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
shall prevail. The Company assumes no responsibility for this translation or for direct, indirect or any
other forms of damages arising from the translation.
Stock Exchange Code 4530
May 2, 2024
(Start date of measures for electronic provision: April 26, 2024)
To Shareholders with Voting Rights:
Kazuhide Nakatomi
President & CEO
Hisamitsu Pharmaceutical Co., Inc.
408 Tashiro Daikan-machi, Tosu, Saga

NOTICE OF CONVOCATION OF
THE 122ND ANNUAL GENERAL MEETING OF SHAREHOLDERS
We would like to express our appreciation for your continued support and patronage.
We would also like to express our heartfelt sympathy to all those affected by the 2024 Noto Peninsula
Earthquake and sincerely hope for the earliest possible recovery.
This is to notify you that the 122nd Annual General Meeting of Shareholders of Hisamitsu PharmaceuticalCo., Inc. (the “Company”) will be held for the purposes as described below.
In convening the General Meeting of Shareholders, the Company has taken measures for electronic provisionand has posted the matters subject to electronic provision on the Company’s website. Please access theCompany’s website below to see the information.
The Company’s website

https://global.hisamitsu/ir/shareholders.html

In addition to the Company’s website, the matters subject to electronic provision are also posted on thewebsite of the Tokyo Stock Exchange (TSE). When you access the TSE website, search for the Company byentering “Hisamitsu Pharmaceutical” in the “Issue name (company name)” bar or the Company’s stock
exchange code “4530” in the “Code” bar, continue selecting “Basic information” and “Documents for public
inspection/PR information” and choose “Notice of General Shareholders Meeting/Informational Materials for a
General Shareholders Meeting” under “Filed information available for public inspection” to see the matters.
TSE website (Listed Company Search)https://www2.jpx.co.jp/tseHpFront/JJK020010Action.do?Show=ShowIn lieu of attending the meeting, you may exercise your voting rights via electromagnetic means, including
the Internet, or in writing. In this case, please review the attached Reference Documents for the General Meetingof Shareholders and exercise your voting rights.
1. Date and Time:Thursday, May 23, 2024 at 10:00 a.m. Japan time

2. Place:

Head office of the Company located at
408 Tashiro Daikan-machi, Tosu, Saga, Japan-1-

3. Meeting Agenda:
Matters to be reported:

1. The Business Report, Consolidated Financial Statements and Non-consolidated Financial Statements for the Company’s 122nd Fiscal Year
(March 1, 2023 - February 29, 2024)
2. Results of audits by the Independent Auditor and the Board of Corporate
Auditors of the Consolidated Financial Statements for the Company’s 122nd
Fiscal Year
Proposals to be resolved:
Proposal 1:
Appropriation of Surplus
Proposal 2:
Election of 9 Directors
Proposal 3:
Election of 3 Corporate Auditors(The details of the meeting agenda and other matters are stated in the following pages.)
4. Matters decided for convocation- Items not stated in a document delivered to shareholders
The document delivered to shareholders also serves as a document that states the matters subject toelectronic provision, which is delivered to shareholders who have requested a paper copy of it. In
accordance with applicable laws and regulations and Article 14 of the Articles of Incorporation of theCompany, the following items are not included in it. Please note that the Corporate Auditors and theIndependent Auditor have audited documents, including the following items.
(1) Matters Regarding Share Acquisition Rights, etc. of the Company, Status of Independent Auditor, andStructure and Policy of the Company in the Business Report(2) Consolidated Statements of Changes in Shareholders’ Equity and Notes to Consolidated Financial
Statements in the Consolidated Financial Statements(3) Non-consolidated Statement of Changes in Shareholders’ Equity and Notes to Non-consolidated
Financial Statements in the Non-consolidated Financial Statements-2-

Reference Documents for the General Meeting of Shareholders
Proposal 1:

