B. Tokyo Stock Exchange Listing by US Companies

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�� Tokyo Stock Exchange

2019 New Listing Guidebook for Foreign Companies

Table of Contents

Table of Contents ...... 1 1. Benefits of Listing ...... 6 (1) Smooth and Diversified Fundraising...... 6 (2) Enhance Corporate Value ...... 6 (3) Improve its Internal Management System and Enhance the Employees’ Motivation ...... 6 2. Mechanism for Initial Listing...... 6 (1) Mechanism for Initial Listing ...... 6 (2) Composition of Market...... 7 3. Overview of the Initial Listing and Disclosure Systems ...... 8 (1) Listing Schedule...... 9 (2) Roles of Each Party Involved in an IPO...... 10 (3) Rules and Regulations on the Disclosure System on the Secondary Market...... 13 a. Statutory Disclosure ...... 13 b. Timely Disclosure ...... 13 (4) Commitment to IR...... 14 4. Listing Examination by TSE (Primary Listing) ...... 15 (1) Main Markets (TSE 1st Section and 2nd Section)(Primary Listing)...... 15 a. Formal Requirements ...... 15 b. Eligibility Requirements ...... 19 c. Documents to be Filed ...... 24 (2) Mothers (Primary Listing) ...... 29 a. Formal Requirements ...... 29 b. Eligibility Requirements ...... 32 c. Documents to be Filed ...... 39 (3) JASDAQ Market (Primary Listing) ...... 44 a. Formal Requirements ...... 44 b. Eligibility Requirements (Standard Market) ...... 47 c. Eligibility Requirements (Growth Market)...... 56 d. Documents to be Filed ...... 65 (4) Listing Examination Schedule (Primary Listing)...... 71 5. Listing Examination by TSE (Multiple Listing) ...... 72 (1) Main Markets (TSE 1st Section and 2nd Section)(Multiple Listing)...... 72 a. Formal Requirements ...... 72 b. Eligibility Requirements and Special Exceptions to Multiple Listing of Foreign Companies ...... 73 c. Documents to be Filed ...... 73 (2) Mothers (Multiple Listing)...... 74 a. Formal Requirements ...... 74

b. Eligibility Requirements ...... 74 c. Documents to be Filed ...... 74 (3) JASDAQ Market (Multiple Listing)...... 75 a. Formal Requirements (Standard and Growth Markets) ...... 75 b. Eligibility Requirements (Standard and Growth Markets) ...... 75 c. Documents to be Filed ...... 75 (4) Listing Examination Schedule (Multiple Listing) ...... 77 6. Listing Examination by TSE (Multiple Listing) ...... 84 7. Listing of JDR...... 84 (1) What is JDR? ...... 84 (2) JDR Issue Scheme ...... 85 (3) Listing of Stock via JDR ...... 86 (4) Handling of DRs under the Formal Requirements ...... 86 8. Finance through Listing (Public Offering and Secondary Offering)...... 87 (1) Procedure for Public Offering, etc. for Listing ...... 87 (2) Finance Schedule on Listing (in the case of an Unlisted Company)...... 88 9. Statutory Disclosure ...... 89 (1) Offering Disclosure...... 89 a. Securities Registration Statement...... 89 b. Obligation of Preparation and Delivery of Prospectus ...... 91 (2) Continuous Disclosure ...... 93 a. Annual Securities Report...... 93 b. Internal Control Report...... 94 c. Quarterly Securities Report ...... 95 d. Confirmation Letter ...... 96 e. Extraordinary Report ...... 97 (3) Accounting Standards Applied to and Audit Certificate on Financial Documents...... 98 a. Accounting Standards...... 98 b. Audit Certificate ...... 99 (4) English Language Disclosure System ...... 101 a. Outline ...... 101 b. Documents Eligible for the English-Language Disclosure ...... 101 c. Requirements for the English-Language Disclosure ...... 102 d. Supplementary Documents ...... 102 e. Attachments ...... 103 f. Submission Deadline ...... 104 10. Shareholder Services and Book-Entry Transfer Systems for Foreign Stocks, etc...... 105 (1) Custody and Book-Entry Transfer Systems for Foreign Stocks, etc...... 105 (2) Dividend Payment ...... 105 (3) Record Date of Shareholders Eligible for Dividend...... 105 (4) Other Rights such as Subscription Warrants...... 106 (5) Exercise of Voting Rights at General Shareholders Meetings ...... 106 (6) Book-Entry Transfers from JASDEC to Securities Companies ...... 106 (7) Handling under TSE Listing Administration Rules ...... 107 a. Selection of Agent and Entity Responsible for Handling Information in Japan ...... 107

b. Setting Up Offices for Handling Exercise, etc...... 107 c. Ensuring Appropriate Shareholder Services and Dividend Payment Services...... 107 d. Notification and Public Notice of Period or Date for Rights Allotment ...... 108 e. Notification of Decision Concerning Depositories, etc. Pertaining to Listed Foreign Stock Depositary Receipts, etc...... 109 11. Overview of Listed Company Compliance ...... 110 (1) Overview of Timely Disclosure System ...... 110 a. Significance of Timely Disclosure ...... 110 b. Overview of the Rules Concerning Timely Disclosure of Corporate Information ..... 110 c. Notes on Using TDnet ...... 121 d. Overview of Trading Halt System ...... 123 e. Outline of System for Issuing Alerts ...... 125 f. Disclosure to Clarify Content of Unclear Information ...... 127 (2) Practical Guide for Timely Disclosure ...... 129 a. Matters to Note regarding Need for Disclosure ...... 129 b. Matters to Note regarding the Disclosure Schedule ...... 133 c. Matters to Note regarding Preparation of Disclosure Documents ...... 136 d. Disclosure regarding Postponement/ Change/ Correction/ Progress of Disclosed Matters ...... 139 e. Others ...... 139 (3) Practical Handling of Timely Disclosure of Corporate Information for Listed Foreign Companies...... 140 a. Changes in Laws and Regulations, etc. of the Home Country concerning the Company System...... 142 b. A Fact that Occurs in a Foreign Country that Has Material Impact on the Circulation of a Listed Stock, etc. or a Foreign Stock Depositary Receipt, etc...... 142 c. Fact of Decision or Occurrence with Material Impact on Rights, etc. Related to Listed Foreign Stock Depositary Receipt, etc., ...... 143 (4) Code of Corporate Conduct ...... 144 a. Overview of Code of Corporate Conduct...... 144 b. Handling of Code of Corporate Conduct of Listed Foreign Companies...... 144 c. Matters to be Observed ...... 147 d. Matters Desired to Be Observed (Matters to be Addressed) ...... 150 (5) Submission of Documents, etc...... 150 a. Corporate Governance Report...... 151 b. Notice Concerning Submission of Foreign Company Registration Statement, etc... 152 (6) Mothers Global ...... 153 (7) Disciplinary Actions against Listed Companies ...... 154 a. Overview...... 154 b. Examination Related to the Disclosure of Corporate Information ...... 155 c. Disciplinary Actions or Measures to Ensure Effectiveness ...... 156 d. Principle of Equity Finance ...... 167 e. Duty of CPAs, etc.to Cooperate with the Exchange, Which Seeks Explanations of CPAs, etc...... 170 f. Examination and Inspection of Securities Trading, etc...... 171

(8) Delisting ...... 172 12. Delisting Criteria (Primary Listing) ...... 173 (1) Main Markets (TSE 1st Section and 2nd Section)(Primary Listing) ...... 173 (2) Mothers (Primary Listing) ...... 178 (3) JASDAQ (Standard Market) (Primary Listing) ...... 184 (4) JASDAQ (Growth Market) (Primary Listing)...... 189 13. Delisting Criteria (Multiple Listing)...... 194 (1) Main Markets (TSE 1st Section and 2nd Section)(Multiple Listing)...... 194 (2) Mothers (Multiple Listing)...... 196 (3) JASDAQ (Standard and Growth Markets) (Multiple Listing) ...... 199 14. Listing Fees ...... 200 (1) Fees for Initial Listing on TSE ...... 200 (2) Annual Listing Fee (Main Market (First & Second Sections) and Mothers) ...... 201 (3) Annual Listing Fee (JASDAQ) ...... 202 15. Securities Taxation System (Japanese Investors Investing in TSE Listed Foreign Stocks) ...... 203 (1) Taxation for Individual Investors ...... 204 (2) Taxation on Corporations ...... 205 16. Q&A ...... 203 (1) Insider Trading Regulations ...... 205 (2) Tender Offer Rules (TOB Rules) ...... 205 (3) Large Shareholding Reporting System ...... 205 (4) Listing on TSE through the Establishment of a Japanese Company ...... 206 A. Forms of Documents, etc. to be Filed for Initial Listing Application (Foreign Stocks) ... 207 (1) Confirmation Report prior to Initial Listing Application (for Applicant Company) .... 207 (2) Confirmation Report prior to Initial Listing Application (for Trading Participant Handling Matters) ...... 215 B. Tokyo Stock Exchange Listing by US Companies ...... 220

Legend TSE: Tokyo Stock Exchange JPX Regulation: Japan Exchange Regulation Act: Financial Instruments and Exchange Act Rules for the Act: Enforcement Rules for the Financial Instruments and Exchange Act Ordinance: Cabinet Office Ordinance on Disclosure of Corporate Affairs, etc. Regulations: Securities Listing Regulations Rules: Enforcement Rules for Securities Listing Regulations Guidelines: Guidelines Concerning Listing Examinations, etc. Primary Listing: Listing other than Multiple Listing Multiple Listing: Listing or continuous trading on foreign financial instruments exchange(s), etc., or equivalent to this. (1) With respect to a foreign stock, a foreign stock depositary receipt representing a right pertaining to said foreign stock is listed or continuously traded on a foreign financial instruments exchange, etc.; (2) With respect to a foreign stock depositary receipt, a foreign stock represented by said foreign stock depositary receipt is listed or continuously traded on a foreign financial instruments exchange, etc.; and (3) With respect to a foreign stock trust beneficiary certificate, a foreign stock that is a trust asset of the foreign stock trust beneficiary certificate or a foreign stock depositary receipt representing a right pertaining to said foreign stock is listed or continuously traded on a foreign financial instruments exchange, etc. JDR: Japanese Depositary Receipt (A beneficial interest in trust issuing beneficiary certificates whose trust assets are foreign stock certificates, etc., as defined in the Trust Act (Act No. 108 of 2006) provided in Rule 2, paragraph 1, item 14 of the Financial Instruments and Exchange Act.)

1. Benefits of Listing By listing on Tokyo Stock Exchange (TSE), your company can:

(1) Smooth and Diversified Fundraising

Once listed on TSE, your company will have access to direct finance by capital increase by issuing shares at a market price through publicly offering stock or issuing subscription warrants, corporate bonds with subscription warrants, etc. Our highly liquid market can bring more efficient and diverse fund-raising capacity for your company to grow further.

(2)Enhance Corporate Value

Coverage by media, including market news of newspapers, will allow your company to enhance its corporate and product reputation in Japan. The company will be able to retain and attract excellent people as well.

(3)Improve its Internal Management System and Enhance the Employees’ Motivation

Corporate disclosure will allow investors and other third parties to examine your company’s corporate management. Therefore, your company has obligations to continue to improve and strengthen its management system as well as its internal management. Becoming a public company will also help boost the morale of the officers and employees of the company.

Please keep in mind that since the shares of stocks issued by a listed company will be a choice of investment by a large number of public investors, going public also involves taking on new social responsibilities and duties for the purpose of protection of investors. It will be required, among other things, to disclose earnings information and corporate profile in an appropriate and timely manner.

2. Mechanism for Initial Listing (1)Mechanism for Initial Listing

Listing of stock is effected on the basis of application filed by a company issuing the stock (hereinafter referred to as an “applicant”). When the stock is listed, it will be an investment choice for a large number of general investors. Thus, TSE (Note) will examine whether an applicant is eligible for listing on TSE from the perspective of investor protection. TSE has developed and set forth various regulations and rules for initial listing. The listing examination will be conducted by assessing whether the requirements in the regulations and rules are satisfied. (“Securities Listing Regulations” and “Enforcement Rules for Securities Listing Regulations,” etc.) by which the examination will be conducted. When the examination results reveal that the applicant is eligible for listing, TSE will approve and announce the listing of applicant, following which the stock will eventually be listed on TSE.

Various rules concerning initial listing comprise “Securities Listing Regulations,” “Enforcement Rules for

Securities Listing Regulations” and “Guidelines for Listing Examinations, etc.” The standards for listing examination specified by various rules provide for “Formal Requirements” which specify quantitative requirements for the number of shareholders, amount of profit, etc. and standards for “Substantive Examination Standards” which represent the qualitative criteria for assessing disclosure system s, corporate governance practices and so on. Please refer to “II Formal Requirements” and “III Listing Examination,” respectively, in this booklet.

As a result of listing examination, when an applicant is determined to meet the eligibility for listing, TSE will approve and announce the listing of the applicant. Subsequently the applicant will be listed through the process of public offering or secondary offering.

Note: Actual examination will be conducted by JPXR to which the role of examination is delegated by TSE.

(2)Composition of Market

TSE operates five markets of the First Section, Second Section, Mothers, JASDAQ. 1) First Section and Second Section The First and Second Sections represent the main boards of TSE where leading large and second tier Japanese and foreign companies are listed. Especially the First Section is viewed as one of the top rank markets in terms of the size and liquidity, as foreign investors account for a large portion of equity trading. The First and Second Sections are collectively referred to as the “Main Markets.”

2) Mothers Mothers offers a trading market for companies with growth potential which aim to be reassigned to the First Section in near future. Thus TSE requires applicants to demonstrate high growth potential. W hether an applicant has growth potential or not shall be assessed and determined by lead underwriters on the basis of its business model or business environment. As the objective of Mothers is to offer financing opportunities for many companies with growth potential, Mothers has no restrictions on the size or business category of applicants. After successfully listing their stock on Mothers, many have satisfied the criteria for alteration to the First Section and listed their stock on the First Section.

3) JASDAQ JASDAQ is a market characterized by the three concepts of (1) reliability, (2) innovativeness and (3) region and internationalization. JASDAQ is split into the “Standard” market for growth companies with a certain size and business performance and the “Growth” market for companies with stronger future growth potential and unique technologies or business models.

Furthermore, any company which successfully lists its stock can change its listed market according to the stage of business development and growth after initial listing as follows.

Assignment to the First Section or alteration thereto requires an application by a listed company, which has to receive the re-examination of the application. The examination thereof will be implemented in accordance with the examination procedures for the listing on the main board of the TSE markets.

3. Overview of the Initial Listing and Disclosure Systems

TSE and JPX Regulation, the organization entrusted by TSE to perform listing examination, assess whether applicants satisfy quantitative criteria and numerical thresholds required by the Regulations based on the listing application filed by the applicant. In performing the listing examination, JPX Regulation focuses on the applicant’s abilities to contribute to fair price formation, the appropriate distribution of shares of stock in the market, the public interest, and investor protection. When a listing is determined to be appropriate based on comprehensive examination and evaluation, TSE will authorize the applicant to list its stock on TSE.

As noted above, an applicant can identify and address potential roadblocks in a listing examination by engaging a consultant before the listing application is filed. When examining a listing application from a foreign company, TSE closely considers the legal system and conventions in practice in the applicant’s home country. As such, TSE will address the listing application filed by foreign companies more flexibly than Japanese applicants.

Foreign companies can also list on TSE via depository receipts (JDRs, ADRs, or GDRs). (Please see section 8 for details.)

(1) Listing Schedule

When a foreign company files an application for listing on TSE, the listing examination will require about three months1. After listing approval by TSE, about one month will be required for public offering procedures (the IPO). An applicant therefore needs four months, as a rule, from the listing application date to the first day of listing. For details on the listing examination performed by JPX Regulation, please see sections 6 and 7. The period for preparing the listing application and period for the underwriting examination may vary, depending on the internal systems and underwriting policies of the underwriting securities firm.

1 Listing schedule for foreign companies may vary depending on legal basis for foundation, applicable accounting standards, and so on.

Listing Schedule

(2) Roles of Each Party Involved in an IPO

The following are the key parties in Japan and the home country who support the listing of a foreign company on TSE. These participants work together closely during the preliminary listing process to support preparations for a listing.

Lead Underwriter A lead underwriter is comprehensively involved in the procedures and (TSE trading preparations for listing overall. It provides underwriting business by participant) entering into a lead underwriting agreement with an issuer and provides advice and consultation on the listing and listing schedule. At the time of listing, the lead underwriter submits a Sponsor’s Letter of Recommendation to TSE. Legal Firm A legal firm checks and reviews listing-related matters from a legal perspective and prepares a legal opinion. It also helps the applicant prepare disclosure documents. After listing, it discloses corporate information as a legal representative of the listed foreign company. Audit Firm2 An audit firm provides advice on the design and implementation of the (foreign audit firm, accounting organization and financial statements and also audits the etc.) financial statements (expression of an audit opinion). TSE TSE explains its listing system to companies, IPO-related parties, and so on, and provides preliminary or prior consultation on the listing. Trust and Banking A trust and banking company acts as a shareholder services agent for company Japanese shareholders after the listing and may act as a dividend payment bank to provide services related to dividend payment. If a foreign company lists through JDRs, the trust and banking company will be responsible for the issuance of the JDRs. Please see section 8 for details on listing through JDRs.

2 Please see section 10 (3) for details on accounting standards and audit certificate.

(3) Rules and Regulations on the Disclosure System on the Secondary Market

Information used for decisions on the value of securities must be accurate, fair, and disclosed in a timely manner to ensure that investors can invest in securities based on reasonable judgment. For this purpose, the Financial Instruments and Exchange Act prescribes requirements for information disclosure in the corporate profiles of issuers (statutory disclosure) and TSE prescribes requirements on timely disclosure by listed companies in the Regulations (timely disclosure).

a. Statutory Disclosure

Companies listed on TSE are required to electronically submit securities reports, quarterly reports, etc. outlining their financial position, and business lines and performance to the Japanese Prime Minister (in practice, to the local Finance Bureau.) The submitted securities reports, etc. are then entered into EDINET (Electronic Disclosure for Investors’ NETwork) for public inspection and made available to investors via the Internet. Please see the details in section 10. b. Timely Disclosure

In addition to statutory disclosure, companies listed on TSE are obliged to promptly disclose decisions and events that may greatly affect investor decisions, in accordance with the Regulations and other relevant rules. Please see the details in section 12 (1).

Such information will then be released to the media and investors via the Internet and TSE’s online disclosure system, TDnet (Timely Disclosure Network).

(4) Commitment to IR

In addition to statutory and timely disclosures, TSE encourages all listed companies to engage in IR activities that enable them to communicate with investors about their corporate status. The Regulations require, for example, that Mothers listed companies hold meetings with investors to explain their company profiles and affairs twice a year. Many TSE-listed companies have implemented individual IR activities that go considerably further.

Active IR activities are a secure way to enhance corporate brand value and companies can strongly benefit from a listing on TSE.

4. Listing Examination by TSE (Primary Listing)

There are two types of requirements by which the company will be examined to list its stock encompassed by the so called Listing Requirements: “Formal Requirements” and “Eligibility Requirements”. TSE examines the company, which meets “Formal Requirements” and conducts an examination on in under “Eligibility Requirements.”

In application of the rules and regulations of the Exchange to a foreign count ry or a foreign corporation where the foreign country or the foreign corporation is an issuer, etc. of a listed security, the Exchange shall take into account legal systems, practices and customs, etc. in such foreign country or the country, etc. of the foreign corporation. [Rule 7 of the Regulations]

(1) Main Markets (TSE 1st Section and 2nd Section)(Primary Listing) a. Formal Requirements

Requirements Item 1st Section 2nd Section 1. Number of shareholders 2,200 shareholders or more 800 shareholders or more (expected at listing)

[Rule 206, Paragraph 1, Item 1 of the Regulations] [Rule 205, Item 1 of the Regulations] [Rule 210, Paragraph 1, Item 1 of the Regulations]

The following a. through c. must The following a. through c. must be be satisfied: satisfied: 2. Number of tradable shares a. The number of tradable a. The number of tradable shares: (expected at listing) shares : 20,000 units or more; 4,000 units or more;

[Rule 206, Paragraph 1, Item 1 of b. The market capitalization of b. The market capitalization of the the Regulations] the tradable shares: 1 billion tradable shares: 1 billion yen or [Rule 205, Item 2 of the yen or more; and more; and Regulations] (in principle, the value derived (in principle, the value derived [Rule 210, Paragraph 1, Item 2 of by the expected price at the by the expected price at the the Regulations] time of public offering for the time of public offering for the purpose of listing by the purpose of listing by the number of tradable shares number of tradable shares expected at the time of listing) expected at the time of listing)

c. The number of tradable shares c. The number of tradable shares (as a percentage of the total (as a percentage of the total number of issued shares number of issued shares outstanding): 35% or more outstanding): 30% or more

3. Market capitalization 25 billion yen or more 2 billion yen or more (expected at listing) (The market capitalization is, in (The market capitalization is, in principle, determined by principle, determined by [Rule 206, Paragraph 1, Item 1 of multiplying the number of listed multiplying the number of listed the Regulations] shares expected at the time of shares expected at the time of [Rule 205, Item 3 of the listing by the prospective prices listing by the prospective prices for Regulations] for public offering or secondary public offering or secondary [Rule 210, Paragraph 1, Item 3 of offering) offering) the Regulations] 4. Number of consecutive The business activities have been continuously carried out by setting years of conducting up a board of directors (meaning an institution corresponding to this in business cases of a foreign company) since a day before the day which is three (3) years prior to the end of a business year immediately prior to the [Rule 206, Paragraph 1, Item 1 of business year containing the initial listing application day the Regulations] [Rule 205, Item 4 of the Regulations]

5. Amount of net assets The amount of consolidated net assets: 1 billion yen or more (expected at listing) (in addition, the amount of non-consolidated net assets are not negative) [Rule 206, Paragraph 1, Item 1 of the Regulations] [Rule 205, Item 5 of the Regulations]

6. Amount of profits and The following a. or b. must be satisfied: market capitalization (Amount of profits a. The total amount of profits in the last two (2) y ears: 500 million yen calculated based on the or more; and consolidated income statement. Market b. The market capitalization: 50 billion yen or more capitalization is expected In addition, sales for the last year: 10 billion yen or more at listing)

[Rule 206, Paragraph 1, Item 1 of the Regulations] [Rule 205, Item 6 of the Regulations]

The following a. through c. must be satisfied:

a. No false statement is made in the securities reports, etc. for each business year or each consolidated accounting year which ended in the last two (2) years;

7. False statement or b. The audit report attached to financial statements, etc. for each adverse opinion, etc. business year or each consolidated accounting year which ended

in the last two (2) years (excluding a business year and a [Rule 206, Paragraph 1, Item 1 of consolidated accounting year which ended in the last year) the Regulations] contains an "unqualified opinion" or a "qualified opinion with [Rule 205, Item 7 of the exceptions" of certified public accountants, etc.; and Regulations]

c. The audit report attached to financial statements, etc. for the business year and consolidated accounting year which ended in the last year contain, as a general rule, an "unqualified opinion" of certified public accountants, etc.

The merger, etc. shall not fall under the following a. and b.:

a. Where a merger, demerger, making other company a subsidiary or making a subsidiary a non-subsidiary or transfer of a business to or from other entity is scheduled to be carried out on or after the initial listing application day and within two (2) years from the end 8. Expected of the most recent business year before such day, and, in addition, implementation of merger, where TSE deems that an initial listing applicant will cease to be a etc substantial surviving company by such an act; provided, however, that the same shall not apply where the [Rule 206, Paragraph 1, Item 1 of Enforcement Rules so specify; and the Regulations] [Rule 205, Item 12 of the b. Where a merger in which an initial listing applicant becomes a Regulations] dissolution company, a stock swap or a stock transfer whereby it becomes a wholly-owned subsidiary of another company is expected to be carried out within two (2) years from the end of the business year immediately prior to the business year containing the initial listing application day (except cases where such acts are scheduled to be carried out before the listing day).

9. Handling by a The following a. or b. must be satisfied: book-entry transfer institution a. Said issue shall be subject to the custody and book-entry transfer operation for foreign stocks, etc. or the book-entry transfer [Rule 206, Paragraph 1, Item 2 of operation of the designated book-entry transfer institution; and the Regulations]

b. Said issue is expected to become so by the time of listing

The following a. or b. must be satisfied:

a. There is no restriction on transfer of a foreign stock, etc. pertaining to an initial listing application; and 10. Restriction on transfer of stocks, etc. b. It is expected that there will be no restriction by the time of listing;

provided, however, that the same shall not apply to cases where [Rule 206, Paragraph 1, Item 3 of imposing a restriction on transfer of a foreign stock, etc. is deemed the Regulations] necessary to receive application of provisions of laws in its home country or a case equivalent to this and, in addition, where its details are deemed not to hinder trading in TSE market

Where an initial listing applicant is an applicant for initial listing of a foreign stock depositary receipt, etc., the deposit agreement, etc. concerning a foreign stock depositary receipt, etc. and any other agreement pertaining to an initial listing application shall be those entered into pursuant following a. or b.: 11. Deposit agreement, etc. a. Foreign stock depositary receipts: Said deposit agreement, etc. is to be concluded among the initial listing applicant, the depository, etc. [Rule 206, Paragraph 1, Item 4 of pertaining to said foreign stock depositary receipts, and holders of the Regulations] said foreign stock depositary receipts; and [Rule 213, Paragraph 3 of the Rules] b. Foreign stock trust beneficiary certificates: Said deposit agreement, etc. is to be concluded between the depository, etc. pertaining to said foreign stock trust beneficiary certificates and holders of said foreign stock trust beneficiary certificates; and the initial listing applicant has concluded a contract deemed appropriate by TSE

b. Eligibility Requirements

Item Requirements

(1) Profit and loss and income and expenditure in consolidated financial statements of an initial listing applicant have not deteriorated.

In this case, even where such profit and loss or income and expenditure have deteriorated, where they are deemed not to impair sound continuity of management activities of the corporate group of the initial listing applicant, it shall be treated as if such profit and loss or income and expenditure have not deteriorated 1. Corporate continuity

and profitability (2) Management activities of the corporate group of an initial listing A business is operated applicant are in a state enumerated in the following a. and b.: continuously and a stable revenue base is present a. There is no material obstacle to the execution of management activities of the corporate group; and [Rule 207, Paragraph 1, Item 1 of the Regulations] b. The structure of the corporate group does not seriously hinder the [II, 7 of Guidelines] continuous execution of business activities

(3) Concerning the matters which are the premises of the main business activities of the corporate group of an initial listing applicant, there is no factor which hinders their continuity

(4) There is no factor which seriously hinders the management and administration of the corporate group of an initial listing applicant.

(1) The corporate group of an initial listing applicant is recognized not to give or enjoy profit wrongfully through a trading act or any other management activities with related parties and other specified 2. Soundness of corporate entities, in light of the matters enumerated in the following a. and management b. and other matters:

A business is carried out a. Where a transaction has been conducted between the corporate fairly and faithfully group of an initial listing applicant and its related parties and/or any

other specified entities, and such transaction has rationality of [Rule 207, Paragraph 1, Item 2 of continuing being carried out and reasonability of trading terms the Regulations] including trading prices [II, 8 of Guidelines]

b. Benefits of the corporate group of an initial listing applicant are not lost wrongfully because related parties and any other specified

entities of the corporate group of an initial listing applicant give priority to their own benefits

(2) Where an initial listing applicant has a parent company, etc., management activities of the corporate group of an initial listing applicant are recognized to be independent from such parent company, etc. in light of the matters enumerated in the following a. to c. or any other matters:

a. In light of the relationship between the business line of the corporate group of an initial listing applicant and that of the corporate group of the parent company, etc., the state of business adjustment made by the corporate group of the parent company, etc. and its possibility and any other matters, an initial listing applicant is not recognized to be substantially a business division of such parent company, etc.;

b. The corporate group of an initial listing applicant or that of a parent company, etc. does not coerce or induce a trading act which becomes disadvantageous to said parent company, etc. or the corporate group of said initial listing applicant such as transactions on markedly different terms from those of normal transactions; and

c. The state of receiving seconded persons of the corporate group of an initial listing applicant is recognized not to heavily depend on the parent company, etc. and not hinder continuous management activities

3. Effectiveness of (1) The system to secure the execution of appropriate work duties of corporate governance and officers of the corporate group of an initial listing applicant, and an internal management internal management system, etc. to carry out management system of an enterprise activities of the corporate group of the initial listing applicant are recognized to be appropriately developed and operated Corporate governance and internal management (2) The accounting system of the corporate group of an initial listing system are properly applicant is recognized as appropriate from the viewpoint of prepared and functioning investor protection

[Rule 207, Paragraph 1, Item 3 of the Regulations] [II, 9 of Guidelines]

(1) The corporate group of an initial listing applicant is recognized to be able to properly manage corporate information of facts, etc. which will have a material effect on management, and a system for making timely and appropriate disclosure to investors and the preemptive prevention of insider trading is deemed to be developed and operated appropriately

(2) Documents pertaining to disclosure of corporate information, out of the initial listing application documents, are deemed to be prepared in compliance with laws and regulations, and contain the matters enumerated in the following a. and b. and other matters

a. The legal system of the home country, etc. of an initial listing applicant, the financial condition and financial results of an initial listing applicant and its corporate group, and matters which may 4. Appropriateness of have a material effect on investment decisions of investors, such as disclosure of corporate important matters, etc. concerning officers, major shareholders, information, etc. related companies, etc.; and

The applicant is in a status b. Matters enumerated in the following (a) to (d) pertaining to the where disclosure of the matters which are the premises of main business activities of the corporate information, etc. corporate group of an initial listing applicant: may be carried out in an (a) Details of the matters which are the premises of main business appropriate manner activities of the corporate group of an initial listing applicant;

(b) Where the validity period of permission, authorization, etc. and [Rule 207, Paragraph 1, Item 4 of any other time limit are specified by laws and regulations or the Regulations] contract, etc., such time limit; [II, 10 of Guidelines] (c) Where cancellation, rescission, and any other event of permission and authorization, etc. are stipulated by laws and regulations or contract, etc., such fact and content; and (d) The fact that there is no factor which hinder their continuity concerning the matters which are the premises of main business activities of the corporate group of an initial listing applicant, and if there is such factor, the fact that it will have a material effect on business activities;

(3) The corporate group of an initial listing applicant does not provide distorted information disclosure on the actual state of the corporate group of the initial listing applicant by conducting a trading act with its related party or any other specified entity or adjustment of stock ownership ratios, etc.;

(4) Where an initial listing applicant has a parent company, etc., the following a. or b. shall be met on the premise that disclosure of such parent company, etc. is valid:

a. A stock, etc. issued by a parent company, etc. of an initial listing applicant is listed on a domestic financial instruments exchange (including cases where a stock, etc. issued by such parent company, etc. is listed or continuously traded on such foreign financial instruments exchange, etc., and the state of disclosure on corporate affairs in a country in which such parent company, etc. or such foreign financial instruments exchange, etc. is located is not deemed to markedly lack investor protection); and

b. An initial listing applicant can appropriately understand company information such as facts and information concerning the parent company, etc. which has a material effect on its management, and the initial listing applicant pledges in writing that such parent company, etc. agrees to its disclosure of company information which has a material effect on its management, out of such company information concerning the parent company, etc., to investors in an appropriate manner;

(1) The contents of the rights of shareholders or holders of foreign stock depositary receipts, etc. and the state of their exercise are deemed appropriate from the viewpoints of the public interest or the protection of investors, because of the matters enumerated as follows and other matters:

a. The contents of the rights of shareholders or holders of foreign 5. Other matters deemed stock depositary receipts, etc., and their exercise are not necessary by TSE from the unreasonably restricted; and viewpoint of the public interest or the protection b. Where an initial listing applicant has introduced a takeover defense of investors measure, the initial listing applicant complies with the matters enumerated in the following (a) to (d): [Rule 207, Paragraph 1, Item 5 of the Regulations] (a) Sufficient disclosure: [II, 11 of Guidelines] The listed company shall make necessary and sufficient timely disclosure concerning takeover defense measures; (b) Transparency: Conditions of implementation and abolishment of takeover defense measures shall not depend on arbitrary decisions by the management; (c) Effect on the secondary market: Takeover defense measures shall not include factors which may

cause extremely unstable price formation of a stock or any other factors which may cause unpredictable damage to investors; and (d) Respect for shareholders’ rights: Takeover defense measures shall give consideration to shareholders’ rights and their exercise.

(2) The corporate group of an initial listing applicant does not have a contention or dispute, etc. which would have a material effect on management activities and business performance

(3) The corporate group of an initial listing applicant is recognized to prepare an internal system to prevent criminal and extremist elements from being involved in management activities, and making efforts to prevent such involvement, and their actual state is recognized as appropriate from the viewpoints of the public interest or the protection of investors

(4) Other cases deemed appropriate from the viewpoints of the public interest or the protection of investors

c. Documents to be Filed

The following highlights the documents required to be filed for the purpose of the initial listing application. Each of these documents is requested to be filed when the requirements for the filing thereof are met. The following also includes the documents to be filed only for the purpose of multiple listing. Please refer to the footnotes at the end of this paragraph with respect to “Documents Required to be Filed only for the Purpose of Multiple Listing” and “Documents Not Required to be Filed for the Purpose of Multiple Listing.”

(a) Documents to be filed at the time of conducting initial listing application

Number Documents to be filed 1 Preliminary application form for initial listing of securities 2 Application form for initial listing of securities 3 Written Oath relating to initial listing application 4 Articles of Incorporation (including by-laws) Minutes of general shareholders’ meeting or the meeting of the Board of Directors concerning 5 the acquisition of shares of treasury stock, the disposal of shares of treasury stock and the retirement of shares of treasury stock 6 Statement certifying no ties with anti-social forces 7 Written Recommendation (by listing approval date) 8 Sponsor’s letter of confirmation Statement of specific considerations and focused matters during the process of instructions on 9 going public and underwriting examination Statement concerning the matters which constitute the premise underlying major business 10 activities Table of distribution of share ownership 11 (unnecessary if the company conducts offering) (Note 2) 12 Statement describing matters concerning controlling shareholders 13 Sample of foreign stock certificate and etc. (to be attached stock sample list) 14 Minutes of the meeting of the Board of Directors on initial listing application 15 Securities Report for Initial Listing Application (Part I) 16 A legal opinion 17 A copy of the document proving that the representative is a person with a legitimate authority Document certifying the deposit agreement concerning depositary receipts, etc. for the new 18 listing application (Note 3) A document certifying that the depository, etc. has agreed to the matters TSE deems necessary 19 for the new listing application (Note 3) In case it has not passed at least two (2) years after the merger or the becoming a foreign 20 holding company to the initial listing application date to a day immediately prior to the listing date, financial statements deemed necessary by TSE for listing examination Table of Change in Number of Shareholders or of Holders of Foreign Stock Depositary Receipts, 21 etc. (Note 4）

A document certifying that the agent, etc. has been appointed or given informal consent to 22 accept the appointment 23 Documents describing the plan for the shareholder directed spin-off (Note 5) 24 Materials concerning the value of the stock pertaining to the initial listing application (Note 6) Corporate Governance Report 25 (only for an initial listing applicant who makes an initial listing application of a domestic stock, etc. and a foreign stock, etc. for which TSE is a main market) Audit reports, interim audit reports or quarterly review reports （Excluding Applicants exempted 26 under the clause in Rule 204, Paragraph 6 of the Rules) Summary audit ｒeports, summary interim audit reports or summary quarterly review reports 27 （Excluding Applicants exempted under the clause in the Rule 204, Paragraph 6 of the Rules) 28 Preliminary Initial Listing Application Report （prepared by the applicant） 29 Preliminary Initial Listing Application Report （prepared by the managing trading participant） 30 Corporate report（materials describing the Applicant's business and operation) Materials sent to shareholders and official publications (including the notice of the general 31 shareholders' meeting) regarding the general shareholders' meetings in the past two (2) years Documents (such as prospectuses) sent to shareholders regarding rights issues in the past two 32 (2) years or regarding most recent right issue in the past five (5) years where there is none in the past two (2) years A copy of the annual report sent to Shareholders or Holders of Foreign Stock Depositary 33 Receipts in the past five (5) years A copy of the interim report and quarterly reports sent to Shareholders or Holders of Foreign 34 Stock Depositary Receipts in the past two (2) years

A copy of the securities report, annual report, interim report, quarterly reports and 35 extraordinary reports submitted to the Prime Minister etc. in the past two (2) years (Note 1)

A copy of the securities registration statement (including amendment thereto) submitted to the 36 Prime Minister etc. in the past two (2) years (Note 1) News releases and newspaper publications regarding earnings announcements, dividend, stock 37 split, rights issue, and other material information in the past one (1) year 38 Relevant laws pertaining to the incorporation of the Applicant in the Applicant's jurisdiction 39 List of agenda of the meeting of the Board of Directors in the past two (2) years A set of documents submitted by the Applicant to relevant authorities in relation to application 40 of tax refund The check sheet regarding the legal framework of accounting and audit in the home country 41 submitted to the Financial Services Agency of Japan 42 Other matters deemed necessary by TSE for listing examination (Note 7)

(b) Documents to be filed at the time of making initial listing application (When an applicant has a non-listed parent company, etc.)

Number Documents to be filed 43 Written document of the last financial information of non-listed parent company, etc. (Note 8) 44 Written confirmation concerning timely disclosure, etc. of parent company, etc. (Note 8)

(c) Documents to be filed at the time of making initial listing application (Where becoming a subsidiary or merger, etc.)

