Sepmber 27,2016(Translation)
Company Name
Representative

EPS Holdings, Inc.
Yan Hao, Chairman &CEO

Stock Code4282, TSE First Section

Contact

Shuzo Orihashi
Director & Executive Corporate
Officer
ir@eps.co.jp

e-mailNotice of Capital and Business Partnership and Disposition of Treasury Stock through
Third-Party Allocation
EPS Holdings, Inc. (hereafter the Company) hereby announces that at its Board of Directors meeting held on September
27, 2016, a resolution was passed to enter into a capital and business partnership with SUZUKEN Co., Ltd. (hereafter
SUZUKEN), and to dispose of its treasury stock through third-party allocation to the said company.

DetailsI. Summary of Capital and Business Partnership
1. Reasons for and Purpose of the Partnership
The pharmaceutical industry to which pharmaceutical manufacturers, the EPS Group’s major client base, belong, has inrecent years struggled to develop new drugs and, with the tightening of approval measures and revisions of the medical
system, continues to find itself in a difficult business climate. Facing growing research and development costs and theexpiration of patents for their mainstay products, pharmaceutical manufacturers are striving to optimize their organizational
structures and augmenting outsourcing with an aim to achieve speedier and more effective development ofpharmaceuticals .
Amid changes to the business climate surrounding development of pharmaceuticals and medical devices, the EPS Grouphas defined a management philosophy based on its corporate mission to “contribute to advancement of the healthcare
industry by providing high-value-added solutions to our clients.” In Japan, the Group operates CRO*1, SMO*2, and CSO*3
Businesses, and overseas, Global Research Business*4 involving clinical trials as well as EKISHIN (China) Business*5.
The Suzuken group focuses on the “health creation.” Its core business is sales of ethical drugs, diagnostic agents, medical
equipment and materials to medical institutions and insurance pharmacies (Pharmaceutical Distribution Business). It also
operates a range of other businesses related to medicine and health, including Pharmaceutical Manufacturing Business that
produces ethical drugs and diagnostic agents; Dispensing Pharmacies Business that dispenses medicine prescribed by
medical institutions; Pharmaceutical Manufacturers Support Business that provides a logistics contracting service forpharmaceutical manufacturers and for the distribution of orphan drugs.
The Company and SUZUKEN have agreed to enter into a capital and business partnership in order to utilize both firms’
management resources and expertise to further develop their respective businesses in Japan and Asia, particularly in China,
and contribute to the medical and healthcare industries.
In Japan, this partnership will enable the joint promotion of CRO Business, SMO Business, CSO Business, and theirancillary activities. Further, by jointly developing new business areas, the two companies will aim to provide new addedvalue mainly for pharmaceutical companies and medical institutions.
With respect to businesses in China, EPS EKISHIN Co., Ltd. (hereafter EPS EKISHIN), a consolidated subsidiary of theCompany handling all businesses in China for the EPS Group, will engage in a third-party allocation of shares to
SUZUKEN in order to promote businesses together. In addition to strengthening the existing business activities of bothgroups in China, the two groups will aim to create new added-value in the areas of manufacturing support, logistics, andother medical service areas.
- 1 -*Notes*1 CRO: Contract Research Organization -- Refers to organizations (or individuals) undertaking various processes associated with clinical trial operation andmanagement for a pharmaceutical firm.
*2 SMO: Site Management Organization -- Refers to organizations (or individuals) undertaking part of processes of conducting clinical trials for medical
institutions.
*3 CSO: Contract Sales Organization -- Refers to organizations, institutions, or individuals that undertake sales and marketing activities for pharmaceuticalmanufacturers, as well as organizations (or individuals) that undertake for a pharmaceutical firm operations of MRs (medical representatives) to provide andcollect information on indications, adverse reactions and proper use of drugs to medical institutions.
*4 Global Research Business -- Involves clinical trials overseas. Currently conducts CRO business activities in China, Hong Kong, Taiwan, South Korea,
and Singapore.
*5 EKISHIN (China) Business -- As a specialized trading firm in the Japan-China healthcare sector, EKISHIN is composed of three divisions: medical
devices, pharmaceuticals, and peripheral support. Acting as a link between Japan and China for the promotion of pharmaceutical and medical businesses andprojects therein, and capitalizing on its network in the Chinese market, this business segment conducts comprehensive market research on businessdevelopment for consulting and provides other services to meet the needs of Japanese and Chinese firms.