Appropriation of Surplus

The Company regards the appropriate return of profits to shareholders as one of the most importantmanagement issues.
With respect to dividends of surplus at the end of the fiscal year under review, upon comprehensively
examining factors such as the performance for the fiscal year, dividend payout ratios and various
management measures for the future in addition to taking into account the stable distribution of dividends
to shareholders, the Company proposes to pay a dividend of ¥42.5 per share as follows. Accordingly, theannual dividend including an interim dividend of ¥42.5 will be ¥85 per share, an increase from the annual
dividend of ¥84.5 per share for the previous fiscal year.
In addition, the Company recognizes the need to strengthen its financial structure to provide for the
stable return of profits to its shareholders and future business development, and therefore intends to allocate¥3.0 billion to general reserve as follows.
1. Matters concerning dividends of surplus(1) Allotment of dividend properties to shareholders and the total amount thereof¥42.5 per share of the Company’s common stock
Total payment of dividends: ¥3,220,341,578(2) Effective date of dividends of surplus
Friday, May 24, 2024
2. Matters concerning appropriation of surplus(1) Surplus item to be increased and the amount thereof
General reserve¥3,000,000,000(2) Surplus item to be decreased and the amount thereof
Retained earnings brought forward¥3,000,000,000-3-Proposal 2:

Election of 9 Directors

The terms of office of all 9 Directors will expire at the conclusion of this General Meeting of
Shareholders. Accordingly, the election of 9 Directors is proposed.
The candidates for Directors are as follows:
No.

1

2

Name
(Date of birth)

Past experience, positions, responsibilities
and significant concurrent positions

Number ofSpecialshares of the interests in the
Company held
Company

Joined the Company
April 1999
February 2007 Head of Corporate Strategy Planning
Director & Executive Officer
Kazuhide Nakatomi May 2007
Managing Director & Executive Officer
May 2009(June 30, 1972)
245,742None
May 2011
Senior Managing Director & Executive Officer[Reappointment]
Vice President & Executive Officer
May 2014
President & COO
May 2015
President & CEO (to present)
May 2019[Reason for nomination as candidate]
Mr. Kazuhide Nakatomi has extensive operational experience in the corporate strategy planning division, and took office as
Director of the Company in 2007. He also has built track records as a corporate manager since he became Representative
Director in 2015. We believe he is suitable for continuing to serve as a Director of the Company, and nominate him as a
candidate for Director.
Joined the Company
April 1977
Director
May 1999
Kosuke Sugiyama
February 2010 Director & Executive Officer(April 28, 1952)
Managing Director & Executive Officer
July 2012
13,000None
Senior Managing Director & Executive Officer
May 2014[Reappointment][In charge of Human Resources, Research andDevelopment, and Corporate Strategy Planning] (topresent)[Reason for nomination as candidate]
Mr. Kosuke Sugiyama has extensive operational experience in the human resources division, and has been managing andsupervising management in general, including human resources, since he took office as Director of the Company in 1999. We
believe he is suitable for continuing to serve as a Director of the Company, and nominate him as a candidate for Director.

-4-

No.

Name
(Date of birth)

Kyu Saito(June 10, 1963)
3

4

5[Reappointment]

Past experience, positions, responsibilities
and significant concurrent positions
April 1987
April 2009
May 2013
May 2023

Joined the Company
Executive Officer
Director & Executive Officer
Managing Director & Executive Officer[Head of Global Business Strategy, Chairman of
Hisamitsu America, Inc., President of Hisamitsu
Pharmaceutical Technology Consulting (Beijing) Co.,
Ltd., President of Hisamitsu Pharmaceutical (China)
Co., Ltd., President of Hisamitsu U.S., Inc., andDirector of P.T. Hisamitsu Pharma Indonesia] (topresent)

Number ofSpecialshares of the interests in the
Company held
Company

7,100

None

[Reason for nomination as candidate]
Mr. Kyu Saito has extensive operational experience in the sales and corporate strategy planning divisions, and has been
managing and supervising the overseas sales division since he took office as Director of the Company in 2013. We believe he issuitable for continuing to serve as a Director of the Company, and nominate him as a candidate for Director.
Joined the Company
April 1988
Executive Officer
March 2010
Nobuo Tsutsumi
May 2014
Director & Executive Officer(March 11, 1964)
5,200
None
[Management of Legal Affairs, Production, Quality
Assurance & Pharmacovigilance, Compliance, and[Reappointment]
Director of Yutoku Pharmaceutical Ind. Co., Ltd. (parttime)] (to present)[Reason for nomination as candidate]
Mr. Nobuo Tsutsumi has extensive operational experience in the legal division, and has been managing and supervising legal
affairs and compliance based on his high expertise since he took office as Director of the Company in 2014. We believe he issuitable for continuing to serve as a Director of the Company, and nominate him as a candidate for Director.
Joined the Company
March 1991
Executive Officer
March
2012
Shinichi Murayama
Director & Executive Officer
May
2014(October 16, 1967)
6,000
None
[Management of Internal Audit, Japan Subsidiaries,
Director of Yutoku Pharmaceutical Ind. Co., Ltd. (part[Reappointment]time), and Outside Corporate Auditor of SANOFIHISAMITSU K.K. (part-time)] (to present)[Reason for nomination as candidate]
Mr. Shinichi Murayama has extensive operational experience in the sales and corporate strategy planning divisions, and has
been managing and supervising management in general, including as Executive Secretary of Chairman’s Office, since he took
office as Director of the Company in 2014. We believe he is suitable for continuing to serve as a Director of the Company, andnominate him as a candidate for Director.

