]
・Chairman of Nikko Kogyo Co., Ltd.
・President of Nittoku Shokoh Co., Ltd.
・President of Nittoku Insurance Center Co., Ltd.
・President of Fuji Sangyo Co., Ltd.
[Reason for nomination as candidate for Director]
Based on his high level of expertise, he has been involved in overall management issues in the Operation Planning &Coordination Group. He has played an important role in improving the corporate value of the Group as President since2019. The Company believes that by leveraging his deep insight in finance and accounting and detailed knowledge ofcorporate governance, he is suitable for Director of the Company. The Company therefore renominates him as a candidate
for Director.

-6-

No.

Name
(Date of birth)

Past experience, positions, responsibilities
and significant concurrent positions
April 1983
April 2000

3

4

Number ofshares of theCompany held

Entered in Nittoku
General Manager of Nittoku Design Division, Automotive
Products Group
April 2008
Deputy Chief Officer of Nittoku Automotive Products Group
March 2009
General Manager of Nittoku Cost Management Division
July 2009
Corporate Officer of Nittoku
April 2010
General Manager of Nittoku Purchasing Division[Reappointment]
June 2012
Director of Nittoku
April 2017
Chief Officer of Nittoku Automotive Products Group (in-service)
15,300Hiroshi Onda
April 2018
General Manager of Nittoku Design Division, Automotive(February 8, 1959)
Products Group
June 2018
Managing Director of Nittoku (in-service)
April 2019
General Manager of Nittoku Production Engineering Division,
Automotive Products Group[Significant concurrent positions]
・President of Daiwa Tokushu Kohki Co., Ltd.
・President of Nittoku CK Co., Ltd.
[Reason for nomination as candidate for Director]
He has held important positions mainly in the Automotive Products Group and has been in charge of the Purchasing andCost Management Divisions. He has made significant contributions to long-term business expansion and improvement of
profitability based on his wide range of knowledge and experience. The Company believes that by leveraging his deep
understanding of the core of the business and broad insight including financial aspects based on cost management, he issuitable for Director of the Company. The Company therefore renominated him as a candidate for Director.
April 1982
Entered in Nittoku
April 2000
General Manager of Nittoku Technical Division, Automotive
Products Group
April 2008
Deputy Chief Officer of Nittoku Automotive Products Group[Reappointment]
July 2009
Corporate Officer of Nittoku
11,200
Hisaya Yamaguchi April 2010
Chief Officer of Nittoku R&D Group(September 16, 1958) April 2011
Plant Manager of Nittoku Aichi Plant
June 2012
Director of Nittoku (in-service)
April 2020
General Manager of Legal Affairs Office and General Manager
of Legal Compliance Office (in-service)[Reason for nomination as candidate for Director]
He has held important positions mainly in the Automotive Products Group and possesses abundant work experience in the
manufacturing and development divisions. He has made contributions to the improvement of corporate value of theCompany based on his knowledge and experience in intellectual property and legal affairs. The Company believes that byleveraging his deep insight in compliance and governance, he is suitable for Director of the Company. The Company
therefore renominated him as a candidate for Director.

-7-

No.

Name
(Date of birth)

Past experience, positions, responsibilities
and significant concurrent positions
April 1980
April 2003

5

6

Number ofshares of theCompany held

Entered in Nittoku
General Manager of Nittoku Technical Division 1, Automotive
Products Group
April 2006
General Manager of Nittoku Overseas Planning Division
April 2008
General Manager belonging to Nittoku China ASEAN Planning
Office[Reappointment]
Temporary transferred to Autoneum Nittoku (Guangzhou)
11,420Automotive Sound-Proof Co., Ltd.
Yoshihiko Yasui(March 29, 1956)
July 2009
Corporate Officer of Nittoku
April 2013
General Manager of Nittoku Overseas Planning Division andGeneral Manager of Nittoku China ASEAN Planning Office
June 2014
Director of Nittoku (in-service)
April 2015
General Manager of Nittoku Overseas Planning Division(in-service)[Reason for nomination as candidate for Director]
He assumed the office of General Manager of the Overseas Planning Division in 2006 and has been leading the growth ofthe overseas business and automotive product business of the Company for many years. The Company believes that byleveraging his abundant work experience and insight including accumulated through working abroad, etc., he is suitable for
Director of the Company. The Company therefore renominated him as a candidate for Director.
April 1980
Entered in Nittoku
April 2002
General Manager of Nittoku Tokyo Sales Operation Division,
Paints & Coatings Group
April 2010
Deputy Chief Officer of Nittoku Paints & Coatings Group[Reappointment]
July 2012
Corporate Officer of Nittoku
9,200
April 2013
Head of Nittoku Eastern Japan Sales Management, Paints &Yoshihiko Doi
Coatings Group (in-service)(October 16, 1961)
June 2017
Director of Nittoku (in-service)[Significant concurrent positions]
・President of Nittoku Mente Co., Ltd.
[Reason for nomination as candidate for Director]
He assumed the office of General Manager of the Tokyo Sales Operation Division, Paints & Coatings Group in 2002, hehas been leading the sales division of paints and coatings business as Head of Nittoku Eastern Japan Sales Management
since 2013, and has made contributions to profit growth. The Company believes that by leveraging his abundant work
experience and deep insight, he is suitable for Director of the Company. The Company therefore renominated him as a
candidate for Director.