2. Details of the Capital and Business Partnership(1) Capital PartnershipThis agreement provides that the Company will acquire SUZUKEN shares and SUZUKEN will acquire shares of theCompany and EPS EKISHIN.
① Acquisition of SUZUKEN shares by the Company
The Company will acquire 632,000 shares of common stock in SUZUKEN (0.61% of shares outstanding for
SUZUKEN) from its treasury stock through a third-party allocation. For details, please refer to “II. Acquisition of
SUZUKEN Shares” below.
② Acquisition of the Company shares by SUZUKEN
A portion of the Company shares will be disposed to SUZUKEN through a third-party allocation. For details, pleaserefer to “III. Disposition of Treasury Stock through Third-Party Allocation” below.
③ Acquisition of new shares in the Company’s consolidated subsidiary by SUZUKENEPS EKISHIN, a consolidated subsidiary of the Company, will carry out a third-party allocation of new shares withSUZUKEN as the allottee. For details, please refer to “IV. Third-Party Allocation of New Shares throughConsolidated Subsidiary” below.
④ Transactions 1 through 3 above are to be carried out as a single integrated transaction, with the following conditions
attached.
A. The condition precedent to this third-party allocation of the Company shares is that the acquisition of SUZUKEN
shares has been effectively carried out through its third-party allocation.
B. The condition precedent to the third-party allocation of EPS EKISHIN shares is that the third-party allocation of theCompany shares has been effectively carried out.
(2) Details of the Business Partnership
In this capital and business partnership, the Company, SUZUKEN, and EPS EKISHIN have agreed to hold concretetalks on the realization of the below-described business partnership and on the adjustment of economic conditions. The
terms agreed to by both parties through these talks shall be recorded in MOU or formalized through separate contracts.
① Utilization of the management resources of both firms in Japan to build a “one-stop contract model” spanning
clinical trials and filing for pharmaceuticals and medical devices, their sales, distribution, post-launch market
research, administration support, and response to enquiries, as well as to create new added-value through joint
development.
② Creation of new added-value through improved functionality of existing businesses, export and commoditization ofJapanese medical services, and the development of new medical services with an aim to make further contributions- 2 -to the Chinese healthcare industry.
③ Joint research on businesses in the global healthcare field in Asia and elsewhere and development of new business inthe field.
④ Enhancement of skills and effective use of employees at both firms through collaboration in education and training⑤ Other collaborations for the effective use of management resources of both firms
3. Summary of Parties to Business Partnership
For a summary of SUZUKEN, please see “III. Disposition of Treasury Stock through Third-Party Allocation” and “6.
Reasons for Selection of the Allottee, etc.; (1) Outline of the Allottee.”
4. Schedule(1)

The Board of Directors meeting(2)

Capital and business partnershipcontract conclusion(3)

Date of payment for the thirdparty allocation of shares

September 27, 2016
September 27, 2016
October 18, 2016

5. Future Outlook
Effects of this partnership on the current fiscal term performance is expected to be minimal, but a stronger relationshipwith SUZUKEN will support growth and expansion of the Company’s businesses, likely leading to increased enterprisevalue in the medium- and long-term.
II. Acquisition of SUZUKEN Shares
1. Summary of acquisition(1)

Type and number ofshares to be acquired

632,000 shares of common stock in SUZUKEN(2)

Acquisition method

Underwriting of treasury stock through third-party allocation(3)

Acquisition date

October 18, 2016(4)

Share value

JPY3,161 per share(5)

Total share value

JPY1,997,752,000(6)Miscellaneous

The above terms shall be subject to condition precedent that filings under the
Financial Instruments and Exchange Act have taken effect.

2. Future Outlook
Effects of this share acquisition on the current fiscal term performance is expected to be minimal, but a stronger
relationship with SUZUKEN will support growth and expansion of the Company’s business, likely leading to increased
enterprise value in the medium- and long-term.
III. Disposition of Treasury Stock through Third-Party Allocation
1. Summary of Disposition(1)

Disposition date(2)

Amount of Treasury
stock to be disposed

October 18, 2016
1,504,000 shares of common stock(3)

Disposition value

JPY 1,329 per share(4)

Total disposition value

JPY 1,998,816,000(5)Disposition or allocation
method (planned

All shares to be allotted to SUZUKEN via third-party allocation- 3 -allottee)(6)

Miscellaneous

Condition precedent to the above terms is that the securities registration statement
be filed under the Financial Instruments and Exchange Act and goes into effect andthat the acquisition of SUZUKEN common shares by the Company has beeneffectively carried out.