-5-

No.

Name
(Date of birth)

Koji Takiyama(October 31, 1971)[Reappointment]
6

7

Past experience, positions, responsibilities
and significant concurrent positions
April 1994
May 2017
May 2021
May 2022

Joined the Company
Executive Officer
Senior Executive Officer
Director & Executive Officer[Executive Secretary of President’s Office, andManagement of Digital Transformation (DX), andSustainability Promotion] (to present)

Number ofSpecialshares of the interests in the
Company held
Company

3,035

None

[Reason for nomination as candidate]
Mr. Koji Takiyama has extensive operational experience in the sales division and in the management of Hisamitsu
Pharmaceutical Group companies, and has been managing and supervising management in general, including as Executive
Secretary of President’s Office, since he took office as Director of the Company in 2022. We believe he is suitable forcontinuing to serve as a Director of the Company, and nominate him as a candidate for Director.
April 1988
Professor of Faculty of Science and Technology, Keio
University, Professor of Graduate School of Scienceand Technology, Keio University
October 1993
Dean of Faculty of Science and Technology, Keio
University
Dean of Graduate School of Science and Technology,
Keio University
May 2001
President of Keio University (Chair of the Board ofTrustees of Keio University and the university
president of Keio University)
Yuichiro Anzai
Advisor for Academic Affairs to Keio University (toMay 2009(August 29, 1946)
present)
Director of the Nakatomi Foundation (to present)
April 2010
300
None
[Reappointment]
Chairman of Japanese Association of University
June 2011[Outside Director]
Physical Education and Sports[Independent Officer] October 2011
President of Japan Society for the Promotion of Science(JSPS)
Professor Emeritus of Keio University (to present)
April 2012
February 2018 President of Kojunsha Club (to present)
Senior Advisor to JSPS (to present)
April 2018
Director of Research Center for Science Systems, JSPS
Outside Director of the Company (to present)
May 2020
Executive Director of The Tokyo Foundation for Policy
July 2020
Research
December 2020 Executive Director and Chief Executive Officer of The
Tokyo Foundation for Policy Research (to present)[Reason for nomination as candidate and summary of expected roles]
Mr. Yuichiro Anzai, who has long served as a manager of a university, has a wide range of knowledge and experience, and we
expect him to provide precise advice on the Company’s management. Furthermore, there is no problem with his independence
in relationship with the Company. We believe he is suitable for continuing to serve as an Outside Director of the Company, andnominate him as a candidate for Outside Director.

-6-

No.

Name
(Date of birth)

Past experience, positions, responsibilities
and significant concurrent positions