Number Documents to be filed Where merger during the recent one year or after the beginning of the business year in which 45 the listing application is filed, financial statements deemed necessary by TSE Where becoming a subsidiary or non-subsidiary company during the recent one year or after 46 the beginning of the business year in which the listing application is filed, financial statements deemed necessary by TSE

(d) Documents to be filed after making initial listing application where necessary /applicable

Number Documents to be filed Quarterly reports for Initial Listing Application where: (Note 1) (Note 2) ◆ The listing day falls anytime after three (3) months from the beginning of the business year containing the initial listing application day, the Quarterly Report for Initial Listing Application for the first quarter of said business year ◆ The listing day falls anytime after six (6) months from the beginning of the business year 47 containing the initial listing application day, the Quarterly Report for Initial Listing Application for the second quarter of said business year ◆ The listing day falls anytime after nine (9) months from the beginning of the business year containing the initial listing application day, the Quarterly Report for Initial Listing Application for the third quarter of said business year Quarterly balance sheet of the final day of the above period 48 (In cases where a management company is the entity preparing consolidated financial statements) Notice of board meeting resolutions or general shareholders' meeting resolutions during the 49 period from the first day of the business year containing the initial listing application day to the listing day Reports of corporate information having significant impact on the business of the initial listing 50 applicant during the period from the first day of the business year containing the initial listing application day to the listing day A copy of the following documents submitted to the Prime Minister etc. during the period from the first day of the business year containing the initial listing application day to the listing day (Note 1) 51 ◆Securities registration statement （including amendment thereto）and document attached thereto ◆Notice of effectiveness of securities registration statement ◆Securities notification (including amendment thereto) and document attached thereto

(e) Documents to be filed after making initial listing application where necessary / applicable (If there are shares that have not been issued as of the new listing application date in the shares as of desired listing date)

Number Documents to be filed A document certifying the resolution authorizing the issuance of such stocks, etc., a copy of the securities notification, a copy of the notice of effectiveness of the securities registration statement or a copy of shelf registration statement, or a copy of notification of receipt of 52 securities notification or a copy of notification of receipt of shelf registration notification, as well as a document certifying completion of payment (certificate of registered matters, etc.) (Note 1) Notification of initial listing application securities report amendment (at time of effect of 53 amended details)

(f) Documents to be filed after making initial listing application but no later than listing approval is granted

Number Documents to be filed 54 Written Confirmation Regarding Compliance with Exchange Rules and Regulations The written document containing the effect that the representative of such initial listing 55 applicant is aware that the Securities Report for Initial Listing Application (Part I) and other documents do not contain any untrue statements Corporate Governance Report (PDF version) 56 (only for an initial listing applicant who makes an initial listing application of a domestic stock, etc. and a foreign stock, etc. for which TSE is the main market) The report containing risk information pertaining to the structure of the corporate group (Note 57 9) 58 Listing Agreement 59 Articles of incorporation (including by-laws) 60 Securities Report for Initial Listing Application (Part I) 61 Securities Report for Initial Listing Application (Part I) PDF version 62 Quarterly report of initial listing application (Note 1) (Note 2) 63 Quarterly report of initial listing application PDF version (Note 1) (Note 2) 64 Calculation of the expected market capitalization 65 Corporate Brochure of Applicant

(g) Documents to be filed by the applicant making a public offering, etc.

Number Documents to be filed 66 Expected public offering or secondary offering plan 67 Securities Registration Statement and its accompanying documents (Note 1) Amendment of Securities Registration Statement (after the determination of the tentatively set 68 price range) (Note 1)(Note 10) Amendment of Securities Registration Statement (after the determination of offering price) 69 (Note 1) 70 Notice on effectiveness of securities registration statement 71 Notice of Execution of public offering or secondary offering 72 Press release of notice of the determination of offering prices and the reasons, etc. therefor 73 Press release of notice of provisional conditions and the reasons for deciding them (Note 10) 74 Materials pertaining the determination of the assumed tentatively set price range 75 Materials pertaining the determination of the tentatively set price range 76 Materials pertaining the determination of offering price 77 Notification of the revisions of the Security Initial Listing Application Form

Note 1: In cases of submission to the Prime Minister, etc. via electronic data processing for disclosure (refers to electronic data processing for disclosure as prescribed by Rule 27-30-2 of the Financial Instruments and Exchange Act), the submission of such documents is not required. Note 2: The applicant applying for a multiple listing need not submit the document. Note 3: Only the applicant applying for a multiple listing needs to submit the document. Note 4: Only the applicant applying for a listing of Foreign Stock Depositary Receipts needs to submit the document. Note 5: Submission only required in cases of a company succeeding business due to a shareholder-directed split of a listed company, which conducts initial listing application prior to such shareholder-directed split. Note 6: In cases where the foreign stock, etc. pertaining to initial listing application is not listed or continuously traded on a domestic f inancial instruments exchange or foreign financial instruments exchange, etc., submission is only required when public offering or secondary offering will not be conducted for the foreign stock, etc. pertaining to initial listing application. Note 7: There may be cases which require a copy of the "minutes of the board of directors meeting," "internal audit documents," "monthly performance management documents," "documents used in annual budget plan, medium-term management plan, and planning," "important agreements," etc. Note 8: The applicant needs to submit the document where none of the following is the case: (1) the shares issued by the parent company, etc. are listed on a f inancial instruments exchange in Japan (2) the shares issued by the parent company, etc. are listed or continuously traded on a foreign f inancial instruments exchange, etc. and it is not deemed that disclosure status of the parent company, etc. in its home country, etc. is seriously detrimental to investor protection. (3) the parent company, etc. is subject to ongoing disclosure (4) the parent company, etc. is subject to ongoing disclosure in its home country and such status is not deemed to be seriously detrimental to investor protection. Note 9: Submission only required in cases where TSE deems the corporate group to have a special composition. Note 10: Submission only required in cases of direct listing. Note 11: The applicant needs to submit documents pertaining a shelf registration, possession of a large volume of shares, and tender offer that it makes after the beginning of the business year containing the initial listing application day

(2) Mothers (Primary Listing) a. Formal Requirements

Item Requirements 1. Number of shareholders 200 shareholders or more (expected at listing)

[Rule 213, Paragraph 1, Item 1 of the Regulations] [Rule 212, Item 1 of the Regulations] The following a. through c. must be satisfied:

a. The number of tradable shares: 2,000 units or more; 2. Number of tradable

shares b. The market capitalization of the tradable shares: 500 million yen (expected at listing) or more; and

(in principle, the value derived by the expected price at the time of [Rule 213, Paragraph 1, Item 1 of public offering for the purpose of listing by the number of tradable the Regulations] shares expected at the time of listing) [Rule 212, Item 2 of the

Regulations] c. The number of tradable shares (as a percentage of the total number of issued shares outstanding): 25% or more

3. Implementation of The applicant must carry out a public offering of a stock, etc. of at public offering least 500 units pertaining to an initial listing application during the period from the initial listing application day to the day preceding the [Rule 213, Paragraph 1, Item 1 of listing day the Regulations] [Rule 212, Item 3 of the Regulations] 4. Market capitalization 1 billion yen or more (expected at listing) (The market capitalization is, in principle, determined by multiplying the prospective prices for public offering or secondary offering by the [Rule 213, Paragraph 1, Item 1 of number of listed shares expected at the time of listing) the Regulations] [Rule 212, Item 4 of the Regulations]

5. Number of consecutive The applicant has conducted the business activities, setting up a years of business conduct board of directors (meaning an institution corresponding to this in cases of a foreign company) for at least a year before the initial listing [Rule 213, Paragraph 1, Item 1 of application day

the Regulations] [Rule 212, Item 5 of the Regulations]

The following a. through c. must be satisfied:

a. The audit report attached to a "Securities Report for Initial Listing Application" (excluding an audit report attached to financial statements, etc. for the business year or the consolidated business year ending in the last year) shall contain an "unqualified opinion" or a "qualified opinion with exceptions" of certified public accountants, etc.; provided, however, that the same shall not apply to cases where the Enforcement Rules specify otherwise;

6. False statement or b. The audit report (limited to an audit report attached to financial adverse opinion, etc. statements, etc. for the business year or the consolidated

business year ended in the last year), an interim audit report or a [Rule 213, Paragraph 1, Item 1 of quarterly review report attached to a "Securities Report for Initial the Regulations] Listing Application" shall contain an "unqualified opinion", an [Rule 212, Item 6 of the "opinion that the interim financial statements, etc. provide useful Regulations] information" or an "unqualified conclusion" of certified public accountants, etc.; provided, however, that the same shall not apply to cases specified by the Enforcement Rules; and

c. No false statement shall be made in a Securities Report, etc. containing or making reference to financial statements, etc., interim financial statements, etc., or quarterly financial statements, etc. pertaining to the audit report, the interim audit report, or the quarterly review report prescribed by a. and the preceding b.;

7. Handling by a The following a. or b. must be satisfied: book-entry transfer institution a. Said issue shall be subject to the custody and book-entry transfer operation for foreign stocks, etc. or the book-entry transfer [Rule 213, Paragraph 1, Item 2 of operation of the designated book-entry transfer institution; and the Regulations] [Rule 206, Paragraph 1, Item 2 of b. Said issue is expected to become so by the time of listing the Regulations] 8. Restriction on transfer The following a. or b. must be satisfied: of stocks, etc. a. There is no restriction on transfer of a foreign stock, etc. pertaining [Rule 213, Paragraph 1, Item 2 of to an initial listing application; and the Regulations] [Rule 206, Paragraph 1, Item 3 of b. It is expected that there will be no restriction by the time of listing;

the Regulations] provided, however, that the same shall not apply to cases where imposing a restriction on transfer of a foreign stock, etc. is deemed necessary to receive application of provisions of laws in its home country or a case equivalent to this and, in addition, where its details are deemed not to hinder trading in TSE market

a. Foreign stock depositary receipts: Said deposit agreement, etc. is to [Rule 213, Paragraph 1, Item 2 of be concluded among the initial listing applicant, the depository, the Regulations] etc. pertaining to said foreign stock depositary receipts, and [Rule 206, Paragraph 1, Item 4 of holders of said foreign stock depositary receipts; and the Regulations]

[Rule 213, Paragraph 3 of the b. Foreign stock trust beneficiary certificates: Said deposit agreement, Rules] etc. is to be concluded between the depository, etc. pertaining to said foreign stock trust beneficiary certificates and holders of said foreign stock trust beneficiary certificates; and the initial listing applicant has concluded a contract deemed appropriate by TSE

b. Eligibility Requirements

Item Requirements

(1) The corporate group of an initial listing applicant is deemed to be able to properly manage corporate information of facts, etc. which will have a material effect on management and to disclose it to investors in a timely and appropriate manner, and a system for the preemptive prevention of insider trading is deemed to be eveloped and operated appropriately

(2) Documents pertaining to disclosure of corporate information, out of initial listing application documents, are deemed to be prepared in compliance with laws and regulations, and contain the matters enumerated in the following a to c and other matters appropriately in consideration of the state of the business line and the business 1. Appropriateness of the condition of an initial listing applicant and its corporate group disclosure of corporate information, risk a. Useful matters for investment decisions of investors such as information, etc. analysis and explanation pertaining to the state of financial conditions, management performance & receipt and disbursement The company is able to of funds, the state of the related companies, the state of R&D make disclosure of the activities, the state of major shareholders, the state of officers & corporate information, risk employees, dividend policy, purposes of funds of an increase in information, etc. may be paid-in capital through a public offering concerning an initial listing carried out in an applicant and its corporate group; appropriate manner b. Matters that should be considered as a risk factor of an initial listing

[Rule 214, Paragraph 1, Item 1 of applicant, when investors make investment decisions, such as a the Regulations] small number of years in business operations, the state of the [III, 2 of Guidelines] occurrence of cumulative losses or business losses, dependence on a specified officer, the state of competition of business with other companies, uncertainties of markets and technologies, the state of support for the purpose of the administration of business from a specified entity, etc., concerning an initial listing applicant; and

(c) Where cancellation, rescission and any other event of permission and authorization, etc. are stipulated by laws and regulations or a contract, etc., such fact; and (d) The effect that there is no factor which hinder their continuity concerning the matters which are the premises of the main business activities of the corporate group of an initial listing applicant, and if there is such factor, the effect that it will have a material effect on business activities;

(3) The corporate group of an initial listing applicant does not make distorted information disclosure on the actual state of the corporate group of the initial listing applicant by carrying out a trading act with its related party or any other specified entity or adjustment of the stock ownership ratios, etc.

(4) Where an initial listing applicant has a parent company, etc., any one of the following a or b shall be met on the premise that disclosure of such parent company, etc. is valid; provided, however, that the same shall not apply to cases where the business relationship between the initial listing applicant and such parent company, etc. is weak and, in addition, it is clear that the ownership of the stock of the initial listing applicant by such parent company, etc. is for the purpose of encouraging investment, not for the substantial control of business activities of the initial listing applicant: a. A stock, etc. issued by a parent company, etc. of an initial listing applicant is listed on a domestic financial instruments exchange (including cases where a stock, etc. issued by such parent company, etc. is listed or continuously traded on such foreign financial instruments exchange, etc., and, the state of disclosure of corporate information in a country in which such parent company, etc. or such foreign financial instruments exchange, etc. is located is not deemed to conspicuously lack investor protection); and b. An initial listing applicant can appropriately understand company information such as facts concerning the parent company, etc. which has a material effect on its management, and the initial listing applicant pledges in writing that such parent company, etc. agrees to its disclosure of company information which has a material effect on its management, out of such company information concerning the parent company, etc., to investors in an appropriate manner

(5) Where an initial listing company is a foreign company, the accounting system adopted by the initial listing company shall be deemed appropriate from the viewpoint of investor protection

(6) Where an initial listing company is a foreign company, and a stock, etc. pertaining to such initial listing applicant is not listed or continuously traded on a Foreign Financial Instruments Exchange, etc., and the initial listing application is made only to TSE, the "Securities Report for Initial Listing Application (Part I)" shall contain matters enumerated in the following a. and b.:

a. Matters enumerated in the following (a) and (b) for a period from a day one year prior counting from the end date of a business year immediately prior to the initial listing application date to a day immediately prior to the listing date: (a) The state of new stock issues, or issues of subscription warrants or subscription warrant securities by the method other than allocation to shareholders; and (b) The state of change in the ownership of the shares pertaining to a stock, etc. by an entity with special interest, etc. (meaning an entity as prescribed in i) and ii) of Item (31) of Paragraph 1 of Rule 2 of the Cabinet Office Ordinance on Disclosure);

b. Where a holder of a stock, a subscription warrant or a subscription warrant security has made an arrangement concerning the holding of such securities for a certain period after listing with an initial listing applicant or with a financial instruments broker-dealer which enters into the principal underwriting agreement with an initial listing applicant, such details.

(1) The corporate group of an initial listing applicant is recognized, as a general rule, not to give or enjoy profit wrongfully through a 2. Soundness of corporate trading act or any other management activities with relevant management parties or other specified entities, for the reason of the matters

enumerated in the following a. and b. and other matters: The company is carrying out business in a fair and a. Where a transaction has occurred between the corporate group of faithful manner an initial listing applicant and its relevant parties or any other

specified entities, and such transaction has rationality of continuing [Rule 214, Paragraph 1, Item 2 of the transaction, and trading terms including trading prices are the Regulations] clearly not disadvantageous to the corporate group of an initial [III, 3 of Guidelines] listing applicant; and

b. Benefits of the corporate group of an initial listing applicant are not

lost wrongfully because relevant parties and any other specified entities of the corporate group of an initial listing applicant give priority to their own benefits;

(2) The mutual relationship of relatives of officers of an initial listing applicant, its composition, actual situation of providing services or the state of concurrent posts as officers and employees, etc. with any other company, etc. are recognized not to impair the fair, faithful and full execution of office duties or the implementation of effective auditing as officers of such initial listing applicant. In this case, where directors, accounting advisors or executive officers, spouses of persons corresponding to these and relatives by blood within the second degree of kinship and relatives by affinity take a position as an auditor, a member of an auditing committee or any other persons corresponding to these, it shall be deemed to impair the implementation of an effective auditing

(3) Where an initial listing applicant has a parent company, etc., management activities of the corporate group of an initial listing applicant are recognized to have independence from such parent company, etc. for the reason of the matters enumerated in the following a. to c. or any other matters: a. In light of the relationship between the business line of the corporate group of an initial listing applicant and that of the corporate group of the parent company, etc., the state of business adjustment made by the corporate group of the parent company, etc. and its possibility and any other matters, an initial listing applicant is not recognized to be substantially a business division of such parent company, etc.; b. The corporate group of an initial listing applicant or that of a parent company, etc., as a general rule, does not coerce or induce a trading act which becomes disadvantageous to such parent company, etc. or the corporate group of such initial listing applicant, such as transactions under markedly different terms from those of normal transactions in principle; and c. The state of receiving seconded persons of the corporate group of an initial listing applicant is recognized not to excessively depend on the parent company, etc. and not hinder continuing management activities.

(1) The system to secure the execution of appropriate work duties of officers of the corporate group of an initial listing applicant is recognized to be reasonably developed and appropriately operated in light of the matters enumerated in the following a and b and other matters:

a. An initial listing applicant has an organizational plan and an officer composition which is able to effectively conduct checking and auditing concerning the execution of work duties of officers of the corporate group of an initial listing applicant; and

b. Checking and auditing the execution of work duties of officers for efficient management is carried out and functions effectively in the corporate group of an initial listing applicant 3. Effectiveness of corporate governance and internal management (2) The internal management system is recognized to be reasonably system of an developed and appropriately operated for an initial listing applicant and its corporate group to carry out effective management enterprise activities for the reason of the matters enumerated in the following a. and b. and other matters: Corporate governance and internal management system are developed in a. A necessary managerial and administrative body is reasonably accordance with the size, developed and appropriately operated to secure efficiency of corporate maturity, etc. of management activities and internal checking functions of the the enterprise, and corporate group of an initial listing applicant; and functioning properly b. An internal auditing system of the corporate group of an initial [Rule 214, Paragraph 1, Item 3 of listing applicant is reasonably developed and appropriately the Regulations] operated; [III, 4 of Guidelines] (3) Necessary personnel are recognized to be competent to carry out stable and continuing execution of management activ ities of the corporate group of an initial listing applicant and to maintain its internal management system;

(4) The corporate group of an initial listing applicant adopts accounting treatment standards adaptable to its actual situation and, in addition, a necessary accounting body is recognized as being prepared and operated appropriately; and

(5) It is recognized that an effective system to comply with laws and regulations, etc. concerning management activities and other matters in the corporate group of an initial listing applicant is prepared and operated appropriately, and that no material breach

of laws and regulations has recently been made, and no act which is likely to become a material breach of laws and regulations in the future is being carried out

4. Reasonableness of the (1) The business plan of the business group of the initial listing business plan applicant is deemed to have taken into account the business model, business environment, risk factors, etc. and appropriately The listing applicant has drawn up. developed reasonable and suitable business plans, (2) The operating base necessary for executing the business plan of and has developed the the business group of the initial listing applicant is deemed to have operating base necessary been developed or that there is reasonable expectation that such for executing such operating base will be developed. business plans, or there is reasonable expectation that it will develop such operating base

[Rule 214, Paragraph 4, Item 1 of the Regulations] [III, 5 of Guidelines]

(1) The contents of the rights of shareholders or holders of foreign stock depositary receipts, etc. and the state of their exercise are deemed appropriate from the viewpoints of the public interest or the protection of investors, in light of the matters enumerated as follows and other matters:

5. Other matters deemed a. The contents of the rights of shareholders or holders of foreign necessary by TSE from the stock depositary receipts, etc. and their exercise are not viewpoint of the public unreasonably restricted; and interest or the protection of investors. b. Where an initial listing applicant has introduced a takeover defense measure, the initial listing applicant complies with the matters [Rule 214, Paragraph 1, Item 5 of enumerated in the following (a) to (d): the Regulations] [III, 6 of Guidelines] (a) Sufficient disclosure: The listed company shall make necessary and sufficient timely disclosure concerning takeover defense measures; (b) Transparency: Conditions of implementation and abolishment of takeover defense measures shall not depend on arbitrary decisions by the management; (c) Effect on the secondary market:

Takeover defense measures shall not include factors which may cause extremely unstable price formation of a stock or any other factors which may cause unpredictable damage to investors; and (d) Respect for shareholders’ rights: Takeover defense measures shall give consideration to shareholders’ rights and their exercise.

(2) The corporate group of an initial listing applicant does not have a contention or dispute, etc. which would have a material effect on management activities and business performance

(3) Concerning the matters which are the premises of the main business activities of the corporate group of an initial listing applicant, there is no factor which hinders their continuity

(4) The corporate group of an initial listing applicant is recognized to develop an internal system to prevent criminal and extremist elements from being involved in management activities, and making efforts to prevent such involvement and their actual state is recognized as appropriate from the viewpoints of the public interest or the protection of investors

(5) Other cases deemed appropriate from the viewpoints of the public interest or the protection of investors

c. Documents to be Filed

The following highlights the documents required to be filed for the purpose of the initial listing application. Each of such documents is requested to be filed when the requirements for the filing thereof are met. The following also includes the documents to be filed only for the purpose of multiple listing. Please refer to the footnotes at the end of this paragraph with respect to “Documents Required to be Filed only for the Purpose of Multiple Listing” and “Documents Not Required to be Filed for the Purpose of Multiple Listing.”

(a) Documents to be filed at the time of conducting the initial listing application

Number Documents to be filed 1 Preliminary Application Form for initial listing of securities 2 Application form for initial listing of securities 3 Written Oath relating to initial listing application 4 Articles of Incorporation (including by-laws) 5 Statement certifying no ties with anti-social forces Statement concerning the matters which constitute the premise underlying major business 6 activities Table of Distribution of Share Ownership 7 (unnecessary if the company conducts offering) (Note 2) 8 Written document of the last financial information of non-listed parent company, etc. (Note 3) 9 Written confirmation concerning timely disclosure, etc. of parent company, etc. 10 Statement describing matters concerning controlling shareholders 11 Minutes of the Meeting of the Board of Directors on initial listing application 12 A legal opinion 13 A copy of the document proving that the representative is a person with a legitimate authority Document certifying the deposit agreement concerning depositary receipts, etc. for the new 14 listing application (Note 4) A document certifying that the depository, etc. has agreed to the matters TSE deems necessary 15 for the new listing application (Note 4) Table of Change in Number of shareholders or of holders of Foreign Stock Depositary Receipts, 16 etc. (Note 5) A document certifying that the agent, etc. has been appointed or given informal consent to 17 accept the appointment 18 Materials concerning the value of the stock pertaining to the initial listing application (Note 6) 19 Written Recommendation (by listing approval date) 20 Sponsor’s Letter of Confirmation Statement of specific considerations and focused matters during the process of instructions on 21 going public and underwriting examination Various explanatory materials concerning listing applicant: “Lines of business”; “Business plan 22 Going Forward”; “Nature of Transactions with Special Interested Party”; “Status of Industry and Trading Partners”; 23 Statement of accounts of consolidated subsidiaries for the last two business years

Financial statements, etc. of merged companies in a merger transaction for the recent two 24 business years 25 Materials concerning the value of the stock pertaining to the initial listing application (Note 7) 26 Securities Report for Initial Listing Application (Part I) 27 Written confirmation concerning timely disclosure, etc. Corporate Governance Report 28 (only for an initial listing applicant who makes an initial listing application of a domestic stock, etc. and a foreign stock, etc. for which TSE is a main market) Audit Reports, Interim Audit Reports or Quarterly Review Reports （Excluding applicants 29 exempted under the clause in Rule 211, Paragraph 6 of the Rules) Summary Audit Reports, Summary Interim Audit Reports or Summary Quarterly Review Reports 30 (Excluding Applicants exempted under the clause in the Rule 211, Paragraph 6 of the Rules) 31 Preliminary Initial Listing Application Report （prepared by the applicant） 32 Preliminary Initial Listing Application Report （prepared by the managing trading participant） 33 Corporate Report（materials describing the applicant's business and operation) Materials sent to Shareholders and official publications (including the notice of the general 34 shareholders' meeting) regarding the General Shareholders' Meetings in the past two (2) years Documents (such as prospectuses) sent to shareholders regarding rights issue in the past two 35 (2) years or regarding most recent right issue in the past five (5) years where there is none in the past two (2) years A copy of the Annual Report sent to shareholders or holders of Foreign Stock Depositary 36 Receipts in the past one (1) year A copy of the Interim Report and Quarterly Reports sent to shareholders or holders of Foreign 37 Stock Depositary Receipts in the past one (1) year A copy of the Securities Report, Annual Report, Interim Report, Quarterly Reports and 38 Extraordinary Reports submitted to the Prime Minister etc. in the past one (1) year (Note 1) A copy of the Securities Registration Statement (including amendments thereto) submitted to 39 the Prime Minister etc. in the past one (1) year (Note 1) News releases and newspaper publications regarding earnings announcements, dividend, stock 40 split, rights issue, and other material information in the past one (1) year 41 Relevant laws pertaining to the incorporation of the applicant in the applicant's jurisdiction 42 List of Agenda of the Meeting of the Board of Directors in the past two (2) years A set of documents submitted by the applicant to relevant authorities in relation to application 43 of tax refund The check sheet regarding the legal framework of accounting and audit in the home country 44 submitted to the Financial Services Agency of Japan 45 Sample of foreign stock certificates and etc. (to be attached stock sample list) 46 Other matters deemed necessary by TSE for listing examination (Note 8)

(b) Documents to be filed after the initial listing application where necessary /applicable

Number Documents to be filed Quarterly Reports for Initial Listing Application where: (Note 1) (Note 2) ◆ The listing day falls anytime after three (3) months from the beginning of the business year containing the initial listing application day, the Quarterly Report for Initial Listing Application for the first quarter of said business year ◆ The listing day falls anytime after six (6) months from the beginning of the business year 47 containing the initial listing application day, the Quarterly Report for Initial Listing Application for the second quarter of said business year ◆ The listing day falls anytime after nine (9) months from the beginning of the business year containing the initial listing application day, the Quarterly Report for Initial Listing Application for the third quarter of said business year Quarterly balance sheet of the end day of the above period 48 (In cases where a management company is the entity preparing consolidated financial statements) (Note 9) Notice of board meeting resolutions or General Shareholders' Meeting resolutions during the 49 period from the first day of the business year containing the initial listing application day to the listing day Reports of corporate information having significant impact on the business of the initial listing 50 applicant during the period from the first day of the business year containing the initial listing application day to the listing day A copy of the following documents submitted to the Prime Minister etc. during the period from the first day of the business year containing the initial listing application day to the listing day (Note 1) 51 ◆Securities Registration Statement （including amendment thereto）and document attached thereto ◆Notice of effectiveness of Securities Registration Statement ◆Securities notification (including amendment thereto) and document attached thereto Notification of Initial Listing Application Securities Report Amendment (at time of effect of 52 amended details)

Number Documents to be filed 53 Written Confirmation Regarding Compliance with Exchange Rules and Regulations 54 Listing Agreement 55 Articles of Incorporation (including by-laws) 56 Securities Report for Initial Listing Application (Part I) 57 Securities Report for Initial Listing Application (Part I) PDF version The written document containing the effect that the representative of such initial listing 58 applicant is aware that the Securities Report for Initial Listing Application (Part I) and other documents do not contain any untrue statements 59 Calculation of the expected market capitalization Corporate Governance Report (PDF version) 60 (only for an initial listing applicant who makes an initial listing application of a domestic stock, etc. and a foreign stock, etc. for which TSE is a main market) 61 Quarterly Report of Initial Listing Application (Note 1) 62 Quarterly Report of Initial Listing Application PDF version (Note 1) 63 Corporate Brochure of Applicant 64 Drafted disclosures (matters concerning growth potential) as of listing date

(d) Documents to be filed by the applicant making a public offering, etc.

Number Documents to be filed 65 Expected Public Offering or Secondary Offering Plan 66 Securities Registration Statement and its accompanying documents (Note 1) 67 Materials pertaining the determination of the assumed tentatively set price range 68 Press release of Notice of Provisional Conditions and the reasons for deciding them 69 Materials pertaining the determination of the tentatively set price range Amendment of Securities Registration Statement (after the determination of the tentatively set 70 price range) (Note 1) 71 Press release of Notice of the Determination of Offering Prices and the reasons, etc. therefor 72 Materials pertaining the determination of the assumed tentatively set price range Amendment of Securities Registration Statement (after the determination of offering price) 73 (Note 1) 74 Notice on effectiveness of Securities Registration Statement 75 Notice of execution of Public Offering or Secondary Offering 76 Notification of the revisions of the Security Initial Listing Application Form

Note 1: In cases of submission to the Prime Minister, etc. via electronic data processing for disclosure (refers to electronic data processing for disclosure as prescribed by Article 27-30-2 of the Financial Instruments and Exchange Act), the submission of such documents is not required. Note 2: The applicant applying for a multiple listing need not submit the document. Note 3: The applicant needs to submit the document where none of the following is the case: (1) the shares issued by the parent company, etc. is listed on a financial instruments exchange in Japan (2) the shares issued by the parent company, etc. is listed or continuously traded on a foreign f inancial instruments exchange, etc. and it is not deemed that disclosure status of the parent company, etc. in its home country, etc. is seriously detrimental to investor protection. (3) the parent company, etc. is subject to ongoing disclosure (4) the parent company, etc. is subject to ongoing disclosure in its home country and such status is not deemed to be seriously detrimental to investor protection. Note 4: Only the applicant applying for a multiple listing needs to submit the document. Note 5: Only the applicant applying for a listing of Foreign Stock Depositary Receipts needs to submit the document. Note 6: Submission only required in cases of a company succeeding business due to a shareholder-directed split of a listed company, which conducts initial listing application prior to such shareholder-directed split. Note 7: Submission only required in cases of a company succeeding business due to a shareholder-directed split of a listed company, which conducts initial listing application prior to such shareholder-directed split. Note 8: There may be cases which require a copy of the "Minutes of the Board of Directors Meeting," "Internal Audit Documents," "Monthly Performance Management Documents," "Documents Used in Annual Budget Plan, Medium-Term Management Plan, and Planning," "Important Agreements," etc. Note 9: Submission only required in cases where TSE deems the corporate group to have a special composition. Note 10: The applicant needs to submit documents pertaining a shelf registration, possession of a large volume of shares, and tender offer that it makes after the beginning of the business year containing the initial listing application day

(3) JASDAQ Market (Primary Listing) a. Formal Requirements

Requirement Item Standard Growth 1. Number of shareholders 200 shareholders or more (in 200 shareholders or more (in (expected at listing) Japan) Japan)

[Rule 216-4, Item 1-b of the Regulations] [Rule 216-7, Item 2 of the Regulations]

2. Market capitalization of 500 million yen or more 500 million yen or more tradable shares (expected at listing)

[Rule 216-4, Item 2-a of the Regulations] [Rule 216-7, Item 3 of the Regulations] [Rule 216-3, Item 2 of the Regulations]

3. Implementation of Public The applicant is required to implement public offering or secondary Offering or Secondary offering of the higher of the number of shares described below and Offering 10% of the number of listed shares expected at the time of listing during the period from the listing application date to the day [Rule 216-4, Item 1-a of the preceding the listing date. Regulations] [Rule 216-7, Item 2 of the (a) Issues with a trading unit of 1,000 shares: one million shares Regulations] (b) Issues with a trading unit of 500 shares: 500,000 shares (c) Issues with a trading unit of 100 shares: 100,000 shares (d) Issues with a trading unit of 50 shares: 50,000 shares (e) Issues with a trading unit of 10 shares: 10,000 shares (f) Issues with a trading unit of 1 share: 1,000 shares

4. Net Asset Value 200 million yen or more Positive (expected at listing)

[Rule 216-4, Item 2-a of the Regulations] [Rule 216-3, Item 3 of the Regulations] [Rule 216-7, Item 1 of the Regulations] [Rule 216-6, Item 1 of the Regulations]

5. Profits or Market The following a. or b. must be ― Capitalization satisfied: (Amount of profits calculated based on the a. Profits during the most recent consolidated income year are at least JPY 100 statement. Market million. capitalization is expected at listing) b. Market capitalization is expected to reach JPY 5 [Rule 216-4, Item 2-a of the billion by the time of listing. Regulations] [Rule 216-3, Item 4 of the Regulations]

The following a. through d. must be satisfied:

a. No false statements in Securities Reports for the year ended during the recent two years are identified.

6. Audit by listed company b. The audit opinion on financial statements and so on for the audit firm, including false business year ended during the recent two years (excluding the statement or adverse recent one year) is “unqualified and fair” or “qualified opinion opinion with exceptions.”

[Rule 216-4, Item 2-b of the c. The audit opinion on financial statements and so on for the Regulations] business year ended during the recent one year is, in principle, [Rule 216-7, Item 4 of the “unqualified and fair.” Regulations] [Rule 212, Item 6 of the Regulations] d. If any stock of an applicant is listed on another financial instruments exchange in Japan, it shall not meet both (a) and (b) below. (a) An internal control audit report for the business year ended during the recent one year includes the statement that “no assessment result can be expressed.”

(b) An internal control audit report for the business year ended during the recent one year includes the statement that “any opinion is refrained from being expressed.”

7. Treatment at designated The following a. or b. must be satisfied: book-entry transfer institution a. The stock is subject to the foreign stock book-entry transfer or book-entry transfer of the designated book-entry transfer [Rule 216-4, Item 2-b of the institution. Regulations] [Rule 216-7, Item 4 of the b. The stock is expected to be subject to the transfer as mentioned Regulations] above by the time of listing. [Rule 206, Item 2 of the Regulations] The following a. or b. must be satisfied:

8. Restrictions on transfer of a. No restrictions have been imposed on the transfer of foreign stock stock, etc. for which an initial listing application is filed.

[Rule 216-4, Item 2-b of the b. No restrictions are expected be imposed by the listing; Regulations] provided, however that this criterion does not apply to cases [Rule 216-7, Item 4 of the where imposing restrictions on the transfer of foreign stock is Regulations] required to meet the provisions of laws and regulations of a [Rule 206, Item 3 of the Regulations] home country and the nature of such restrictions is determined not to impede trading on JASDAQ

If an initial listing applicant files an application for listing of foreign stock depositary receipts, the depository agreement and other agreements for foreign depository receipts for which the listing applicant is filed shall meet the requirements of a and b below. 9. Depository agreement, etc. a. In the case of foreign stock depositary receipts, the depository

agreement will be entered into concerning the depository period [Rule 216-4, Item 2-b of the of the receipts and by and between the holders of the receipts. Regulations]

[Rule 216-7, Item 4 of the b. In the case of foreign stock trust beneficiary certificates, the Regulations] depository agreement will be entered into concerning the [Rule 206, Item 4 of the Regulations] depository period of the certificates and by and between the [Rule 213, Paragraph 3 of the Rules] holders of certificates, and the initial listing applicant enters into the agreement which TSE determines is appropriate.

b. Eligibility Requirements (Standard Market)

Item Requirements

(1) Outlook for business performance and financial condition of the corporate group of an initial listing applicant do not hinder the corporate continuity of the applicant in the future. In this case, when falling under the following a. or b., the outlook for business performance and financial condition shall be deemed to not hinder corporate continuity.

a. Maintenance of the levels of recent business performance and financial condition of the corporate group of an initial listing applicant is reasonably expected.

b. In cases where the business performance or financial condition of the corporate group of an initial listing applicant is deteriorating or poor, such situation is deemed to improve in such way as the levels of such performance and conditions are expected to recover or improve in the future based on an objective fact(s). 1. Business continuity

There are no obstacles to (2) Management activities of the corporate group of an initial listing continuity of business applicant are deemed to be able to be carried out stably and activities continuously in light of matters including those enumerated in the following a. to d.: [Rule 216-5, Paragraph 1, Item 1 of the Regulations] a. Business activities of the corporate group of an initial listing [III-2, 2 of Guidelines] applicant can be conducted stably and continuously in light of purchases, production, sales, and actual results of transactions with customers and suppliers, as well as characteristics and demand trends for manufactured products and services and the state of performance of any other business.

b. Investment activities such as capital investment and business investment, etc. of the corporate group of the initial listing applicant do not hinder the continuity of management activities in light of the trend and future outlook, etc. for its investment.

c. Financial activities such as fund-raising, etc. of the corporate group of the initial listing applicant do not hinder the continuity of management activities in light of the trend and future outlook, etc. of its financial state.

d. With respect to the matters which are the basis of the main business activities of the corporate group of the initial listing

applicant, there are no issues that will hinder the continuity of such business activities. (1) The system to ensure the appropriate execution of duties of officers of the corporate group of the initial listing applicant is deemed to be properly established and appropriately operated in light of matters including those enumerated in the following a. and b.:

a. An initial listing applicant has an organizational structure and an officer composition which allow for effective checking and audit of the execution of duties by officers of the corporate group of an initial listing applicant. The listing examination in such case shall be conducted in consideration of the state of compliance with matters prescribed in the provisions of Rules 436-2 through 439 of the Regulations. 2. Establishment of sound b. Checking and audit of the execution of officer duties are carried out corporate governance and and function effectively toward the efficient management of the internal management system corporate group of an initial listing applicant.

Corporate governance and (2) The mutual relationship between relatives of officers of an initial internal management listing applicant, its composition, the actual working situation or the system have been state of concurrent positions as officers and employees, etc. at established in another company, etc. are deemed to not impair the fair, faithful, accordance with corporate and proper execution of officer duties or effective audit of such scale and function initial listing applicant. In this case, where a spouse, blood relative effectively within the second degree of kinship, and relations by affinity of directors, accounting advisors, executive officers, or persons [Rule 216-5, Paragraph 1, Item 2 equivalent thereto assume a position as an auditor, a member of of the Regulations] an audit committee, or persons equivalent thereto, it shall be [III-2, 3 of Guidelines] deemed to impair effective audit.

