October 11, 2018

Notice Regarding Succession of Business to a Subsidiary by Company Split(Simplified Absorption-type Split)
STAR MICRONICS CO., LTD. (“STAR MICRONICS” or “the Company”) resolved at a meeting of its
Board of Directors held today (October 11, 2018) that as was notified in “Notice Regarding the Establishmentof a Subsidiary” on July 11, 2018, it will transfer its Special Products Segment in Japan by way of a company
split (simplified absorption-type split; “the Company Split”) to Star Marketing Japan Co., Ltd. (“SMJP”).
With regard to this, the Company and SMJP have entered into an agreement, dated today. Details of theCompany Split are as follows.
Under the Company Split, the Company will transfer business to SMJP, a wholly owned subsidiary, and assuch the disclosure of certain items and details have been omitted from this notice.
1. Purpose of the Company Split
The Company established SMJP in July 2018 as a wholly owned subsidiary with the objective of further
expanding the domestic sales business of its Special Products Segment. In order to smoothly conduct thetransfer of the Special Products Segment’s sales business, however, the Company is transferring this businessto SMJP by using an absorption-type company split method.
2. Overview of the Company Split(1) The Company Split Schedule
Board of Directors meeting to approve an October 11, 2018absorption-type company split agreement
Conclusion of the agreement for the absorption- October 11, 2018
type company split
Effective date of the absorption-type company January 1, 2019 (planned)
split
Note: The Company and SMJP will not seek respective approvals to conclude the agreement at their General Meeting ofShareholders as the Company Split will be executed through a simplified absorption-type split pursuant to Article 784,
Paragraph 2 of the Companies Act for the Company, the splitting company, and through a short-form absorption-typesplit under Article 796, Paragraph 1 of the Companies Act for SMJP, the successor company.

(2) Method of the Company Split
An absorption-type company split in which the Company is the splitting company and SMJP is thesuccessor company.
(3) Details of Share Allocation as Pertains to the Company Split
The Company Split will be conducted with a wholly owned subsidiary, and as such, when the Company
Split is executed SMJP will not allocate shares or pay any other consideration.
(4) Handling of Share Options and Share Options with Bonds Associated with the Company Split
The Company issues share options and bonds with share options, however, there will be no change intheir handling as a result of the Company Split.
(5) Capital to be Increased or Decreased Due to the Company Split
There will be no increase or decrease in capital due to the Company Split.
(6) Rights and Obligations to be Transferred to the Successor Company
The Company will transfer the assets and liabilities, as well as those rights and responsibilities thatpertain to these and that are set out in the agreement, and are associated with the business to be transferred
as of the effective date, as set forth in the Company Split agreement. The Company will cumulatively
take on liabilities that the successor company transfers.
1(7) Prospects for the Performance of Obligations
The Company has determined that the Company and SMJP will have no problems in discharging theirobligations on or after the day the Company Split takes effect.
3. Overview of Companies Involved in the Company Split
Splitting Company

Successor Company

STAR MICRONICS CO., LTD.
20-10 Nakayoshida, Suruga-ku, Shizuoka City, Shizuoka
Prefecture
Mamoru Sato, Representative Director, President andCEO
Manufacturing and sale of special products, machine
tools, and precision productsStar Marketing Japan Co., Ltd.

(5) Paid-in capital¥12,721 million¥40 million(6) Date of establishment

July 6, 1950

July 25, 2018(7) Shares issued

46,267,634

4,000(8) Fiscal period

December 31
The Master Trust Bank of Japan, Ltd. (TrustAccount)December 31
9.58% 100.0% held by STAR MICRONICS CO., LTD.

Japan Trustee Services Bank, Ltd. (TrustAccount)

9.38%

The Shizuoka Bank, Ltd.

4.30%

NORTHERN TRUST CO. (AVFC) RE
HCR00

2.26%

Japan Trustee Services Bank, Ltd. (TrustAccount 9)

2.14%

BNYM SA/NV FOR BNYM FOR BNYGCM CLIENT ACCOUNTS M LSCB RD

2.03%

Michi Suzuki

1.78%

Japan Trustee Services Bank, Ltd. (TrustAccount 5)

1.67%

THE BANK OF NEW YORK 133522

1.50%

BBH BOSTON CUSTODIAN FOR JAPANEQUITY PREMIUM FUND OF CREDITSUISSE UNIVER620373

1.42%(1) Name(2) Address(3) Representative(4) Business content(9) Major shareholders andratio of shares held

3-3-13, Shimbashi, Minato-ku, Tokyo
Takayuki Aoki, President and Representative Director
Sale of POS printers and peripheral devices(10) Financial condition and management results in most recent fiscal year
PeriodFY2/2018 (Note 1)(Note 2)

Net assets¥47,446 million―

Total assets
Net assets per share
Net sales¥77,362 million¥1,263.15¥60,772 million―――

Operating income¥6,210 million―

Ordinary income
Net income attributableto owners of parent
Net income per share¥7,015 million―¥5,780 million―¥155.68―

Note 1: At the 93th General Meeting of Shareholders held on May 24, 2018, the Company, which is the splitting company, resolved
to change its Articles of Incorporation to revise its fiscal period from ending on the last day of February, to December 31.
Note 2: SMJP, the successor company, being established on July 25, 2018, has no financial condition or management results to reportin the most recent fiscal year.

4. Outline of the Business to be Split(1) Business of the segment to be split off
Domestic sales business of the Special Products Segment(2) Management results for the division being split off
Net sales of ¥1,995 million (FY2/2018).
(3) Assets and liabilities being split off, and monetary values
There are no assets or liabilities being split off.
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5. Status after the Company Split(1)(2)

NameAddress(3)

Representative(4)

Business content

(5)
(6)

Paid-in capital
Fiscal periodSplitting Company
STAR MICRONICS CO., LTD.
20-10 Nakayoshida, Suruga-ku, Shizuoka City,
Shizuoka Prefecture
Mamoru Sato, Representative Director, President andCEO
Manufacturing and sale of special products, machine
tools, and precision products¥12,721 million
December 31

Successor CompanyStar Marketing Japan Co., Ltd.
3-3-13, Shimbashi, Minato-ku, Tokyo
Kazuyoshi Terao, President and Representative
Director
Sale of POS printers and peripheral devices¥10 million
December 31

Note 1: As of the effective date of November 26, 2018, the successor company is scheduled to reduce its paid-in capital by ¥30
million, to ¥10 million yen.
Note 2: The successor company is planning to transfer (change) its representative as of January 1, 2019.

6. Future Prospects
The Company Split is a simplified absorption-type company split between the Company and its wholly
owned subsidiary, and as such, will have nominal impact on the Company’s consolidated financial results.

(Reference) Consolidated business results forecasts for the period (disclosure on October 11, 2018) andconsolidated results for the previous period(Unit: millions of yen)
Consolidated
net sales
Results forecasts for theperiod (FY12/2018)
Results for the previousperiod (FY2/2018)

Consolidated
operating income

Consolidated
ordinary income

Net income attributableto owners of parent

61,200

8,200

8,300

6,000

60,772

6,210

7,015

5,780

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