Number ofSpecialshares of the interests in the
Company held
Company

April 2001
June 2005
June 2006
June 2012
June 2013

8

9

Joined Matsuo Construction Co., Ltd.
Managing Director of Matsuo Construction Co., Ltd.
President of Matsuo Construction Co., Ltd. (to present)
Tetsugo Matsuo
Outside Director of FM Saga Co., Ltd. (to present)(January 1, 1972)
Outside Director of Saga Ube Concrete Kogyo Co.,
1,900
None
Ltd. (to present)[Reappointment]
Chairman of Saga General Construction Association (toMay 2016[Outside Director]
present)[Independent Officer]
Outside Director of the Company (to present)
May 2020
Outside Director of New Otani Kyushu Co., Ltd. (toJune 2023
present)[Reason for nomination as candidate and summary of expected roles]
Mr. Tetsugo Matsuo has extensive experience and insight into overall management acquired as a representative director of aconstruction company, and we expect him to provide precise advice on the Company’s management. Furthermore, there is no
problem with his independence in relationship with the Company. We believe he is suitable for continuing to serve as an
Outside Director of the Company, and nominate him as a candidate for Outside Director.
April 2004
Joined KPMG AZSA LLC
May 2006
Registered as a certified public accountant
Joined ASG Tax Corporation
Tamako Watanabe April 2008
Registered as a certified tax accountant
August2010(January 26, 1982)
Joined Odaki Accounting, Tax and Consulting
July 2011
0
None
General Manager of Tateyama Office[Reappointment]
September 2011 Registered as a licensed social insurance consultant[Outside Director]
Established Itsuki Accounting Firm
July 2019[Independent Officer]
Representative (to present)
Outside Director of the Company (to present)
May 2023
December 2023 Outside Auditor of SHOEI CO., LTD. (to present)[Reason for nomination as candidate and summary of expected roles]
Ms. Tamako Watanabe has a wide range of knowledge and experience acquired as a certified public accountant, a certified tax
accountant and a licensed social insurance consultant, and we expect her to provide precise advice on the Company’s
management. Furthermore, there is no problem with her independence in relationship with the Company. We believe she issuitable for continuing to serve as an Outside Director of the Company, and nominate her as a candidate for Outside Director.
(Notes)1. Messrs. Yuichiro Anzai and Tetsugo Matsuo and Ms. Tamako Watanabe are candidates for Outside Directors.
2. Messrs. Yuichiro Anzai and Tetsugo Matsuo and Ms. Tamako Watanabe, candidates for Outside Directors, satisfy therequirements of independent officers stipulated by Tokyo Stock Exchange, Inc., Nagoya Stock Exchange, Inc. andFukuoka Stock Exchange, respectively, and the Company has notified these stock exchanges of them as independent
officers.
3. At the conclusion of this General Meeting of Shareholders, Messrs. Yuichiro Anzai and Tetsugo Matsuo will have served
for four years, and Ms. Tamako Watanabe will have served for one year as Outside Directors of the Company.
4. The Company has entered into agreements with Messrs. Yuichiro Anzai and Tetsugo Matsuo and Ms. Tamako Watanabein accordance with Article 427, Paragraph 1 of the Companies Act, to limit the liability for damages set forth in Article
423, Paragraph 1 of the same act to the amount stipulated by laws and regulations. If this proposal is approved, theCompany plans to continue the said agreements with them.
5. The Company has concluded a directors and officers liability insurance contract with an insurance company, and all
candidates for this election proposal will be insured under the contract. The insurance contract covers damages that may
arise from the insured directors and officers assuming liability for the execution of their duties or receiving claims related
to the pursuit of such liability.

-7-

Proposal 3:

Election of 3 Corporate Auditors

The term of office of Messrs. Nobuyuki Nakatomi, Munehiko Hirano and Keinosuke Ono, 3 of the total
4 Corporate Auditors, will expire at the conclusion of this General Meeting of Shareholders. Accordingly,
the election of three Corporate Auditors is proposed.
The Board of Corporate Auditors has given its consent to this proposal.
The candidates for Corporate Auditor are as follows:
No.

Name
(Date of birth)

Past experience, positions and significant concurrent positions

September 1988 Joined Cable Television Kurume Co., Ltd.
April 1990
President of Cable Television Kurume Co., Ltd.
250,200
None
May 1999
Director of the Company[Reappointment]
May 2008
Corporate Auditor of the Company (to present)[Reason for nomination as candidate]
Mr. Nobuyuki Nakatomi has long been engaged in management of Hisamitsu Pharmaceutical Group companies and has
extensive experience of managing and supervising management of the Company in general as Director. Based on theexperience, he has been auditing the Company since he took office as Corporate Auditor of the Company in 2008. We believe heis suitable for continuing to serve as a Corporate Auditor of the Company and nominate him as a candidate for Corporate
Auditor.
April 1974
Joined the Company
April 1997
Head of Pharmaceutical Formulation
Laboratories, Research and Development
Munehiko Hirano
Headquarters of the Company(September 20, 1947)
2,300
None
February 2005 General Manager in charge of Pharmaceutical[Reappointment]
Formulation Technology, Research andDevelopment Headquarters of the Company
May 2006
Corporate Auditor of the Company (to present)[Reason for nomination as candidate]
Mr. Munehiko Hirano has extensive operational experience in the research and development division. Based on the experience,
he has been auditing the Company since he took office as Corporate Auditor of the Company in 2006. We believe he is suitablefor continuing to serve as a Corporate Auditor of the Company and nominate him as a candidate for Corporate Auditor.
Nobuyuki Nakatomi(September 7, 1940)

1

2

Number ofSpecialshares of the interests in the
Company held
Company

-8-

No.