(3) The corporate group of an initial listing applicant is deemed to adopt accounting treatment standards suited to its actual situation and, in addition, a necessary accounting structure is deemed to be established and operated appropriately.

(4) An effective system for compliance with laws and regulations, etc. concerning management activities and other matters in the corporate group of an initial listing applicant is deemed to be established and operated appropriately.

(5) The internal management system is deemed to be properly

established and appropriately operated so that an initial listing applicant and its corporate group carry out effective management activities in light of matters including those enumerated in the following a. and b.:

a. A necessary managerial and administrative system is properly established and appropriately operated to ensure efficiency of management activities and internal check-and-balance functions of the corporate group of an initial listing applicant.

b. An internal audit system of the corporate group of an initial listing applicant is properly established and appropriately operated.

(6) Necessary personnel are deemed to be secured in order to carry out stable and continuous execution of management activities and maintenance of the internal management system of the corporate group of an initial listing applicant.

(1) The corporate group of an initial listing applicant is deemed, as a general rule, to not unfairly grant or enjoy benefits through a transaction or any other management activities with relevant parties or other specific entities in light of matters including those enumerated in the following a. and b.:

a. Where a transaction has occurred between the corporate group of an initial listing applicant and relevant parties or other specific 3. Reliability of Corporate entities, and such transaction has reasonability of continuance, and Actions its terms including the transaction price are appropriate.

Corporate actions which b. The interests of the corporate group of an initial listing applicant cause market disorder are are not unfairly undermined due to relevant parties or other not expected specific entities of the corporate group of an initial listing applicant giving priority to their own interests. [Rule 216-5, Paragraph 1, Item 3 of the Regulations] (2) Where an initial listing applicant has a parent company, etc. [III-2, 4 of Guidelines] (excluding cases where such applicant is expected to cease to have a parent company, etc. by the end of the first business year after listing), management activities of the corporate group of an initial listing applicant are deemed to be independent of such parent company, etc. in light of matters including those enumerated in the following a. to c.:

a. In light of the relationship between the business line of the corporate group of the initial listing applicant and that of the

corporate group of the parent company, etc., the state and possibility of business line adjustment made by the corporate group of the parent company, etc. and any other matters, the initial listing applicant is not deemed to be substantially a business division of such parent company, etc. b. The corporate group of an initial listing applicant or that of a parent company, etc., as a general rule, has not been coercing or inducing transactions which will undermine the interests of such parent company, etc. or the corporate group of such initial listing applicant, such as transactions that have markedly different terms from those of normal transactions c. The state of receiving seconded persons of the corporate group of an initial listing applicant is deemed not to excessively depend on the parent company, etc. and not hinder continuous management activities.

(3) The management of the corporate group of an initial listing applicant has insight into the responsibilities and significance of being listed on a financial instruments market.

(4) An initial listing applicant shall not fall under any of the following a. through c. a. In case where the listing applicant plans to effect merger, divesture of business, or become a subsidiary or non-subsidiary within three years from the end of the business year following the initial listing application date, TSE determines that the initial listing company would not be a de facto surviving company through any of such acts; provided that this will not apply to cases where it is determined that the merger is effected to make any company without substance a surviving company and the divesture is determined to be a divesture of business to receive the business from the parent company. b. The initial listing applicant plans to effect a merger where the initial listing applicant becomes a dissolved company, a share exchange or share transfer where the initial listing applicant becomes a fully owned subsidiary of another company within three years from the end of business year immediately preceding the initial listing application date.

c. The initial listing applicant plans to delist its stock by means of acquisition of all the shares by large shareholders, management, employees or other specified persons or other means within three years from the end of business year immediately preceding the initial listing application date.

(5) Where an initial listing applicant has introduced a takeover defense measure, the initial listing applicant complies with the matters enumerated in the following (a) to (d):

(a) Sufficient disclosure: The listed company shall make necessary and sufficient timely disclosure concerning takeover defense measures; (b) Transparency: Conditions of implementation and abolishment of takeover defense measures shall not depend on arbitrary decisions by the management; (c) Effect on the secondary market: Takeover defense measures shall not include factors which may cause extremely unstable price formation of a stock or any other factors which may cause unpredictable damage to investors; and (d) Respect for shareholders’ rights: Takeover defense measures shall give consideration to shareholders’ rights and their exercise.

(6) The corporate group of an initial listing applicant has developed a corporate structure to prevent anti-social forces from intervening in management activities and is making efforts to prevent such intervention, and such efforts are deemed appropriate in light of the public interest or investor protection.

(7) The corporate group of an initial listing applicant has not recently committed material violations of laws and regulations or acts against the public interest, and furthermore is deemed not to conduct acts which are likely to become a material violation of laws and regulations or work against the public interest in the future.

4. Appropriateness of (1) The corporate group of an initial listing applicant is deemed to be disclosure of corporate able to properly manage corporate information of facts, etc. which details, etc. will have a material impact on management and to disclose it to investors in a timely and appropriate manner. Moreover, its system The company is capable of for the preemptive prevention of insider trading is deemed to be appropriately disclosing developed and operated appropriately. corporate details, etc.

(2) Documents pertaining to disclosure of corporate information, out [Rule 216-5, Paragraph 1, Item 4 of initial listing application documents, are deemed to be prepared of the Regulations] in compliance with laws and regulations, and appropriately contain [III-2, 5 of Guidelines] the matters enumerated in the following a. to c. and other matters in consideration of the state of the business line and the business condition of an initial listing applicant and its corporate group:

a. Useful matters for investment decisions of investors such as analysis and explanation pertaining to the state of financial condition, management performance, and receipt and disbursement of funds, the state of related companies, the state of research and development activities, the state of major shareholders, the state of officers and employees, dividend policy, and purposes of funds raised for capital increase through a public offering with respect to an initial listing applicant and its corporate group.

b. Matters that should be considered as risk factors of an initial list ing applicant when investors make investment decisions, such as the small number of years in business operation, the state of cumulative losses or business losses, dependence on a specific officer, the state of competition for business with other companies, uncertainties of markets and technologies, and the state of support for the purpose of the administration of business from a specific entity, etc., concerning an initial listing applicant.

c. Matters enumerated in the following (a) to (d) with respect to matters which are the premises of the main business activities of an initial listing applicant and its corporate group: (a) Details of the matters which are the premises of the main business activities of an initial listing applicant and its corporate group; (b) Where the validity period of permission and authorization, etc. and any other time limit is specified by laws and regulations or a contract, etc., such time limit; (c) Where cancellation, rescission, and any other event of permission, authorization, etc. are stipulated by laws and regulations or a contract, etc., such fact; and (d) The effect that there is no factor which hinders their continuity concerning the matters which are the premises of the main business activities of the corporate group of an initial listing applicant, and if there is such factor, the effect that it will have a material effect on business activities.

(3) The corporate group of an initial listing applicant does not make distorted information disclosure on the actual state of the

corporate group of the initial listing applicant by carrying out a trading act with its relevant party or any other specific entity or adjusting share ownership ratios, etc.

(4) If an initial listing applicant owns a company which in effect holds a majority of voting rights of the initial listing applicant, the disclosure on the company must be effective and meet either a. or b. below; provided that this will not apply to cases where the actual relationship between the initial listing applicant and its apparent major shareholding company is thin and the shareholding by the majority shareholding company has been made for the fostering of investment and has not been made for substantially controlling the business activities of the initial listing applicant. a. Stock, etc. issued by the majority shareholding company of an initial listing applicant is listed on a domestic financial instruments exchange (including cases where a stock, etc. issued by such parent company, etc. is listed or continuously traded on such foreign financial instruments exchange, etc., and the state of disclosure on corporate affairs in a country in which such parent company, etc. or such foreign financial instruments exchange, etc. is located is not deemed to markedly lack investor protection). b. The listing applicant can appropriately grasp the facts, etc. concerning the majority shareholding company which may significantly affect its management and the applicant undertakes in writing that the majority shareholding company agrees to appropriately disclose to investors any information of its corporate information which may have significant effect on the management of the initial listing applicant.

(5) Where an initial listing company is a foreign company, the accounting system adopted by the initial listing company shall be deemed appropriate from the viewpoint of investor protection.

(6) Where an initial listing company is a foreign company, the stock, etc. pertaining to such initial listing applicant is not listed or continuously traded on a foreign financial instruments exchange, etc. and the initial listing application is made only to the Exchange, the "Securities Report for Initial Listing Application (Part I)" shall contain matters enumerated in the following a. and b.: a. Matters enumerated in the following (a) and (b) for the period from

the day that falls one year prior to the end of the first business year immediately before the initial listing application date to the day immediately prior to the listing date (a) The state of new stock issues, or issues of subscription warrants or bonds with subscription warrants by a method other than allocation to shareholders (b) The state of change in the ownership of the shares pertaining to the stock, etc. held by parties having special interests, etc.

b. Where a holder of a stock, a subscription warrant or a bond with subscription warrants has made an arrangement concerning the holding of such securities for a certain period after listing with an initial listing applicant or with a financial instruments business operator which enters into the principal underwriting agreement with an initial listing applicant, such details. (1) The details of the rights of shareholders or holders of foreign stock depositary receipts, etc. and the state of their exercise are not unfairly restricted.

(2) The corporate group of an initial listing applicant does not have an ongoing lawsuit or dispute, etc. which would have a material impact on management activities and business performance.

(3) Where the domestic stock, etc. pertaining to an initial listing applicant is shares without voting rights or shares with a small 5. Other matters deemed number of voting rights, all of the following a. to f. shall be met: necessary by TSE from the viewpoint of the public a If a company is controlled with an extremely small ratio of equity interest or investor contribution, a scheme of shares without voting rights or a small protection number of voting rights is expected to be dissolved.

[Rule 216-5, Paragraph 1, Item 5 b Where conflicts of interest arise between shareholders of different of the Regulations] classes, it is deemed that protection measures can be taken so that [III-2, 6 of Guidelines] shareholders of a domestic stock, etc. pertaining to such initial listing applicant are not unfairly damaged.

c. Where the issuer of the domestic stock, etc. pertaining to such initial listing application carries out a transaction with an entity enumerated in the following (a) to (c) (including transactions, out of transactions carried out between an entity enumerated in the following (a) to (c) and such issuer on behalf of a third party and those between such issuer and a third party, where an entity enumerated in the following (a) to (c) has a material impact on such issuer concerning such transactions), it is deemed that

measures to protect minority shareholders are expected to be able to be taken: (a) A parent company (b) The controlling shareholders (excluding a parent company) and their close relatives (c) The company, etc. whose majority of voting rights are held by the entities enumerated in the preceding (b) for their own account that holds the majority of the voting rights on its own account and a subsidiary of such company, etc. d. Where the domestic stock, etc. pertaining to such initial listing application are shares with a small number of voting rights, shares with a large number of voting rights shall be converted to shares with a small number of voting rights when the transfer of such shares, etc. is carried out. e. Where the domestic stock, etc. pertaining to such initial listing application has preferential contents concerning dividends from retained earnings, as a general rule, estimated profits for two (2) years after the end of the business year immediately prior to listing application date and a distributable amount as of the end of the business year immediately prior to the listing application date are deemed to be good, and it is expected that the issuer of such domestic stock, etc. will record enough profits to carry out dividends from retained earnings pertaining to such domestic stock, etc. f. The interests of shareholders and investors are deemed to be highly unlikely to be undermined.

(4) It is deemed appropriate from the viewpoint of the public interest or investor protection.

c. Eligibility Requirements (Growth Market)

Item Requirements

(1) The profit/loss situation or financial condition of the corporate group of the initial listing applicant is expected to rise. An initial listing applicant that falls under the following a or b shall be handled as being in a situation where its profit/loss situation or financial condition is expected to rise.

a. From the business plan, it can reasonably be expected to achieve sustainable growth from the fiscal year of the application.

1. Corporate growth b. In the case of a company that is an anticipatory investment potential prospect expected to achieve sustainable growth in the future,

from the business plan, it is expected to achieve net income within The company has growth five (5) years counting from the fiscal year of the application. potential

[Rule 216-8, Item 1 of the (2) There are reasonable grounds for the competitive edge and Regulations] business environment on which the business plan is based. [III-3, 2 of Guidelines] (3) There are no questions regarding the current state or the basis for plans for staff allocation in the company and construction of facilities to achieve the business plan.

(4) There are no factors, regarding matters which are the premises of the main business activities of the corporate group of the initial listing applicant, will hinder the continuity of such matters.

2. Establishment of sound (1) The system to ensure the appropriate execution of duties of corporate governance and officers of the corporate group of an initial listing applicant is internal management recognized to be properly developed and appropriately operated in systems in accordance light of matters including those enumerated in the following a. and with the stage of growth b.:

Corporate governance and a. Organ design and composition of executives whereby effective internal management check and balance functions will be provided for the execution of systems have been duties of executives of the corporate group of the initial listing established in accordance applicant and effective audit can be performed. with the company's stage of growth and function b. Check and balance functions are implemented and audit is effectively performed for the execution of executives of the corporate group of the initial listing applicant to ensure efficient management. [Rule 216-8, Item 2 of the

Regulations] (2) The mutual relative relationship among officers of an initial listing [III-3, 3 of Guidelines] applicant, its composition, the actual working situation or the state of concurrent positions as officers and employees, etc. at another company, etc. are deemed not to impair the fair, faithful, and proper execution of officer duties or effective audit of such initial listing applicant. In this case, where a spouse, blood relative within the second degree of kinship, and relations by affinity of directors, accounting advisors, executive officers, or persons equivalent thereto assume a position as an auditor, a member of an audit committee, or persons equivalent thereto, it shall be deemed to impair effective audit.

(3) The corporate group of an initial listing applicant is deemed to adopt accounting standards suited to its actual situation and, in addition, a necessary accounting structure is deemed to be established and operated appropriately.

(4) It is recognized that an effective system to comply with laws and regulations, etc. concerning management activities and other matters in the corporate group of an initial listing applicant is prepared and operated appropriately.

(5) The internal management system is deemed to be established properly and operated appropriately so that an initial listing applicant and its corporate group carry out effective management activities in light of matters including those enumerated in the following a. and b.:

a. A necessary managerial and administrative system required to ensure efficiency of management activities and internal check-and-balance functions of the corporate group of an initial listing applicant have been properly established and appropriately operated.

b. An internal audit system of the corporate group of an initial listing applicant is properly established and appropriately operated.

(6) Necessary personnel are deemed to be secured in order to carry out stable and continuous execution of management activities and maintain the internal management system of the corporate group of an initial listing applicant.

(1) The corporate group of an initial listing applicant is deemed, as a general rule, to not unfairly grant to or enjoy benefits from relevant parties or other specific entities through a transaction or any other management activities in light of matters including those enumerated in the following a. and b.:

a. Where a transaction has occurred between the corporate group of an initial listing applicant and relevant parties or other specific entities, and continuance of such transaction is reasonable and its terms and conditions including the transaction price are not clearly disadvantageous for the corporate group of an initial listing applicant.

b. The interests of the corporate group of an initial listing applicant are not unfairly undermined due to relevant parties and other specific entities of the corporate group of an initial listing applicant giving priority to their own interests. 3. Reliability of Corporate Actions (2) Where an initial listing applicant has a parent company, etc., management activities of the corporate group of an initial listing Corporate actions which applicant are deemed to be independent of such parent company, cause market disorder are etc. in light of matters including those enumerated in the following not expected a. to c.:

[Rule 216-8, Item 3 of the a. In light of the relationship between the business line of the Regulations] corporate group of an initial listing applicant and that of the [III-3, 4 of Guidelines] corporate group of the parent company, etc., the state and possibility of business line adjustment made by the corporate group of the parent company, etc. and any other matters, the initial listing applicant is not deemed to be substantially a business division of such parent company, etc.

b. The corporate group of an initial listing applicant or that of a parent company, etc., as a general rule, has not been coercing or inducing transactions which will undermine the interests of such parent company, etc. or the corporate group of such initial listing applicant, such as transactions that have markedly different terms and conditions from those of normal transactions

c. The state of receiving seconded persons of the corporate group of an initial listing applicant is deemed not to excessively depend on the parent company, etc. and not hinder continuous management activities.

(3) The management of the corporate group of an initial listing applicant has insight into the responsibilities and significance of being listed on a financial instruments market.

(5) Where an initial listing applicant has introduced a takeover defense measure, the initial listing applicant complies with the matters enumerated in the following (a) to (d):

(6) The corporate group of an initial listing applicant has developed a corporate structure to prevent anti-social forces from intervening in corporate activities, is making efforts to prevent such intervention, and such efforts are deemed appropriate in light of the public interest or investor protection.

(7) The corporate group of the initial listing applicant has not recently committed material violations of laws and regulations or acts against the public interest, and furthermore is not conducting acts which are likely to become a material violation of laws and regulations or work against the public interest in the future.

(1) The corporate group of an initial listing applicant is deemed to be able to properly manage corporate information of facts, etc. which will have a material impact on management and to disclose it to investors in a timely and appropriate manner. Moreover, its system for the preemptive prevention of insider trading is deemed to be developed and operated appropriately.

4. Appropriateness of (2) Documents pertaining to disclosure of corporate information, out disclosure of corporate of initial listing application documents, are deemed to be prepared details, etc. in compliance with laws, regulations, etc., and appropriately contain the matters enumerated in the following a. to c. and other The company is capable of matters in consideration of the state of the business line and the appropriately disclosing business condition of an initial listing applicant and its corporate corporate details, etc. group:

[Rule 216-8, Item 4 of the a. Useful matters for investment decisions of investors such as Regulations] technologies with growth potential, features of its business model, [III-3, 5 of Guidelines] business environment, schedule or state of progress until full business launch, analysis and explanation pertaining to the state of financial condition, management performance & receipt and disbursement of funds, the state of the related companies, the state of R&D activities, the state of major shareholders, the state of officers & employees, dividend policy, and purposes of funds raised for capital increase through a public offering concerning an initial listing applicant and its corporate group.

b. Matters that should be considered as risk factors for an initial listing applicant when investors make investment decisions, such as the small number of years in business operation, the state of the occurrence of cumulative losses or business losses, management dependence on a specific officer, the state of competition for business with other companies, uncertainties of markets and technologies, and the state of support for the purpose of the administration of business from a specific entity, etc., concerning an initial listing applicant. c. Matters enumerated in the following (a) to (d) with respect to matters which are the premises of the main business activities of the corporate group of an initial listing applicant: (a) Details of the matters which are the premises of the main business activities of the corporate group of an initial listing applicant (b) Where the validity period of permission and authorization, etc. and any other time limit is specified by laws and regulations or a contract, etc., such time limit (c) Where cancellation, rescission, and any other event of permission and authorization, etc. are stipulated by laws and regulations or a contract, etc., such fact (d) With regard to the matters which are the premises of the main business activities of the corporate group of an initial listing applicant, the effect that there is no factor which hinders their continuity, and if there is such factor, the effect that it will have a material impact on business activities

(3) An initial listing applicant is able to appropriately develop a medium-term management plan and hold briefings and other sessions for investors.

(4) The corporate group of an initial listing applicant does not make distorted information disclosure on the actual state of the corporate group of the initial listing applicant by carrying out a trading act with its relevant party or any other specific entity or adjusting share ownership ratios, etc.

(5) If an initial listing applicant owns a company which in effect holds a majority of voting rights, the disclosure on the company must be effective and meet either a. or b. below; provided that this will not apply to cases where the actual relationship between the initial listing applicant and its apparent

major shareholding company is thin and the shareholding by the majority shareholding company has been made for the fostering of investment and has not been made for substantially controlling the business activities of the initial listing applicant. a. Stock, etc. issued by the majority shareholding company of an initial listing applicant is listed on a domestic financial instruments exchange (including cases where a stock, etc. issued by such parent company, etc. is listed or continuously traded on such foreign financial instruments exchange, etc., and the state of disclosure on corporate affairs in a country in which such parent company, etc. or such foreign financial instruments exchange, etc. is located is not deemed to markedly lack investor protection). b. The listing applicant can appropriately grasp the facts, etc. concerning the majority shareholding company which may significantly affect its management and the applicant undertakes in writing that the majority shareholding company agrees to appropriately disclose to investors any information of its corporate information which may have significant effect on the management of the initial listing applicant.

(6) Where an initial listing company is a foreign company, the accounting system adopted by the initial listing company shall be deemed appropriate from the viewpoint of investor protection.

(7) Where an initial listing company is a foreign company, the stock, etc. pertaining to such initial listing applicant is not listed or continuously traded on a foreign financial instruments exchange, etc. and the initial listing application is made only to the Exchange, the "Securities Report for Initial Listing Application (Part I)" shall contain matters enumerated in the following a. and b.: a. Matters enumerated in the following (a) and (b) for the period from the day that falls one year prior to the end of the first business year immediately before the initial listing application date to the day immediately prior to the listing date: (a) The state of new stock issuance, or issuance of subscription warrants or bonds with subscription warrants by a method other than allocation to shareholders (b) The state of change in the ownership of the shares pertaining to the stock, etc. held by a party having special interests, etc. b. Where a holder of a stock, a subscription warrant or a bond with

subscription warrants security has made an arrangement concerning the holding of such securities for a certain period after listing with an initial listing applicant or with a financial instruments business operator which enters into the principal underwriting agreement with an initial listing applicant, details of such arrangement.

(1) The details of the rights of shareholders or holders of foreign stock depositary receipts, etc. and the state of their exercise are not unfairly restricted.

(2) The corporate group of an initial listing applicant does not have an ongoing lawsuit or dispute, etc. which would have a material impact on management activities or business performance.

(3) Where the domestic stock, etc. pertaining to an initial listing application is shares without voting rights or shares with a small number of voting rights, all of the following a. to f. shall be met:

a. If a company is controlled with an extremely small ratio of equity contribution, a scheme of shares without voting rights or a small 5. Other matters deemed number of voting rights is expected to be dissolved. necessary by TSE from the viewpoint of the public b. Where conflicts of interest arise between shareholders of different interest or investor classes, protection measures are deemed to be able to be taken so protection. that shareholders of the domestic stock, etc. pertaining to such

initial listing application are not unreasonably damaged. [Rule 216-8, Item 5 of the

Regulations] c. Where the issuer of the domestic stock, etc. pertaining to such [III-3, 6 of Guidelines] initial listing application carries out a transaction with an entity enumerated in the following (a) to (c) (including transactions, out of transactions carried out between an entity enumerated in the following (a) to (c) and such issuer on behalf of a third party and those between such issuer and a third party, where an entity enumerated in the following (a) to (c) has a material impact on such issuer concerning such transactions), it is deemed that protection measures for minority shareholders are expected to be able to be taken: (a) A parent company (b) The controlling shareholders (excluding a parent company) and their close relatives (c) The company, etc. in the preceding (b) that holds the majority of the voting rights on its own account and a subsidiary of such company, etc.

d. Where the domestic stock, etc. pertaining to such initial listing application is shares with a small number of voting rights, shares with a large number of voting rights shall be converted to shares with a small number of voting rights, when transfer, etc. of such shares is carried out. e. Where the domestic stock, etc. pertaining to such initial listing application has preferential contents concerning dividends from retained earnings, estimated income for two (2) years after the end of the business year immediately prior to the listing application date and a distributable amount as of the end of the business year immediately prior to the listing application date are, as a general rule, deemed to be good, and it is expected that the issuer of such domestic stock, etc. will record enough income to carry out dividends from retained earnings pertaining to such domestic stock, etc. f. The interests of shareholders and investors are deemed to be highly unlikely to be undermined.

(4) It is deemed appropriate from the viewpoint of the public interest or investor protection.

d. Documents to be Filed

(a) Documents to be filed at the time of conducting the initial listing application

Number Documents to be filed 1 Preliminary Application Form for initial listing of securities 2 Application form for initial listing of securities 3 Written Oath relating to initial listing application 4 Articles of Incorporation (including by-laws) 5 Statement certifying no ties with anti-social forces 6 Financial Statement of account for non-listed majority holding company, etc (Note 3) Written statement of assurance of parent company’s concerning cooperation regarding listing 7 examination, etc. of parent company (Note 3) Written statement of assurance of parent company’s concerning timely disclosure, 8 etc. of parent company (Note 3) 9 Statement describing matters concerning controlling shareholders 10 Minutes of the Meeting of the Board of Directors on initial listing application 11 A legal opinion 12 A copy of the document proving that the representative is a person with a legitimate authority Document certifying the deposit agreement concerning depositary receipts, etc. for the new 13 listing application (Note 4) A document certifying that the depository, etc. has agreed to the matters TSE deems necessary 14 for the new listing application (Note 4) Table of Change in Number of shareholders or of holders of Foreign Stock Depositary Receipts, 15 etc. (Note 5) A document certifying that the agent, etc. has been appointed or given informal consent to 16 accept the appointment 17 Materials concerning the value of the stock pertaining to the initial listing application (Note 6) 18 Written Recommendation (by listing approval date) 19 Sponsor’s Letter of Confirmation Statement of specific considerations and focused matters during the process of instructions on 20 going public and underwriting examination 21 JASDAQ Listing Application Report 22 Materials concerning the value of the stock pertaining to the initial listing application (Note 7) 23 Securities Report for Initial Listing Application (Part I) 24 Written confirmation concerning timely disclosure, etc.

Audit Reports, Interim Audit Reports or Quarterly Review Reports （Excluding applicants 25 exempted under the clause in Rule 211, Paragraph 6 of the Rules) Summary Audit Reports, Summary Interim Audit Reports or Summary Quarterly Review Reports 26 (Excluding Applicants exempted under the clause in the Rule 211, Paragraph 6 of the Rules) 27 Preliminary Initial Listing Application Report （prepared by the applicant） 28 Preliminary Initial Listing Application Report （prepared by the managing trading participant） 29 Corporate Report（materials describing the applicant's business and operation) Materials sent to Shareholders and official publications (including the notice of the general 30 shareholders' meeting) regarding the General Shareholders' Meetings in the past two (2) years Documents (such as prospectuses) sent to shareholders regarding rights issue in the past two 31 (2) years or regarding most recent right issue in the past five (5) years where there is none in the past two (2) years A copy of the Annual Report sent to shareholders or holders of Foreign Stock Depositary 32 Receipts in the past one (1) year A copy of the Interim Report and Quarterly Reports sent to shareholders or holders of Foreign 33 Stock Depositary Receipts in the past one (1) year A copy of the Securities Report, Annual Report, Interim Report, Quarterly Reports and 34 Extraordinary Reports submitted to the Prime Minister etc. in the past one (1) year (Note 1) A copy of the Securities Registration Statement (including amendments thereto) submitted to 35 the Prime Minister etc. in the past one (1) year (Note 1) News releases and newspaper publications regarding earnings announcements, dividend, stock 36 split, rights issue, and other material information in the past one (1) year 37 Relevant laws pertaining to the incorporation of the applicant in the applicant's jurisdiction A set of documents submitted by the applicant to relevant authorities in relation to application 38 of tax refund The check sheet regarding the legal framework of accounting and audit in the home country 39 submitted to the Financial Services Agency of Japan 40 Sample of foreign stock certificates and etc. (to be attached stock sample list) 41 Written oath concerning matters relevant to the applicant Financial statements and supplementary statements about the business year that the company 42 has not made its consolidated financial statements and/or non-consolidated financial statements in last five years (copy) (Note 8) List of meetings of Board of Directors for the last two years and the year in which the 43 application is filed (Note 8) Minutes of meetings of Board of Directors for the latest year and the year in which the 44 application is filed (copy) (Note 8) List of meetings of Board of Company Auditors for the last two years and the year in which the 45 application is filed (Note 8) Minutes of meetings of Committee of Company Auditors for the latest and the year in which the 46 application is filed (copy) (Note 8) A series of company auditors’ (audit committee’s) audit materials ranging from the audit 47 planning and implementation to report, etc. for the latest year and application year (copy) (Note 8) Financial statements, business report or corporate tax return of related parties of the corporate 48 group of the applicant for each of the last two years (Note 8)

Monthly performance management data for the previous year and the year in which the 49 application is filed (copy) (Note 8) Annual budget plan and medium-term management plan and (the series of internal data used 50 for the preparation thereof) for the fiscal year in which the listing application is filed (copy) (Note 8) 51 Contract which is important for Material contracts for the management 52 Management organization chart and assignment plan as of listing date (Note 8) 53 Catalogs and pamphlets for products, goods, and services, etc. (Note 8) 54 Flow chart (related to procurement and sales procedures) (Note 8) Corporate Governance Report 55 (only for an initial listing applicant who makes an initial listing application of a domestic stock, etc. and a foreign stock, etc. for which TSE is a main market) JASDAQ Listing Application Report 15．(5) Materials were documenting the correspondence 56 described in the "management of timely disclosure materials, etc." (company regulation and manuals, etc.) A series of internal audit materials ranging from the audit planning and implementation to 57 report, etc. for the recent year and application year (copy) Financial statements, business reports or a document submitted by the applicant to relevant 58 authorities in relation to application of tax refund of each fiscal year in the last two years of related parties of the applicant company group. (Note 8) (Note 9)

(b) Documents to be filed after the initial listing application where necessary /applicable

Number Documents to be filed Quarterly Reports for Initial Listing Application where: (Note 1) (Note 2) ◆ The listing day falls anytime after three (3) months from the beginning of the business year containing the initial listing application day, the Quarterly Report for Initial Listing Application for the first quarter of said business year ◆ The listing day falls anytime after six (6) months from the beginning of the business year 59 containing the initial listing application day, the Quarterly Report for Initial Listing Application for the second quarter of said business year ◆ The listing day falls anytime after nine (9) months from the beginning of the business year containing the initial listing application day, the Quarterly Report for Initial Listing Application for the third quarter of said business year Notice of board meeting resolutions or General Shareholders' Meeting resolutions during the 60 period from the first day of the business year containing the initial listing application day to the listing day Reports of corporate information having significant impact on the business of the initial listing 61 applicant during the period from the first day of the business year containing the initial listing application day to the listing day A copy of the following documents submitted to the Prime Minister etc. during the period from the first day of the business year containing the initial listing application day to the listing day (Note 1) 62 ◆Securities Registration Statement （including amendment thereto）and document attached thereto ◆Notice of effectiveness of Securities Registration Statement ◆Securities notification (including amendment thereto) and document attached thereto Notification of Initial Listing Application Securities Report Amendment (at time of effect of 63 amended details)

Number Documents to be filed 64 Written Confirmation Regarding Compliance with Exchange Rules and Regulations 65 Listing Agreement 66 Articles of Incorporation (including by-laws) 67 Securities Report for Initial Listing Application (Part I) 68 Securities Report for Initial Listing Application (Part I) PDF version 69 A document describing the matters relating to a controlling shareholder, etc PDF version Financial Statement of account for non-listed majority holding company, etc PDF version (Note 70 3) The written document containing the effect that the representative of such initial listing 71 applicant is aware that the Securities Report for Initial Listing Application (Part I) and other documents do not contain any untrue statements 72 Calculation of the expected market capitalization Corporate Governance Report (PDF version) 73 (only for an initial listing applicant who makes an initial listing application of a domestic stock, etc. and a foreign stock, etc. for which TSE is a main market) 74 Quarterly Report of Initial Listing Application (Note 1) 75 Quarterly Report of Initial Listing Application PDF version (Note 1) 76 Corporate Brochure of Applicant 77 Drafted disclosures (matters concerning growth potential) as of listing date

(d) Documents to be filed by the applicant making a public offering, etc.

Number Documents to be filed 78 Expected Public Offering or Secondary Offering Plan 79 Securities Registration Statement and its accompanying documents (Note 1) Materials pertaining the determination of the assumed tentatively set price range 80 (accompanying documents of calculation of the expected market capitalization) 81 Press release of Notice of Provisional Conditions and the reasons for deciding them 82 Materials pertaining the determination of the tentatively set price range Amendment of Securities Registration Statement (after the determination of the tentatively set 83 price range) (Note 1) 84 Press release of Notice of the Determination of Offering Prices and the reasons, etc. therefor 85 Materials pertaining the determination of the assumed tentatively set price range Amendment of Securities Registration Statement (after the determination of offering price) 86 (Note 1) 87 Notice on effectiveness of Securities Registration Statement 88 Notice of execution of Public Offering or Secondary Offering 89 Notification of the revisions of the Security Initial Listing Application Form

Note 1: In cases of submission to the Prime Minister, etc. via electronic data processing for disclosure (refers to electronic data processing for disclosure as prescribed by Article 27-30-2 of the Financial Instruments and Exchange Act), the submission of such documents is not required. Note 2: The latest quarterly report is only required in the business year containing the initial listing application day. The applicant applying for a multiple listing need not submit the document. Note 3: The applicant only needs to submit the document when an applicant has a non-listed majority holding company. However, "Financial Statement of account for non-listed majority holding company, etc" and "Written statement of assurance of parent company’s concerning timely disclosure, etc. of parent company" are needed to submit, where none of the following is the case: (1) the shares issued by the parent company, etc. is listed on a financial instruments exchange in Japan (2) the shares issued by the parent company, etc. is listed or continuously traded on a foreign f inancial instruments exchange, etc. and it is not deemed that disclosure status of the parent company, etc. in its home country, etc. is seriously detrimental to investor protection. (3) the parent company, etc. is subject to ongoing disclosure (4) the parent company, etc. is subject to ongoing disclosure in its home country and such status is not deemed to be seriously detrimental to investor protection. Note 4: Only the applicant applying for a listing of Foreign Stock Depositary Receipts needs to submit the document. Note 5: Only the applicant applying for a multiple listing needs to submit the document. Note 6: Submission only required in cases of a company succeeding business due to a shareholder-directed split of a listed company, which conducts initial listing application prior to such shareholder-directed split. Note 7: In cases where the foreign stock, etc. pertaining to initial listing application is not listed or continuously traded on a domestic f inancial instruments exchange or foreign financial instruments exchange, etc., submission is only required when public offering or secondary offering will not be conducted for the foreign stock, etc. pertaining to initial listing application. Note 8: When the company did not make the documents or is too diff icult to made them due to a foreign company, please contact New Listings, Tokyo Stock Exchange. Note 9: Submission only required in cases where the applicant for “Growth Market”. Note 10: The applicant needs to submit documents pertaining a shelf registration, possession of a large volume of shares, and tender offer that it makes after the beginning of the business year containing the initial listing application day

(4) Listing Examination Schedule (Primary Listing)

The listing examination schedule of stock of foreign companies may vary dependent on the legal basis for foundation, accounting standards applied or whether the application relates to single or multiple listing. For reference, the following shows a typical listing schedule for foreign companies. The examination period for foreign companies may take three months from the acceptance of listing application. Actual examination will be carried out by JPX Regulation entrusted by TSE to do so.

Standard Examination Schedule (Foreign companies)3 , 4

3 The schedule shown here is a typical example and may be subject to change. 4 TSE shall examine the regulatory system of the home country of an applicant company in preliminary confirmation procedure. Note that, it may take longer time than the others when the applicant company is the first from its country to apply. Please refer to forms of "Confirmation Report prior to Initial Listing Application (for Applicant Company)" and "Confirmation Report prior to Initial Listing Application (for Trading Participant Handling Matters)" at A.

5. Listing Examination by TSE (Multiple Listing)

When a foreign company that is already listed on the market of its home country lists on TSE, it shall be treated as a multiple listing. Subset of the listing criteria of multiple listing are different from primary listing. The formal requirements and the eligibility requirements of each market are as follows.

In application of the rules and regulations of TSE to a foreign country or a foreign corporation where the foreign country or the foreign corporation is an issuer, etc. of a listed security, TSE shall take into account legal systems, practices and customs, etc. in such foreign country or the country, etc. of the foreign corporation. [Rule 7 of the Regulations]

(1) Main Markets (TSE 1st Section and 2nd Section)(Multiple Listing) a. Formal Requirements

The formal requirements for the purpose of multiple list ing are similar to those for the purpose of primary listing in many aspects. However the following criteria differ from those for primary listing. For the formal criteria for primary listing, please refer to Formal Criteria at section 6(1) a.

Requirements Item TSE 1st Section TSE 2nd Section Status of distribution of a A remarkably large number of shares is deemed not to be held by foreign stock, etc.5 specific shareholders or holders of a foreign stock depositary receipt, etc. [Rule 206, Paragraph 2, Item 1 of the Regulations]

Tradable shares (expected at listing)6

[Rule 206, Paragraph 2, Item 2 of the Regulations] The number of tradable shares : The number of tradable shares : [Rule 205, Item 2-a of the 20,000 units or more; and 4,000 units or more; and Regulations] [Rule 210, Item 2 of the Regulations] [Rule 210, Item 1-a of the Regulations]

5 Required for multiple listing. 6 The market capitalization of the tradable shares” and “The number of tradable shares (as a percentage of the total number of issued shares outstanding)”, which are required for primary listing, are not required for multiple listing.

b. Eligibility Requirements and Special Exceptions to Multiple Listing of Foreign Companies

The same eligibility requirements as those for primary listing will apply. For the requirements of eligibility requirements, please refer to sections 6(1) b.

Where an initial listing applicant is a foreign company, and the main market of a foreign stock, etc. issued by such initial listing applicant is other than TSE and, furthermore, where TSE deems it appropriate in light of listing of securities, timely disclosure of the issuer of listed securities, delisting, the state of the development and operation of the legal system and rules concerning listed securities in such main market, they shall be treated as appropriate for all or part of the examination. [II. 12 of the Guidelines]

In addition, “Special Exceptions to Multiple Listing Foreign Companies” is not for Mothers market or JASDAQ market but for Main Markets (TSE 1st Section and 2nd Section).

c. Documents to be Filed

The same documents as those for primary listing are required to be filed. For details, please refer to section 6(1)c.

(2) Mothers (Multiple Listing) a. Formal Requirements

The formal requirements for the purpose of multiple listing are similar to those for the purpose of primary listing in many aspects. However the following criteria differ from those for primary listing. For the formal criteria for primary listing, please refer to Formal Criteria at section 6 (2) a.