2. Reasons for and Purpose of Disposition
Please refer to “I. Summary of Capital and Business Partnership.”
3. Amount, Use, and Scheduled Timing of Expenditure of Funds to Be Raised(1) Amount of Funds to Be Raised
1

Total amount to be paid

2

Estimated costs of issuance3

Estimated net amount

JPY1,998,816,000
JPY 3,432,000
JPY 1,995,384,000

Notes: 1. Consumption tax is not included in the estimated costs of issuance.
2. The costs of issuance above are various procedural fees and other expenses.
(2) Use of Funds to Be Raised
The estimated net amount of JPY1,995,384,000 is to be used for the capital and business partnership stated in “I.
Summary of Capital and Business Partnership, 1. Reasons for and Purpose of Partnership,” with the entirety of the amountto be allocated for the acquisition of ordinary shares of SUZUKEN.
4. Rationale for the Use of Funds to Be Raised
As described in the “2. Reasons for and Purpose of Disposition” above, this third-party allocation of shares is intended toutilize the management resources and expertise of both groups and expand their respective businesses in Japan and Asia,
particularly in China. In these ways, the Company aims to contribute to the medical and healthcare industries while also
expanding its profit base. The Company believes that through such efforts its enterprise value will increase in the mid- andlong-term, and therefore deems the capital use for this third-party allocation to be reasonable.
5. Rationale for Conditions of Issuance(1) Basis for Calculation of Amount to Be Paid and Details Thereof
Through negotiations with SUZUKEN, the disposition value has been set at the average of the closing prices of ordinary
shares of the Company on the Tokyo Stock Exchange for a period spanning one month until the day immediately preceding
the day on which the decision regarding the third-party allotment was made at the Board of Directors meeting (from August27, 2016 to September 26, 2016). As a result, the value is decided at JPY1,329 (the number is rounded down to the nearest
single yen value). The Company believed that using an average share price for a certain period – a leveled price – would
allow for the removal of extraordinary factors, such as temporary price shifts, and be therefore more objective andreasonable as the basis of calculation. The period taken into the basis of calculation was one month immediately preceding
the day on which the decision regarding the third-party allotment was made at the Board of Directors meeting on the
grounds that using a period closest to the recent market price rather than a period of three or six months would be morereasonable. The “Guidelines Concerning Treatment of Capital Increase through Third-Party Share Allocations” stipulatedby the Japan Securities Dealers Association (April 1, 2010) sets forth that when issuing shares through a third-party
allocation, the amount paid must be based on the share price on the day immediately preceding the day on which thedecision regarding such third-party allotment is made at the Board of Directors meeting (where no transactions were madeon the preceding day, the share price on the most recent day shall apply).
The disposition price (JPY1,329) represents a 2.42% discount of the closing price (JPY1,362) of the Company’s
ordinary shares at the Tokyo Stock Exchange on the business day (September 26, 2016) prior to the aforementioned
meeting and decision of the Board, and a 0.91% premium on the average closing price (JPY1,317) of its ordinary shares- 4 -over a three month period spanning June 27, 2016 to September 26, 2016, and a 1.92% discount of the average closing
price (JPY1,355) of its ordinary shares over a six month period spanning March 27, 2016 to September 26, 2016.
Considering the recent price range of its ordinary shares, the Company thinks that the disposition value is not set
particularly advantageous to either party. Further, the Company believes that the above basis of calculation for the
disposition value conforms to the “Guidelines Concerning Treatment of Capital Increase through Third-Party Share
Allocations” stipulated by the Japan Securities Dealers Association.
The Company’s all three auditors who attended the Board of Directors meeting on the day and took part in the discussion
concerning the third-party share allocation affirmed that the disposition value and price based on the above basis of
calculation were drawing on the objective market prices that indicated the value of the Company’s common shares. They
also stated that they were in accordance with the Guidelines Concerning Treatment of Capital Increase through Third-Party
Share Allocations” stipulated by the Japan Securities Dealers Association, and in light of the Company’s latest financial
status and performance, deemed reasonable, appropriate and legal, with no unfair advantage given to the allottee.
(2) Basis for Determination of Reasonable Number of Shares to Be Issued and the Level of Dilution
The 1,504,000 ordinary shares to be allocated to SUZUKEN in this transaction correspond to 3.25% of 46,311,389
shares outstanding as of March 31, 2016 (or 3.38% of 444,865 shares with voting rights) and represent a dilution of shares.
However, this third-party allocation is intended to utilize the management resources and expertise of both firms to expand
their respective businesses in Japan and Asia, particularly in China, and to contribute to the medical and healthcare
industries while also expanding profit bases, leading to increased enterprise value. For these reasons, the number of sharesissued and the level of dilution arising from this allocation are deemed reasonable.
6. Reasons for Selection of the Allottee, etc.
(1) Outline of the Allottee (as of March 31, 2016; excluding where stated otherwise)
(1)