Name
(Date of birth)

Past experience, positions and significant concurrent positions
March 1979
April 2006

Ryusuke Itakura(November 17, 1955)

3

April 2007

[New Appointment]
June 2009[Outside Corporate Auditor][Independent Officer]
June 2013
May 2019
June 2019

Joined the Mitsui Bank, Limited (currently
Sumitomo Mitsui Banking Corporation)
Executive Officer and General Manager ofConsumer Loan Dept. of Sumitomo Mitsui
Banking Corporation
Executive Officer and Deputy Head ofConsumer Banking Unit (in charge of WestJapan) of Sumitomo Mitsui Banking
Corporation
Representative Director and President of SMBC
Guarantee Co., Ltd.
Representative Director and President of
Muromachi Building Service Co., Ltd.
Director of Tanioka Gakuen Educational
Foundation (to present)
Outside Audit & Supervisory Board Member ofFutaba Industrial Co., Ltd.

Number ofSpecialshares of the interests in the
Company held
Company0

None[Reason for nomination as candidate]
Mr. Ryusuke Itakura has knowledge of finance he acquired over many years in the financial industry and experience as a corporate
manager. We nominate him as a candidate for Corporate Auditor in order for him to provide precise advice on the Company’s
management and since there is no problem with his independence in relationship with the Company. We believe he is suitable forserving as an Outside Corporate Auditor of the Company.
(Notes)
1. Mr. Ryusuke Itakura is a candidate for Outside Corporate Auditor.
2. Mr. Ryusuke Itakura, a candidate for Outside Corporate Auditor, satisfies the requirements of independent officers
stipulated by Tokyo Stock Exchange, Inc., Nagoya Stock Exchange, Inc. and Fukuoka Stock Exchange, respectively.
The Company has notified the stock exchanges that if this proposal to appoint Mr. Ryusuke Itakura as a Corporate
Auditor is approved, he will be an independent officer.
3. If this proposal is approved, the Company plans to enter into an agreement with Mr. Ryusuke Itakura in accordance with
Article 427, Paragraph 1 of the Companies Act, to limit the liability for damages set forth in Article 423, Paragraph 1 ofthe same act to the amount stipulated by laws and regulations.
4. The Company has concluded a directors and officers liability insurance contract with an insurance company, and all
candidates for this election proposal will be insured under the contract. The insurance contract covers damages that may
arise from the insured directors and officers assuming liability for the execution of their duties or receiving claims related
to the pursuit of such liability.

-9-Corporate
Auditors

Directors(Reference)(1) Skill matrix of Directors and Corporate Auditors (planned) after this Annual General Meeting of
Shareholders
The Company elects multiple Outside Directors within the limits of the number specified in the Companies Act
and the Company’s Articles of Incorporation, so that its Board of Directors is both diverse and effective, with agood balance of members who possess the knowledge, experience, and skills needed to effectively perform theirroles and responsibilities. If Proposal 2 and Proposal 3 are approved as originally proposed, the composition of
the Company’s Directors and Corporate Auditors, and experience and expertise of each Director and Corporate
Auditor are as follows:
Legal affairs /IT / DigitalHR
Production /Sustainability Compliance / Finance /transformation management /
R&D
/ ESG
Risk
Accounting(DX)
development
management