-8-

No.

Name
(Date of birth)

Past experience, positions, responsibilities
and significant concurrent positions
April 1985
April 2006
April 2016

7

8

Number ofshares of theCompany held

Entered in Nittoku
General Manager of Nittoku Technical Division 1, R&D Group
Deputy Chief Officer of Nittoku Paints & Coatings Group and[Reappointment]
Plant Manager of Nittoku Hiratsuka Plant
April 2017
Corporate Officer of Nittoku
5,000
Hiroshi Suzuki
April 2017
Head of Plant Operation, Nittoku Paints & Coatings Group and(September 16, 1962)
Plant Manager of Nittoku Hiratsuka Plant
June 2019
Director of Nittoku (in-service)
June 2019
Chief Officer of Nittoku Paints & Coatings Group (in-service)[Reason for nomination as candidate for Director]
Based on the experience of leading the development of paint products in the development division, he has madecontributions to profit growth in the paints & coatings business from the position of controlling the production division andthe entire paints & coatings business. The Company believes that by leveraging his abundant work experience and insight,
he is suitable for Director of the Company. The Company therefore renominated him as a candidate for Director.
April 1987
Entered in Nittoku
July 2010
General Manager belonging to Nittoku China ASEAN Planning
OfficeTemporary transferred to Wuhan Nittoku Autoneum
Sound-Proof Co., Ltd.
April 2015
General Manager belonging to Nittoku Overseas Planning
Division[Reappointment]
Temporary transferred to Wuhan Nittoku Autoneum
Sound-Proof Co., Ltd.
1,500
April 2017
Corporate Officer of Nittoku
Shin Nakamura
April 2018
Plant Manager of Nittoku Aichi Plant(March 9, 1964)
April 2019
Head of Plant Production, Nittoku Automotive Products Group(in-service)
June 2019
Director of Nittoku (in-service)[Significant concurrent positions]
・President of Takahiro Co., Ltd.
・CEO of Wuhan Nittoku Autoneum Sound-Proof Co., Ltd.
・Chairman of Wuhan Nittoku Autoneum Auto Parts Co., Ltd.
[Reason for nomination as candidate for Director]
Based on the experience of increasing profits of subsidiaries in China, he has led profit growth of the automotive productbusiness from the position of generally controlling the plant production division of automobile products. The Company
believes that by leveraging his abundant work experience and insight accumulated through working abroad, etc., he issuitable for Director of the Company. The Company therefore renominated him as a candidate for Director.

-9-

No.

Name
(Date of birth)

Past experience, positions, responsibilities
and significant concurrent positions

Number ofshares of theCompany held

April 1974
June 2003
June 2004
April 2006
April 2006
June 2014
June 2015
June 2016910