Name

SUZUKEN Co., Ltd.

(2)

Headquarters

8 Higashikataha-machi, Higashi-ku, Nagoya(3)

Head officer

Hiromi Miyata, President and Chief Executive Officer(4)Business scope

Sales and production of pharmaceuticals and operation of dispensing pharmacies
business(5)

Capital

JPY13.546bn(6)

Established

August 10, 1946

(7)

Outstanding shares

103,344,083(8)

Fiscal year end

March 31

(9)

Number of employees

4804

(10)

Major clients

Pharmaceutical companies, medical institutions (hospitals, clinics), dispensing
pharmacies(11)

Main financing banks

Bank of Tokyo-Mitsubishi UFJ, Mizuho Bank

(12)

7. Major shareholders

Japan Trustee Services Bank, Ltd. (Retirement benefit trust account re-and their shareholding

trusted by Sumitomo Mitsui Trust Bank, Limited. as trustee for

ratio

Shionogi & Co., Ltd.

5.74%

Shionogi & Co., Ltd.

3.51%

Hiroko Bessho

2.99%

Japan Trustee Services Bank Ltd. (Trust account)

2.81%

Suzuken Group Employee Stock Ownership Association

2.77%

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

2.46%

Hisayo Izawa

2.33%

Eisai Co., Ltd.

2.01%

Astellas Pharma Inc.

1.86%

Japan Trustee Services Bank Ltd. (Trust account 9)

1.82%

- 5 -

(13)

Relationship between theparties(As of September 27, 2016)

Capital relationship

N/A

Personal relationship

N/A

Business relationship

N/A

Related party

The allottee to this third-party allocation is not a party related to the Company.

relationship

Further, those entities and firms affiliated with the allottee are not parties related tothis Company.

(14)

Consolidated business performance and consolidated financial status for the last three years (units: JPYmn,
excluding where stated otherwise)