Name

Corporate
management

Sales /
MarketingGlobal /Business

Kazuhide Nakatomi

●

●

●

●

Kosuke Sugiyama

●

●

●

Kyu Saito

●

●

●

●

Nobuo Tsutsumi●

Shinichi Murayama●

Koji Takiyama●

Yuichiro Anzai●

Tetsugo Matsuo●

Tamako Watanabe●

Nobuyuki Nakatomi●

Munehiko Hirano

●

●

●
●

●
●

●

●

●

●

●
●

●

●

Kentaro Watanabe●●

Ryusuke Itakura●●- 10 -●

(2) Criteria for selecting independent officers
Hisamitsu Pharmaceutical Co., Inc. (the “Company”) shall establish criteria for independence of outside officers(Outside Directors and Outside Corporate Auditors) of the Company as follows.
I. If an outside officer does not fall under any of the attributes listed in the following items, the Company
determines that the outside officer is fully independent from the Company.
1. Relationship with group companies(1) An executive*1 or a Director who is not an executive of the parent company of the Company in the pastten years(2) A Corporate Auditor of the parent company of the Company in the past ten years (This is limited to thecase where an Outside Corporate Auditor is designated as an independent officer.)(3) An executive of a fellow subsidiary of the Company in the past ten years
2. Remuneration from the Company(1) An attorney at law, certified public accountant, certified public tax accountant, consultant, etc. who hasreceived ¥10 million or more of money or other financial benefits per year from the Group (This refers to
the Company and its parent company, fellow subsidiaries, and subsidiaries. The same applies hereinafter.)in any of the past three business years, other than the officer’s remuneration(2) A person who belongs to a corporation such as a law office, audit corporation, tax accountancy corporation,or consulting firm or an organization such as a partnership that has received a certain amount*2 or moreof money or other financial benefits from the Group in any of the past three business years or a person
who has recently fallen under this category
3. Business relationship
A person who has a significant business relationship*3 with the Group or, if the person is a corporation orother organization, an executive thereof or a person who has recently fallen under this category
4. Major shareholder
A person who is a major shareholder*4 of the Company, or an executive of a company of which the Company
is a major shareholder in any of the past three business years
5. Donation recipient
A person who has received a donation exceeding ¥10 million from the Company in any of the past threebusiness years (If the person is a corporation or other organization, a person who has received a donation
exceeding ¥10 million and accounting for more than 2% of the total revenue of the corporation or otherorganization) or, if the person is a corporation or other organization, an executive of the person
6. Others(1) A spouse or a relative within the second degree of a person who falls under any of the items 1 to 5 (Thisis limited to a person who is in a significant position*5 for an executive of a corporation or otherorganization or a person described in 2 (2).)(2) A spouse or a relative within the second degree of a person who falls under any of the following (This islimited to a person who is in a significant position.)
1) An accounting advisor of the Company (If the accounting advisor is a corporation, it includes an
employee who is to perform the duties thereof. The same shall apply hereinafter.) (This is limited tothe case where an Outside Corporate Auditor is designated as an independent officer.)2) An executive of a subsidiary of the Company
3) A Director who is not an executive or accounting advisor of a subsidiary of the Company (This islimited to the case where an Outside Corporate Auditor is designated as an independent officer.)4) An executive or a Director who is not an executive of the parent company of the Company
5) A Corporate Auditor of the parent company of the Company (This is limited to the case where an
Outside Corporate Auditor is designated as an independent officer.)6) An executive of a fellow subsidiary of the Company
7) A person who has recently fallen under items 1) to 3) or an executive of the Company (This includes
a Director who is not an executive in the case where an Outside Corporate Auditor is designated as anindependent officer.)- 11 -

II. Even if an outside officer falls under any of the attributes listed in any of the items stipulated in I., theCompany may determine that there is no problem with the requirements for an independent officer
when the Board of Directors or the Board of Corporate Auditors of the Company conducts acomprehensive review and determines that independence is ensured.
(Notes) *1 An executive refers to an executive stipulated in Article 2, paragraph (3), item (vi) of the Regulations for Enforcementof the Companies Act, which includes an executive Director, corporate officer, executive officer, and other employee.
*2 A certain amount refers to 2% of the gross sales of the corporation or an organization such as a partnership.
*3 A person who has a significant business relationship refers to a person who falls under either (1) or (2) described below.
(1) A person for which the Group is a significant business partner
A person who has received a payment of the amount exceeding 2% of the consolidated net sales from the Group in
any of the past three business years(2) A person who is a significant business partner of the GroupA person who has paid an amount exceeding 2% of the Group’s consolidated net sales to the Group, or a person
who has provided a loan exceeding 2% of the Company’s consolidated total assets as of the end of the previous
business year to the Group in any of the past three business years*4 A major shareholder refers to a shareholder who holds 10% or more of the total voting rights of the Company.
*5 A person in a significant position refers to a Director (excluding Outside Directors), executive officer, corporate officer,
or a person with authority equivalent thereto. (In addition to the person, it includes an attorney at law, certified public
accountant, or certified public tax accountant belonging to a law office, audit corporation, or tax accountancy
corporation for the person described in I. 2 (2).)- 12 -

(3) Reduction of cross-shareholdings<Policy for cross-shareholdings>- At a meeting of the Board of Directors held in May of each year, the Company verifies the reasonableness of its
shareholdings by comprehensively considering the results of qualitative verification based on the status oftransactions for each issue and quantitative verification based on economic rationality through benefits anddividends associated with transactions.
- Based on the results of the verification, the Company will dialogue with investee companies and consider reducing
the issues that are determined to be unreasonable to hold.
<Reduction target>- 13 -