Item Requirements Tradable shares7 (expected at listing)

[Rule 213, Paragraph 2, Item 2 of The number of tradable shares : 2,000 units or more; and the Regulations] [Rule 212, Item 2-a of the Regulations]

b. Eligibility Requirements

The same eligibility requirements as those for primary listing will apply. For the requirements of eligibility requirements, please refer to section 6 (2) b.

c. Documents to be Filed

The same documents as those for primary listing are required to be filed. For details, please refer to section 6 (2) c.

7 “The market capitalization of the tradable shares” and “The number of tradable shares (as a percentage of the total number of issued shares outstanding)”, which are required for primary listing, are not required for multiple listing.

(3) JASDAQ Market (Multiple Listing) a. Formal Requirements (Standard and Growth Markets)

The formal requirements for the purpose of multiple listing are similar to those for the purpose of primary listing in many aspects. However the following criteria differ from those for primary listing. For the formal criteria for primary listing, please refer to Formal Criteria at section 6 (3) a.

Multiple listing Item Primary listing (Standard and Growth)

― Public offering or secondary offering at the higher of the number of shares described in the division mentioned below or 10% of the number of shares issued expected at the time of listing shall be implemented during the period from the listing application date to the previous day of the listing date. Implementation of public offering or (a) Trading unit comprising 1,000 shares: secondary offering one million shares (b) Trading unit comprising 500 shares: [Rule 216-4, Item 1-a of the 500,000 shares Regulations] (c) Trading unit comprising 100 shares: 100,000 shares (d) Trading unit comprising 50 shares: 50,000 shares (e) Trading unit comprising 10 shares: 10,000 shares (f) Trading unit comprising 1 shares: 1,000 shares

b. Eligibility Requirements (Standard and Growth Markets)

The same eligibility requirements as those for primary listing will apply. For the requirements of eligibility requirements, please refer to sections 6 (3) b and 6 (3) c.

c. Documents to be Filed

The same documents as those for primary listing are required to be filed. For details, please refer to section 6 (3) d.

(4) Listing Examination Schedule (Multiple Listing)

Listing schedules of foreign companies may vary dependent on their legal basis for their foundation and the accounting standards applied. For the listing schedule of foreign companies, please refer to section 6 (4).

6. Listing Examination by TSE (Alteration of Markets)

There are 4 markets which are First Section, Second Section, Mothers, JASDAQ and it is possible to alter the markets among these categories.

From Mothers to the 1st section Item On the basis of market capitalization On the basis of sales amount

1) Number of shareholders (by the 2,200 or more time of requirements)

a. Number of tradable shares: 20,000 units or more 2) Tradable shares (by b. Market capitalization of tradable shares: the time of ¥2,000 million or more requirements) c. Number of tradable shares: 35% or more of the total number of share of stock, etc.

The average monthly trading volume for each of the last three months and three 3) Trading volume － months preceding such recent three months be at least 200 trading units

4) Market Capitalization ¥ 25,000 million or more ¥4,000 million or more (by the time of requirements)

5) Number of An applicant has established its Board of Directors and continued its consecutive years of operation for three years or more. conducting business

6) Amount of net assets (by the time of ¥1,000 million or more (it must not be negative on a separate basis) requirements)

7) Amount of profit or market capitalization (for the amount of Either of a. or b. below is met. profit, consolidated a. The amount of profit for the last two years is ¥500 million or more. ordinary income, and b. The sales for the recent one year is ¥10,000million or more and the for the market market capitalization is expected to be ¥50,000 million or more. capitalization, the value expected by the time of requirements)

a. No false statements in a. No false statement is made in the securities Securities Reports for reports, etc. for each of business years which the year ended during ends during the last two years the last five years are identified.

b. The audit opinions on financial statements, etc. for each business years which ended during the last two years (excluding the b. An "unqualified business year ended during the recent one opinion" or a year) represent an "unqualified opinion" or a "qualified opinion with "qualified opinion with exceptions” exceptions” for the 8) False statement or c. The audit opinion on financial statements, etc. last five years adverse opinion, etc. for the business year ended during the recent one year represents “unqualified opinion”, in principle.

c. Either of (a) and (b) d. Either of (a) and (b) below is not met. below is not met.

(a) The internal management report for the business year ended during the last year contains the statement that “assessment results will be refrained from being expressed.” (b) The internal management audit report for the business year ended during the last year contains the statement that “no opinion will be expressed.”

9) Establishment of a Shareholder services have been entrusted to an institution designated by shareholder services TSE, or a consent of acceptance of the entrustment of such shareholder agent services from the shareholder services agent has been received.

10) Share unit (by the time of The Share Unit shall be expected to be 100 shares listing) An applicant has imposed no restrictions on the transfer of shares for which 11) Restriction on a listing application has been filed or is not expected to impose any transfer of shares restriction thereon by listing.

12) Handling by the Shares of stock for which a listing application is filed has been or expected designated book-entry to be handled by the designated book-entry transfer institution. transfer institution

An applicant does not meet either a or b below a. The applicant expects to effect a merger, company split-up, turning a 13) Expected company into a subsidiary or vice versa, or receipt or transfer of implementation of business on or after the listing application date and within the two merger, etc. years from the end of the previous year, and the applicant ceases to be a substantive surviving company through such transactions; and 78 b. The applicant expects to effect a merger in which the applicant will be

dissolved, or share exchange or transfer of shares which turns the applicant into a wholly owned subsidiary of another company within two years from the end of the previous year (excluding transactions expected to be implemented before the listing date)

The following summarizes the formal requirements for the alteration to the 1st section from JASDAQ.

Item From JASDAQ to the 1st section

1) Number of shareholders (by the 2,200 or more time of listing) a. Number of tradable shares: 20,000 units or more

2) Tradable shares (by b. Market capitalization of tradable shares: the time of listing) ¥1,000 million or more

c. Number of tradable shares: 35% of the total number of shares of stock, etc.

3) Trading volume －

4) Market Capitalization ¥ 25,000 million or more (by the time of listing)

5) Number of consecutive years of An applicant has established its Board of Directors and continued its conducting a business operation for three years or more. years

6) Amount of net assets (by the time of ¥1,000 million or more (it must not be negative on a separate basis) listing)

7) Amount of profit or market capitalization (for the amount of Either of a. or b. below is met. profit, consolidated a. The amount of profit for the last two years is ¥500 million or more. ordinary income, and b. The sales for the last year is ¥10,000million or more and the market for the market capitalization is expected to be ¥50,000 million or more. capitalization, the value expected by the time of listing)

a. No false statement is made in the securities reports, etc. for each of business years which end during the recent two years. b. The audit opinions on financial statements, etc. for each business years 8) False statement or which ended during the recent two years (excluding the business year adverse opinion, etc. which ends during the recent one year) represent an "unqualified opinion" or a "qualified opinion with exceptions” c. The audit opinion on financial statements, etc. for the business year which ends during the recent one year represents “unqualified opinion”,

in principle. d. Either of (a) and (b) below is not met. (a) The internal management report for the business year ended during the recent one year contains the statement that “assessment results will be refrained from being expressed.” (b) The internal management audit report for the business year ended during the recent one year contains the statement that “no opinion will be expressed.”

An applicant has imposed no restrictions on the transfer of shares for which 10) Restriction on a listing application has been filed or is not expected to impose any transfer of shares restriction thereon by listing.

11) Handling by the Shares of stock for which a listing application is filed has been or expected designated book-entry to be handled by the designated book-entry transfer institution. transfer institution

An applicant does not meet either a or b below a. The applicant expects to effect a merger, company split-up, turning a company into a subsidiary or vice versa, or receipt or transfer of business on or after the listing application date and within the two 12) Expected years from the end of the previous year, and the applicant ceases to implementation of be a substantive surviving company through such transactions; and merger, etc. b. The applicant expects to effect a merger in which the applicant will be dissolved, or share exchange or transfer of shares which turns the applicant into a wholly owned subsidiary of another company within two years from the end of the previous year (excluding transactions expected to be implemented before the listing date)

List of Substantive Requirements of Examination Standards Item Requirements

1. Corporate continuity and An applicant has carried out its business in a continuous manner profitability: and developed a revenue base to generate stable profit.

2. Soundness of company The applicant has been performing its business fairly and faithfully. management

3. Effectiveness of Corporate governance and internal management systems have corporate governance been designed and operated appropriately in consideration of its and internal size and the level of maturity management system

4. Appropriateness of disclosures of relevant The applicant is in a position to appropriately make the disclosures corporate profile, risk of corporate profile. information, etc.

5. Other matters as TSE deems necessary from the perspectives of the - public interest and protection of investors

7. Listing of JDR (1) What is JDR?

Japanese Depositary Receipt (JDR) is a beneficial interest in trust issuing beneficiary certificate whose trust assets are foreign stocks, etc., as defined in the Trust Act (Act No. 108 of 2006) provided in Rule 2, Paragraph 1, Item 14 of the Act. JDR is often called “Japanese ADR” or “Japanese GDR.” In the United States and Europe, the depositary receipt scheme has traditionally allowed foreign companies to list their stocks on US stock exchanges. In the United States, American Depositary Receipts or ADRs are issued and listed on a US stock exchange pursuant to the laws of the United States of America. In the United Kingdom, depositary receipts (Global Depositary Receipts or GDRs) are issued and listed on UK stock exchanges mainly under the laws of European jurisdictions. A depositary receipt represents a negotiable certificate issued by a depositary facility as a document evidencing the stocks (hereinafter, “underlying stock”) deposited at the depositary facility located in the home country in which the depositary receipt is issued, and it is listed as an alternative for the underlying stock. This listing of shares via depositary receipt scheme is an effective fund-raising mechanism for any foreign company whose underlying stock has difficulty or inconvenience in direct listing in a foreign market (e.g. when foreign investors are restricted from acquiring underlying stock of a company in the country, or when the governing laws in the country in which the underlying stock is issued do not allow the issuer to list the underlying stock in any foreign stock exchange). JDR is positioned as a Japanese version of depositary receipt. To be more precise, JDR is not a depositary receipt but a beneficiary certificate. In November 2007, TSE prepared listing rules for JDRs for foreign stocks, and made a partial revision to the rules in February 2008. JDR is defined as “a foreign stock trust beneficiary certificate” in the Rules (Rule 2, Item 10 of the Rules).

(2) JDR Issue Scheme

An example of JDR issue scheme is shown in the diagram below. The following procedures are expected.

(1) Foreign Company assigns the stock (underlying stock) to a Securities Company (Type I Financial Instruments Business Operator) which serves as Trustor (2) Securities Company (Trustor) entrusts the underlying stock to a Trust Bank serving as Trustee. (3) Trust Bank (Trustee) consigns the custody of the underlying stock to a Foreign Financial Institution (Custodian). (4) Trust Bank (Trustee) issues JDR for Trustor. (5) & (6) Securities Company (Trustor) performs an IPO via JDR, and investors pay the value. (7) After JDRs are listed on the TSE market, investors may buy and sell JDRs in the TSE market.

JDR Issue Scheme (Example)8

8 The above example indicates a basic scheme for JDR and does not exclude other schemes.

(3) Listing of Stock via JDR

When an issuer lists its stock on the TSE market via JDR scheme, the statutory disclosure under the Financial Instruments and Exchange Act (See section 10) and the procedures under the listing rules are almost the same as the case when listing the stock (underlying stock) directly on the TSE market. Therefore, the Foreign Company is required to implement the statutory disclosure as issuer and also to make a listing application to TSE as a listing applicant. In the case of JDR, the price of JDR is calculated instead of stocks because JDR is trading on the stock exchange.

Categories Price Stocks N/A（Almost same as JDR Price） JDR Calculated

(4) Handling of JDRs under the Formal Requirements

There is a table which shows the way to count of some requirements when JDR is selected. Dual Listing: Dual Listing: JDR(Single Listing) JDR(Japan)+Stocks(Foreign) Stocks(Japan)+Stock s (Foreign) Number of shareholders The number of JDR Holders The number of The number of JDR Holders (estimated as of (TSE) Stock Holders listing date) Tradable shares (estimated as of listing date) (1) Number of The number of The number of JDR tradable The number of JDR Stocks (TSE) shares (TSE+ Foreign) (2) Market The number of capitalization The number of JDR The number of JDR Stocks of tradable (TSE) (TSE+ Foreign) shares (3) Ratio of The number of tradable The number of JDR The number of JDR Stocks shares to listed (TSE) (TSE+ Foreign) shares Market Calculated based capitalization Calculated based on the Calculated based on the on the number of (estimated as of number of Stocks number of Stocks Stocks listing date)

(5) The way to calculate the Market capitalization

In the case of JDR, stocks the companies issued is deposited to the trust bank and the bank issue JDR instead of the stocks. As a result, there are two ways to count the Market capitalization as below.

Categories Based on issued stocks Based onJDR Calculation issued stocks times the price of JDR JDR times the price of JDR

8. Finance through Listing (Public Offering and Secondary Offering) (1) Procedure for Public Offering, etc. for Listing

Under TSE Rules, there are no special rules for foreign companies regarding the procedure of public offering or secondary offering on listing. In general, foreign companies are required to take the same procedures as Japanese companies. In addition, all the listing procedures in the past fifteen years have been performed via book-building.9, 10

(i) Book-building (Survey on investors' demand for public offering, etc. before listing that is conducted pursuant to TSE Rules). (ii) Public offering, etc. through competitive bidding (Public offering, etc. before listing that is conducted pursuant to TSE Rules) [Rule 233 of the Rules]

9 There have been no cases where Rule 233 of the Rules applied to foreign companies. Therefore, foreign companies are not solely subject to the above procedures. 10 As far as a company incorporated in Japan goes, when a company allocates shares for subscription through third party allotment, etc. on and after the date one year prior to the final date of the fiscal year immediately before the listing application date, both the listing applicant and the person who received the allocation of shares are required to submit a notice in writing to TSE with regard to the continued holding of the shares for subscription and the state of holding of the shares when transferred and inquired by TSE and also submit a commitment in writing to TSE to the effect that they will affirm public inspection on the above document and the description or any other matters TSE considers necessary. In cases where the listing applicant fails to submit the document to TSE, TSE will refuse the listing application or cancel the approval. In addition, TSE’s accreditation as to whether the shares for subscription are allocated or not will be made on the basis of the due date of payment or the final date of the payment period with respect to the shares for subscription.

(2) Finance Schedule on Listing (in the case of an Unlisted Company)

The chart below indicates a model schedule up to the listing of shares. As this schedule is only a model, the actual finance schedule (including pre-marketing period, book-building period, board of directors’ meeting for resolution of terms and conditions thereof, and timing of submission of Securities Registration Statement) may differ according to each applicant.

8. Statutory Disclosure

Statutory disclosure under the Financial Instruments and Exchange Act shall be classified into two categories of disclosures: Offering Disclosure, which is required at the time of offering securities; and Continuous Disclosure, which is required after offering or listing securities.

(1) Offering Disclosure a. Securities Registration Statement (a) Filing of Securities Registration Statement

In normal cases, IPOs (public offering and secondary offering) of shares of foreign stock are conducted in the Japanese market before listing. In this case, before the solicitation for subscription for sales of shares of foreign stock, the foreign company is required to file the Securities Registration Statement with the Kanto Finance Bureau as part of Offering Disclosure (stipulated in Article 4, Paragraph (1) of the Financial Instruments and Exchange Act). The form of the Securities Registration Statement, the matters to be described and required accompanying documents, etc. are defined by law (please refer to section 10 (1) a (c)). The Securities Registration Statement, other disclosure documents and the accompanying documents shall be filed and made available to the public via an electronic disclosure system called EDINET (Electronic Disclosure for Investors' NETwork), managed by the Financial Services Agency. Please keep in mind that the foreign company is required to appoint a standing proxy for the purpose of filing the Securities Registration Statement (stipulated in Article 7, Paragraph (1) of the Cabinet Office Ordinance on Disclosure of Information, etc.). In practice, Japanese law firms are usually appointed for that purpose, and such law firms in the capacity of standing proxy in Japan file the Securities Registration Statement on behalf of foreign issuers.

(b) Prohibition of Solicitation before the Notification of Securities Registration Statement and Transactions before the Effective Date

As stated above, as it is required to file the Securities Registration Statement with the Kanto Finance Bureau before the solicitation for subscription for sales of shares of foreign stock (Article 4, Paragraph (1) of the Financial Instruments and Exchange Act), such solicitation to Japanese investors (promotion etc.) is prohibited before the filing of the Securities Registration Statement. In addition, it shall not be allowed to have Japanese investors acquire any shares of foreign stock or sell any shares of foreign stock to Japanese investors before the Securities Registration Statement takes effect (Article 15 of the Financial Instruments and Exchange Act). The period required for the Securities Registration Statement to take effect (waiting period) is usually fifteen (15) days (stipulated in Article 8, Paragraph (1) of the same act).

However, pre-hearing which refers to a preliminary hearing conducted by an issuer and/or underwriters regarding the prospective of investors’ demand for the securities that plans to offer or sale in advance should not be deemed as solicitation of securities, together with targeting the Specified Investors (tokutei-toushika) or existing shareholders holding 5% or more of all the voting securities of the issuer and taking certain required measures (Consideration Points with respect to Disclosure of Corporate Affairs, etc. (the Disclosure Guidelines 2-12-2)).

Foreign companies are required to file Form 7 of the Securities Registration Statement (stipulated in Article 8, paragraph 1, item (4) of the Cabinet Office Ordinance on Disclosure of Information, etc.). Description items required in Form 7 are as follows:

Cover Page Part I Information Concerning Securities I Terms and Conditions of Primary Offering II Terms and Conditions of Secondary Offering III Special Description of Third Party Allotment IV Other Description Part II Corporate Information I Outline of the Legal and Other Systems in the Home Country II Outline of the Company III Description of Business IV Conditions of Facilities V Description of the Company VI Financial Conditions (*)This includes the financial statements for the recent two or three years. VII Trend of Foreign Exchange Rates VIII Summary of Issuer's Share Handling, etc. in Japan IV Reference Information of Issuer Part III Information on Guarantor, etc. (*)This is required for Guaranteed Bonds but is not required for Foreign Stock. Part IV Additional Information (*) Financial statements for the recent five fiscal years other than those listed in VI of Part II shall be posted; provided, however, that this does not applicable to cases where financial statements for the recent three fiscal years are posted in VI of Part II.

As stated above, foreign companies are required to include the financial statements for the recent three years in “Part IV Additional Information” of the Securities Registration

Statement. For details of accounting standards and audit certificates of the financial documents, please see section 10 (3). In addition, foreign companies are required to file the following documents as accompanying documents (Article 10, paragraph (1), item (4) of the Cabinet Office Ordinance on Disclosure of Information, etc.).

1) Articles of Incorporation 2) Minutes of the board of directors' meeting, etc. (any of the following: a copy of minutes of the board of directors’ meeting at which a resolution authorizing the issuance of the securities; a copy of minutes of the board of directors’ meet ing in the case where a resolution of the shareholders’ meeting; a copy of minutes of the shareholders’ meeting; or certificate evidencing a permission, approval or admission by the administrative agency regarding the issuance） 3) A certificate of authorization related to changes in the amount of capital (a written statement containing description sufficient to understand that the company obtained permission, authorization, or approval from administrative agencies in cases where such permission, authorization, or approval from administrative agencies is required for changing the amount of capital of the company) 4) Trust agreement or other major contract (in case of JDR) 5) Certificate of incumbency (a written statement that proves that the representative of a foreign company submitting such Securities Registration Statement is a person who has legitimate authority regarding the registration of such offering or secondary offering of the securities) 6) Power of attorney (a written statement that proves that such foreign company granted the authority to represent the company for all acts regarding the registration of such offering or secondary offering of securities to a party domiciled in Japan.) 7) Written legal opinion by a legal expert (certifying that the public offering or secondary offering is legitimate and the statement contained in the Securities Registration Statement is correct and accurate) 8) Certificate of authorization pursuant to the Foreign Exchange and Foreign Trade Act (a written statement that proves that such foreign company obtained such permission in cases where it is necessary pursuant to Article 21, Paragraph 1 or 2 of the Foreign Exchange and Foreign Trade Act) 9) A copy of the principal underwriting agreement (a copy of the principal underwriting agreement that was concluded between such foreign company and a financial instruments business operator)

b. Obligation of Preparation and Delivery of Prospectus

An issuer who has filed the Securities Registration Statement shall prepare Prospectus (stipulated in Article 13, paragraph (1) of the Cabinet Office Ordinance on Disclosure of Information, etc.) and subsequently (or at the same time) deliver Prospectus to investors (stipulated in Article 15, paragraph (2) of the Cabinet Office Ordinance on Disclosure of Information, etc.)

Description items required to be included in Prospectus are almost the same as shown above in the Securities Registration Statement. Therefore, in practice, the Securities Registration Statement as amended to some extent could be used and delivered as the Prospectus.

(2) Continuous Disclosure

After listing, foreign companies are required to file Annual Securities Reports, Internal Control Reports, Quarterly Securities Reports and Extraordinary Reports as part of Continuous Disclosure. These disclosure documents and the accompanying documents shall be filed and disclosed via EDINET consistent with the Securities Registration Statement. In addition, the practical submission of the documents will be made by a standing proxy in Japan, which is also the same with the Securities Registration Statement.

a. Annual Securities Report

Foreign companies whose shares of stock are listed on a Japanese stock exchange are required to file Annual Securities Report to the Kanto Finance Bureau within six (6) month after the end of each fiscal year (stipulated in Article 24, paragraph (1) of the Financial Instruments and Exchange Act , Article 3-4 of the Order for Enforcement of the Financial Instruments and Exchange Act). However, foreign companies shall be allowed to extend the deadline for submission of Annual Securities Reports by obtaining approval of the FSA Commissioner in cases where it is deemed that they are unable to submit the reports by the deadline due to unavoidable reasons such as the laws and regulations or practices in their home country (stipulated in Article 24, paragraph (1) of the Financial Instruments and Exchange Act, Article 3-4 of the Order for Enforcement of the Financial Instruments and Exchange Act, Article 15-2-2 of the Cabinet Office Ordinance on Disclosure of Corporate Information, etc.). Foreign companies are required to file Form 8 of Annual Securities Report (stipulated in Article 15, Paragraph 2, Item a. of the Cabinet Office Ordinance on Disclosure of Information, etc.). Description items required in Form 8 are almost the same as shown above in the Securities Registration Statement (Form 7). However, “Part I Information Concerning Securities” and “Part IV Additional Information” are not required in the Annual Securities Report. Foreign companies are required to include the financial documents for the most recent two (2) fiscal years (the financial documents for the most recent fiscal year, in the case where the financial documents for the most recent fiscal year include information equivalent to comparative information, prescribed in the Ordinance on Consolidated Financial Statements or the Ordinance on Financial Statements, etc., and the financial documents for the most recent two (2) fiscal years have already been disclosed in past submissions of Securities Registration Statements or Annual Securities Reports) in the Annual Report. For details of accounting standards applied to and audit certificate on the financial documents, please see section 10 (3). It is necessary to file the following documents as accompanying documents of the Annual Securities Report (stipulated in Article 17, Paragraph (1), Item (2) of the Cabinet Office Ordinance on Disclosure of Information, etc.).

1) Articles of Incorporation 2) Matters reported or resolved at ordinary general shareholders meeting (Annual Report,

etc.) 3) Copy of Trust agreement or other major contract (in case of JDR) 4) Certificate of incumbency (a written statement that proves that the representative of a foreign company described in the Annual Securities Report is a person who has legitimate authority regarding the submission of the Annual Securities Report) 5) Power of attorney (a written statement that proves that such foreign company granted the authority to represent the company for all acts regarding the submission of the Annual Securities Report to a party domiciled in Japan.) 6) Written legal opinion by legal expert (certifying that the statement as to legal matters contained in the Securities Registration Statement is correct and accurate) 7) (In cases where a foreign company submitted the Securities Registration Statement, etc. with respect to bonds issued and outstanding) Copy of any agreement by the foreign company and the other parties for the purpose that the foreign company will entrust the credit management or acts for other creditors, the act for itself, or task for the act for itself, and copy of agreement on payment of the principal and interest.

b. Internal Control Report

Listed companies are required to submit an Internal Control Report each year, together with Annual Securities Report (stipulated in Article 24-4-1, Paragraph (1) of the Financial Instruments and Exchange Act). The Internal Control Report is a report which is made by the management for the purpose of validity assessment of the organization required to secure the reliability of financial reporting. In cases where a foreign issuer includes financial documents in the Annual Securities Report in the home country or a third country and where the Commissioner of the Financial Services Agency determines that such disclosure is appropriate in the light of the protection of investors, the foreign issuer may submit the Internal Control Report disclosed in the home country or third country to the Japanese authority as eligible Internal Control Report. (Stipulated in Article 24-4-4, Paragraph (1) of the Financial Instruments and Exchange Act; and Article 12 of the Cabinet Office Ordinance on Disclosure of Information, etc.). In fact, there are past cases where Internal Control Reports disclosed in the United States, Korea and Malaysia have been submitted in Japan. This Internal Control Report shall be audited by an auditing firm, etc., including the auditing firm which issued the notification to the Financial Services Agency (stipulated in Article 193-2, Paragraph (2) of the Financial Instruments and Exchange Act). In the case where a company submits its internal control report during the period of three years from the date on which the company became an issuer of listed securities, the company is exempted from an obligation to audit internal control reports (Stipulated in Article 193-2, Paragraph (2) of the Financial Instruments and Exchange Act; and Article 35-3 of the Order for Enforcement of the Financial Instruments and Exchange Act)11.

11 However, newly-listed companies that are deemed to exert a strong influence over the market or over society or over the economy (such as those with capital amounts of 10 million yen or more, or total liabilities of 100 billion yen or more) would not be subject to the exemption.

c. Quarterly Securities Report

Foreign listed companies are required to file Quarterly Securities Reports every three months (Article 24-4-7, Paragraph (1) of the Financial Instruments and Exchange Act). Therefore, Quarterly Securities Report shall consist of 1Q, 2Q, and 3Q securities reports. In addition, the deadline for the submission of the Quarterly Securities Report is within forty-five (45) days after the end of each quarterly period (Article 24-4-7, Paragraph (1) of the Financial Instruments and Exchange Act; and Article 4 -2-10, Paragraph 3 of the Order for Enforcement of the Financial Instruments and Exchange Act). However, foreign companies shall be allowed to extend the deadline for submission of Quarterly Securities Reports in cases where it is deemed that they are unable to submit the reports by the deadline due to unavoidable reasons such as the laws and regulations or practices in their home country (Article 24-4-7, Paragraph (1) of the Financial Instruments and Exchange Act; and Article 17-15-2, Paragraph (1) of the Cabinet Office Ordinance on Disclosure of Corporate Information, etc.). Foreign issuers are required to file Form 9-3 of the Quarterly Securities Report (stipulated in Article 17-15, Paragraph (1), Item (2) of the Cabinet Office Ordinance on Disclosure of Information, etc.). Description items required in Form 9-3 are as follows:

Cover Page Part I Corporate Information I Outline of the Legal and Other Systems in the Home Country II Outline of the Company III Description of Business IV Description of the Company V Financial Conditions VI Trend of Foreign Exchange Rates Part II Information on Guarantor, etc. (*) This is required for Guaranteed Bonds and is not required for Foreign Stock.

Foreign companies are required to include quarterly financial statements in “V Financial Conditions” of “Part I Corporate Information” as listed in the above table in the quarterly reports. For details of accounting standards applied to and audit certificate on the financial documents, please see section 9 (3). Foreign companies are required to submit the following documents as accompanying documents to Quarterly Securities Report (Article 17-15, Paragraph 3 of the Cabinet Office Ordinance on Disclosure of Information, etc.). 1) Certificate of incumbency (a written statement that proves that the representative of a foreign company described in the Quarterly Securities Report is a person who has legitimate authority regarding the submission of the Quarterly Securities Report) 2) Power of attorney (a written statement that proves that such foreign company granted the authority to represent the company for all acts regarding the submission of the Quarterly Securities Report to a party domiciled in Japan.)

d. Confirmation Letter

Listed companies are required to submit to the Prime Minister a Confirmation Letter to the effect that they confirmed these documents are in compliance with the applicable laws and regulations (stipulated in Article 24-4-2 and Article 24-4-8 of the Financial Instruments and Exchange Act). If a listing company has a Chief Financial Officer, the Confirmation Letter requires a signature of the Chief Financial Officer as well as the Representative Director (Stipulated in Article 17-10, Paragraph 1, Item (1) of the Cabinet Office Ordinance on Disclosure of Information, etc.; Form 9-2).

e. Extraordinary Report

Listed companies are required to file an Extraordinary Report without delay when a significant event exceeding prescribed criteria occurs (Article 24- 5, Paragraph (4) of the Financial Instruments and Exchange Act). Main events that are required for the submission of the Extraordinary Report are as listed below; provided, however, that the submission of the Extraordinary Report is not required in the case of minor events which do not meet certain conditions (Article 19 of the Cabinet Office Ordinance on Disclosure of Information, etc.).

[Non-Consolidated Basis]

1) Public Offering or Secondary Offering of Securities in Foreign Market

2) Issuance of Privately Placed Securities

3) Issuance of Stock Options Not Required for Notification

4) Change in Parent Company or Specified Subsidiaries

5) Change in Major Shareholders

6) Occurrence of Significant Disaster

7) Filing or Settlement of Lawsuit

8) Determination of Stock Swap, Stock Transfer, Absorption-type Company Split,

Incorporation-type Company Split , or Consolidation-type Merger

9) Determination of Transfer or Acquisition of Key Business

10) Change of President or Representative Director

11) Commencement of Bankruptcy Proceedings, etc.

12) Occurrence of Large Uncollectible Claims

13) Occurrence of Event Significant Adverse Effect on Financial Condition and Results of

Operations

14) Occurrence or Change of Initial Public Offering Information

[Consolidated Basis]

1) Occurrence of Significant Disaster at Consolidated Subsidiary

2) Filing or Settlement of Lawsuit at Consolidated Subsidiary

3) Determination of Stock Swap, Stock Transfer, Absorption-type Company Split,

Incorporation-type Company Split , or Consolidation-type Merger at Consolidated

Subsidiary

4) Determination of Transfer or Acquisition of Key Business at Consolidated Subsidiary

5) Commencement of Bankruptcy Proceedings, etc. at Consolidated Subsidiary

6) Occurrence of Large Uncollectible Claims at Consolidated Subsidiary

7) Occurrence of Event Significant Adverse Effect on Financial Condition and Results of

Operations at Consolidated Subsidiary

(3) Accounting Standards Applied to and Audit Certificate on Financial Documents a. Accounting Standards

As stated above, foreign companies are required to include their financial statements in Securities Registration Statement, Annual Securities Report and Quarterly Securities Report. In the same way as Japanese companies, foreign companies may adopt US GAAP 12 or J-GAAP in consolidated financial statements (or non-consolidated financial statements if the company does not submit consolidated financial statements) if they satisfy certain requirements. However, in cases where the Commissioner of the Fin ancial Services Agency determines that such financial statements are appropriate in light of the public interest or the investor protection, the foreign issuer may use the financial statements as disclosed in the home country or another country. (Rule 131, Paragraph (1) & (2) of the Regulations for Financial Documents; Article 85, Paragraph (1) & (2) of Quarterly Regulations for Financial documents) Approval by the Commissioner of the Financial Services Agency will be made on a case-by-case basis. However, in cases where a foreign company submits financial statements that were approved by the Commissioner of the Financial Services Agency in the past, the procedure to obtain approval could be simplified. The accounting standards approved by the Commissioner of the Financial Services Agency in the past are as given below. Therefore, in case of initial public offering, an foreign company is required to confirm whether the type of financial document disclosed by the company in the home country or another country has been approved by the Commissioner of the Financial Services Agency in the past or not.

12 For a company registered with the US Securities and Exchange Commission (“SEC”) that prepares consolidated financial statements in accordance with the terminology, forms, and preparation methods for issuance, etc. of American depositary receipts as required by SEC, it may apply said terminology, forms, and preparation methods in the submission of such consolidated financial statements as statutory filings if the Commissioner of the Financial Services Agency deems them to be sufficient in terms of the public interest and investor protection. However, this shall exclude items on which the Commissioner of the Financial Serv ices Agency has deemed necessary to provide instruction. (Article 95 of the Ordinance on Consolidated Financial Statements)

・International Financial Reporting Standards (IFRS) ・Accounting principles generally accepted in the United States of America ・Accounting principles generally accepted in Canada ・Accounting principles generally accepted in Mexico ・Accounting principles generally accepted in the United Kingdom ・Accounting principles generally accepted in Ireland ・Accounting principles generally accepted in Germany ・Accounting principles generally accepted in France ・Accounting principles generally accepted in Holland ・Accounting principles generally accepted in Spain ・Accounting principles generally accepted in Italia ・Accounting principles generally accepted in Switzerland ・Accounting principles generally accepted in Luxembourg ・Accounting principles generally accepted in Sweden ・Accounting principles generally accepted in Finland ・Accounting principles generally accepted in Norway ・Accounting principles generally accepted in Korea ・Accounting principles generally accepted in Hong Kong ・Accounting principles generally accepted in Taiwan ・Accounting principles generally accepted in Australia ・Accounting principles generally accepted in Singapore ・Accounting principles generally accepted in Malaysia

b. Audit Certificate

In order to disclose financial statements in the Securities Registration Statement, Annual Securities Report, and Quarterly Securities Report, it is necessary to obtain an audit certificate issued by a certified public accountant or audit firm (Article 193-2, Paragraph 1 (body text) of the Financial Instruments and Exchange Act; Article 1, Paragraph 1 and 7 of the Cabinet Office Ordinance on Audit Certification of Financial Statements, etc.). However, in case s of foreign companies, it is generally considered that an audit certificate or equivalent to that issued by a foreign audit firm, etc. is deemed as eligible, as long as it is consistent with the audit certificate in Japan (stipulated in Article 193-2, Paragraph (1), Item (1) of the Financial Instruments and Exchange Act; Rule 35, Paragraph (2), Item (4) of the Order for Enforcement of the Financial Instruments and Exchange Act; Article 1-2 of the Cabinet Office Ordinance on Audit Certification of Financial Statements, etc.). Therefore, practically, foreign companies may usually use audit certificates abroad (in other words, do not obtain new audit certificates issued by a Japanese certified public accountant or auditing firm in Japan). However, in this case, please keep in mind that it is necessary to file a prior notification to the Financial Services Agency in order to be approved as “eligible foreign audit firm, etc.” (Article 193-2, Paragraph (1), Item (1) of the Financial Instruments and Exchange Act; and Rule 1-3, Paragraph (7) and Article 34-35, Paragraph (1) of the Certified Public Accountants Act). On the other hand, it is not required to provide audit certificates on quarterly financial

statements that are disclosed in Quarterly Securities Report. However, in cases where such quarterly financial statements are reviewed in home countries, some foreign companies disclose the results of the reviews in Japan at their own discretion.

(4) English Language Disclosure System a. Outline

The English-Language Disclosure System is a system which allows foreign companies to submit English documents (limited to those which were actually disclosed in a foreign country pursuant to laws and regulations, including rules of a stock exchange or an equivalent institution, in the foreign country) in place of the Securities Registration Statement, Annual Securities Report and other disclosure documents that are required to be submitted under the Financial Instruments and Exchange Act Japanese documents, in cases where these English documents are deemed not to be inadequate in consideration of the public interest and investor protection in Japan. In cases where a foreign company submits these English documents (including those which are required as supplementary documents), such company shall be deemed to have submitted Securities Registration Statement, Annual Securities Report and other disclosure documents, with the same effect under the governing laws and regulations (Article 5, Paragraph 8 and Article 24, Paragraph 11 of the Financial Instruments and Exchange Act and others). The outline of the English Language Disclosure System will be discussed below. For further discussion, please see “Preparation Procedure of Foreign Company Annual Securities Reports, etc.” (1.5 version) as published on the website below. https://www.jpx.co.jp/english/equities/products/foreign/en-disclosure/index.html

b. Documents Eligible for the English-Language Disclosure

Among the documents that are eligible for the English-Language disclosure, the important items for foreign companies are as below:

Corresponding documents under the Type of the disclosure documents English-Language Disclosure System Securities Registration Statement (limited to Foreign Company Registration Statement those prepared in the regular method) and its and supplementary documents as well as their amendment statements amendment statements Foreign Company Annual Securities Report Annual Securities Report and its amendment and supplementary documents as well as their statements amendment statements Foreign Company Quarterly Securities Quarterly Securities Report and its Report and supplementary documents as well as amendment statements their amendment statements Foreign Company Confirmation Letter and Confirmation Letter and its amended supplementary documents as well as their Confirmation Letter amended Confirmation Letter Foreign Company Internal Control Report Internal Control Report and its amendment and supplementary documents as well as their statements amendment statements Extraordinary Report and its amendment Foreign Company Extraordinary Report and statements its amendment statements

100

c. Requirements for the English-Language Disclosure

For the use of the English-Language Disclosure System, the requirements specified in the followings in accordance with the classification of the documents listed in e ach item shall be met.

A. Foreign Company Registration Statement, Foreign Company Annual Securities Report, and Foreign Company Quarterly Securities Report, etc. (Article 5, Paragraph 6, Item 2 of the Financial Instruments and Exchange Act, and Article 9-6, Paragraph 1 of the Cabinet Office Ordinance on Disclosure of Information, etc.) 1) The document shall be prepared in English. 2) The documents were disclosed pursuant to the laws and regulations in the foreign country. 3) The documents shall be deemed not to be inadequate by the FSA Commissioner in consideration of the public interest and investor protection in Japan.