F i s c a ly e a rFY March 2014

FY March 2015

FY March 2016

Consolidated net assets

325,996367,798

394,098

Consolidated total assets

1,027,133

1,086,685

1,178,435

3,283.06

3,705.12

3,970.59

1,988,216

1,969,689

2,228,331

Consolidated operating profit

17,84013,24028,244

Consolidated ordinary profit

35,32030,09345,727

21,44718,92028,960216.30190.82292.13

54.00

54.00

69.00

Consolidated net assets per share(JPY)
Consolidated net sales

Net income attributable toshareholders of the parent
Consolidated net income per share(JPY)
Dividend per share (JPY)*The Company deems that SUZUKEN, the allottee to this transaction, and their officers and affiliates have no relationships
with nor links to antisocial forces. This judgement is based on the fact that SUZUKEN is listed on the Tokyo Stock
Exchange, Nagoya Stock Exchange, and Sapporo Securities Exchange (collectively the "Exchanges"), and the statements
under “2. Basic Policy for Building Internal Control Systems; (10) Basic thinking about the elimination of anti-social forces
and the status of related activities” in “IV. Internal Control System; 2. Basic Policy for Building Internal Control Systems”
on their corporate governance report submitted to the Exchanges on June 28, 2016 that read, "based on our awareness that acompany is a public organ of society, and in accordance with highest ethical standards, SUZUKEN has a strong
commitment to fulfilling its social responsibilities. We are resolutely opposed to anti-social forces and groups that threaten
public order and safety."(2) Reasons for the Selection of SUZUKEN
Please refer to the “I. Summary of Capital and Business Partnership; 1. Reasons for and Purpose of Partnership” above
for details on reasons for the selection of SUZUKEN to this transaction.
(3) Ownership Policy of SUZUKENThe Company has confirmed with SUZUKEN that it intends to retain the shares allocated through this third-party
allocation for the medium- to long-term. In this business partnership agreement, the Company and SUZUKEN have agreed
that SUZUKEN, the allottee, shall obtain a prior written consent of the Company should SUZUKEN intends to transfer to athird party, set a collateral, or otherwise dispose of the Company’s shares during the period of this business partnershipagreement.
The Company and SUZUKEN have also discussed that if SUZUKEN transfers all or part of the shares allocated within
two years of payment, it shall immediately notify the Company in writing of the name and/or appellation of the recipient(s)of the shares, the number of shares transferred, and other relevant details; the Company shall report said details to theTokyo Stock Exchange; and said report will be subject to public inspection. The Company has already received an informal
consent on these terms from SUZUKEN and plans to obtain a written statement of assurance.
- 6 -(4) Confirmation of Assets of SUZUKEN with Regard to Payment for the Third-Party Allocation
Having confirmed on SUZUKEN’s consolidated balance sheet in its latest quarterly report (for the first quarter of its 71st
fiscal year), which was submitted to the Kanto Local Finance Bureau on August 12, 2016, the Company has confirmed thatSUZUKEN possesses sufficient funds (JPY119.722bn in cash and deposits according to the BS) for the payment of thethird-party share allocation and therefore sees no uncertainty regarding the payment for this third-party allocation.
7. Major Shareholders and their Shareholding Ratio
Prior to offering

After offering

Y&G Limited

21.04％Y and G LLC

21.04％GOLDMAN, SACHS & CO. REG(Standing proxy: Goldman-Sachs Japan Co., Ltd.)

8.08％

GOLDMAN, SACHS & CO. REG(Standing proxy: Goldman-Sachs Japan Co., Ltd.)

8.08％

Japan Trustee Services Bank, Ltd.

Japan Trustee Services Bank Ltd.

6.44％

(Trust account)

6.44％(Trust account)

Yukihiro Sasaki

3.22％

SUZUKEN Co., Ltd.

3.25％

Haruo Nishino

3.22％

Yukihiro Sasaki

3.22％

CBNY - GOVERNMENT OF NORWAY(Standing proxy: Citibank Japan, Ltd.)

2.64％

Haruo Nishino

3.22％

EPS Holdings, Inc.

2.52％

CBNY - GOVERNMENT OF NORWAY
2.64％(Standing proxy: Citibank Japan Ltd.)THE BANK OF NEW YORKTHE BANK OF NEW YORK

(Standing proxy: Mizuho Bank, Ltd. Settlement Sales

2.39％(Standing proxy: Mizuho Bank, Ltd. Settlement Sales

Department)

2.39％

Department)

Sumitomo Life Insurance Company(Standing proxy: Japan Trustee Services Bank Ltd.)

Sumitomo Life Insurance Company(Standing proxy: Japan Trustee Services Bank Ltd.)

2.33％

The Master Trust Bank of Japan, Ltd.

The Master Trust Bank of Japan, Ltd.

2.05％

(Trust account)

2.33％

2.05％

(Trust account)
0.13％

EPS Holdings, Inc.

(Note: The above information is based on the Company’s shareholders list as of March 31, 2016)

8. Future Outlook
Effects of this share acquisition on the current fiscal term performance is expected to be minimal, but a stronger
relationship with SUZUKEN will support growth and expansion of the Company’s business, likely leading to increased
enterprise value in the medium- and long-term.
9. Procedures per Code of Corporate Conduct
Given that this third-party allocation of shares has a dilution rate of less than 25% and does not involve any shift incontrolling shareholders, it does not require to obtain opinions from an independent third party nor to confirm the intent ofeach shareholder as stipulated in Article 432 of the Tokyo Stock Exchange’s Securities Regulations.
10. State of Business and Equity Finance over the Last Three Years(1) Three-Year Performance (consolidated; units: JPYmn, excluding where stated otherwise)
FY September 2013

FY September 2014

FY September 2015

Consolidated net sales

37,58441,80045,202

Consolidated operating profit

3,497

4,491

5,482

Consolidated ordinary profit

3,540

4,242

5,362

Net income attributable to

1,709

1,828

2,163

- 7 -

shareholders of the parent
Consolidated net income per share

47.81

51.54

58.14

18.00

18.00

18.00

488.90533.49614.27(JPY)
Dividends per share (JPY)
Consolidated net assets per share(JPY)