Registered as lawyer
Partner of Hanzomon Sogo Law Office (in-service)
Outside Auditor of Nittoku[Reappointment]
Vice President of Japan Federation of Bar Associations[Outside]
President of Dai-Ichi Tokyo Bar Association[Independent]
23,100Outside Director of Oji Holdings Corporation (in-service)
Outside Director of Nittoku (in-service)
Michihiro Nara
Outside Director (Audit & Supervisory Committee Member) of(May 17, 1946)
CHORI CO., LTD.
June 2016
Outside Director (Audit & Supervisory Committee Member) of
SEIKO EPSON CORPORATION[Reason for nomination as candidate for Outside Director and outline of expected roles]
Although he has not been involved in corporate management other than having served as an outside officer, he provides
timely and appropriate advice and suggestions based on his abundant experience cultivated through working as outside
officer in listed companies and professional expertise as a lawyer. The Company believes that, based on his experience, hewill provide appropriate supervision and objective advice on the management of the Company and contribute to theenhancement of corporate governance of the Company. Therefore, he has been renominated as a candidate for Outside
Director.
April 1991
Registered as lawyer
August 2000
Adjunct professor of University of Illinois College of Law(in-service)[Reappointment]
January 2001
Partner of YUASA and HARA (in-service)[Outside]
April 2002
Registered as patent attorney[Independent]
1,600
September 2005 Guest instructor of Chuo Law School
Kozo Yabe
April 2009
Patent attorney examination commissioner(January 22, 1962) June 2010
Executive board member of International Association for theProtection of Intellectual Property (in-service)
June 2017
Outside Director of Nittoku (in-service)[Reason for nomination as candidate for Outside Director and outline of expected roles]
Although he has not been involved in corporate management other than having served as an outside officer, he provides
timely and appropriate advice and suggestions on the management of the Company based on wide range of experience andhigh level of expertise as a lawyer and patent attorney. The Company believes that, based on his experience, he will
provide appropriate supervision and objective advice on the management of the Company and contribute to theenhancement of corporate governance of the Company. Therefore, he has been renominated as a candidate for Outside
Director.
(Notes)1. Matters regarding special interests are as follows.
(1) Candidate Mr. Masahiro Nojima is concurrently serving as Chairman of UGN, Inc. as well as Chairman ofAutoneum Nittoku (Guangzhou) Automotive Sound-Proof Co., Ltd., Tianjin Autoneum Nittoku Sound-Proof Co.,
Ltd. and Wuhan Nittoku Autoneum Sound-Proof Co., Ltd. The Company has a business relationship involving
products, etc. with each of these companies.
(2) Candidate Mr. Jun Taya is concurrently serving as Chairman of Nikko Kogyo Co., Ltd. as well as President of
Nittoku Shokoh Co., Ltd., Nittoku Insurance Center Co., Ltd. and Fuji Sangyo Co., Ltd. The Company has abusiness relationship involving products, etc. with each of these companies.
(3) Candidate Mr. Hiroshi Onda is concurrently serving as President of Daiwa Tokushu Kohki Co., Ltd. and Nittoku
CK Co., Ltd. The Company has a business relationship involving products, etc. with the said companies.
(4) Candidate Mr. Yoshihiko Doi is concurrently serving as President of Nittoku Mente Co., Ltd. The Company has abusiness relationship involving products, etc. with the said company.
(5) Candidate Mr. Shin Nakamura is concurrently serving as President of Takahiro Co., Ltd. and Chairman of Wuhan
Nittoku Autoneum Auto Parts Co., Ltd. The Company has a business relationship involving products, etc. withthe said companies.
(6) There are no special interests between other candidates and the Company.
2. Matters regarding the liability limitation agreement are as follows.
The Company has entered into a liability limitation agreement with Mr. Michihiro Nara and Mr. Kozo Yabe to limit
their liability to the minimum amount provided for by laws and regulations according to Article 427, Paragraph 1of the Companies Act. If their reappointment is approved, the Company plans to continue the said agreementwith them.

- 10 -

3.

4.

Matters regarding candidates for Outside Directors are as follows.
(1) Mr. Michihiro Nara and Mr. Kozo Yabe are candidates for Outside Directors.
(2) The Company registered Mr. Michihiro Nara and Mr. Kozo Yabe with the Tokyo Stock Exchange as Independent
Directors based on the rules of Tokyo Stock Exchange. If their reappointment is approved, they will continue tobe Independent Directors.
(3) Mr. Michihiro Nara and Mr. Kozo Yabe are currently Outside Directors of the Company and it will havebeen six years since the appointment of Mr. Michihiro Nara and four years since the appointment of Mr.
Kozo Yabe at the conclusion of this General Shareholders Meeting. Mr. Michihiro Nara was Outside Auditorof the Company for ten years from June 2004 to June 2014.
Matters regarding the directors and officers liability insurance agreement are as follows.
The Company has concluded with an insurance company a directors and officers liability insurance (hereafter referred
to as “D&O Insurance”) agreement provided for in Article 430-3, Paragraph 1 of the Companies Act. The insurance
covers damages, etc. that may result from the Directors and Auditors being liable for the performance of their duties(However, excluding the case that falls under indemnity conditions stipulated in the insurance agreement). The
premiums of D&O Insurance are fully borne by the Company. If each of candidates assumes office as Director, he/shewill be insured under the D&O Insurance. The term of the D&O Insurance is one year. Before expiration of this term,
the Company plans to renew the said insurance agreement upon a resolution of the Board of Directors.