B. Foreign Company Internal Control Report and Foreign Company Confirmation Letter Only a foreign company which submitted a Foreign Company Annual Securities Report may submit a document containing matters required in the form of an Internal Control Report or Foreign Company Confirmation Letter are provided in English (Article 24-4-2, Paragraph 6 and Article 24-4-4, Paragraph 6 of the Financial Instruments and Exchange Act, etc.). Such company shall be allowed to submit either a newly prepared document or an existing document which was disclosed in a foreign country.

C. English Language Disclosure in lieu of Extraordinary Report In cases where a foreign company satisfies the requirements in the following requirements 1) and 2), it may submit a document in which matters required in the form of the Extraordinary Report are provided in English (Article 24-5, Paragraph 1 of the Financial Instruments and Exchange Act, and Article 19-2-2 of the Cabinet Office Ordinance on Disclosure of Information, etc.). Such company shall be allowed to submit either a newly prepared document or an existing document which was disclosed in a foreign country. 1) The reason for submission is provided in Japanese. 2) The document shall be deemed not to be inadequate by FSA Commissioner in consideration of the public interest and investor protection in Japan.

d. Supplementary Documents

For the purpose of English-Language Disclosure, foreign companies are required to submit the following supplementary documents (Article 5, Paragraph 7 of the Financial Instruments and Exchange Act, Article 9-7, Paragraphs 2 through 4, of the Cabinet Office Ordinance on Disclosure of Information, etc.). 1) Japanese Translation of Summary on Specific Items For example, with regards to Foreign Company Registration Statement, summary of transition of major management indicators, etc., outline of business and risks in

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business etc. are required to be translated into Japanese and attached as one of supplementary documents. 2) Non-described items falling under the items for which Japanese translation of a summary should be prepared. In cases where there is no description for items which are required to be included in each form corresponding to a Foreign Company Registration Statement, Foreign Company Annual Securities Report, and Foreign Company Quarterly Securities Report, etc., and such items fall under those for which a Japanese translation of a summary should be prepared (specifically, the items enumerated in the preceding 1)), documents which include such items in Japanese or English are required to be attached as supplementary documents. A Japanese translation of a summary must be attached in cases where these documents are prepared in English. 3) Non-described Items In cases where there is no description for items which are required to be included in each form equivalent to a Foreign Company Registration Statement, Foreign Company Annual Securities Report and Foreign Company Quarterly Securities Report, etc. (excluding the items specified in the above 2), documents which include such items in Japanese or English are required to be attached as one of the supplementary documents. 4) Comparison Table For the Foreign Company Registration Statement, etc. (excluding the Foreign Company Extraordinary Report), foreign companies are required to prepare a comparison table for items in each corresponding form and those in the Foreign Company Registration Statement, etc. (excluding the Foreign Company Extraordinary Report) to be submitted. 5) Certificate of Incumbency and Power of Attorney, etc.

e. Attachments

The following documents are required to be attached to a Foreign Company Registration Statement (Article 5, Paragraph 10 of the Financial Instruments and Exchange Act, and Article 10, paragraph 1, item 8 of the Cabinet Office Ordinance on Disclosure of Information, etc.). 1) Minutes of board of directors meetings, etc. (a copy of the minutes, etc. of board of directors meetings or general shareholders’ meeting in cases where the issuance of the securities is resolved at such board of directors meetings or general shareholders meeting, or a written statement that proves that the company was authorized by administrative agencies) 2) A certificate of authorization related to changes in the amount of capital (a written statement containing description sufficient to understand that the company obtained permission, authorization, or approval from administrative agencies in cases where such permission, authorization, or approval from the administrative agencies is required for changing the amount of capital of the company (including a designated corporation) due to the issuance of such securities) 3) Copies of the trust agreement and other important agreements (in the case of JDR)

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4) Written legal opinion by a legal expert (written legal opinion by a legal expert on the legality of such offering or secondary offering of securities) 5) Certificate of incumbency (a written statement that proves that the representative of a foreign company submitting such Securities Registration Statement is a person who has legitimate authority regarding the registration of such offering or secondary offering of the securities) 6) Power of attorney (a written statement that proves that such foreign company granted the authority to represent the company for all acts regarding the registration of such offering or secondary offering of securities to a party domiciled in Japan.) 7) Certificate of authorization pursuant to the Foreign Exchange and Foreign Trade Act (a written statement that proves that such foreign company obtained such permission in cases where it is necessary pursuant to Article 21, Paragraph 1 or 2 of the Foreign Exchange and Foreign Trade Act) 8) A copy of the principal underwriting agreement (a copy of the principal underwriting agreement that was concluded between such foreign company and a financial instruments business operator)

f. Submission Deadline

With regard to a Foreign Company Annual Securities Report that will be submitted in lieu of an Annual Securities Report, the foreign company is required to submit such report within four months after the end of its fiscal year (Article 24, Paragraph 10 of the Financial Instruments and Exchange Act; and Article 4-2-2 of the Order for Enforcement of the Financial Instruments and Exchange Act). Please note that the period is shorter compared to cases where a foreign company submits an Annual Securities Report. In contrast, a foreign company is allowed to submit an Annual Securities Report within six months after the end of its fiscal year taking into account the burden of translation into Japanese. In principle, foreign companies are required to submit other English-Language Disclosure documents by the same deadline as Japanese companies.

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10. Shareholder Services and Book-Entry Transfer Systems for

Foreign Stocks, etc.13 (1) Custody and Book-Entry Transfer Systems for Foreign Stocks, etc.

Foreign stocks are settled under the business regulations relating to the depository and book-entry transfers for foreign stocks, etc. of Japan Securities Depository Center, Inc. (JASDEC). In this system, securities companies and banks, etc. establish participant accounts in JASDEC and general investors establish customer accounts in securities companies or banks, etc. in accordance with the rules of JASDEC and TSE. Regular transactions of foreign stocks listed on the TSE market are settled, in the same way as domestic stocks, via book-entry transfer on the fourth business day counting from the trade day (T+3) based on the system for custody and book-entry transfer for foreign stocks, etc. of JASDEC. Please also visit JASDEC's website for description of custody and book-entry transfer system for foreign stocks, etc. (https://www.jasdec.com/system/foreign/) The physical certificates of foreign stocks are not brought into Japan but are held in custody in the foreign depository designated by JASDEC. The shareholdings of beneficial shareholders (customers who actually own the foreign stocks, etc.) are recorded in the relevant customer accounts.

(2) Dividend Payment

The foreign depository receives dividends from listed foreign companies on behalf of JASDEC and transfers the corresponding amount to the dividend-paying bank in Japan (trust bank or major retail bank). When the dividend-paying bank receives dividends, it distributes the dividends to the beneficial shareholders on the relevant lists of the beneficial shareholders according to the instructions from shareholder services agents (trust banks). These distributions of dividends are made by crediting the accounts designated by beneficial shareholders or sent in the form of postal money orders. Dividend payments are made in Japanese yen. As a general rule, conversion into Japanese yen is calculated using the Telegraphic Transfer Buying (TTB) rate on the day when the dividend-paying bank receives the dividends.

(3) Record Date of Shareholders Eligible for Dividend

In the case of registered stocks, the record date shall, as a general rule, be the same as that in the home market. For the most of bearer stocks, the record date on the TSE market shall be one business day prior to the dividend payment date in the home market. Dividends will be paid to the beneficial stockholders as of record date.

13 Please refer to the following TSE website regarding stock administration and clearing rules for foreign stocks. https://www.tse.or.jp/english/rules/clearing/clearing.html

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(4) Other Rights such as Subscription Warrants

In cases where subscription warrants are granted, if a beneficial shareholder wishes to subscribe for new shares and pays for them through a part icipant, JASDEC exercises the subscription warrants and receives the new shares which are then credited to the customer account of the beneficial shareholder. Such payment is generally made in Japanese yen. On the other hand, if a beneficial shareholder does not wish to subscribe for new shares or JASDEC determines that it is unable to exercise the rights taking into account factors such as the payment schedule in the home country, JASDEC collectively sells all such subscription warrants in the home market of the listed foreign company and pays sales proceeds to the beneficial shareholders via shareholder services agents. In addition, in the case of a stock listed only on the TSE market, if a corresponding subscription warrants market is opened at TSE, JASDEC will not collectively sell all subscription warrants and the beneficial shareholder may sell the subscription warrants in such market. New shares, which are allotted due to a stock split or gratis allotment, etc., shall be received by JASDEC and credited to the costumer account of the corresponding beneficial shareholder. However, JASDEC will sell fractional shares in the home market of the listed foreign company and pay sales proceeds to the relevant beneficial shareholders via shareholder services agents. Note that, if there is no market to sell the relevant rights, there may be no choice other than to abandon such rights.

(5) Exercise of Voting Rights at General Shareholders Meetings

Voting rights at general shareholders meetings are exercised by JASDEC in accordance with instructions issued by beneficial shareholders (submission of instruction for the proxy exercise of voting rights). If no instruction is issued by a beneficial shareholder, JASDEC will not exercise the corresponding voting right. In addition, in cases where the record date for a general shareholders meeting is set in the home country, the same date is set as record date in Japan. Documents such as notice of convening a general shareholders meeting and form for instruction for the proxy exercise of voting rights are sent to the beneficial shareholders as of the record date. Beneficial shareholders are able to exercise their voting rights referring to such documents. However, even though a record date is set, in cases where procedures, such as sending of notice of convening a general shareholders meeting to beneficial shareholder s, are deemed difficult due to the limited schedule, such beneficial shareholder will be required to perform procedures to exercise the voting right through the shareholder services agent within the period published by the company in the newspapers. In the case of a company which does not set a record date for the general shareholders meeting, a beneficial shareholder intending to exercise his/her voting right should perform the procedures within the period published by the company in newspapers.

For your information, TSE has defined “Framework Improvement to Facilitate Exercise of Voting Rights for Listed Foreign Companies” as a measure in line with the Code of Corporate Conduct. For details, please see section 12 (3) c (d).

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(6) Book-Entry Transfers from JASDEC to Securities Companies

Foreign stocks bought on the TSE market can be sold in any other market where the foreign company is listed. In this case, the shareholder will be able to sell his/her shares after transfer of custody under the custodian of JASDEC to that of a securities company, etc. is completed. In addition, in cases where TSE decides to delist a foreign stock, such stock will also be transferred from a foreign custodian of JASDEC to that of a securities company, etc.

Workflow of Shareholder Services and Dividend Payments

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(7) Handling under TSE Listing Administration Rules

Based on the shareholder services and book-entry transfer systems as discussed above, listed foreign companies shall assume the following obligations:

a. Selection of Agent and Entity Responsible for Handling Information in Japan

〔Selection of Agent of the Company in Japan〕 A listed foreign company is obliged to select a person as agent in Japan who has an address or residence in Japan and has the authority to deputize or represent such listed foreign company with respect to all acts in relation to TSE. The agent in Japan shall, in principle, be selected from amongst the officers and employees of the listed foreign company. However, if selection from such officers and employees is difficult, the agent shall be a person approved by TSE. [Rule 426 of the Regulations]

〔Listed Foreign Companies, etc. with a main market listing on TSE〕 It is assumed that a listed foreign company with a main market listing on TSE has a large number of shareholders in Japan. Therefore, in principle, such listed foreign company shall select a person responsible for handling of information amongst the directors, executive officers or equivalent senior persons residing in Japan and notify TSE of such person responsible for handling of information for the purpose of ensuring smooth communication and reporting in reply to inquiries from TSE. The person responsible for handling of information shall be not only in charge of liaison pertaining to reporting to TSE but also engaged in internal management of important corporate information and timely disclosure. In addition, the person responsible for handling of information may reside in a home country or countries other than Japan, as long as he/she can ensure smooth reporting structure with TSE. For details, please consult with TSE in advance. [Rule 417 of the Regulations]

b. Setting Up Offices for Handling Exercise, etc.

A listed foreign company who is an issuer of a listed convertible bond shall set up an exercise handling office or agency office for a subscription warrant pertaining to a listed convertible bond in Chuo-ku, Chiyoda-ku or Minato-ku in Tokyo or any of the places specified by TSE. [Rule 423 of the Regulations]

c. Ensuring Appropriate Shareholder Services and Dividend Payment Services

A listed foreign company shall ensure that shareholder services and dividend payment services for beneficial shareholders of foreign stocks, etc. will be carried out appropriately in each of the following items.

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A. Notice shall be made in Japanese as to measures taken by a listed foreign company (including depository facilities, etc. pertaining to listed foreign stock depositary receipts, etc., if the listed foreign company is an issuer of listed foreign stock depositary receipts, etc.) with respect to surplus dividends, granting of subscription warrants, and other rights or interests of shareholders. * The notice may be made by public notice in Japan (which shall be carried out in a manner similar to public notice carried out by an issuer of listed domestic stocks), by a method subject to the prior approval of TSE in which the notice is kept at an office of the shareholder services agent, or by other methods that are prescribed by TSE.

B. Notice shall be made in Japanese for Business Reports, such as Annual Securities Reports, Interim Securities Reports, and Quarterly Securities Reports (Quarterly Securities Reports may replace Interim Securities Reports). * These reports may be summarized or replaced by other reports pursuant to the provisions of TSE. However, when the listed foreign company does not provide such notice to the shareholders, these notices are not required. [Rule 425 of the Regulations]

d. Notification and Public Notice of Period or Date for Rights Allotment

Where a listed foreign company decides a period or a date to determine those who may exercise voting rights, those who receive dividends or allocation of a stock, or those who may exercise rights as shareholders (in cases of an issuer of a listed foreign stock depositary receipt, etc., where a depository, etc. pertaining to the listed foreign stock depository security, etc. decides a period or a date to determine entities who may exercise rights concerning such foreign depositary receipt, etc.), the listed foreign company shall notify TSE of such period or date two (2) weeks before such period or date (where the deadline of notification and public notice required in the home country, etc. of such listed foreign company is earlier than a day two (2) weeks prior to such period or date, prior to such deadline) and, in addition, shall make public notice in Japan; provided, however, that it may omit such public notice in the cases listed below:

A. Public notice of a period or date that is determined to fix the persons who are entitled to exercise the voting rights at a general shareholders meeting, if applicable; provided, however, that the documents necessary to exercise voting rights are delivered to beneficial shareholders before the date of said general shareholders meeting; B. Public notice of the period or date that has been determined in advance to fix the persons who are entitled to receive dividends, if applicable; C. Public notice of the period or date that is determined to fix the persons who are entitled to exercise rights, from amongst those that are impossible or extremely difficult to exercise in Japan, that are deemed by TSE to have particularly low economic value; and D. Public notice of matters that correspond to matters to be publicized through public notice, if such matters are disclosed in a manner prescribed by TSE. [Rule 430 of the Regulations]

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e. Notification of Decision Concerning Depositories, etc. Pertaining to Listed Foreign Stock Depositary Receipts, etc.

Where a dividend or a subscription warrant or any other right is given to a foreign stock pertaining to a right representing a listed foreign stock depositary receipt, etc., if a depositary, etc. pertaining to the listed foreign stock depositary receipt, etc. makes decision on how to deal with such right, etc. concerning such foreign stock depositary receipt, etc., the issuer shall immediately notify TSE thereof. [Rule 431 of the Regulations]

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11. Overview of Listed Company Compliance (1) Overview of Timely Disclosure System a. Significance of Timely Disclosure

A financial instruments market functions to contribute to the development of the national economy through the proper and efficient linking of asset management via securities by the public and stable, long-term fund-raising via the issue of securities by companies. In order for a market to fulfill this role, it is vital to maintain investors' confidence in the fairness and soundness of the market, as well as provide appropriate information on securities required for investment decisions. Rules for statutory disclosure (securities registration statement, securities report, quarterly financial reports, etc.) based on the Financial Instruments and Exchange Act as discussed in section 10 (Securities Registration Statement, Annual Securities Report, and Quarterly Securities Report, etc.) as well as rules for timely disclosure in financial instruments exchanges co-exist and serve the function of providing information required for investment decision-making. Timely disclosure rules are established pursuant to the rules of a financial instruments exchange for the purpose of providing investors with important corporate information from listed companies. These disclosures are characterized by their widespread and timely transmission to investors, through either the media or Timely Disclosure network (TDnet). Because of the large impact corporate information occurring minute-to-minute has on trading, timely disclosure is extremely vital to investors. Particularly, during this period of dynamic changes to the corporate environment where investors need access to accurate information, timely disclosure is becoming increasingly important as a quick, accurate, and fair means of providing the latest corporate information. Timely disclosure of corporate information should be initiated by each listed company responsible for the function. Therefore, each listed company is required to recognize the significance and importance of timely disclosure of corporate information and maintain a faithful stance to fulfill the disclosure, and at the same time, is required to prepare and improve its internal structure to carry out disclosure in a timely and appropriate manner. TSE prescribes requirements on timely disclosure about corporate information in the Securities Listing Regulations (hereinafter referred to as the "Regulations") and requires each listed company to disclose important corporate information, with the basic understanding that timely and appropriate disclosure of corporate information lies at the foundations of a sound financial instruments market.

b. Overview of the Rules Concerning Timely Disclosure of Corporate Information (a) Basic Principle Concerning Faithful Execution of Services

The Regulations stipulate the obligations of listed companies, including but not limited to strengthening prompt, accurate and fair disclosure of corporate information at all times from the viewpoint of investors with full recognition that timely and appropriate disclosure of corporate information to investors is the foundation of a sound financial instruments market. Each listed company is required to understand the meaning of this basic principle to the full extent, carry out faithful services and work on pro-active timely disclosure. [Rule 401 of the Regulations]

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(b) Maintenance of Timely Disclosure Structure

Appropriate and timely disclosure of important corporate information upholds an important role for investors as basic premise of self-responsibility in investments in the financial instruments market. Therefore, each listed company needs to conduct effective internal structure so as to fulfill appropriate information disclosure.

In preparing and improving a timely disclosure structure appropriately, the following three points are especially important:

A. Management of each listed company should indicate a clear stance and policy on the importance of corporate information disclosure in person in order to maintain and manage timely disclosure structure effectively, and also enlighten employees about the clear stance and policy. B. Clarifying key points to be accomplished for the purpose of conducting timely disclosure in an appropriate manner. C. Conducting monitoring of the timely disclosure structure by the internal audit division, director and company auditor (audit committee or similar bodies in the case of a company with committees) so as to manage and maintain the structure in appropriate manner.

Outline of a listed company's timely disclosure structure is included in the report containing matters concerning corporate governance, and this information is publicly -available on the TSE homepage (corporate governance information service), etc.

Corporate information required for timely disclosure includes information related to the company's business, operations, or performance which has a significant effect on securities investment decisions. The Regulations stipulate that a listed company is obliged to immediately disclose any items, excluding those falling under any of criteria items hav ing insignificant influence on investors’ decision-making as in the Rules (hereinafter, “De minimis Criteria”). Since a listed foreign company should pay careful attention that it is required to disclose any item in a timely manner, even though it is not clear whether it falls under the De minimis Criteria or not.

When applying the rules and regulations of TSE to a foreign country or a foreign corporation where the foreign country or the foreign corporation is an issuer, etc. of a listed security, TSE shall take into account legal systems, practices and customs, etc. in such foreign country or the country, etc. of the foreign corporation as well. [Rule 7 of the Regulations]

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〔Corporate Information Required for Timely Disclosure〕 i. Listed Company Information (i) Decisions by Listed Companies ・ Offering of issued shares, treasury shares to be disposed of, issued subscription warrants, or offering to entities who will subscribe to treasury subscription warrants to be disposed of, or a secondary offering of shares or subscription warrants ・ Shelf-registration or commencement of a demand survey ・ Decrease in amount of capital ・ Decrease in amount of capital reserve or profit reserve ・ Acquisition of own stock ・ Gratis allotment of shares or gratis allotment of subscription warrants ・ Shelf-registration concerning gratis allotment of subscription warrants or commencement of a demand survey or a survey on intention to exercise the warrants ・ Stock split or reverse stock split ・ Issue of stock options ・ Dividend from surplus ・ Stock swap, stock transfer, merger, demerger ・ Takeover bid or takeover bid for own shares ・ Announcement of opinions about a takeover bid, etc. ・ Transfer or acquisition of all or part of a business ・ Dissolution (excluding dissolution by means of merger) ・ Commercialization of a new product or new technology ・ Business alliance or dissolution of business alliance ・ Transfer or acquisition of shares or equity interest accompanied by a change in a subsidiary or other matters accompanied by a change in a subsidiary ・ Transfer or acquisition of fixed assets, lease of fixed assets ・ Suspension or abolition of all or part of a business ・ Application for delisting ・ Petition for commencement of bankruptcy proceedings, commencement of rehabilitation proceedings, or commencement of reorganization proceedings ・ Commencement of a new business ・ Change in representative directors or representative executive officers ・ Rationalization such as personnel reduction ・ Change in a trade name or a corporate name ・ Change in the number of shares for a share unit of a stock, or abolition/introduction of provisions for the number of shares for a share unit ・ Change in accounting period (change in the end date of the business year) ・ Petition to the Prime Minister stating an excess of liabilities or possibility of the halt of repayment of deposit, etc. (Petition pursuant to the provisions of Article 74, Paragraph 5 of the Deposit Insurance Act) ・ Petition for mediation in accordance with specified mediation procedures pursuant to the Act on Specified Mediation for Promoting Adjustment of Specified Liabilities, etc.

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・ Advanced redemption of a listed bond or convocation of a bondholders meeting and any other important matters related to rights pertaining to listed bonds ・ Change in certified public accountants, etc. ・ Putting notes on matters related to the going concern assumption ・ Submission of application for approval of deadline extension for submission of Annual Securities Report or Quarterly Securities Report ・ Cancellation of entrustment of shareholding services to a shareholding serv ice proxy institution ・ Submission of internal control reports containing content to the effect that there is a material deficiency or that the evaluation result cannot be stated ・ Amendment to the articles of incorporation ・ Acquisition of all classified stocks subject to whole acquisition clause ・ Approval or rejection of a special controlling shareholder’s request for sale of shares, etc. ・ Other important matters related to listed company operations, business, assets, or listed company stock certificates, etc.

(ii) Facts which Occurred for a Listed Company ・ Loss arising from a disaster or damage which occurs in the course of business execution ・ Change in major shareholders or the largest shareholder ・ Fact which causes delisting ・ Filing of a lawsuit or a court decision ・ Petition for a provisional disposition or decision on such petition, etc. ・ Cancellation of a license, suspension of a business or any other disciplinary action corresponding to these on the basis of laws and regulations by an administrative agency or accusation of violation of laws and regulations by an administrative agency ・ Change in a parent company, change in controlling shareholders (excluding a parent company) or change in other related company ・ Petition or notification for commencement of bankruptcy proceedings, commencement of rehabilitation proceedings, commencement of reorganization proceedings, or execution of enterprise mortgage ・ Dishonor of a bill or check or suspension of trading by a clearing house ・ Petition for commencement of bankruptcy proceedings, commencement of rehabilitation proceedings, commencement of reorganization proceedings, or execution of enterprise mortgage pertaining to a parent company, etc. ・ Default on obligations or delay in collection ・ Suspension of trade with a business partner ・ Financial support, such as exemption of obligations ・ Discovery of natural resources ・ Special controlling shareholder’s request for sale of shares, etc. ・ Claim for suspension of issue of stock or subscription warrants ・ Demand for convocation of a general shareholders meeting ・ Unrealized loss of securities held

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・ Acceleration of obligations pertaining to a corporate bond ・ Convocation of a meeting of bondholders for a listed bond, etc. and other important facts pertaining to rights of a listed bond, etc. ・ Change in certified public accountants, etc. ・ Delay in submission of Annual Securities Report or Quarterly Securities Report ・ Approval and etc. of deadline extension for submission of Annual Securities Report or Quarterly Securities Report ・ The fact that an audit report attached to financial statements, etc. contains an "adverse opinion", "opinions are not expressed", or a "qualified opinion" with making issues concerning a going concern assumption as exceptions ・ An internal control audit report contains an "adverse opinion" or the fact that "opinions are not expressed" ・ Receipt, etc. of a notice of canceling a shareholder services agent agreement ・ Other important matters related to operation, business or assets of such listed company or related to a listed stock certificates, etc.

(iii) Listed Company Earnings Information ・ Earnings Reports (Kessan Tanshin) ・ Quarterly Earnings Reports (Shihanki Kessan Tanshin)

(iv) Amendments, etc. to Performance Estimates or Dividend Estimates of Listed Company ・ Amendments to performance estimates, differences in estimates and earnings values ・ Dividend estimate or amendment to dividend estimate

(v) Other Information ・ Disclosure related to lowering the size of investment units ・ Disclosure of the status of membership in Financial Accounting Standards Foundation ・ Disclosure of status of conversion or exercise of MSCB, etc. ・ Disclosure of matters relating to controlling shareholder, etc. ・ Earnings information of unlisted parent company, etc. ・ Disclosure related to delisting, etc. ii．Information on Subsidiaries (i) Decisions by Subsidiaries ・ Stock swap, stock transfer, merger, demerger ・ A takeover bid or a takeover bid for own shares ・ Transfer or acquisition of all or part of a business ・ Dissolution (excluding dissolution by means of merger) ・ Commercialization of a new product or new technology ・ Business alliance or dissolution of business alliance ・ Transfer or acquisition of shares or equity interest accompanied by change in a sub-subsidiary, or other matters accompanied by change in a sub-subsidiary

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・ Transfer or acquisition of fixed assets, lease of fixed assets ・ Suspension or abolition of all or part of a business ・ Petition for commencement of bankruptcy proceedings, commencement of rehabilitation proceedings, or commencement of reorganization proceedings ・ Commencement of a new business ・ Change in trade name or corporate name ・ Petition to the Prime Minister stating an excess of liabilities or possibility of the halt of repayment of deposit, etc. (Petition pursuant to the provisions of Article 74, Paragraph 5 of the Deposit Insurance Act) ・ Petition for mediation in accordance with specified mediation procedures pursuant to the Act on Specified Mediation for Promoting Adjustment of Specified Liabilities, etc. ・ Other important matters related to operation, business or assets of a subsidiary of such listed company

(ii) Facts which Occurred for a Subsidiary ・ Loss arising from a disaster or damage which occurs in the course of business execution ・ Filing of a lawsuit or a court decision ・ Petition for a provisional disposition or decision on such petition, etc. ・ Cancellation of a license, suspension of a business or any other disciplinary action corresponding to these on the basis of laws and regulations by an administrative agency or accusation of violation of laws and regulations by an administrative agency ・ Petition or notification for commencement of bankruptcy proceedings, commencement of rehabilitation proceedings, commencement of reorganization proceedings, or execution of enterprise mortgage ・ Dishonor of a bill or check or suspension of trading by a clearing house ・ Petition for commencement of bankruptcy proceedings, commencement of rehabilitation proceedings, commencement of reorganization proceedings, or execution of enterprise mortgage pertaining to a sub-subsidiary ・ Default on obligations or delay in collection ・ Suspension of trade with a business partner ・ Financial support, such as exemption of obligations ・ Discovery of natural resources ・ Other important matters related to operation, business or assets of such subsidiary

(iii) Amendment, etc. to Performance Estimates of Subsidiary (Amendment to Performance Estimate of Subsidiary, Difference in Estimate and Earnings Values, etc.)

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〔Implementation of Timely and Appropriate Disclosure of Corporate Information〕

The provisions defined in the Regulations state the minimum requirements, methods, etc. that a listed company should observe with respect to timely disclosure of corporate information, etc., and a listed company shall not use the provisions of the same section as an excuse for failures to disclose corporate information in a more timely and appropriate manner. A listed company is urged to make a proactive timely disclosure of corporate information in any event that is assumed to have influence on investors’ decision making in the light of each individual situation of such event which occurred with the listed company. [Rule 411-2 of the Regulations]

For example, when an event falls under the following case examples, it is appropriate to regard that it is significant in the light of investment decision-making even though it may fall into the De minimis Criteria.

・ In cases where a decision or occurrence of a corporate event is expected to cause the listed company to turn business around or vice versa for and after the fiscal year to which the decision or occurrence of the corporate event belongs.

・ In cases where a decision or occurrence of a corporate event is expected to bring about a significant change in fundamentals of the listed company related to its management, operations and properties, including but not limited to a change in business organization or earnings structure thereof.

・ In cases where separate facts of decision or occurrence that fall under the same disclosure items are deemed to collectively have material impact on the listed company in light of continuity or connection on the whole, even though each of events does not fall under the criteria of corporate information required for timely disclosure (in the case that combination of separates events falls under the criteria of the corporate information required for timely disclosure).

(d) Disclosure Timing

Listed companies are obliged to disclose any important information immediately upon decision or occurrence pursuant to the Regulations. As for disclosure timing, listed companies are required to make a judgment based on actual conditions without heavily depending on any formal aspects, such as resolution of board of directors’ meeting. Concretely, any facts of decision made by a listed company shall be disclosed immediately upon resolution or decision by an organization body with substantial authorization to make a decision to perform operations of the company. On the other hand, any facts of occurrence to be caused by external factors shall be disclosed upon recognition of the occurrence.

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Given that quick disclosure to investors is required with respect to timely disclosure of corporate information, listed companies are required to disclose the information immediately upon occurrence, irrespective of trading hours.

(e) Matters to be Described in Disclosure Documents (Disclosure Matters)

It is extremely important to make a disclosure document that fully and accurately describes corporate information because timely disclosure is the basis for providing material for investors to properly understand the situation and make investment decisions.

The Enforcement Rules includes the following matters as requiring disclosure. (TSE may deem disclosure as inappropriate if it is found lacking in matters corresponding to the following.) a. Reason behind the decision by the listed company or how and why it was made b. Summary of decided facts and facts that occurred c. Future prospects related to decided facts and facts that occurred d. Other matters that are deemed by TSE to have material significance on investment decisions [Rule 402-2, Paragraph 1 of the Enforcement Rules]

A listed company is required to comply with following matters pertaining to timely disclosure of corporate information and shall pay careful attention in preparing disclosure documents.

・ The contents of the information to be disclosed do not contain false statements. ・ The information to be disclosed is not lacking information deemed to be significant to investment decisions. ・ The information will not cause misunderstanding regarding investment decisions. ・ The information is not found lacking in appropriateness in any other way. [Rule 412, Paragraph 1 of the Regulations]

* Even though this guide book only describes certain matters, this does not contradict the above points regarding whether disclosure is lacking in information deemed important for investment decisions and will not cause misunderstanding regarding investment decision. Whether it is material information for investment decisions or may cause misunderstanding in investment decisions are judged on a case-by-case basis.

(f) Examinations Pertaining to Disclosure of Corporate Information

JPX Regulation conducts examinations concerning disclosure of corporate information based on the Regulations when JPX Regulation deems it is necessary and appropriate for ensuring the adequacy of disclosure of company information. The examination is carried out for disclosure of material corporate information from the following points of v iew. In case where a disclosure document has any problem concerning the following points, such disclosure may be regarded as inappropriate.

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・ Whether or not the timing of disclosure is appropriate ・ Whether or not the details of disclosed information are false ・ Whether or not the disclosed information lacks information deemed important for investment decisions ・ Whether or not the disclosed information gives rise to misunderstandings for investment decisions ・ Whether or not the disclosure is lacking in appropriateness [Rule 412, Paragraph 2 of the Regulations, II of the Guidelines]

(g) Prior Explanation on Corporate Information before Disclosure of Corporate Information If a listed company decides, for the smooth implementation of timely disclosure of material corporate information, to disclose the corporate information based on the Rules 402 to 411 -2 and 416, the listed company is required to explain the contents of the disclosure to TSE before the corporate information is disclosed. [Rule 413, Paragraph 1 of the Regulations]

At TSE, each listed company has a TSE-side staff responsible for disclosure. When a listed company registers a disclosure document via TDnet, TSE will call the person responsible for disclosure at the listed company to ask for an explanation of the contents (generally within 30 minutes). Therefore, the person (not limited to the one responsible for handling information) should wait for a call from TSE.

(h) Matters to Note Concerning Publication of Corporate Information on Listed Company’s Own Website

When a listed company intends to save corporate information requiring timely disclosure in a public directory (meaning in folders on web servers, which are accessible to outsiders via the Internet), it is obliged to take necessary measures, including not saving it before the corporate information has been disclosed or, in the case the information is to be saved before disclosure is carried out, to implement access controls by setting a password, etc. so that outsiders would not be able to access the information easily. [Rule 413, Paragraph 2 of the Regulations]

Timely disclosure matters include information which falls under the "material facts" in the insider trading regulations. If outsiders can access the information easily before the scheduled disclosure time, they may use such information to carry out trading. As a result, that may significantly undermine the fairness of the financial instruments market. Therefore, a listed company is required to take appropriate measures. In addition, a listed company is encouraged to establish internal rules concerning the publication of corporate information on its own website. The rules should be made known throughout the company, and there should also be regular inspections on compliance.

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(i) Method of Disclosure of Corporate Information

Disclosure of corporate information shall be carried out using TDnet. [Rule 414 of the Regulations]

TDnet functions as an integrated electronic system jointly used by Japanese financial instruments exchanges for the purpose of achieving fairer, faster, and more extensive timely disclosure of corporate information. Specifically, on the day when performing a timely disclosure, listed companies are required to register disclosure documents via TDnet Online Registration System, make a reply to an inquiry from TSE and make a prior explanation to TSE. Later, at the specified disclosure time after completion of TSE disclosure process, the registered disclosure documents are transmitted to a lot of media institutions via TDnet. At the same time, it is also posted to the Timely Disclosure Information Browsing Service, a website created by TSE, and the corporate information is made available for public inspection on the browsing service.

* Posting documents to the Timely Disclosure Information Browsing Service constitutes one of the publication measures under insider trading regulations. By posting corporate information to this service, listed companies are able to execute the publication measures pertaining to material facts under insider trading regulations such as the fact concerning tender offers (limited to those (Tender Offer for Share Certificates, etc. by Issuer) pertaining to tender offer prescribed in Article 27-22-2, Paragraph 1 of the Financial Instruments and Exchange Act) simultaneously (Article 30 of the Order for Enforcement of the Financial Instruments and Exchange Act).

(j) Report and Disclosure on Inquiry Concerning Corporate Information

A listed company is required to make an accurate report on an inquiry matter immediately, in the case where TSE makes an inquiry on corporate information of a listed company where it deems necessary. In the case where TSE deems that it is necessary and appropriate to disclose a fact pertaining to the inquiry, a listed company shall disclose details immediately. [Rule 415 of the Regulations]

When a news report or rumor concerning a listed security or its issuer is circulated, or when TSE receives an accusation from an outside party, TSE may make an inquiry to the listed company about the authenticity of such circulated information, etc. The listed company is required to make an accurate report to TSE. If TSE deems it necessary and appropriate for the listed company to clarify the authenticity, TSE may request the listed company to disclose the details of report. In such a case, the listed company is obliged to carry out disclosure immediately. Listed companies are reminded that non-action on a request for disclosure by TSE may constitute a violation of the Regulations, furthermore, that it may hinder fair price formation in the financial instruments market and cause to investors to lose confidence in them.

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On the other hand, when a news report or rumor concerning a listed security or its issuer is circulated, TSE may issue an alert to inform investors. For details on the system for issuing alerts, please refer to “Outline of system for issuing alerts”.

(k) Cancellation, modification, or correction of disclosed information

A listed company is required to disclose "cancellation of or change in a disclosed matter" in the case of cancellations or changes of any material corporate information already disclosed, and "addition, correction, or explanation of timely disclosure materials" in the case of corrections. In the case where a change or correction should be made to a disclosed earnings report/quarterly earnings report, the listed company shall disclose details of such change or correction, for example, as "correction of earnings report." However, in the case where a listed company recognizes the need to change or correct the disclosed earnings information prior to the submission of the securities report/quarterly securities report, it shall be sufficient to carry out disclosure after submitting such report, except in cases where such changes or corrections may have a remarkable effect on investment decisions. [Rule 416 of the Regulations]

In addition, regarding voluntary disclosure that is not under the Regulations, but is carried out via TDnet based on a decision by the listed company, in the case where a change or correction should be made to the content of disclosed information, the listed company is also required to disclose the details of such change or correction.

(l) Notification of Person Responsible for Handling Information

A listed company is required to select a person responsible for handling information from among its directors or any other person of similar capacity, and notify TSE of such person. [Rule 417 of the Regulations]

A person responsible for handling information means a liaison for reporting in response to inquiries from TSE and other matters regarding the disclosure of corporate information. Specifically, the person is the point of contact for TSE, and will be in charge of managing material corporate information and carrying out disclosure. When a listed company changes its person responsible for handling information, or alters the contents (e.g. name, title, or contact information) of the notification, the listed company is required to notify TSE immediately. In the case where alteration of the person responsible for handling information is scheduled due to the re-election of board directors, etc., the listed company may notify TSE in advance, describing the expected date of alteration.

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c. Notes on Using TDnet

TDnet functions as an integrated electronic system jointly used by Japanese financial instruments exchanges for the purpose of achieving extensive corporate information which have influence on investment decisions. TDnet is developed and operated by TSE. Besides disclosure of corporate information to be carried out under the Regulations, a listed company is encouraged to voluntarily disclose corporate information that may be useful for investment decisions via TDnet from the point of view of disseminating information to investors. In this case, as the information is registered as "Timely Disclosure Information" via TDnet, such information will be disseminated to investors, directly through the "Corporate Announcement Disclosure Service" operated by TSE, and indirectly through the media and information vendors. In addition, TDnet is also available for the dissemination of corporate information that may not be useful for investment decisions to the media and information vendors. If such information is registered as "PR information, etc.," it is not posted to the "Corporate Announcement Disclosure Service" and is disseminated only to the media and information vendors. Due to the public purpose of TDnet, it is permitted to be connected to major media agencies and information vendors directly. As such, posting to TDnet is, at the same time, recognized as a "publication measure" under the insider trading regu lations. Due to this situation, listed companies are not permitted to register information that deviates from the intended purpose of publishing corporate information for investment decisions. This includes expressing opinions in cases where there are differences or conflicts of opinion with other parties. The basic policy regarding appropriate usage of "Timely Disclosure Information" and "PR information, etc." is as follows.