Note: A 2:1 stock split was executed on April 1, 2013 and then again a 100:1 stock split on April 1, 2014. Consolidated net
income per share, dividends per share, and consolidated net assets per share are calculated assuming that these stock splits
had taken place at the start of the fiscal year ended September 2013.
(2) Shares Outstanding and Dilutive Shares as of September 27, 2016
Number of shares
Shares Outstanding
Dilutive shares at current conversion
price (strike price)
Dilutive shares at minimum
conversion price (strike price)
Dilutive shares at maximum
conversion price (strike price)

Percentage of issued shares

46,311,389

100%

－

－

－

－

－

－

(3) Recent Share Prices
1. Share Prices over the Last Three Years
FY September 2013
FY September 2014
FY September 2015
222,000 JPY
95,900 JPY
Opening price
1,428 JPY
□ 133,000 JPY■1,170 JPY
304,500 JPY
140,000 JPY
High price
1,627 JPY
□169,100 JPY■1,476 JPY
199,400 JPY
90,500 JPY
Low price
1,099 JPY
□89,000 JPY■936 JPY
271,100 JPY
113,900 JPY
Closing price
1,169 JPY
□95,900 JPY■1,417 JPY
Note: 1 -- □ symbol refers to an ex-rights share price following a 2:1 stock split on April 1, 2013.
2 -- ■ symbol refers to an ex-rights share price following a 100:1 stock split on April 1, 2014.
2. Share Prices over the Last Six Months
March 2016

April

May

June

July

AugustOpening price1,400 JPY

1,401 JPY

1,353 JPY

1,420 JPY

1,262 JPY

1,438 JPY

High price

1,543 JPY

1,492 JPY

1,467 JPY

1,529 JPY

1,450 JPY

1,484 JPY

Low price

1,351 JPY

1,260 JPY

1,335 JPY

1,253 JPY

1,233 JPY

1,227 JPY

Closing price

1,376 JPY

1,384 JPY

1,442 JPY

1,284 JPY

1,408 JPY

1,300 JPY

3. Share Price on the Business Day Immediately Preceding the Day of the Resolution for issuance
September 26, 2016
Opening price

1,370 JPY

High price

1,383 JPY

Low price

1,360 JPY

Closing price

1,362 JPY

(4) State of Equity Finance over the Last Three Years
N/A

- 8 -

11. Disposition Details(1)Type and number of shares

1,504,000 shares of common stock(2)

Amount to be paid

JPY1,329 per share(3)

Total amount to be paid

JPY1,998,816,000(4)Application period

October 18, 2016

(5)

Date of payment

October 18, 2016

(6)

Disposition or allocation method and disposition to

All shares to be allocated to SUZUKEN via third-party
allocation(7)

Miscellaneous

The above terms are subject to a condition precedent thatthe securities registration statement be filed under the
Financial Instruments and Exchange Act and goes into
effect and that the acquisition of SUZUKEN commonshares by the Company has been effectively carried out.

IV. Third-Party Allocation of New Shares through Consolidated Subsidiary
1. Summary of Offering(1)

Consolidated subsidiaryconducting third-party

EPS EKISHIN

allocation of new shares(2)

Overview of theProfessional trading business linking Japan, China, and Southeast Asia in the

consolidated subsidiary

healthcare industry and overseeing EKISHIN (China)’s business segments(Manufacture and sale of medical devices in China, investment inpharmaceuticals and healthcare, import and sale of research materials inJapan, and other consulting services)(3)

Type and number of sharesissued(4)3,500 shares of EPS EKISHIN’s common stock

Offering and allocation
methodAll shares to be allocated to SUZUKEN via third-party allocation(Scheduled allottee)(5)Date of the Resolution at
the Ordinary General

September 27, 2016

Meeting of Shareholders(6)

Date of payment

October 18, 2016(7)

Issue price

JPY771,500 per share(8)

Total amount to be paid

JPY2,700,250,000(9)EPS EKISHIN shareholder
structure following thethird-party allocation

The Company: 65.0%
SUZUKEN: 35.0%(10)

Use of funds

Business investment(11)

Miscellaneous

The above terms are subject to a condition precedent that the third-party
allocation of the Company shares to SUZUKEN has been effectively carriedout.

2. Future outlook
Effects of this share allocation on the current fiscal term performance is expected to be minimal, but a stronger
relationship with SUZUKEN will support growth and expansion of the Company’s business, likely leading to increased
enterprise value in the medium- and long-term.

- 9 -