- 11 -

Proposal 3:

Appointment of One Reserve Auditor

In order to prevent from lacking necessary numbers of Auditors defined by the laws and regulations, theBoard of Directors proposes appointment of one reserve Auditor.
This proposal has been approved by the Board of Auditors.
The candidate is as follows:
Name(Date of birth)

Past experience, positions
and significant concurrent positions

Number ofshares of theCompany held

October 1987

Entered in Sanwa Tohmatsu Aoki Auditing Firm (Current
Deloitte Touche Tohmatsu)
March 1991
Registered as certified public accountant
December 2003
Partner/Executive Officer of Deloitte Touche Tohmatsu,
Corporate Finance Division
Koichiro Tanaka
February 2005
Registered as certified tax accountant
1,000
July 2014
President of Tanaka Accounting Firm (in-service)(July 6, 1965)
March 2017
Outside auditor of Odawara Engineering Co., Ltd. (in-service)
June 2018
Auditor of Japan Automobile Research Institute (in-service)
June 2020
Outside Corporate Auditor of Arisawa Mfg. Co., Ltd.
(in-service)
March 2021
Representative Partner of Cenxus Audit Corporation (in-service)[Reason for nomination as candidate for Reserve Outside Auditor]
He possesses a wide range of knowledge in finance and accounting as a certified public accountant and certified tax accountant,and abundant experience in major auditing firms, listed companies, and other organizations. The Company believes that,reflecting his experience in the audit systems of the Company, he is capable of appropriately fulfilling his duties as an Outside
Auditor from an independent and fair position. Therefore, he has been renominated as a candidate for Reserve Outside Auditor.
(Notes)1. There are no special interests between the candidate and the Company.
2. The candidate is a candidate for Reserve Outside Auditor.
3. If Mr. Koichiro Tanaka assumes office as Auditor of the Company, the Company plans to enter into a liability
limitation agreement with him to limit his liability provided in Article 427, Paragraph 1 of the Companies Act to theminimum amount provided for by laws and regulations.
4. If Mr. Koichiro Tanaka assumes office as Auditor, the Company intends to register him with the Tokyo Stock
Exchange as Independent Auditor based on the rules of Tokyo Stock Exchange.
5. The Company has concluded with an insurance company a directors and officers liability insurance (hereafter referred
to as “D&O Insurance”) agreement provided for in Article 430-3, Paragraph 1 of the Companies Act. The insurance
covers damages, etc. that may result from the Directors and Auditors being liable for the performance of their duties(However, excluding the case that falls under indemnity conditions stipulated in the insurance agreement). The
premiums of D&O Insurance are fully borne by the Company. If Mr. Koichiro Tanaka assumes office as Auditor, hewill be insured under the D&O Insurance. The Company plans to renew the said D&O Insurance agreement during aperiod where the election of Reserve Outside Auditor is valid, upon a resolution of the Board of Directors.