(a) Matters to be disclosed as "Timely Disclosure Information" A listed company is required to disclose its corporate information as "timely disclosure information" when the information is required to be disclosed under the Regulations. On the other hand, in the case where a fact is expected to have a certain effect on business performance, even though there is no disclosure obligation under the Regulations, or where company information briefing materials, monthly business performance reports, materials concerning corporate management policy are prepared, a listed company is encouraged to disclose such information as "timely disclosure information" because it is regarded as useful for investment decisions.

(Note) Disclosure of corporate information as "timely disclosure information" is recognized as disclosure for the purpose of providing information that is useful for investment decisions. Therefore, referring to the practical handling of each disclosure item, etc., a listed company shall take care to prepare disclosure material appropriately from the viewpoint of providing material for investment decisions by describing matters necessary for investors to understand and judge the fact appropriately.

(b) Matters to be disclosed as "PR information, etc." Regarding corporate information which may have little effect on business performance and usefulness in investment decisions, disclosure of such information is required to be carried out as "PR information, etc." instead of "timely disclosure information."

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(c) Scope of "Timely Disclosure Information" and "PR Information, etc." The scope for "Timely Disclosure Information" and "PR Information" is different in terms of posting to "Company Announcements Disclosure Service" as shown in the table below.

Timely Disclosure PR Information Information, etc. Post to Company Announcements Disclosure Yes No Service Display in Listed Company Search (Note 1) Yes Yes Distribute to News Agencies & Information Yes Yes Vendors TDnet Database Service Yes Yes (Note 1) Disclosure information is shown in the listed company search on the day after disclosure.

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d. Overview of Trading Halt System

TSE may halt trading of a listed security when TSE deems it necessary to do so from the perspective of ensuring fair price formation and investor protection. [Rule 29 of the Business Regulations]

(a) Reason for trading halt Where information on a certain security or issuer that may have a significant effect on investment decisions is revealed and details of such information are not clear and/or TSE deems it necessary to inform the public.

(b) Duration of trading halt i. In the case where a trading halt is implemented due to information that may have significant effect on investment decisions, such as a merger of a listed company, and was reported without official disclosure by the listed company, trading will resume, in principle, fifteen (15) minutes after disclosure regarding the authenticity of such information by the listed company. ii. In the case where a trading halt is implemented due to information that may have a significant effect on investment decisions, such as a merger concerning the listed company, and for which the listed company has carried out timely disclosure, trading will resume, in principle, fifteen (15) minutes after disclosure by the listed company. iii. In the case where such corporate information falls under a reason for designation as a Securities Under Supervision or Securities To Be Delisted, trading will resume as follows. - Designation as Securities Under Supervision: Fifteen (15) minutes after TSE announces the designation - Designation as Securities To Be Delisted: On the business day following TSE's announcement of the designation

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(c) In addition to the matters falling under a. above, the following matters shall also be subject to a trading halt. i. Where TSE deems that the state of trading is or is likely to be abnormal, or where TSE deems that continuing trading is not appropriate from the viewpoint of the management of trading ii. Where a malfunction occurs in the trading system, or where TSE deems that continuing trading is difficult due to a failure in the facilities of TSE pertaining to trading of a security, and other cases iii. Where TSE deems it necessary to inform the public that it may cancel a trade

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e. Outline of System for Issuing Alerts

TSE has a system for issuing alerts regarding information about securities or its issuers (hereinafter referred to as "system for issuing alerts") if it deems necessary to inform investors. In particular, TSE will issue an alert in the following situations where necessary: when unclear information (i.e., a leak or rumor) that is deemed likely to have material impact on investment decisions (hereinafter referred to as "unclear information") becomes available, when there are other circumstances regarding a security or its issuer deemed to require particular attention. [Rule 30 of the Business Regulations]

* The system for issuing alerts is not a penalty or measure to ensure the effectiveness of the Regulations. It is aimed at allowing TSE to promptly and flexibly issue alerts regarding uncle ar information in cases where time may be required before appropriate information disclosure can be made or where only certain information can be disclosed immediately. * Under the system, an alert is issued each time TSE deems it necessary and is not removed. As such, multiple alerts may be issued for a single case on the day when the unclear information becomes available, and alerts may be issued on subsequent days for the same unclear information. * Decisions on whether to issue an alert are made separately from decisions on whether to halt trading.

(a) Cases where alerts are issued Information "deemed likely to have material impact on investment decisions" includes, but is not limited to, information related to equity financing, mergers and/or acquisitions, earnings information that may lead to disclosure requirements for "adjustments to earnings forecasts or figures," bankruptcy or voluntary liquidation, and false statements. "Other circumstances regarding a security or its issuer deemed to require part icular attention" include, but are not limited to, when a listed company has not made disclosure regarding its decisions, events, earnings information, or adjustments to earnings forecasts or figures within a required period, or when TSE deems that a listed company has not clarified the content of the unclear information, which may, without clarification, mislead investors. As TSE issues an alert "if it deems necessary to inform investors," TSE would not always issue an alert when a situation falls under one of examples above.

(b) Means of issuing alerts Alerts will be issued by means including notices to trading participants, releases to the media, and posts on the TSE website.

(c) Daily disclosure of outstanding margin trading Where a stock, for which margin trading can be made, becomes subject to the alert as prescribed in Rule 30 of the Business Rules, TSE may publicize its outstanding margin transactions on a daily basis. [Rule 2, Item 1 of the Rules on Regulatory Measures Concerning Securities Trading, etc. or Its Brokerage]

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i. Subjecting an issue to daily disclosure Where a situation falls under 1. or 2. below, and, in addition, where TSE deems that the situation has a large impact on the price or trading volume of the relevant stock in the auction trading session, TSE may make daily disclosure of outstanding margin trading on the issue from the next business day. (i) A listed company has not made disclosure regarding its decisions, events, earnings information, or adjustments to earnings forecasts or figures within the required period. (ii) A listed company has not clarified the content of unclear information. Even if a listed company makes appropriate disclosure, depending on the time of disclosure, TSE may publish outstanding margin trading on the issue just for the next business day. ii. Removing the daily disclosure requirement For an issue subject to daily disclosure pursuant to (a) above, if the issue falls under any of the following cases, TSE may remove the daily disclosure requirement on the next business day. (i) Where the listed company makes appropriate disclosure (ii) Where the issue falls under the criteria for removal of the daily disclosure requirement specified in the guidelines concerning designation, etc. of daily disclosure issues (iii) Where TSE deems it appropriate to remove the daily disclosure requirement, including when an appropriate period of time has elapsed since the issue became subject to daily disclosure

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f. Disclosure to Clarify Content of Unclear Information

When TSE makes an inquiry on speculation in the media or a rumor in the public domain on a security or its issuer, the listed company is required to respond accurately. If TSE deems it necessary and appropriate for the listed company to clarify the content of speculation in the media or rumors, TSE may request the listed company to disclose the content of its response, in which case, the listed company will be required to make immediate disclosure. [Rule 415, Paragraphs 1 and 2 of the Regulations]

(a) Outline Disclosure requests will be made from the perspective of whether speculation in the media or rumors have material impact on investment decisions, regardless of whether the content of the response from the listed company falls under the de minimis criteria for timely disclosure. Where there is unclear information and the content of speculation in the media or rumors have factual basis, the listed company shall be required to make appropriate disclosure on the actual situation. If, on the other hand, the content is totally or partially untrue, it is required to deny or otherwise make appropriate disclosure. Even if the listed company provides comments on speculation in the media or rumors, for example "The company did not make such disclosure" is not appropriate as disclosure contents because this comment does not clarify the content of the unclear information or contribute to investment decisions. Listed companies are required to make as in-depth disclosure as possible. Referring back to the relationship between this and the system for issuing alerts, listed companies should note that inquiries and disclosure requests may not necessarily be made before an alert is issued. In particular, when unclear information becomes available during auction trading, TSE may issue an alert to investors before making an inquiry or disclosure request to the listed company. Listed companies are reminded that non-action on a disclosure request may constitute a violation of the Regulations. In addition, it would adversely affect price discovery in the financial instruments market and lead to a loss of investor confidence in the listed company. In particular, in order to avoid a situation where the company's relationship with a third party may prevent clarification, the company is advised, at the outset of negotiations regarding merger, acquisition, etc., to agree with the third party to disclose the status of negotiations in the case speculation in the media or a rumor on the progress of negotiation talks is disseminated. Furthermore, if the listed company had made disclosure to clarify the content of unclear information, it shall also disclose any subsequent significant developments or changes in the situation.

(b) Matters to note in the case where there is unclear information reg arding equity financing When there is unclear information regarding equity financing, TSE may make an inquiry to the listed company on the authenticity of such information or request the listed company to carry out disclosure to clarify the authenticity of such information. While a listed company should consider regulations on solicitation prior to registration under the Financial Instruments and Exchange Act when it would like to disseminate information on the equity financing prior to submitting security registration statement, 2-12 of the "Points of

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Attention Regarding Disclosure of Corporate Affairs, etc." provides that "disclosure which is carried out under the articles of association of the exchange or other rules" "does not fall under the category of Solicitation of Offers to Acquire or Solicitation of Offers to Buy." Therefore, it is understood that even if a listed company carries out detailed disclosure concerning the status of consideration on equity financing at TSE’s request, it does not breach the regulations on solicitation prior to registration. In the case where a listed company, in the so-called "comment" disclosure, makes detailed disclosure of the status of consideration regarding equity financing, it is encouraged to clarify that the disclosure material is not prepared for Solicitation of Offers to Acquire or Solicitation of Offers to Buy by, for example, adding explanatory notes to the text as follows.

(Example) Note: This document was not prepared for the purpose of soliciting acquisition or sale.

(c) Matters to note in the case where there is unclear information regard ing earnings/business performance When there is unclear information regarding earnings/business performance, TSE may also make an inquiry to a listed company on the authenticity of such information or request a listed company to carry out disclosure to clarify the authenticity of such information. TSE generally requests to carry out disclosure in accordance with the timely disclosure criteria for amendment of estimated value of business performance. In addition, TSE may also request to carry out disclosure on the facts, including the authenticity of information, in the case where there is a large difference between the unclear information and the actual situation or where TSE deems that the unclear information may have material effect on investment decisions based on the stock price or order trends. In the case where there is unclear information concerning quarterly earnings or business performance, if the annual business performance can be estimated from the content of such information, TSE may also request for disclosure on the facts, including the authenticity of the unclear information. As information regarding earnings is understood to be fixed through a series of processes, such as audits/review of accounts by accounting auditors and auditors (audit committee members), and account settlement operations at the listed company, etc., whether the listed company can carry out detailed disclosure regarding the unclear information at the time of its occurrence also depends on the circumstances. Therefore, when there is unclear information regarding earnings or business performance, the method of disclosure for clarify ing the authenticity of the unclear information may not be limited to the disclosure of a "comment." As disclosure concerning "adjustments to earnings forecasts" and the advancement of schedule for disclosure of earnings results, etc. may be available, please select an appropriate method, taking your company’s own circumstances into consideration.

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(2) Practical Guide for Timely Disclosure

When a listed company intends to carry out timely disclosure, it is required to go through the process of (i) considering the need for timely disclosure, (ii) confirming the timely disclosure schedule, etc., (iii) preparing the timely disclosure document, and (iv) carrying out timely disclosure. This chapter describes the matters to note concerning the above mentioned procedures. The general procedure for carrying out timely disclosure is as follows.

1. Considering the need for timely (i) To consider if the fact falls under any disclosure matter disclosure (ii) To consider if the fact falls under the "de minimis criteria" (iii) To consider if the fact falls under the basket clause (iv) To consider making voluntary disclosure 2. Confirming the schedule (i) To check the timing of disclosure (ii) To check the need and timing for prior consultation (iii) To check the need for any operations concerning timely disclosure (iv) To check the need for submission of statutory disclosure documents 3. Preparing disclosure document (i) To check "items to be disclosed" and "instruction for preparation of disclosure document" (ii) To prepare disclosure document using template document form, etc. (iii) To prepare PDF file for registration 4. Carrying out timely disclosure (i) To register disclosure document via TDnet (ii) To publish disclosure document in the "Company Announcement Disclosure Service" (iii) To disseminate information via other media * After a listed company carries out timely disclosure, it may be required to carry out disclosure regarding postponement/ change/ correction/ progress of the disclosed matter. * A listed company may be required to submit document(s) to TSE concerning timely disclosure.

a. Matters to Note regarding Need for Disclosure (a) Basic Principle Concerning Faithful Execution of Services When a listed company determines a matter related to operations, business or assets of said listed company or said listed stock, etc. which has material effect on investment decisions or such a matter occurs at the listed company, it may be required to carry out timely disclosure. When you determine such a matter or when such a matter occurs, please consider if the matter falls under any individual disclosure matter first. Each disclosure matter is prescribed in the Regulations.

* In the case where a fact falls under more than one disclosure matter It is possible that a fact falls under more than one disclosure matter, depending on the details of the fact of decision/occurrence. (For example, in the case where an allottee of a third-party share allotment accompanying a capital and business alliance becomes a major

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shareholder, a single action (the implementation of the capital and business alliance) will fall under three disclosure items, which are "offering to subscribe for new shares to be issued," "business alliance" and "change in major shareholders." Also, in the case where a listed company newly calculates estimated value in the current consolidated accounting year as a result of consideration of the degree of effect given to the account record, etc. caused by the fact of decision or occurrence, it may be required to carry out timely disclosure of the "adjustment to earnings forecasts, etc." In these cases, it is also required to consider if the fact falls under the de minimis criteria, etc. for the respective disclosure matter.

* In the case where delisting has been determined Even if a listed company is scheduled to be delisted, when it determines a fact which falls under a disclosure matter or when a fact which falls under a disclosure matter occurs, the listed company shall carry out timely disclosure.

(b) Considering whether a Fact Falls under the De Minimis Criteria De minimis criteria are set for many disclosure matters. If a fact falls under the de minimis criteria, in general, timely disclosure is not required. On the other hand, there is no "de minimis criteria" for some disclosure matters, such as corporate reorganization and mergers. A "de minimis criterion" may involve more than one requirement. (For example, the increase or decrease in sales is within a certain range, and the increase or decrease in net assets is within a certain range.) Only if a fact meets all of such requirements, the fact falls under the de minimis criteria and timely disclosure is not required. While many de minimis criteria are determined based on consolidated indicators, such as consolidated sales amount, the de minimis criteria quoted from such criteria in the insider trading regulations, in principle, are determined based on non-consolidated indicators, such as sales amount (non-consolidated basis). Therefore, when a listed company considers whether a fact falls under the de minimis criteria, it is necessary to confirm both of the consolidated indicators and non-consolidated indicators.

* Cases where “Net Profit Attributable to Shareholders of the Parent Company” should be read “Consolidated Net Profit” Because of the recent amendments to the “Ordinance on Terminology, Forms, and Preparation Methods of Consolidated Financial Statements”, which were in turn based on amendments to the “Accounting Standard for Business Combination”, data prev iously published under the category of “Net Profit” in consolidated financial statements prepared according to Japanese accounting standards are now required to be published under the category of “Net Profit Attributable to Shareholders of the Parent Company”. (This change applies to all consolidated financial statements for fiscal years starting on or after April 1st, 2015.) Based on this change, Rules have been revised so as to use “Net Profit Attributable to Shareholders of the Parent Company” instead of “Consolidated Net Profit” in the assessment of de minimis criteria. (The rev ision has been implemented as of April 1st, 2015.) In accordance with these amendments, “Guidebook for Timely Disclosure of Corporate Information” adopts the use of “Net Profit Attributable to Shareholders of the

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Parent Company” as the item to assess whether de minimis criteria are met. However, in cases such as when Consolidated Net Profit is being used to assess whether de minimis criteria are met in previous fiscal years, you should be aware that the “Net Profit Attributable to Shareholders of the Parent Company” should be substituted with the “Consolidated Net Profit” where applicable.

* In cases where it is not clear whether a fact falls under the de minimis criteria In cases where it is not clear whether a fact falls under the de minimis criteria, the fact should be considered to not fall under the de minimis criteria, and timely disclosure is required. For example, in the case where it is difficult to calculate the amount of impact on business performance caused by a fact of decision/fact of occurrence, timely disclosure shall be carried out, unless the estimated maximum amount of impact still falls under the de minimis criteria.

* In cases where a fact does not have material impact on business performance together with the estimated amount of impact caused by another factor Even if the aggregated amount of impact on business performance caused by a fact of decision/occurrence (Fact A) and such amount of impact caused by another fact (Fact B) falls under the de minimis criteria, timely disclosure shall be carried out if the estimated amount of impact caused by Fact A does not fall under the de minimis criteria.

* In cases where the effect caused by a fact has already been included in the estimated value of business performance Even if the impact caused by a fact has already been reflected in the estimated value of business performance, such a fact shall be disclosed if the estimated value of impact its elf does not fall under the de minimis criteria.

* In cases where a string of events involving more than one act is conducted In cases where a listed company conducts a string of events involving more than one act that falls under a specific fact of decision, even if each act falls under the de minimis criteria prescribed in the Regulations, it is necessary to determine whether the overall impact of the string of events falls under the de minimis criteria as far as it is deemed appropriate to regard these as a string of events based on their aims, intention, and economic value.

* In cases where the amount of profit is small TSE sets the disclosure criteria relating to the amount of profit for many disclosure matters. In the case where the estimated value of impact on profit is more than 30% of consolidated ordinary profit or net profit attributable to shareholders of the parent company recorded for the most recent consolidated accounting year, timely disclosure shall be carried out. In cases where the amount of profit is small, however, special provisions are available. The following cases fall under the special provisions. (i) Regarding the criteria on net profit attributable to shareholders of the parent company consolidated ordinary profit, in the case where the amount of consolidated ordinary profit for the most recent consolidated accounting year is less than 2% of the amount

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of sales for the most recent consolidated accounting year, and (ii) Regarding the criteria on net profit attributable to shareholders of the parent company, in the case where the amount of consolidated net pr1ofit for the most recent consolidated accounting year is less than 1% of the amount of sales for the most recent consolidated accounting year.

* In the case of irregular accounting period In the case of irregular accounting period accompanied by change in the settlement term (A settlement term becomes longer or shorter than 12 months), eligibility for the de minimis criteria is to be determined based on comparing the figures based on a 12-month period. For example, the calculation of the de minimis criteria for a 6-month settlement term is as follows.

Reference value for the case where the most recent accounting year (X-1 year) introduced irregular account settlement (6-month)

Net Profit Attributable to Consolidated Shareholders of the Net Sales (JPY) Parent Company (JPY) X-2 year (12-month) 150 billion 13 billion X-1 year (6-month) 80 billion 3 billion X-1 year (after conversion) 160 billion 6 billion Reference value for X year 160 billion 6 billion

* In the case where submission of extraordinary report is not necessary As matters for timely disclosure and requirement for timely disclosure do not always overlap with the grounds for submission of extraordinary report, it is possible that, even if the submission of extraordinary report is not required, timely disclosure shall still be carried out.

(c) Considering whether a Fact Falls under the Basket Clause In addition to individual disclosure matters prescribed in the Regulations, in the case where a listed company makes a decision regarding important matters related to operations, business or assets of such listed company or such listed stock, etc. wh ich have a material effect on investment decisions, or such matters occur, timely disclosure shall be carried out (so called the "basket clause"). Even if a fact (i) does not fall under any disclosure matter or (ii) falls under the de minimis criteria while it falls under a disclosure matter, it is possible that such a fact falls under the basket clause and timely disclosure shall be carried out. Therefore, when a listed company considers the need for timely disclosure, it is required to consider the eligib ility for the basket clause.

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(d) Considering Making Voluntary Disclosure Even if a listed company determines that timely disclosure is not necessary to be carried out as a result of considerations in (a) to (c) above, it is still encouraged to consider making disclosure on a voluntary basis from the point of v iew of timely and appropriate disclosure of corporate information. For example, if a listed company discloses corporate information in a foreign country in accordance with the laws, etc. of the country, it is desirable to make voluntary disclosure from the point of view of fair information provision. Even when voluntary disclosure is carried out, as far as the information is disclosed as "timely disclosure information," such information is regarded to be provided to investors as information useful for investment decisions. Therefore, in preparing disclosure documents, a listed company is required to pay attention in order to make appropriate disclosure from the point of view of providing information for investment decision with referring the "disclosure matter" and "notes in disclosure and writing" for disclosure matters, etc. Regarding the timing of disclosure, please carry out disclosure immediately after the decision is made or the fact occurs as timely disclosure is carried out. Also, after a listed company carries out voluntary disclosure, it is also required to make disclosure when the company decides not to execute the disclosed matter, or when it is necessary to change or correct the disclosed matter.

If you have questions about the need for disclosure, please contact TSE.

b. Matters to Note regarding the Disclosure Schedule (a) Confirming the Time of Disclosure (i) A practical way of thinking regarding the time of disclosure of fact of decisions In cases where a body that decides a listed company’s business execution makes a decision on carrying out a matter that falls under a material decision, the listed company shall carry out disclosure immediately according to the provisions of the Regulat ions and the Enforcement Rules. The actual time of disclosure about a decision shall not be constrained by formal aspects, such as a board meeting, and the time shall be determined according to the actual situation. In general, a listed company is required to carry out disclosure at the stage where the body that decides its business execution in practice effectively decides to carry out such matter. (A body that decides a listed company’s business execution does not always mean the body that has authority to make the ultimate decision according to the Companies Act.) In practice, regarding matters to be resolved at a general shareholders meeting and matters to be resolved at a board meeting, it is generally understood that timely disclosure is carried out immediately after the resolution at board meeting, and regarding the matters on which the president of the company has authority, it is also understood that timely disclosure is carried out immediately after the decision is made by the president. If it is clear that other bodies or executives decide such business execution in practice, however, timely disclosure shall be carried out when such resolution/decision is made. Regarding matters to be resolved at a general shareholders meeting, in general, it is necessary to carry out timely disclosure not after the general shareholders meeting reaches a resolution, but immediately after the board meeting resolves to make a proposal.

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Regarding the insider trading regulations, while a listed company is required to appropriately manage information that may fall under material facts based on past cases from the stage where a decision is made to start operations towards implementation (in some cases, prior to such stage), it is not always required to carry out timely disclosure immediately at this stage.

* In the case where a basic agreement, etc. is concluded Regarding organizational restructuring, such as merger, etc. and transfer of subsidiary, etc., there are cases where a Memorandum of Understanding (hereinafter referred to as "MOU") and/or Letter of Intent is concluded before a final contract is concluded. If these acts are practically decided by conclusion of these MOU, etc., timely disclosure is necessary to be carried out at this stage. For example, however, in the case where such conclusion of MOU, etc. means just a preliminary action, or a certain agreement to begin negotiations which may not necessarily lead to the final agreement, or in the case where the disclosure of such conclusion of MOU may cause the negotiations to collapse, timely disclosure may not be required. In addition, please note that the need for disclosure is not determined by whether the MOU is legally binding, or whether the ratio of the merger is described.

* In the case where administrative approval/permission is necessary Even if the execution or implementation of an act related to corporate information requires approval by the authority, in principal, timely disclosure is required to be carried out when the listed company decides to execute the act. In such a case, it is required to describe in the disclosure document that approval by authority is the condition for execution/implementation.

* In the case where resolution at the board meeting of the counterparty has yet to be made In the case where a listed company intends to conduct reorganization, etc. such as merger, etc., it is possible that resolution of board of directors meeting at the other party has not been completed at the time when the resolution of board of directors meeting at the listed company has already been made, due to the different dates for the board meeting at the listed company and the other party. Even if the resolution of the board meeting has not been made at the other party, the listed company shall carry out timely disclosure at the time when its decision making body reaches a resolution on the execution of the operation. Therefore, if a listed company intends to carry out timely disclosure at the same time as the resolution of the board meeting of the other party, both parties should coordinate on the schedule, taking timely disclosure into consideration.

(ii) A practical way of thinking about the timing of disclosure for occurred facts A listed company shall carry out timely disclosure when material corporate information occurs according to the provisions of the Regulations and the Enforcement Rules. The disclosure is to be carried out at the time when the occurrence of such information is recognized. Therefore, a listed company is encouraged to establish and maintain a system that enables it to immediately recognize that a fact has occurred.

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(iii) A practical way of thinking about the timing of disclosure for amendments to earnings forecasts, etc. In the case where a listed company recalculates the forecasts for business performance for the current consolidated accounting year (current business year), or fixes the details of account settlement for the current consolidated accounting year (current business year), it shall carry out timely disclosure concerning the amendment to its forecasts, etc.

* In the case where the whole picture of the act has not been decided or clarified at the time of decision/occurrence Even if the whole picture of the act has not been decided or the whole picture of the fact has not been clarified, the listed company shall classify the facts into those that have been fixed/clarified and those which have not been fixed/clarified, and then, carry out timely disclosure concerning the facts that have been fixed/clarified. In addition, after such disclosure is carried out, when the unfixed/unclarified fact becomes fixed/clarified, the listed company shall carry out timely disclosure as "Progress of disclosed matter" accordingly.

(b) To Confirm the Need and Timing for Prior Consultation In the case where a listed company falls under any disclosure matter listed below under certain conditions, it shall consult TSE at least 10 days (for an absorption type merger, etc. that does not fall under the de minimis criteria for inappropriate mergers: 2 weeks before, for introduction or exercise of takeover defense measure: 3 weeks before) prior to the scheduled disclosure date.

・ Third Party Share Allotment ・ Issuance of MSCB, etc. ・ Introduction/Exercise of Takeover Defense Measures ・ Allotment of Share Options without Contribution ・ Reverse Stock Split that is Expected to Result in Delisting ・ Acts of Reorganization, such as Merger/Acquisition ・ Takeover Bid or Takeover Bid for Treasury Shares ・ Expression of Intent, etc. concerning Takeover Bid ・ Acquisition of all classified stocks subject to whole acquisition clause ・ Approval or rejection of a special controlling shareholder’s request for sale of shares, etc. ・ Assignment of independent auditors or directors who meet independence standards ・ Merger, etc. that does not Fall under the De Minimis Criteria concerning Inappropriate Mergers

Regardless of whether an act falls under the list above, in the case where there are specific matters to be taken into consideration concerning disclosure, including cases where the details of the disclosure are different from the details that TSE require to be disclosed, where any scheme with no precedent is being considered and where there are concerns over matters that need to be observed, please provide sufficient time for prior consultation.

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Prior consultation is available by interview, telephone, and e-mail. If it is not clear whether there is a need for prior consultation, please contact TSE.

(c) To confirm the need for any operations related to timely disclosure Depending on the disclosure matter, there are some cases where certain procedures, such as acquisition/submission of document, are required prior to timely disclosure. For example, in the case where an act corresponds to a transaction with the controlling shareholder, it is required to obtain the opinion from an entity that does not have any interest with the controlling shareholder. In addition, in the case of a third party share allotment that falls under a certain condition, it is required to obtain the opinion from the third party or take procedures to confirm shareholder intent.

(d) To confirm the need for submitting statutory disclosure document(s) Depending on the disclosure matter, the securities registration statement or extraordinary report is required to be submitted in addition to timely disclosure. (For the details, please contact the Financial Service Agency or Local Finance Bureaus.) Regardless of whether an extraordinary report has been submitted, in the case where the body that decides a listed company’s business execution makes a decision, the listed company shall carry out timely disclosure immediately. However, in the case where timely disclosure is carried out prior to the submission of the securities registration statement concerning corporate information that requires such submission, such as issuance of new shares and subscription rights for new shares, the case may be contrary to the regulation on prior solicitation. Therefore, please take care to avoid causing such a situation by temporarily registering the extraordinary report with EDINET in advance to confirm if the report is ready to be submitted.

c. Matters to Note regarding Preparation of Disclosure Documents (a) Confirm "Disclosure Matters" and "General Instructions for Preparation" In “Guidebook for Timely Disclosure of Corporate Information”, the details to be described for disclosure (the "disclosure items") and the "general instructions for preparation" are explained for each disclosure matter. In general, these disclosure items mean items that a listed company is required to disclose in order to enable investors to make decisions pertaining to such information. In principle, all of these items are required to be described in a disclosure document. Therefore, in preparing a disclosure document, please confirm these disclosure items and the general instructions for preparation first. In addition to the prescribed disclosure items, it is required to describe the items, which are necessary for investors to understand/judge the corporate information properly, in a disclosure document.

On the other hand, in the case where false description is included in a disclosed document, where information that is regarded as important for making investment decisions is insufficient

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in the disclosure document, or where the information in the disclosure document is misleading, the disclosure may be subject to the measure prescribed in the Regulations. Therefore, when a listed company prepares a disclosure document, the company is required to confirm the facts carefully, and to prepare the disclosure document accurately without errors or omissions.

* In the case where a fact falls under more than one disclosure matter In the case where any corporate information falls under more than one disclosure matter, if it is regarded appropriate to combine the matters into a single disclosure document so that the investors will be able to understand and judge the information appropriately, prepare a single disclosure document. On the other hand, in the case where it is regarded appropriate to explain each matter separately so that the investors will be able to understand and judge the information appropriately, prepare a separate disclosure document, indicating the relationship between any related facts. In both cases, the listed company is encouraged to describe the prescribed disclosure items concerning each disclosure matter in order to enable investors to understand and judge the corporate information appropriately in accordance with the practical handling of timely disclosure of corporate information described in this guidebook.

(b) Use of disclosure templates For the convenience of listed companies in preparing disclosure documents, templates for disclosure are published for each disclosure matter. While a listed company is able to cover all disclosure items that are described in “Guidebook for Timely Disclosure of Corporate Information” by preparing the timely disclosure documents in accordance with each template, it does not mean that the listed company is required to base its disclosure on the templates. In addition, even if an item is not required to be described in the disclosure form, as far as such item may have material impact on investment decisions on a case-by-case basis, such item needs to be disclosed appropriately. Also, the TDnet database service enables its users to search past timely disclosure documents. When a listed company prepares a disclosure document, it may be useful to search the examples of other companies, and refer to such documents when making disclosure that is easy for investors to understand. Since such documents disclosed by other companies are prepared for the specific circumstances, the listed company should not simply use their content but should take care to prepare disclosure documents and carry out timely disclosure in accordance with its own situation.

(c) General Instructions for Preparation of Disclosure Documents (i) Preparing disclosure documents on a consolidated basis In principle, disclosure documents should be prepared using consolidated indicators. In cases where there is no consolidated indicator, such as in the case of a listed company that does not prepare consolidated financial statements, or in cases where it is more appropriate to prepare them on a non-consolidated basis, disclosure documents may be prepared using

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non-consolidated indicators. Figures for indicators described in disclosure documents should be distinguished between consolidated and non-consolidated indicators.

(ii) Joint preparation of disclosure documents While disclosure documents are generally prepared under the name of a single listed company, it is acceptable to jointly prepare disclosure documents (for example, in the case where the parent company and subsidiary are both listed). Even if a disclosure document is jointly prepared, the disclosure document is regarded as disclosed by the listed company. Therefore, please note that the listed company is fully responsible for the accuracy of the disclosure document, including details concerning the other companies involved in joint preparations.

(iii) Preparing disclosure documents that are easy to understand In order to make disclosure documents easier to understand, the following measures should be considered. ・ For technical terms used in a specific business area or industry, add explanatory notes as far as possible. ・ For the style of writing, avoid using terms that are difficult to understand as far as possible, and describe concretely. ・ To try to use description that is easy to understand, as well as charts and diagrams. ・ For facts that have already been disclosed, specify the gist of such facts by quoting the date and title of the related disclosure documents.

(iv) Preparing disclosure documents from the standpoint of fair provision of information A listed company is required to provide information to investors fairly. For example, if material information that is not described in the disclosure document is disseminated at the press conference that is held with timely disclosure, only certain investors will be able to obtain the information, and this is unfair. In such a case, it may even be necessary to amend or correct the details of the disclosure. Therefore, in preparing disclosure documents, listed companies are encouraged to include answers to expected questions from investors in disclosure documents in order to prevent unequal access to information.

(v) Description of future outlook In disclosure documents, listed companies are required to describe the expected impact of an occurred fact or decision on business performance from the current business year and its future outlook, depending on the disclosure matter. In this regard, as to the expected impact on business performance from the current business year, even if the aggregation of the impact on business performance from the current business year by the fact and impact by other facts does not result in a material impact on business performance, the listed company is required to describe details, including the impact of other facts. In addition, even if the expected impact on business performance from the current year is yet to be calculated, the listed company is encouraged to describe at least the scale and/or degree of the impact.

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d. Disclosure regarding Postponement/ Change/ Correction/ Progress of Disclosed Matters (a) Postponement of disclosed matters In the case where a listed company decides not to carry out the matter concerning the material corporate information that has been disclosed, it shall disclose to that effect as "Postponement of the disclosed matter."

(b) Change/correction of disclosed matters In the case where a change or correction should be made to the content of disclosed information, a listed company shall disclose the details of such change or correction immediately, as "Change of Disclosure Matter" and "Correction of Timely Disclosure Document."

(c) Progress of disclosed matters Regarding disclosure details that are difficult to be disclosed at the time the matter was first disclosed, a listed company is required to make disclosure as "Progress of Disclosure Matter" immediately after such details become available for disclosure.

e. Others (a) Information management regarding timely disclosure matters In general, timely disclosure matters correspond to material facts in the insid er trading regulations. Therefore, listed companies are encouraged to thoroughly conduct information management concerning timely disclosure matters in order to avoid insider trading by people who have gained access to the information ahead of timely disclosure. Listed companies are also required not to provide undisclosed information individually in the course of everyday communications with parties, including customers, individual investors, security analysts, and the media. Regardless of whether it is intended, if a listed company provides undisclosed information individually, it is required to carry out disclosure concerning such information via TDnet immediately from the point of view of fair disclosure. In the case where media speculation or a rumor is circulating in the public domain, TSE may issue an alert to the general public. For the details of the public announcement measure, please refer to the “Outline of system for issuing alerts”.

(b) Documents to be submitted Depending on the content of timely disclosure, listed companies are required to submit document(s) to TSE before/after such timely disclosure.

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(3) Practical Handling of Timely Disclosure of Corporate Information for Listed Foreign Companies

A listed foreign company (meaning an issuer of a foreign stock or foreign stock depositary receipt, etc.; the same shall apply hereinafter) shall disclose the facts prescribed in Rule 402 through 405 of the Regulations, in the same manner as a listed domestic company. In addition, based on Rule 407 of the Regulations, there are items to be disclosed only by a listed foreign company such as changes in laws and regulations of the home country concerning the company system.

On the other hand, as disclosure systems and procedures may vary depending on the home country of the listed foreign company, it is not necessarily reasonable to apply a uniform measure. Furthermore, foreign companies are also listed using diversified methods, including direct listing on TSE and listing of foreign stock depository receipts. Therefore, under the Regulations, in applying the rules and regulations of TSE to a listed foreign company, TSE shall take into account the legal systems, business practices, and customs of the home country of the listed foreign company. [Rule 7 of the Regulations]

○ Facts that are decided by the listed company [Rule 402, Item 1 of the Regulations] ○ Facts that occurred at the listed company [Rule 402, Item 2 of the Regulations] ○ Earnings results of the listed company [Rule 404 of the Regulations] ○ Amendments to earnings/dividend forecasts of the listed company, etc. [Rule 405 of the Regulations] ○ Information on subsidiaries, etc. [Rule 403 of the Regulations] ○ Information to be disclosed only by a listed foreign company [Rule 407 of the Regulations] ・ Changes in laws and regulations, etc. of the home country concerning the company system that have material impact on shareholders (including holders of listed foreign stock depositary receipts, etc.) or the company’s business performance ・ A fact that occurs in a foreign country that has material impact on the circulation of a listed foreign stock, etc., or a foreign stock depositary receipt, etc. that represents a right pertaining to a listed foreign stock, etc. ・ In addition to the above, a decision on a change in or termination of a deposit agreement, etc. pertaining to a listed foreign stock depositary receipt, etc. or any other agreement, other matters that have material impact on a right, etc. related to a listed foreign stock depositary receipt, etc., or a fact that has material impact on such right, etc. * When these provisions are applied to a foreign company that is conducting English-Language Disclosure for statutory disclosure, "securities registration statement," "securities report," "quarterly report," "internal control report," and "extraordinary report" shall be read as "foreign company registration statement," "foreign company report," "foreign company quarterly report," "foreign company internal control report," and "foreign company extraordinary report" respectively. * Regarding the approval granted to an application for an extension of the deadline for filing securities report/quarterly report, when a listed foreign company submits a document that describes that the reasons for application for said approval have not been changed or no longer exist according to Paragraph (5), Article 15-2-2 or Paragraph (5), Article 17-25 of the

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Cabinet Office Ordinance on Disclosure of Corporate Information, it is required to make timely disclosure to that effect as "Progress of Disclosed Information" that is a timely disclosure matter of "Submission of application for an extension of the deadline for filing Securities Report/Quarterly Report." * A listed foreign company, for which TSE is the principal market, is encouraged to carry out disclosure concerning earnings information, etc. in accordance with “Guidebook for Timely Disclosure of Corporate Information”. In this case, among items that are uniformly required to be described in the earnings report, "Basic approach toward Choice of Accounting Standard" does not apply.

[Definitions of subsidiary, etc. and sub-subsidiary]

○ A "subsidiary, etc." means a subsidiary prescribed in Article 166, Paragraph (5) of the Financial Instruments and Exchange Act, and in cases of a listed foreign company (limited to entities deemed necessary by TSE), its subsidiary, affiliated company, or other entities deemed necessary by TSE. ○ A "sub-subsidiary" means a sub-subsidiary prescribed in Article 29, Item (ii) of the Enforcement Ordinance of the Financial Instruments and Exchange Act, and in cases of a listed foreign company (limited to entities deemed necessary by TSE), it means a subsidiary, etc. of the subsidiary, etc.

[Timely disclosure of information regarding a company considered to be a capital-subordinate company, etc.]

When TSE deems necessary, a listed foreign company is required to disclose information regarding a capital-subordinate company, etc., including a fact of decision and fact of occurrence, etc. A capital-subordinate company, etc. means, among affiliated companies based on human relations and affiliated companies based on capital relations, a company considered to be substantially controlled or owned by the listed foreign company. Also, taking the example of a listing by a Chinese company that is conducting businesses in industries that prohibit or restrict foreign investment, it is understood that more than a few capital-subordinate companies, etc. may exist under such listed companies, and the relations among the listed company, subsidiary companies, and capital-subordinate companies, etc. may depend on a set of complicated contracts among them. In such a case, as it is predicted that the change in such contract agreements may have material impact on the listed foreign company depending on the substance of the change, information on such change is strongly recommended to be disclosed.

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a. Changes in Laws and Regulations, etc. of the Home Country concerning the Company System (a) Disclosure Obligations under the Regulations When changes in laws and regulations, etc. of the home country concerning the company system that have material impact on shareholders (including holders of a listed foreign stock depositary receipt, etc.) or the company’s business performance are made, a listed foreign company shall disclose its details immediately. [Rule 407, Paragraph 1, item 1 of the Regulations]

(Note) As for the cases of changes in laws and regulations, etc. of the home country concerning the company system that have material impact on shareholders (including holders of a listed foreign stock depositary receipt, etc.) or the company’s business performance, restrictions on stock transfers, nationalization of corporations, etc. are considered as examples.

(b) Items to be Disclosed and Notes on Disclosure/Descriptions In disclosure material, prescribed items shall be indicated, and then, the details shall be included so that investors can understand/judge the corporate information properly. In addition, other than the prescribed items, items necessary for investors to understand/judge corporate information properly shall also be described. a. Details of changes in laws and regulations, etc. of the home country b. Impact on shareholders or the company’s business performance caused by the changes in laws and regulations, etc. of the home country c. Other items necessary for investors to understand/judge the corporate information properly

b. A Fact that Occurs in a Foreign Country that Has Material Impact on the Circulation of a Listed Stock, etc. or a Foreign Stock Depositary Receipt, etc. (a) Disclosure Obligations under the Regulations When a fact that has a material impact on the circulation of a listed foreign stock etc. or a foreign stock depositary receipt, etc. that represents a right pertaining to a listed foreign stock, etc. occurs in a foreign country, a listed foreign company shall disclose its details immediately. [Rule 407, Paragraph 1, item 2 of the Regulations]

(Note) As for a fact that occurs in a foreign country that has material impact on the circulation of a listed foreign stock, etc. or a foreign stock depositary receipt, etc. that represents a right pertaining to a listed foreign stock, etc., a takeover bid against the stock, etc. of the listed foreign company made by an unlisted company and occurrence of a fact that will cause delisting from an exchange other than TSE are considered as examples.

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than the prescribed items, items necessary for investors to understand/judge corporate information properly shall also be described. a. Details of the fact b. Impact on the circulation of the listed foreign stock, etc. caused by the fact c. Other matters necessary for investors to understand/judge the corporate information properly

c. Fact of Decision or Occurrence with Material Impact on Rights, etc. Related to Listed Foreign Stock Depositary Receipt, etc., (a) Disclosure Obligations under the Regulations Where an issuer of a listed foreign stock depositary receipt, etc. has made a decision on a change or termination of a deposit agreement, etc. or any other matters that have material impact on a right, etc. related to the listed foreign stock depositary receipt, etc., or where a fact that has material impact on such right, etc. has emerged, the issuer shall disclose details immediately. [Rule 407, Paragraph 2 of the Regulations]

(b) Items to be Disclosed and Notes on Disclosure/Descriptions In disclosure materials, prescribed items shall be indicated, and then, details shall be included so that investors can understand/judge the corporate information properly. In addition, other than the prescribed items, items necessary for investors to understand/judge corporate information properly shall also be described. a. Details of the fact b. Impact on the right, etc. related to the listed foreign stock depositary receipt, etc. by the incident or fact c. Other matters necessary for investors to understand/judge the corporate information properly

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(4) Code of Corporate Conduct a. Overview of Code of Corporate Conduct

A Listed company is required to keenly recognize that it is a member constituting the financial instruments market and to improve disclosure of corporate information for the achievement of transparency. In addition, it is also required to take the appropriate responses in corporate activity for the purpose of protection of investors and appropriate fulfillment of market function. In the light of these points, the Regulations defines the Code of Corporate Conduct consisting of “Matters to be Observed” which clarify the minimum points to be adhered to as a listed companies and “Matters Desired to Be Observed” which clearly specify the matters to be addressed by a listed company. [Rule 432 through 452 of the Regulations]

b. Handling of Code of Corporate Conduct of Listed Foreign Companies

Provisions of “Matters to be Observed” applicable to listed foreign companies are: Rule 432 (Matters to be observed for third party allotment); Rule 433 (Prohibition of stock split, etc. which is likely to disrupt the secondary market); Rule 434 (Matters to be observed pertaining to issuance of MSCB, etc.); Rule 436 (Framework improvement to facilitate exercise of voting rights for listed foreign companies; limited to a listed foreign company whose listed foreign stock, etc. is traded principally on the TSE market); Rule 440 (Matters to be observed pertaining to introduction of takeo ver defense measures); Rule 441 (Matters to be observed pertaining to disclosure of MBO, etc.); Rule 441 -2 (Matters to be observed pertaining to significant transactions, etc. with controlling shareholder); Rule 442 (Prohibition of insider trading); Rule 443 (Exclusion of antisocial forces); and Rule 444 (Prohibition of actions damaging to the function of the secondary market or shareholders’ rights). In addition, provisions of “Matters Desired to be Observed” applicable to listed foreign companies are: Rule 445-3 (Respect for Corporate Governance Code); Rule 449 (System improvement for prevention of occurrence of insider trading); Rule 450 (Development of system, etc. for excluding antisocial forces); and Rule 452 (Fair provision of supplementary explanatory materials related to the details of account settlement). Since the application of these items will be managed in consideration of legal systems and practices, etc. of each home country of the relevant listed foreign company, please consult TSE about the handling of these items, etc.

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Japanese Foreign Matters to be Observed Company Company ・ Matters to be observed for third party allotment (a) Applicable Applicable ・ Prohibition of stock split, gratis allotment of shares, gratis allotment of subscription warrants, reverse stock split, or change in the number of shares per share unit Applicable Applicable which is likely to disrupt the secondary market or infringe upon shareholder interests (b) ・ Matters to be observed pertaining to issuance of MSCB, Applicable Applicable etc. (c) ・ Exercise of voting rights in writing, etc. Applicable - ・ Framework improvement to facilitate exercise of voting - Applicable rights for listed foreign companies (d) ・ Obligation to secure independent director(s)/auditor(s) Applicable - ・ Comply or Explain with Corporate Governance Code Applicable - ・ Obligation to set up board of directors, board of auditors Applicable - or an audit committee and accounting auditors ・ Obligation to appoint an accounting auditor as certified public accountant, etc. conducting audit certification, Applicable - etc. ・ Obligation to develop system and structure necessary to Applicable - ensure appropriateness of business ・ Matters to be observed pertaining to introduction of Applicable Applicable takeover defense measures (e) ・ Matters to be observed pertaining to disclosure of MBO, Applicable Applicable etc. (f) ・ Matters to be observed pertaining to significant Applicable Applicable transactions, etc. with controlling shareholder (g) ・ Audit by a listed company audit firm, etc. Applicable - ・ Prohibition of insider trading (h) Applicable Applicable ・ Exclusion of antisocial forces (i) Applicable Applicable ・ Prohibition of actions damaging to the function of the Applicable Applicable secondary market or shareholders’ rights (j)

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Matters Desired to be Addressed Japanese Foreign (matters to be addressed) Company Company ・ Efforts, etc. toward the shift to and maintenance of the Applicable - desired investment unit level ・ Efforts, etc. toward unification of trading unit Applicable - ・ Respect for Corporate Governance Code (a) Applicable Applicable ・ Securing Independent Directors/Auditors as Directors Applicable - on the Board ・ Preparation of an environment for the functioning of Applicable - independent directors/auditors ・ Provision of information regarding independent Applicable - director(s)/auditor(s), etc. ・ Framework improvement to facilitate exercise of voting Applicable - rights ・ Documents to be delivered to shareholders owning Applicable - stock without voting rights ・ System improvement for prevention of occurrence of Applicable Applicable insider trading (b) ・ Development of system, etc. for excluding antisocial Applicable Applicable forces (c) ・ Development of systems and structures to properly Applicable - respond to changes, etc. in accounting standards, etc. ・ Fair provision of supplementary explanatory materials Applicable Applicable related to the details of account settlement (d)

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c. Matters to be Observed (a) Matters to be Observed for Third party allotment

When a listed company performs an allotment of stocks, etc. by third party allotment that would (i) dilute the ratio of voting shares by twenty five (25) percent or more, or (ii) cause a controlling shareholder to transfer the shares held, it shall, in principle, (a) receive opinion of a person who has a specific degree of independence from the management regarding the necessity and suitability of such allotment, or (b) confirm the intent of shareholders regarding such allotment by means such as a resolution in the general shareholders meeting; provided, however, that the preceding provisions shall not apply to cases where it is difficult for the listed company to conduct any of the procedures enumerated in (a) or (b) due to reasons such as rapidly deteriorating financial situations. [Rule 432 of the Regulations; Rule 435-2, Paragraph 3 of the Rules]

(b) Prohibition of Stock Split, Gratis Allotment of Shares, Gratis Allotment of Subscription Warrants, Reverse Stock Split, or Change in the Number of Shares Per Share Unit which is likely to Disrupt the Secondary Market or Infringe upon Shareholder Interests

A listed company shall not carry out a stock split, gratis allotment of shares, gratis allotment of subscription warrants, reverse stock split, or change in the number of shares per share unit which is likely to disrupt the secondary market or infringe upon shareholder interests. [Rule 433 of the Regulations]

When a listed company issues MSCB, etc., it shall take measures to restrict conversion or exercise of MSCB, etc. by purchasers of MSCB, etc. In addition, a listed company shall not conduct actions deemed by TSE as damaging to the function of the secondary market or the rights of shareholders. [Rule 434 of the Regulations]

(d) Framework Improvement to Facilitate Exercise of Voting Rights for Listed Foreign Companies

In cases where a listed foreign company (limited to a listed foreign company whose listed foreign stock, etc. is traded principally on the TSE market) convenes a general shareholders meeting, it shall send an instruction sheet written in Japanese language (*1) and a reference document containing so adequate content that a beneficial shareholder of a foreign stock certificate, etc. can give instruction for an exercise of a voting right (*2) to beneficial shareholders of a foreign stock, etc. by two (2) weeks prior to a day of such general shareholders meeting. In addition, since the

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application of these items will be managed in consideration of legal systems and practices, etc. of each home country of the relevant listed foreign company, please consult TSE about the handling of these items, etc. (*1) Meaning a document by which a beneficial shareholder of a foreign stock, etc. gives instructions for the exercise of voting rights. (*2) Meaning a document containing matters that should serve as a reference regarding instruction for the exercise of voting rights. [Rule 436 of the Regulations]

(e) Matters to be Observed Pertaining to Introduction of Takeover Defense Measures

In cases where a listed company introduces takeover defense measures (meaning decision of the concrete substance of takeover defense measures such as making a resolution to issue new shares or subscription warrants as takeover defense measures), it shall observe the matters referenced in each of the following items:

ⅰ. Sufficient disclosure The listed company shall make necessary and sufficient timely disclosure concerning takeover defense measures.

ⅱ. Transparency Conditions of implementation (meaning making the realization of an acquisition difficult by executing the substance of takeover defense measures; the same shall apply hereinafter) and abolishment (meaning canceling introduced takeover defense measures such as retiring new shares or subscription warrants issued as takeover defense measures) of takeover defense measures shall not depend on arbitrary decisions by the management.

ⅲ. Effect on the secondary market Takeover defense measures shall not include factors which may cause extremely unstable price formation of a stock or any other factors which may cause unpredictable damage to investors.

ⅳ. Respect for shareholders’ rights Takeover defense measures shall give consideration to shareholders’ rights and their exercise. [Rule 440 of the Regulations]

(f) Matters to be Observed Pertaining to Disclosure of MBO, etc.

In cases where a listed company conducts the announcement of an opinion or representation to shareholders relating to a takeover bid from an officer of the target of the takeover bid (including takeover bids where the takeover bidder is conducting the bid based on the request of an officer of

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the target of the takeover bid and has a common interest with the officer of such target) or by a controlling shareholder or other person defined by the Rules, timely disclosure shall be made in a necessary and sufficient manner. [Rule 441 and Rule 441-2 of the Regulations]

(g) Matters to be Observed Pertaining to Significant Transactions, etc. with Controlling Shareholder

A listed company that has a controlling shareholder shall, in the cases where a body which decides the business execution of such listed company or a subsidiary thereof makes a decision on any significant transactions, etc. with a controlling shareholder and other persons specified by the Rules, obtain opinion from a person who has no interest in such controlling shareholder, that the relevant decision will not undermine interests of minority shareholders of such listed company. In addition, it shall perform necessary and sufficient timely disclosure. [Rule 441-2 of the Regulations; Rule 436-3 of the Rules]

A controlling shareholder means a parent company or an entity specified by the Rules as entity which directly or indirectly holds a majority of the voting rights. The latter means a main shareholder (other than the parent company) who holds the majority of voting rights of a listed company after combining the voting rights held for its own account and the voting rights held by a close relative of said main shareholder and a company, etc. (meaning a company, designated corporation, partnership, or other similar entities (including foreign entities that ar e equivalent to these entities); the same shall apply hereinafter) whose majority voting rights are held by said main shareholder and the close relative specified in the preceding item, and a subsidiary of said company, etc. [Rule 2, Item 42-2 of the Regulations; Rule 3-2 of the Rules]

(h) Prohibition of Insider Trading

A listed company shall not allow its officers, agents, employees and other workers to conduct insider trading (*) for such listed company’s account. (*) Insider trading represents a transaction forbidden by Rule 166 and 167 of the Financial Instruments and Exchange Act. The same applies hereinafter. [Rule 442 of the Regulations]

In addition, “Matters Desired to be Observed” include “System Improvement for Prevention of Occurrence of Insider Trading.” Please also refer to the corresponding section.

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(i) Exclusion of Antisocial Forces

In cases where it has become clear that a listed company has relationships prescribed above as those in which the listed company is involved with antisocial forces, and where TSE deems that such condition has considerably damaged shareholders and investors trust in the market, the listed company shall be delisted. [Rule 601, Paragraph 1, item 19 of the Regulations; Rule 601, Paragraph 15 and Rule 436-4 of the Rules]

In addition, “Matters Desired to be Observed” include “Development of System, etc. for Excluding Antisocial Forces.” Please also refer to the corresponding section.

(j) Prohibition of Actions Damaging to the Function of the Secondary Market or Shareholders’ Rights

A listed company shall, in addition to observing the individual provisions listed as “Matters to be Observed” in the Code of Corporate Conduct, not conduct actions deemed by TSE as damaging to the function of the secondary market or the rights of shareholders. [Rule 444 of the Regulations]

This is defined as a so-called basket clause of “Matters to be Observed” in the Code of Corporate Conduct. Therefore, a listed company shall not, in addition to observing the individual provisio ns listed as “Matters to be Observed” in the Code of Corporate Conduct, conduct any quasi-actions in the light of the intent and purpose of the Code of Corporate Conduct.

d. Matters Desired to Be Observed (Matters to be Addressed) (a) Respect for Corporate Governance Code

Listed companies shall respect for sense and ethos of the "Corporate Governance Code" and address the enhancement of their corporate governance. [Rule 445-3 of the Regulations]

(b) System Improvement for Prevention of Occurrence of Insider Trading

A listed company shall endeavor to prepare and maintain a required information management system to prevent insider trading by its officers, agents, employees and other workers. [Rule 449 of the Regulations]

In addition, “Matters to be Observed” include “Prohibition of Insider Trading.” Please also refer to the corresponding section.

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A listed company shall endeavor to develop a company structure to prevent damage due to anti-social forces including criminal and extremist elements and to prevent the intervention of anti-social forces against individual corporate activities. [Rule 450 of the Regulations]

In addition, “Matters to be Observed” include “Exclusion of Antisocial Forces.” Please also refer to the corresponding section.

(d) Fair Provision of Supplementary Explanatory Materials Related to the Details of Account Settlement

A listed company shall make efforts to ensure the fair provision of supplementary explanato ry materials on the details of the account settlement disclosed pursuant to the provisions of Rule 404 (Earnings Reports, etc.) when preparing and providing such materials to investors. [Rule 452 of the Regulations]

e. Measures for enforcing the Code of Corporate Conduct and reporting requirement

TSE may impose measures to ensure the effectiveness of the Code of Corporate Conduct if TSE deems that a listed company has violated a matter to be observed. Measures available to TSE include publicizing the fact of the violation, imposing a listing agreement violation penalty, requesting an improvement report/improvement status report, and designating the stock as a security on alert. Listed foreign companies shall report to TSE when it falls under the following condition:

・ Where a listed foreign company (limited to those whose principal market is TSE) violates the Code of Corporate Conduct regarding improving systems to facilitate rights exercise.

(5) Submission of Documents, etc. a. Corporate Governance Report A listed foreign company whose principal market is TSE shall, in the same way as a listed domestic company, submit a corporate governance report that describes the company’s approach toward corporate governance, and when any change has occurred in the contents, it shall also submit without delay a document that describes the details of such changes. Submitted corporate governance reports are published on the TSE website.

[Outline of Contents] (1) Basic approach to corporate governance and basic information about the initial listing applicant including capital structure, corporate attributes, etc.; (2) Status of the corporate governance system including business management organization pertaining to management decision making, execution, and oversight; (3) Implementation status of measures to protect the interests of shareholders and other

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stakeholders; (4) Basic approach to and implementation status of the internal control system; and (5) Other matters deemed necessary by TSE. [Rule 419 of the Regulations]

* Regarding the descriptions in the report, TSE shall take into account the legal systems, etc. of the home country.

b. Notice Concerning Submission of Foreign Company Registration Statement, etc. In the case where a listed foreign company decides, for the first t ime, to submit a Foreign Company Registration Statement, etc. (meaning the Foreign Company Registration Statement, etc. prescribed in Article 117, Paragraph (1), Item (25) of the Cabinet Office Ordinance regarding Financial Instruments Business (Cabinet Office Ordinance No.52 of 2007)) to the Prime Minister, etc. it is required to submit a document that describes of that effect and the expected submission date of such Foreign Company Registration Statement, etc. to TSE immediately after such decision is made. [Rule 424 of the Enforcement Rules]

* In the case where a listed foreign company that has been submitting a Foreign Company Registration Statement, etc., decides to cease submitting Foreign Company Registration Statements, etc., it is required to advise TSE to that effect and provide the date that it will submit the Securities Registration Statement, etc. (statutory disclosure documents in Japanese)

(6) Mothers Global

Since December 1, 2006, foreign stocks and foreign stock depositary receipts, etc. listed on the Mothers market of TSE have been collectively called "Mothers Global." This sub-category was introduced, from the viewpoint of expressing more clearly the character of foreign companies listed on Mothers, with the intent of promoting the listing of growth companies from Asia and other foreign countries In this sense, TSE makes efforts to offer information, such as the character of each issue, etc. to investors through a website prepared specially for providing information on Mothers Global companies.

Mothers Global website URL: https://www.jpx.co.jp/equities/products/foreign/mothers/index.html

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[Example of information on Mothers Global website] Whether there is a company operating the main business in the Principal Main Country of listed foreign company's corporate listed business incorporation group that has no capital market region relationship with the listed foreign Name of listed foreign company. Company (Code, Listing Whether there is a company that is Date) Type of not a subsidiary company, and that issue Governing is an object for timely disclosure in Risk (stock or law accordance with the provision of factors depository Rule 402, Item 1.q of the receipt) Regulations. (attach PDF file) XYZ Corporation TSE US Nil US (XXXX, DD/MM/YY) Stock US laws Nil Nil; PDF PDF

A listed foreign company shall provide sufficient information for the table above. For risk factors (PDF file), please prepare the document by abstracting the "Risk of business, etc." section of the securities report for new listing application (Part I) (include the company name and date of submission).

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(7) Disciplinary Actions against Listed Companies

The Regulations define that in cases where a listed company violates or infringes the Regulations, TSE may take effective measures to ensure the effectiveness of the punishment against such violation, etc., including designation of securities on alert, submission of improvement report and improvement status report, designation to disclosure-in-question securities, publication of such violation fact, and imposition of listing agreement violation penalty.

a. Overview Self-regulation operations on financial instruments exchange comprise the following:

− Listing examination to examine the soundness of the financial position and corporate management of an unlisted company;

− Listing supervision to examine whether a listed company falls under any of the criteria for delisting;

− Inspection to test and ensure the soundness of and confidence in trading participants charged with trade execution and settlement on the Exchange market; and

− Trading examination and inspection carried out to surveil for unfair trading practices such as market manipulation, insider trading, etc.

Japan Exchange Group has Tokyo Stock Exchange, Inc. (the Exchange) and Osaka Exchange, Inc., both of which run markets on financial instruments exchanges, and Japan Exchange Regulation (JPX-R) designed to perform self-regulation operations under its auspices. By entrusting JPX-R independent of both Exchanges with self-regulation operations, the independence of the self-regulation function will certainly be strengthened. By using a holding company, the effectiveness of self-regulation function will certainly be ensured through the adequate collaboration between the Exchanges charged with market operations and JPX-R charged with self-regulation practices. Tokyo Stock Exchange as a market operator carries out overall businesses related to the operation of the Exchange financial instruments market, with the exception of the businesses entrusted to JPX-R. The Listing Department of the Exchange provides various consultations and advice to listed companies as a consultation window and carries out various procedures for listed securities such as listing section reassignment, while additionally developing and implementing plans for listing and disclosure systems. Meanwhile, the Exchange has entrusted self-regulation operations for listed company compliance, etc. to JPX-R, and the Listed Company Compliance Department performs those self-regulation operations. Specifically, the self-regulation operations include:

(1) Examination of disclosures of corporate information based on the regulations of Part 2, Chapter 4, Section 2 of the Securities Listing Regulations;

(2) Examination of compliance with the code of corporate conduct based on the regulations of Part 2, Chapter 4, Section 2 of the Securities Listing Regulations;

(3) Examination to ensure the effectiveness in relation to listing agreement violation penalties, public announcement measures, the submission of improvement reports, the designation as a security on alert, etc. 154

(4) Examination focused on delisting based on criteria for inappropriate mergers, false statements or adverse opinions, listing agreement violations, undue restrictions on the rights of shareholders, public interest and investors protection

The Listing Department of the Exchange assesses the results of these examinations, etc. carried out by JPX-R to determine delisting, regulatory or d isciplinary actions, and other measures for listed companies. The Exchange has also entrusted JPX-R with a survey to ensure the fairness of the trading of securities, etc. on the Exchange market. Based on the survey results, the Examination and Inspection Department of JPX-R carries out examinations relating to any trading likely to violate laws and regulations or other rules, including insider trading. b. Examination Related to the Disclosure of Corporate Information

Disclosure examinations in accordance with the requirements of Part 2, Chapter 4, Section 2 of Securities Listing Regulations shall be carried out in light of the following (1) to (5) concerning disclosure of material corporate information:

(1) Whether or not the timing of disclosure is appropriate;

(2) Whether or not the details of disclosed information are false;

(3) Whether or not disclosed information lacks information deemed important for investment decisions;

(4) Whether or not disclosed information gives rise to misunderstandings for investment decisions; and

(5) Whether or not disclosed information lacks appropriateness of disclosure

【Guidelines for Listed Companies Compliance, etc. II 2】

Where the Exchange makes an inquiry of corporate information of a listed company by deeming that it is necessary to do so, such listed company shall make an accurate report on an inquiry matter immediately. The listed company is also required to make an accurate report on an inquiry matter immediately made by JPX-R. 【Rule 415 Paragraph 1 of Securities Listing Regulations; Rule 3 Paragraph 2 of the same regulations】

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c. Disciplinary Actions or Measures to Ensure Effectiveness

Securities Listing Regulations provide that the Exchange may designate any listed company as Securities on Alert, require submission of improvement report and public announcement measures or charge listing agreement violation penalty for any listed company in violation of Securities Listing Regulations in order to ensure effectiveness.

〔Measures to ensure effectiveness〕

○Measures involving penalty ○Improvement measures ・Public announcement measure ・ Improvement report and improvement status report ・Listing agreement violation penalty ・ Designation of securities on alert

(a) Designation system as a security on alert

When any one of the following items is met by a listed company and TSE deems highly necessary for it to improve its internal management system, TSE should designate the secur ities, etc. issued by the listed company as a security on alert.

・ When the Exchange does not determine that a listed company meets each item of the following though it previously assessed that the listed company was likely to do so: Rule 601, Paragraph 1, Item 9-2 of Securities Listing Regulations Damage to sound transactions with controlling shareholders Rule 601, Paragraph 1, Item 12 of Securities Listing Regulations Breach of listing agreement, etc. Rule 601, Paragraph 1, Item 19 of Securities Listing Regulations Involvement of Anti-Social Forces

Rule 601, Paragraph 1, Item 20 of Securities Listing Regulations Public interest or the protection of investors

・ When a listed company meets any one of the following:

A listed company made any false statement in its securities report (Rule 2, Item 30 of Securities Listing Regulations)

Where, in audit reports attached to financial statements, etc. or quarterly review reports attached to quarterly financial statements, etc. a certified public accountant, etc. expresses an "adverse opinion" or the fact that "opinions are not expressed" in an audit report, or a "negative conclusion" or the fact that "conclusion is not expressed" in a quarterly rev iew report (in cases of a spec ified business company, an "opinion that interim financial statements, etc. do not provide useful information" or the fact that "opinions are not expressed");

* However, excluding cases where the fact that "opinions are not expressed" or the fact that "conclusion is stated, and such statements are made due to reasons not attributable to the listed company, such as act of providence;

・ Where the Exchange deems that a listed company has violated the provisions;

・ Where the Exchange deems that a listed company has violated the “Matters to be Observed for”

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the code of corporate conduct;

・ Where the Exchange deems it will not recognize improvement in the execution of improvement measures and operating conditions in a listed company which has submitted an improvement report pertaining to the timely disclosure and code of corporate conduct

A listed company which is the issuer of a listed stock, etc. designated as a security on alert shall submit a document specified by the Enforcement Rules that contains the status of the internal management system, etc. (hereinafter referred to as a "Written Confirmation of Internal Management System") promptly after one (1) year has elapsed since such designation. The “Written Confirmation of Internal Management System" is required to be prepared pursuant to “"Securities Report for Initial Listing Application(Part II)” prescribed in Rule 204, Paragraph 1, Item 4 of the Enforcement Rules for Securities Listing Examination; provided that the submission of documents specified by the Exchange will suffice when it deems unnecessary the submission of documents pursuant to “Securities Report for Initial Listing Application (Part II)” if the audit report contains the fact that no opinion is provided due to any problems relating to the going conc ern assumption.

The Exchange shall conduct examination on the internal management system, etc. on the basis of the substance of the “Written Confirmation of Internal Management System”. Where the Exchange deems that there is no problem in the internal man agement system, etc., the Exchange shall cancel the designation as a security on alert; provided that the Exchange deems that there are problems on the Internal Management System where the listed company does not submit the submitted the “Written Confirmation of Internal Management System”, or that the contents described in the “Written Confirmation of Internal Management System” provided are apparently inadequate.

When the Exchange deems necessary and makes an inquiry of the internal management system, etc. to a listed company that is an issuer of a listed stock, etc., for which designation as a security on alert continued, the listed company shall accurately make reports on inquired matters promptly. JPX-R entrusted by the Exchange with the self-regulation operations will also make similar inquiries. The listed company shall accurately make reports on inquired matters promptly in the same manner to the Exchange. The examination of the internal management system, etc. described above shall consider the matters reported against the enquiries.

Where the Exchange does not deem that there is a problem in the internal management system, etc., the Exchange shall cancel the designation as a security on alert. However where the Exchange deems that there is still a problem in the internal management system, etc., it continues the designation as a security on alert.

A listed company that is an issuer of a listed stock, etc., for which designation as a security on alert continued must resubmit the Written Confirmation of Internal Management System promptly after one (1) year and six (6) months have elapsed since the designation.

The Exchange will make the examination based on the substances, etc. of resubmitted Written Confirmation of Internal Management System, etc. 【Rule 501 of Securities Listing Regulations; Rule3, Paragraph 2 of the same regulations】

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The designation as a security on alert will be made in comprehensive consideration of the following matters and others.

 Case where a listed company is likely to meet the criteria for delisting;

- The details, the background, the cause, and the actual state of affairs relating to the event that the Exchange deems likely to fall under the criteria for delisting;

 Case where a listed company is likely to meet the criteria for false statement or adverse opinion, etc.;

- The period, amount of money, actual state, and impact on stock prices pertaining to false statements or adverse opinion, etc. in securities reports, etc.

- The act, involvement of company-related parties, and development and administration of internal management system that are causes of false statements or adverse opinion, etc., in securities reports, etc.,

 Case where the Exchange deems that a listed company violates the provisions on timely disclosure;

- The materiality of information timely disclosed for investment decisions

- The background, cause, and circumstances of a listed company that violated the provisions on timely disclosure

- State of compliance in the past with the provisions on timely disclosure

 Case where the Exchange deems that a listed company violates the provisions on the “Matters to be Observed” for the code of corporate conduct;

- The details, the background, the cause, and the actual state of affairs relating to the violations of the “Matters to be Observed” for the code of corporate conduct;

 Case where an improvement report is submitted;

- The details, the background, the cause, and the actual state of affairs relating to the event on which the Exchange requests submission of an improvement report

- The state of implementation and operation of improvement measures described in an improvement report

【Guidelines for Listed Company Compliance, etc. III 1】

The assessment of whether there is a problem in the internal management system, etc. for the cancellation of the designation as a security on alert shall be made in comprehensive consideration of the matters described below and other matters.

- The state of the system and implementation of audit concerning business execution by internal audit and audit by auditors, etc.;

- The state of internal management system such as the organization of the business administration or establishment of internal rules;

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- The state of administration of corporate information such as facts that have a significant impact on management, and the state of timely disclosure system pertaining to such corporate information;

- The state of the system to ensure compliance with the provisions concerning the ““Matters to be Observed” for the code of corporate conduct

- The state of development and operation of internal organizations concerning preparation of securities reports and other accounting related matters;

- The state of compliance with laws, regulations, etc.; and

- The state of compliance with the provisions concerning listed company compliance, etc. after the designation as a security on alert

【Guidelines for Listed Company Compliance, etc. III 2】

If a listed company that is an issuer of a listed stock, etc., for which designation as a security on alert meets any one of the following, the stock will be delisted:

- Where the Exchange deems that the internal management system, etc. of the listed company has not been improved within one (1) year and six (6) months from the designation as a security on alert (limited to cases where the Exchange deems that the improvement is no longer expected);

- Where the Exchange deems that the internal management system, etc. of the listed company has not been improved within one (1) year and six (6) months from the designation as a security on alert;

- Where the Exchange deems that improvement of the internal management system, etc. of the listed company can no longer be expected

【Rule 601, Paragraph 1, Item 11-2 of Securities Listing Regulations】

(b) Improvement report system and improvement status report system

1) Submission of improvement report and its availability for the public inspection

【Improvement report: application of designation as a security on alert (image)】

improvement report improvement Deems that no

Submission of Submission Designation as a security on improvement has alert is applicable not been made

Deems that No additional improvement

improvement has measures are necessary

been made

* Improvement report system is a measure before the designation as a security on alert is made

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2) Submission of improvement report pertaining to timely disclosure and code of corporate conduct

In the cases provided in the following items and where the Exchange deems that improvement is highly necessary, the Exchange may request that the listed company submit a report which contains its background and improvement measures (hereinafter referred to as an "Improvement Report"). In such cases the listed company is required to submit the improvement report promptly.

- Where the Exchange deems that a listed company has breached the provisions concerning the timely disclosure; and

- Where the Exchange deems that a listed company has breached the provisions concerning the “Matters to be Observed for” of the code of corporate conduct.

Where the Exchange deems that the contents of the Improvement Report submitted are apparently inadequate, the Exchange may request such listed company to change it and resubmit an Improvement Report. In such cases the listed company is required to submit the improvement report promptly.

The Exchange may make the improvement report submitted available for the public inspection and widely disseminate it through the Exchange website.

【Rule 502 of Securities Listing Regulations】

The necessity of submission of improvement report will be determined in comprehensive consideration of the following:

 In case of breach of provisions concerning timely disclosure

- Materiality of information made public as timely disclosure, etc., as information relating to investment decisions; and

- The background, the cause, and the actual state of affairs relating to the circumstances where timely disclosure was not made fairly; and

- The state of past compliance, etc. with the provisions concerning timely disclosure

【Guidelines for Listed Company Compliance, etc. III 3. (1)】

For example if a listed company falls under any one of the following, the Exchange considers it as a determinant factor for the request of improvement report and in principle requires the listed company to submit the improvement report..

i. It was deemed that unfair information disclosure was made for the past two years (delay in disclosure or inadequate contents of disclosed information and Exchange deemed it necessary for the listed company to improve the state though it did not deem it necessary to submit the improvement report and the listed company submitted the document containing the description of backgrounds and improvement measures (hereinafter “Background Document”). However the listed company has committed a violation of the regulations at a similar or more significant level;

ii. A listed company which submitted an improvement report during the past five years 160

committed the violation of the regulations.

Furthermore, though the Exchange required a listed company to submit the Background Document, the listed company did not do so promptly (within two weeks) or the contents thereof were clearly inadequate, the Exchange considers them to be determinant factors for the request of improvement report as other matters, and the Exchange requests the submission of improvement report.

 In case of breach of provisions concerning “Matters to be Observed”

- The background, the cause, and the actual state of affairs relating to the circumstances where timely disclosure was not made fairly; and

- The state of past compliance, etc. with the provisions concerning timely disclosure

【Guidelines for Listed Company Compliance, etc. III 3. (2)】

Where the Exchange requests a listed company to submit the improvement report and the listed company falls under any one of following, the listed company is determined to commit a material breach of the listing agreement and shall be delisted.

- Though the Exchange notifies a listed company of the submission, etc. of the improvement report and establishes the submission date, the company does not submit an Improvement Report by the established date and time; and

- Though the Exchange requires a listed company to submit the improvement report, the Exchange deems that the improvement of state of disclosure of corporate information is no longer expected. 【Rule 601, Paragraph 1, Item 12 of Securities Listing Regulations; Rule 601, Paragraph 11, Items 1 and 2 of Enforcement Rule】

3) Improvement status report pertaining to timely disclosure and code of corporate conduct

- A listed company which submitted an Improvement Report shall promptly submit an Improvement Status Report containing the status of implementation and operation of the improvement measures after six (6) months from the submission of such Improvement Report.

- In this case, where the Exchange deems that the contents of the Improvement Status Report are clearly inadequate, it will request the change of contents and require the resubmission of the Improvement Status Report. In such cases the listed company shall be required to submit the Improvement Status Report promptly. The Exchange will make the Improvement Status Report submitted available for the public inspection and disseminate it through the Exchange website.

- When a listed company is required to submit the Improvement Status Report, the Exc hange may request the submission of necessary data or make them available for the public inspection or make necessary inquiries or interviews in order to confirm the status of implementation and operation of implementation measures and if the Exchange deems that

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the contents included in the Improvement Status Report are clearly inadequate, the Exchange shall request the listed company which submitted the Improvement Status Report to resubmit the Improvement Report.

In addition to the above, the listed company which submitted the Improvement Report is required to submit the Improvement Status Report pertaining to the implementation and operation of improvement measures for five (5) years from the submission of the Improvement Status Report whenever the Exchange deems necessary.

Furthermore, if the Exchange makes any inquiry to the listed company which submitted the Improvement Report concerning the implementation and operation of implementation measures when the Exchange deems necessary, the listed company shall make accurate reports on inquired matters. The JPX-R which is entrusted by the Exchange with the self-regulation operations may make similar inquiries. In such case the listed company is required to make accurate reports on the inquired matters in the manner similar to the Exchange promptly.

【Rule 503 of Securities Listing Regulations; Rule 3, Paragraph 2 of the same regulations】

4) Improvement Report pertaining to the submission of documents

Where the Exchange deems that a listed company did not appropriately make the submission of documents or in case of a listed company in MOTHERS or JASDAQ Growth section, it did not properly make holding of presentation pursuant to the Securities Listing Regulations, and deems that the necessity of improvement is high, the Exchange may request the listed company to submit the Improvement Report. In such cases the listed company is required to submit the Improvement Report promptly.

In addition where the Exchange deems that the contents of the Improvement Report are clearly inadequate, the Exchange can request the listed company to change the contents and resubmit the Improvement Report. In such cases the listed company is also required to submit the Improvement Report promptly.

【Rule 504 of Securities Listing Regulations】

5) Improvement Report pertaining to the affirmation related to third-party allotment, etc.

Where a listed company does not appropriately provide a report on the transfer of an offered stock allotted by third-party allotment, etc. and its affirmation, etc. on the basis of the provisions of Rule 422, the Exchange may request such listed company to submit the Improvement Report.