- 12 -

Proposal 4: Determination of Compensation for Granting Restricted Shares to Directors (Excluding Outside
Directors)
The amount of compensation for Directors of the Company has been approved at 500 million yen or less per
year (including 50 million yen or less per year for Outside Directors) at the 113th Ordinary General
Shareholders Meeting held on June 21, 2019. On this occasion, with the objective of providing incentives for
Directors (excluding Outside Directors, hereinafter referred to as the “Eligible Directors”) to aim for sustained
enhancement of corporate value of the Company and further promoting the sharing of value with its
shareholders, the Company proposes to introduce a new plan to allot restricted shares to the Eligible Directors(hereinafter referred to as the “Plan”) and requests approval for the payment of compensation for granting
restricted shares to the Eligible Directors separately from the above amount of compensation.
The monetary compensation to be paid in order to grant restricted shares to the Eligible Directors shall be
100 million yen or less in total per year, which is an amount considered to be appropriate based on the above
objectives. Furthermore, the specific allocation to each Eligible Director shall be decided by the Board of
Directors.
Currently there are eleven (11) Directors (including two (2) Outside Directors). If Proposal 2 is approved as
proposed, there will be ten (10) Directors (including two (2) Outside Directors).
The specific details of restricted shares to be granted to the Eligible Directors are as follows.
1. Matters concerning maximum number of restricted shares, and allotment of and payment thereof
Under the Plan, the Company will provide to Eligible Directors monetary compensation receivables within
the annual limit stated above as compensation in order to grant restricted shares. The Eligible Directors will beallotted the restricted shares by making contribution in kind of all of such monetary compensation receivables.
The total number of the Company’s common shares to be issued or disposed of for the purpose of allotting
restricted shares shall be up to 100,000 shares per year (however, if a share split (including gratis allotment ofcommon shares of the Company) or a reverse share split of common shares of the Company is conducted, or if
another reason that necessitates an adjustment to the total number of the Company’s common shares to be
allotted as restricted shares arises after the day on which this proposal has been approved, the total number ofrestricted shares shall be adjusted to a reasonable extent).
The amount to be paid in for restricted shares will be determined by the Board of Directors of the Company
based on the closing price of the common shares of the Company on the Tokyo Stock Exchange as of thebusiness day immediately preceding the date of resolution of the Board of Directors meeting (if no transaction
is executed on such date, the closing price on a business day immediately preceding such date), within an
amount that will not be particularly advantageous to the Eligible Directors who will receive such restricted
shares. In addition, the monetary compensation receivables stated above shall be provided on the condition
that the Eligible Directors have agreed to the contribution in kind as mentioned above and that the Eligible
Directors have concluded a restricted share allotment agreement containing the details as set forth in 2 below.
2. Details of the restricted share allotment agreement
The restricted share allotment agreement (hereinafter referred to as the “Allotment Agreement”) concluded
between the Company and the Eligible Directors who will be allotted the restricted shares shall include thefollowing details.
(1) Details of transfer restriction
The Eligible Directors who have been allotted restricted shares may not transfer to any third party, createa security interest on, grant as advancement before death or otherwise dispose of the common shares of theCompany allotted (hereinafter referred to as the “Allotted Shares”) during a period from the date of theallotment to the date when the Eligible Directors retire from the position of Director of the Company(hereinafter referred to as the “Transfer Restriction Period”).
(2) Lifting of transfer restriction
On the condition that an Eligible Director who has been allotted restricted shares has continuously
remained in office as specified in the above (1) during the period determined by the Board of Directors(hereinafter referred to as the “Service Provision Period”), the Company shall lift the transfer restriction on
all the Allotted Shares upon the expiry of the Transfer Restriction Period. Notwithstanding the foregoing,- 13 -

if an Eligible Director retires from the post specified in the above (1) during the Service Provision Period
due to reasons deemed justifiable by the Board of Directors, the number of the Allotted Shares subject tothe lifting of the transfer restriction and the timing of lifting of the transfer restriction shall be adjusted in areasonable manner as required.
(3) Acquisition of restricted shares without consideration
From among the Allotted Shares, if there are any shares for which the transfer restriction has not been
lifted pursuant to the provisions of the reasons for removal of the transfer restriction specified in the above(2) upon the expiry of the Transfer Restriction Period as specified in the above (1), the Company shallrightfully acquire them without consideration.
(4) Treatment in case of organizational restructuring, etc.
If, during the Transfer Restriction Period, a merger agreement in which the Company becomes a
non-surviving company, a share exchange agreement or a share transfer plan under which the Company
becomes a wholly-owned subsidiary or any other matters related to an organizational restructuring, etc. isapproved at a General Shareholders Meeting of the Company (provided, however, at the Board of
Directors meeting of the Company if the approval of the General Shareholders Meeting for the saidorganizational restructuring, etc. is not required), the Company shall, prior to the effective date of the saidorganizational restructuring, etc., lift the transfer restriction on a number of Allotted Shares determined in areasonable manner by resolution of the Board of Directors based on the period from the date ofcommencement of the Service Provision Period to the date of approval of the said organizational
restructuring, etc. In addition, in the cases provided for above, the Company shall acquire without
consideration the Allotted Shares for which the transfer restriction has not been lifted at the time
immediately after the lifting of the transfer restriction.
(5) Other matters
Other matters concerning the Allotment Agreement shall be determined by the Board of Directors of theCompany.
3. Reasons why the granting of restricted shares is appropriate
The restricted shares are granted to Directors for the purpose of providing an incentive to achieve sustained
enhancement of corporate value of the Company and further promoting the sharing of value withshareholders.
In addition, as the monetary amount of the Allotted Shares valued at fair value as of the business day
immediately preceding the date of resolution of the Board of Directors meeting regarding the allotment of
restricted shares (if no transaction is executed on such date, a business day immediately preceding such date)
will be within the upper limit of the annual amount approved by this General Shareholders Meeting, and theratio of the restricted shares to the total issued shares will be 0.4% (if the restricted shares are issued at theirmaximum number over a period of 10 years, the ratio of the restricted shares to the total issued shares will be4.2%), and thus the dilutive effect will be minor, the Company considers that the granting of the restricted
shares is appropriate.
On the condition that this proposal is approved, the Company plans to revise its previous decision policy
regarding the details of individual compensation, etc. for Directors (the outline is described on page 28 of theBusiness Report in the Japanese version of this document) in line with the details of this proposal.

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