The Exchange may make such report available for the public inspection if the Exchange deems it necessary and appropriate. 【Rule 505 of Securities Listing Regulations】

In cases referred to in each of the following items, the Exchange may make a public 162

announcement of such information if the Exchange deems this necessary:

- Where the Exchange deems that a listed company has breached the provisions pertaining to timely disclosure;

- Where the Exchange deems that a listed company has breached the provisions pertaining to the “Matters to be Observed for” of the code of corporate conduct; and

- Where a listed company breaches the provisions of Article 331, Article 335, Article 337, or Article 400 of the Companies Act.

【Rule 508 of Securities Listing Regulations】

The Exchange decides the necessity of public announcement measures in comprehensive consideration of the following:

 In case of breach of provisions concerning timely disclosure

- Materiality of information made public as timely disclosure, etc., as information relating to investment decisions;

- The background, the cause, and the actual state of affairs relating to said violation of the provisions of Chapter 4, Section 2 by a listed company; and

- The state of implementation measures such as a regulatory action taken by the Exchange in response to said violation.

【Guidelines for Listed Company Compliance, etc. III 4.】

 In case of breach of provisions concerning the “Matters to be Observed” for the code of corporate conduct

- The state of implementation and contents of the proceedings taken prescribed in the provisions of each item of Rule 432 of the Regulations

- The ratio of stock split, etc., the investment unit after completing stock split, etc. and any other circumstances regarding the stock split, etc.

- The exercise terms, the quantity to be issued, the scale of dilution, the contents of the measures taken in relation to the monthly exercise quantities with regard to MSCB, etc.

< Matters to be observed for appointment of independent directors/auditors>

- The status of a person(s) who is reported to the Exchange as being an independent director(s)/auditor(s) by the issuer of a listed domestic stock pursuant to the provisions of Rule 436-2 of the Enforcement Rules

- The contents of takeover defense measures and the state of their disclosure;

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- The state of disclosure of measures to ensure fairness and prevent a conflict of interest described in disclosure regarding public announcement of opinions in relation to a takeover bid or presentation of such opinions to shareholders as defined in Rule 441 of the Regulations

- The nature of violation of the provisions of Rule 442 of Securities Listing Regulations, background, the cause, and the actual state of affairs relating to the event that give rise to such violation and the state of development of the information management system required for the prevention of insider trading

- The state of development of the internal system for the prevention of involvement of anti-social forces; and

- The state where the function of the secondary market or shareholder rights are undermined.

【Guidelines for Listed Company Compliance, etc. III 5.】

(d) Listing Agreement Violation Penalty

The Exchange has established the listing agreement violation penalty when a listed company violates the listing agreement at the level in which such violation does not result in delisting. The listing agreement violation penalty aims to enhance effectiveness of various listing related regulations and rules and would be applied to any violation acts which the Exchange deems to undermine the confidence of shareholders and investors in the Exchange market.

The enhancement of effectiveness of various listing related rules is essential for the benefits of shareholders and investors, but also is considered to be essential to listed companies from the perspective of contribution to the quality of market and maintenance of their reputation. The Exchange encourages listed companies to abide by various listing related rules by fully understanding the purpose of the system.

 Outline of listing agreement violation penalty

In cases provided in each of the following items, if the Exchange deems that said listed company has undermined the confidence of shareholders and investors in the Exchange market, the Exchange may claim payment of a listing agreement violation penalty against said listed company. In this case, the Exchange shall make a public announcement of such information.

- Where the Exchange deems that a listed company has breached the provisions pertinent to timely disclosure;

- Where the Exchange deems that a listed company has breached the “Matters to be Observed ” for the code of corporate conduct; and

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- In addition to the cases provided in the preceding two items, where the Exchange deems that a listed company has breached the Securities Listing Regulations or other regulations.

【Rule 509 of Securities Listing Regulations】

A decision on whether or not to impose the listing agreement violation penalty shall be made in comprehensive consideration of the matters assessed in deciding whether the public announcement measures should be implemented. The decision on the public announcement measures and claim for the listing agreement penalty shall be made based on the assessment of whether such violation undermines the confidence of shareholders and investors on the Exchange market.

【Guidelines for Listed Company Compliance, etc. III 4.】

Since the objective of this system is to enhance the effectiveness of listing regulations, it is not designed to apply to immaterial violating acts. Therefore the system does not apply to the breach of requirements for timely disclosure which does not trigger the submission of improvement report or the breach caused by a listed company which simply forget submitting relevant documents.

Violation acts to which the listing agreement violation penalty may apply include:

- Where a listed company whose stock is designated as a security on alert amended the earnings report which had already amended in the past as an inappropriate accounting treatment was identified; or

- Where a listed company whose stock is designated as a security on alert did not carry out necessary procedures which were required at the time of third-party allotment with dilution ratio of 25% or more or expected change in controlling shareholders (Securities Listing Regulations Rule 432).

- These acts apparently violate the requirements of timely disclosure or code of corporate conduct. If a listed company makes such act, it certainly undermines the confidence in the Exchange markets and listed companies as a whole. The listing agreement v iolation penalty applies to these cases.

The Exchange is certainly to improve the illustration of any violation acts to which the penalty applies to enhance the foreseeability of such acts by showing specific incidents to which the penalty applies.

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The amount of the listing agreement violation penalty shall be calculated for each issue of listed stocks, etc. in accordance with the following table;

Market Section, etc. 1st Section 2nd Section Mothers Foreign stocks, etc. (excluding listed companies whose main market is the Exchange and JASDAQ-listed Market Capitalization companies) JPY 5 bil. or less JPY 19.2 mil. JPY 14.4 mil. JPY 9.6 mil. JPY 2.4 mil. Over JPY 5 bil., but JPY 33.6 mil. JPY 28.8 mil. JPY 24 mil. JPY 4.8 mil. JPY 25 bil. or less Over JPY 25 bil., but JPY 48 mil. JPY 43.2 mil. JPY 38.4 mil. JPY 9.6 mil. JPY 50 bil. or less Over JPY 50 bil., but JPY 62.4 mil JPY 57.6mil. JPY 52.8 mil JPY 12 mil. JPY 250 bil. or less Over JPY 250 bil., but JPY 76.8 mil. JPY 72 mil JPY 67.2 mil. JPY 14.4 mil. JPY 500 bil. or less Over JPY 500 bil. JPY 91.2 mil JPY 86.4 mil. JPY 81.6 mil. JPY 16.8 mil.

Market Section, etc. JASDAQ Market Capitalization JPY 100 bil. or less JPY 20 mil. Over JPY 100 bil. JPY 24 mil.

(Note) Listed market capitalization shall be calculated as specified in the following items

- Domestic stocks, etc.

Listed market capitalization is calculated, using (i) the last price on the last day of the auction session in December immediately prior to the day on which the Exchange decided to claim the listing agreement violation penalty (if no transaction is executed in the auction session on such last day, the last price in the auction session on the most recent day prior to such last day on which transactions are executed) and (ii) the number of listed domestic shares, etc. at the end of February. However, if the claim for the listing agreement violation penalty is decided before the last day of auction sessions in December that arrives for the first time after listing, the market capitalization on the day of listing is used for such calculation. In addition, adjustments due to a stock split, gratis allotment of share, or reverse stock split shall be made as specified the Exchange.

- Foreign stocks, etc.

Listed market capitalization is calculated by using (i) the last price on the last day of the auction session on the last day of the business year immediately prior to the day on which the Exchange decided to claim the listing agreement violation penalty (if no

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transaction is executed in the auction session on such last day, the base price on such day) and (ii) the number of listed foreign shares, etc. on such day. However, if the claim for the listing agreement violation penalty is decided before the last day of the business year that arrives for the first time after listing, the market capitalization on the day of listing is used for such calculation.

A listed company shall pay the amount specified in the preceding item by the last day of the month immediately following the month containing the day on which the Exchange required payment of the listing agreement violation penalty. In cases where a listed company fails to pay the listing agreement violation penalty by the due date, the Exchange may charge the delinquency damages. d. Principle of Equity Finance

The financing of a listed company using equity finance should be respected as it utilizes the inherent function of the capital market. It would be inappropriate, however, to simply assume that any act is justified insofar as it stays within the bounds of laws and regulations or the Exchange regulations and rules.

In order to address ever-evolving circumstances surrounding the capital market, the Exchange is certainly required to revise regulations and rules as appropriate in response to such evolution. Notwithstanding its efforts to do so, some incidents unmanageable under the scope of the revised regulations and rules will inev itably take place. While JPX-R carries out self-regulation operations, some listed companies deem that mere compliance with regulations and rules, no matter how superficial, serves as sufficient justification for their acts. In some cases, several equity finance transactions which may not instantly be alleged to violate the laws and regulations or the Exchange regulations and rules are carried out and the proceeds from the transactions are used not for the original business purposes but ultimately for the benefits of specific persons or corporations.

In order to address these conditions and circumstances, JPX-R has noted that it would be effective to combine a rule-based approach with a principle-based approach. JPX-R thus developed what it calls the “Principles of Equity Finance.”

(a) Principle-based approach

Principle-based approach mentioned herein refers to the approach where the principles which all the listed companies must observe and share shall be confirmed and each would exercise its normative consciousness derived from the principles to act independently, thereby improving the quality of capital market as a whole.

In this context, the “Principles of Equity Finance” represent fundamental concepts which listed companies must rely on in raising funds using capital markets beyond the minimum disciplines specified in laws and regulations and the Exchange regulations and rules. Unlike rules, they would not automatically bind the behaviors of listed companies or market participants.

* Even if a listed company does not fully meet the “Principles of Equity Finance”, no measures would be imposed on the listed company without any reasonable reasons associate with the Exchange regulations and rules.

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(b) Expected effect of the “Principles of Equity Finance”

JPX-R expects that the following effect will be achieved as listed companies and market participants share and implement the “Principles of Equity Finance.”

1) When there are no explicit rules or there is diversity in interpretations of regulations and rules, listed companies may exercise management judgement to carry out equity finance in reliance on fundamental notions guided by the Principles of Equity Finance.

2) Market participants including subscribers or securities companies, legal advisors, CPAs, consultants and others who provide advice to listed companies may give advice such that listed companies do not depart from the underlying concept of the “Principles of Equity Finance,” by fully understanding them and may contribute to the appropriate management decision of listed companies.

3) Shareholders and investors may rely on the Principles to assess the adequacy of equity finance effected by listed companies and make more reasonable investment decisions.

4) Financial instruments exchange may carry out dialogues with listed companies or market participants within the underlying concepts derived from the Principles while implementing self-regulation operations. When financial instruments exchange interprets and applies more general regulations and rules in the absence of directly applicable regulations and rules, the underlying concepts derived from the Principles could guide its judgment and financial instruments exchange could address specific situation more responsive to the substances thereof.

The Principles of Equity Finance have been developed based on principles comprising the following four principles, which clearly define and embody the purposes and spirits underlying laws and regulations and other rules pertaining to equity finance, then adding to various aspects and perspectives acquired while JPX-R has carried out self-regulation operations. Any of principles represents the underlying principle which should be and should prev iously have been shared and applied by all the market participants.

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Principles of Equity Finance

1. Contribute to the enhancement of enterprise value It is reasonably certain that the funds procured are used effectively to improve the earnings power of a listed company based on the assessment of the purpose of fund procurement, use of funds, appropriation status of funds procured in the past, and earnings forecasts. The performance results and financial position of the listed company do not give rise to any threat to reasonable expectations.

The financing is expected to realize sustainable improvements in the enterprise value of the listed company as sound management is carried out after the financing transaction.

2. No damage to the benefits of existing shareholders The financing methodology, timing, and issuance terms are determined in full consideration of potential dilution associated with the financing transaction and the impact of the transactions on the secondary market. The transactions must be clearly explained to existing shareholders. 3. No threat to the fairness of or confidence in markets

Any entity or cooperating party who endeavors to obtain profit in any unfair manner should not be allowed to participate in or trade on the capital market. No scheme should be developed to obtain undue profit as a whole by combining transactions that may not instantly be alleged to violate the Exchange regulations or rules on an individual basis.

4. Ensure transparency by disclosing information in a timely and adequate manner For information disclosure, timing is important. The information disclosed must be true and consistent. The scope of the disclosure is sufficient and the explanations included with the disclosed data, etc. must be straightforward and useful to the investment decisions of shareholders and investors.

It must be demonstrated that the contents of disclosure will be adequate even after the financing transaction is implemented.

e. Duty of CPAs, etc.to Cooperate with the Exchange, Which Seeks Explanations of CPAs, etc.

Where the Exchange deems it necessary to decide the appropriateness pertaining to delisting of a listed stock, etc. issued by such listed company and requests certified public accountants (CPAs), etc. (including entities who were such certified public accountants, etc.) who carry out audit certification, etc. of financial statements, etc. or quarterly financial statements, etc. to give explanation on the circumstances, etc. , the listed company shall cooperate in this process so that CPAs, etc. could readily provide such explanations, etc.

【Rule 606, Paragraph 1 of Securities Listing Regulations】

JPX-R carries out the operation entrusted to it by the Exchange may request a listed company to provide similar explanations, etc. Whenever requested so, the listed company shall cooperate in the

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process in the similar way to the Exchange.

【Rule 3, Paragraph 2 of Securities Listing Regulations】

Where the Exchange requests a listed company for the purpose of requiring such certified public accountants, etc. to give explanation on the circumstances, etc., the listed company shall promptly submit a document stating that such certified public accountants, etc. agree to give explanation on the circumstances, etc. 【Rule 606, Paragraph 2 of Securities Listing Regulations】

Note: It should be noted that when a listed company refuses the submission of agreement statement of the certified public accountants, etc. or delays it, such situation may meet the provisions of Rule 601, Paragraph 1, Item 12 of the Securities Listing Agreement (Listing Agreement Violation).

f. Examination and Inspection of Securities Trading, etc.

The Exchange has entrusted JPX-R with self-regulation operations pertaining to survey to ensure fairness of trading of securities on the Exchange market, in addition to self-regulation operations for the listing of securities. Accordingly, JPX-R (Examination and Inspection Department) carries out the examination and inspection of trading pertinent to trading acts which violate relevant laws and regulations, including insider trading.

(a) Duty to report the background for public announcement of corporate information

JPX-R (Examination and Inspection Department) shall inquire into the developments, etc. from the occurrence of corporate information to the public announcement, to a listed company, where JPX-R deems it necessary to carry out a survey in order to secure fairness of securities trading, etc.

【Rule 16, Paragraph 2 of JPX-R Business Regulations】

Where JPX-R entrusted by the Exchange with the self-regulation operations deems it necessary to carry out a survey in order to ensure fairness of securities, trading, etc. and makes an inquiry into listed stock, etc. including the developments, etc. from the occurrence of corporate information to the public announcement, to a listed company by deeming that it is necessary for the purpose of trading supervision, the listed company shall accurately report on the inquired matters. 【Rule 415, Paragraph 4, Item 1 of Securities Listing Regulations; Rule 3, Paragraph 2 of the same regulations】

Where another domestic financial instruments exchange requests a listed company to provide information concerning a listed company pertaining to information from the occurrence through the public announcement of corporate information due to a survey in order to ensure fairness of securities trading, etc. in such market, the listed company shall promptly make report on the inquired matters.

【Rule 415, Paragraph 4, Item 2 of Securities Listing Regulations】

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(b) Issuing warnings to listed companies

JPX-R (Trading Examination Department) may issue warnings to an issuer of a listed security, where it deems that the act of such issuer of the listed security is an act in violation of laws and regulations or an act which is likely to fall under the violation of laws and regulations or where it concludes that the internal system (*) for the prevention of unfair trading with respect to corporate information is not adequate and deems it necessary, as a result of the examination of securities trading, etc.

Note: The internal system includes necessary systems to prevent insider trading, etc. by its officers, agents, employees and other workers as specified by Rule 449 of Securities Listing Regulations.

【Rule 18, Paragraph 1 of JPX-R Business Regulations】

JPX-R shall require a listed company to report improvement measures, etc. by a document, where it deems necessary when issuing warnings. 【Rule 18, Paragraph 2 of JPX-R Business Regulations】

(8) Delisting

In cases where a listed stock, etc. falls under the Delisting Criteria for Listed Companies as defined in the Regulations, it shall be delisted. For details of the Delisting Criteria for Listed Companies, please refer to 13. [Rule 601 through 612 of the Regulations]

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12. Delisting Criteria (Primary Listing)

For the purpose of maintaining quality of certain level and liquidity as a market, we set up strict and detailed delisting criteria. Delisting criteria for each market are as follows.

(1) Main Markets (TSE 1st Section and 2nd Section)(Primary Listing)

Item Requirement

1. Number of shareholders Where the number of shareholders is less than 400 as at the end of a [Rule 602, Paragraph 1, Item 1 of the business year of a listed company, and the number does not reach at least Regulations] 400 within a year. [Rule 601, Paragraph 1, Item 1 of the Regulations]

Where any of the following a. through c. is met; provided, however, that the same shall not apply to cases where the Enforcement Rules specify otherwise:

a. Where the number of tradable shares is less than 2,000 units as at the end of a business year of a listed company and the number does not reach at least 2,000 units within a year;

2. Tradable shares b. Where the market capitalization of the tradable shares is less than 500 [Rule 602, Paragraph 1, Item 1 of the million yen as at the end of a business year of a listed company and the Regulations] number does not reach at least 500 million yen within a year; [Rule 601, Paragraph 1, Item 2 of the provided, however, that where the general market condition rapidly Regulations] deteriorates and TSE deems that this criterion is not appropriate, TSE shall specify the criterion on a case by case basis; or

c. Where the number of tradable shares is less than 5% of the total number of a listed stock, etc. as at the end of a business year of a listed company and the listed company does not submit a scheduled plan of public offering, secondary offering or distribution by a day specified by the Enforcement Rules.

Where the following a. or b. is met; 3. Trading volume provided, however, that the same shall not apply to cases where public [Rule 602, Paragraph 1, Item 1 of the offering, secondary offering or off-auction distribution is carried out as Regulations] specified by the Enforcement Rules (Rule 601, Paragraph 2 of the [Rule 601, Paragraph 1, Item 3 of the Enforcement Rules) within three (3) months after the following a. or b. is Regulations] met: [Rule 601, Paragraph 2 of the Rules] a. Where the average monthly trading volume of a listed stock, etc. for

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each year ending December 31 is less than ten (10) units; or

b. Where no trade has been made for three (3) months before the end of every month

Where the following a. or b. is met:

a. Where the market capitalization is less than one (1) billion yen and does not reach at least one (1) billion yen within nine (9) months; provided, however, that where the general market condition rapidly 4. Market capitalization deteriorates and TSE deems that this criterion is not appropriate, other [Rule 602, Paragraph 1, Item 1 of the criteria shall apply as specified by TSE on a case by case basis; or Regulations]

[Rule 601, Paragraph 1, Item 4 of the b. Where the market capitalization of said stock, etc. is less than the Regulations] amount obtained by multiplying the number of the listed stock, etc. by two (2) and does not reach at least such amount within three (3) months

Where a listed company has liabilities in excess of assets as of the end of the business year and the liabilities in excess of assets is not cleared within a year; provided, however, that this means cases where the liabilities in excess of assets are not cleared within two (2) years if such listed company plans to 5. Liabilities in excess of assets clear the liabilities in excess of assets within a year counting from a day [Rule 602, Paragraph 1, Item 1 of the when such year passes by carrying out rehabilitation proceedings or Regulations] reorganization proceedings on the basis of the provisions of laws, [Rule 601, Paragraph 1, Item 5 of the business revitalization based on Specific Certified Dispute Resolution Regulations] Procedures prescribed in Rule 2, Paragraph 25 of the Industrial Revitalization Act, or workouts based on the "Guidelines for Multi-Creditor Out-of-Court Workouts" formulated by the Study Group on Multi-Creditor Out-of-Court Workouts (limited to cases deemed appropriate by TSE);

6. Suspension of bank Where a bill, etc. issued by a listed company is dishonored and its bank transactions transactions are suspended or their suspension becomes certain [Rule 602, Paragraph 1, Item 1 of the Regulations] [Rule 601, Paragraph 1, Item 6 of the Regulations]

7. Bankruptcy proceedings, Where a listed company become necessary to enter its bankruptcy rehabilitation proceedings or proceedings, rehabilitation proceedings or reorganization proceedings on reorganization proceedings the basis of the provisions of laws or where it falls under a situation [Rule 602, Paragraph 1, Item 1 of the equivalent to these. In this case, it means circumstances where the Regulations] company discloses a restructuring plan prescribed by the Enforcement

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[Rule 601, Paragraph 1, Item 7 of the Rules and the market capitalization does not reach at least one (1) billion Regulations] yen for a month counting from the day following the day on which such restructuring plan is disclosed

8. Suspension of business Where a listed company suspends its business activities or where it falls activities into a situation equivalent to this [Rule 602, Paragraph 1, Item 1 of the Regulations] [Rule 601, Paragraph 1, Item 8 of the Regulations]

In cases of the following a. or b., where TSE deems that such a. or b. is met:

b. Where a company is listed subject to the following (a) through (c); and TSE deems that a listed company as prescribed by the following (a) through (c) is not a substantial surviving company pertaining to such 9. Inappropriate merger, etc. company, and such company does not satisfy the criteria specified by [Rule 602, Paragraph 1, Item 1 of the the Enforcement Rules within three (3) years: Regulations] (a) Where a listed stock, etc. is delisted due to dissolution caused by a [Rule 601, Paragraph 1, Item 9 of the merger of a listed company on the Main Markets: Regulations] The newly created company or the surviving company, or the parent [Rule 208, Item 1, 3 and 5 of the company of the surviving company pertaining to such merger; Regulations] (b) Where a listed company on the Main Markets becomes a wholly-owned subsidiary of another company by a stock swap, stock transfer and other means or where it is specified by the Enforcement Rules as a status equivalent to this: Such other company or the parent of such other company; (c) Where a listed company on the Main Market is delisted due to falling under the case where a listed company on the Main Market ceases to be the party to the listing agreement by making another company succeed the listing agreement based on its agreement of a split by a merger or a plan of a split by creating a new company at the time of carrying out a shareholder directed spin-off: Such other company

10. Damage to Sound Where there is a change of a controlling shareholder due to private Transactions with Controlling placement, when TSE deems there is considerable damage to sound

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Shareholder transactions with the controlling shareholder within the coming 3 years. [Rule 602, Paragraph 1, Item 1 of the Regulations] [Rule 601, Paragraph 1, Item 9-2 of the Regulations]

11. Delay in Submission of Annual Where Annual Securities Report or Quarterly Securities Report to which an Securities Report or Quarterly audit report or a quarterly review report as specified in Article 3, Securities Report Paragraph 1 of the Cabinet Office Ordinance on Audit Certification [Rule 602, Paragraph 1, Item 1 of the prepared by two (2) or more certified public accountants or an audit firm Regulations] is attached) is not submitted to the Prime Minister within one (1) month [Rule 601, Paragraph 1, Item 10 of the after a period specified in the Financial Instruments and Exchange Act. Regulations]

Where the following a. or b. is met:

a. Where a listed company makes a false statement in a securities report, etc. and, in addition, TSE deems that its effect is material; or 12. False Statement or Adverse

Opinion, etc. b. Concerning an audit report attached to financial statements, etc. or a [Rule 602, Paragraph 1, Item 1 of the Quarterly Review Report attached to Quarterly Financial Statements, Regulations] etc. of a listed company, where certified public accountants state an [Rule 601, Paragraph 1, Item 11 of the "adverse opinion" or a fact that "opinions are not expressed" in an Regulations] audit report, and a "negative conclusion" or a fact that "conclusions are not expressed" in a quarterly review report and, in addition, TSE deems that such fact has a material impact.

Where the following a., b. or c. is met:

13. Breach of Listing Agreement, a. Where a listed company has committed a material breach of the listing etc. agreement as prescribed by the Enforcement Rules (Article 601, [Rule 602, Paragraph 1, Item 1 of the Paragraph 10 of the Enforcement Rules); Regulations] [Rule 601, Paragraph 1, Item 12 of the b. Where a listed company has committed a material breach as to matters Regulations] taken on oath in the Written Oath submitted; or [Rule 601, Item 10 of the Rules] c. Where a listed company ceases to be a party to the listing agreement.

14. Becoming a Wholly-Owned Where a listed company becomes a wholly -owned subsidiary of another Subsidiary company by stock swap or stock transfer. [Rule 602, Paragraph 1, Item 1 of the Regulations] [Rule 601, Paragraph 1, Item 15 of the Regulations]

15. Unreasonable Restriction on Where the details of shareholders’ rights and their exercise are

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Shareholders’ Rights unreasonably restricted as specified by the Enforcement Rules (Article [Rule 602, Paragraph 1, Item 1 of the 601, Paragraph 13 of the Enforcement Rules). Regulations] [Rule 601, Paragraph 1, Item 17 of the Regulations] [Rule 601, Item 13 of the Rules]

16. Whole Acquisition Where a listed company acquires all shares pertaining to such stock. [Rule 602, Paragraph 1, Item 1 of the Regulations] [Rule 601, Paragraph 1, Item 18 of the Regulations] 17. Involvement of Anti-Social Where it has become clear that a listed company has relationships Forces prescribed in the Enforcement Rules as those in which the listed company [Rule 602, Paragraph 1, Item 1 of the is involved with anti-social forces, when TSE deems that such condition Regulations] has considerably damaged shareholders and investors trust in the market. [Rule 601, Paragraph 1, Item 19 of the Regulations]

18. Handling by Designated Where such security has ceased to be handled in the custody and Book-Entry Transfer Institution book-entry transfer operation of listed foreign stocks, etc. or the [Rule 602, Paragraph 1, Item 2 of the book-entry transfer operation of a designated book-entry transfer Regulations] institution.

Where a listed foreign company imposes a transfer restriction on a listed foreign stock, etc. issued by such company; 19. Restriction on Transfer of provided, however, that the same shall not apply to cases where the Share Certificates, etc. transfer restriction on a stock, etc. is deemed necessary to receive the [Rule 602, Paragraph 1, Item 3 of the application of the provisions of laws and regulations of a home country or Regulations] in cases equivalent thereto where the details are deemed not to hinder trading in the market of TSE.

Where a deposit agreement, etc. or any other agreement is terminated if a 20. Termination of Deposit listed foreign company is an issuer of such listed foreign stock depositary Agreement, etc. receipt, etc.; [Rule 602, Paragraph 1, Item 4 of the provided, however, that the same shall not apply to cases where such Regulations] deposit agreement, etc. or any other agreement is terminated because of [Rule 206, Paragraph 1, Item 4 of the a change in a depository, etc. pertaining to a listed foreign stock Regulations] depositary receipt, etc.

21. Others In addition to each of the preceding items, where TSE deems that [Rule 602, Paragraph 1, Item 1 of the delisting of such security is appropriate for the public interest or the Regulations] protection of investors. [Rule 601, Paragraph 1, Item 20 of the Regulations]

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(2) Mothers (Primary Listing)

Item Requirement

Where the number of shareholders is less than 400 as at the end of a 1. Number of shareholders business year of a listed company, and the number does not reach at least [Rule 604, Paragraph 1, Item 1 of the 400 within a year (within a period of ten (10) years since listing, where the Regulations] number is less than 150, and the number does not reach at least 150 [Rule 603, Paragraph 1, Item 1 of the within a year (where ten (10) years since listing elapse during such year, Regulations] at least 400))

Where a listed domestic stock, etc. falls under any of the following a. through c.; provided, however, that the same shall not apply to cases where the Enforcement Rules specify otherwise:

a. Where the number of tradable shares is less than 2,000 units as at the end of a business year of a listed company, and the number does not reach at least 2,000 units within a year (within a period of ten (10) years since listing, where the number is less than 1,000 units, and the number does not reach at least 1,000 units within a year (where ten (10) years since listing elapse during such year, at least 2,000 units));

2. Tradable shares b. Where the market capitalization of tradable shares is less than 500 [Rule 604, Paragraph 1, Item 1 of the million yen as of the end of a business year of a listed company, and it Regulations] does not reach 500 million yen within a year (within a period of ten (10) [Rule 603, Paragraph 1, Item 2 of the years since listing, where it is less than 250 million yen, and it does not Regulations] reach at least 250 million yen within a year (where ten (10) years since listing elapse during such year, at least 500 million yen)); provided, however, that where the general market condition rapidly deteriorates and TSE deems that this criterion is not appropriate, TSE shall prescribe on a case by case basis; or

Where a listed company has liabilities in excess of assets as at the end of 3. Liabilities in excess of assets a business year (excluding cases where a listed company falls into [Rule 604, Paragraph 1, Item 1 of the liabilities in excess of assets within three (3) years after listing) and the Regulations] liabilities in excess of assets do not cease within a year; [Rule 603, Paragraph 1, Item 3 of the provided, however, that in cases where such listed company plans to clear Regulations] liabilities in excess of assets within a year counting from a day when such

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year passes by undertaking rehabilitation proceedings or reorganization proceedings pursuant to the provisions of laws, business revitalization based on Specific Certified Dispute Resolution Procedures prescribed in Article 2, Paragraph 25 of the Industrial Revitalization Act, or workouts based on the "Guidelines for Multi-Creditor Out-of-Court Workouts" formulated by the Study Group on Multi-Creditor Out-of-Court Workouts, the liabilities in excess of assets is not cleared within two (2) years;

4. Sales Where sales are less than 100 million yen in the last year (excluding cases [Rule 604, Paragraph 1, Item 1 of the where the amount of profits is recorded in the last year and where sales Regulations] are less than 100 million yen in the last year within five (5) years after [Rule 603, Paragraph 1, Item 4 of the listing). In this case, "the last year" shall be counted from the end of the Regulations] most recent business year Where the following a. or b. is met:

a. Where the market capitalization is less than one (1) billion yen, and it does not reach at least one (1) billion yen within nine (9) months (within a period of ten (10) years since listing, where it is less than 500 million yen and it does not reach at least 500 million yen within nine (9) 5. Market capitalization months (where ten (10) years since listing elapse during such nine (9) [Rule 604, Paragraph 1, Item 1 of the months, at least one (1) billion yen)); Regulations] provided, however, that where the general market condition rapidly [Rule 603, Paragraph 1, Item 5 of the deteriorates and TSE deems that this criterion is not appropriate, TSE Regulations] shall prescribe on a case by case basis; or

b. Where the market capitalization of said stock, etc. is less than the amount obtained by multiplying the number of the shares of the listed stock by two (2) and does not reach a least such amount within three (3) months;

Where, by the point of time when 3 years have elapsed since listing, the stock price falls below 10% of the public offering price at the time of initial 6. Stock price listing, the price fails to recover to 10% or more of such public offering [Rule 604, Paragraph 1, Item 1 of the price within 9 months; Regulations] provided, however, that this shall be handled as specified by TSE on a [Rule 603, Paragraph 1, Item 5-2 of the case-by-case basis if TSE deems that application of the above standard is Regulations] inappropriate in consideration of changes in market trends and other circumstances

7. Trading volume Where the following a. or b. is met; [Rule 604, Paragraph 1, Item 2 of the provided, however, that the same shall not apply to cases where public Regulations] offering, secondary offering or off-auction distribution is carried out as [Rule 601, Paragraph 1, Item 3 of the specified by the Enforcement Rules (Article 601, Paragraph 2 of the Regulations] Enforcement Rules) within three (3) months after the following a. or b. is

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met:

a. Where the average monthly trading volume of a listed stock, etc. for each year ending December 31 is less than ten (10) units; or

b. Where no trade has been made for three (3) months before the end of every month

8. Suspension of bank Where a bill, etc. issued by a listed company is dishonored and its bank transactions transactions are suspended or their suspension becomes certain [Rule 604, Paragraph 1, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 6 of the Regulations]

Where a listed company become necessary to enter its bankruptcy 9. Bankruptcy proceedings, proceedings, rehabilitation proceedings or reorganization proceedings on rehabilitation proceedings or the basis of the provisions of laws or where it falls under a situation reorganization proceedings equivalent to these. In this case, it means circumstances where the [Rule 604, Paragraph 1, Item 2 of the company discloses a restructuring plan prescribed by the Enforcement Regulations] Rules and the market capitalization does not reach at least one (1) billion [Rule 601, Paragraph 1, Item 7 of the yen for a month counting from the day following the day on which such Regulations] restructuring plan is disclosed

10. Suspension of business Where a listed company suspends its business activities or where it falls activities into a situation equivalent to this [Rule 604, Paragraph 1, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 8 of the Regulations] In cases of the following a. or b., where TSE deems that such a. or b. is met:

a. Where a listed company carries out an absorption-type merger of an 11. Inappropriate merger, etc. unlisted company or an act specified by the Enforcement Rules as an [Rule 604, Paragraph 1, Item 2 of the act classified as this: Regulations] Where TSE deems that such listed company is not a substantial [Rule 601, Paragraph 1, Item 9 of the surviving company and such listed company does not satisfy the criteria Regulations] specified by the Enforcement Rules within three (3) years; or [Rule 208, Item 1, 3 and 5 of the Regulations] b. Where a company is listed subject to the following (a) through (c); and TSE deems that a listed company as prescribed by the following (a) through (c) is not a substantial surviving company pertaining to such company, and such company does not satisfy the criteria specified by the Enforcement Rules within three (3) years:

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(a) Where a listed stock, etc. is delisted due to dissolution caused by a merger of a listed company on the Main Markets: The newly created company or the surviving company, or the parent company of the surviving company pertaining to such merger; (b) Where a listed company on the Main Markets becomes a wholly-owned subsidiary of another company by a stock swap, stock transfer and other means or where it is specified by the Enforcement Rules as a status equivalent to this: Such other company or the parent of such other company; (c) Where a listed company on the Main Market is delisted due to falling under the case where a listed company on the Main Market ceases to be the party to the listing agreement by making another company succeed the listing agreement based on its agreement of a split by a merger or a plan of a split by creating a new company at the time of carrying out a shareholder directed spin-off: Such other company

12. Damage to Sound Where there is a change of a controlling shareholder due to private Transactions with Controlling placement, when TSE deems there is considerable damage to sound Shareholder transactions with the controlling shareholder within the coming 3 years [Rule 604, Paragraph 1, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 9-2 of the Regulations]

13. Delay in Submission of Annual Where Annual Securities Report or Quarterly Securities Report to which an Securities Report or Quarterly audit report or a quarterly review report as specified in Article 3, Securities Report Paragraph 1 of the Cabinet Office Ordinance on Audit Certification [Rule 604, Paragraph 1, Item 2 of the prepared by two (2) or more certified public accountants or an audit firm Regulations] is attached) is not submitted to the Prime Minister within one (1) month [Rule 601, Paragraph 1, Item 10 of after a period specified in the Financial Instruments and Exchange Act. the Regulations] Where the following a. or b. is met:

a. Where a listed company makes a false statement in a securities report, etc. and, in addition, TSE deems that its effect is material; or 14. False Statement or Adverse

Opinion, etc. b. Concerning an audit report attached to financial statements, etc. or a [Rule 604, Paragraph 1, Item 2 of the Quarterly Review Report attached to Quarterly Financial Statements, Regulations] etc. of a listed company, where certified public accountants state an [Rule 601, Paragraph 1, Item 11 of "adverse opinion" or a fact that "opinions are not expressed" in an the Regulations] audit report, and a "negative conclusion" or a fact that "conclus ions are not expressed" in a quarterly review report and, in addition, TSE deems that such fact has a material impact.

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Where the following a., b. or c. is met:

15. Breach of Listing Agreement, a. Where a listed company has committed a material breach of the listing etc. agreement as prescribed by the Enforcement Rules (Article 601, [Rule 604, Paragraph 1, Item 2 of the Paragraph 10 of the Enforcement Rules); Regulations] [Rule 601, Paragraph 1, Item 12 of b. Where a listed company has committed a material breach as to matters the Regulations] taken on oath in the Written Oath submitted; or [Rule 601, Item 10 of the Rules] c. Where a listed company ceases to be a party to the listing agreement.

16. Becoming a Wholly-Owned Where a listed company becomes a wholly-owned subsidiary of another Subsidiary company by stock swap or stock transfer. [Rule 604, Paragraph 1, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 15 of the Regulations]

17. Unreasonable Restriction on Where the details of shareholders’ rights and their exercise are Shareholders’ Rights unreasonably restricted as specified by the Enforcement Rules (Article [Rule 604, Paragraph 1, Item 2 of the 601, Paragraph 13 of the Enforcement Rules). Regulations] [Rule 601, Paragraph 1, Item 17 of the Regulations] [Rule 601, Paragraph 1, Item 13 of the Rules]

18. Whole Acquisition Where a listed company acquires all shares pertaining to such stock. [Rule 604, Paragraph 1, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 18 of the Regulations]

19. Involvement of Anti-Social Where it has become clear that a listed company has relationships Forces prescribed in the Enforcement Rules as those in which the listed company [Rule 604, Paragraph 1, Item 2 of the is involved with anti-social forces, when TSE deems that such condition Regulations] has considerably damaged shareholders and investors trust in the market. [Rule 601, Paragraph 1, Item 19 of the Regulations]

20. Handling by Designated Where such security has ceased to be handled in the custody and Book-Entry Transfer Institution book-entry transfer operation of listed foreign stocks, etc. or the [Rule 604, Paragraph 1, Item 3 of the book-entry transfer operation of a designated book-entry transfer Regulations] institution. [Rule 602, Paragraph 1, Item 2 of the Regulations]

21. Restriction on Transfer of Where a listed foreign company imposes a transfer restriction on a listed

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Share Certificates, etc. foreign stock, etc. issued by such company; [Rule 604, Paragraph 1, Item 3 of the provided, however, that the same shall not apply to cases where the Regulations] transfer restriction on a stock, etc. is deemed necessary to receive the [Rule 602, Paragraph 1, Item 3 of the application of the provisions of laws and regulations of a home country or Regulations] in cases equivalent thereto where the details are deemed not to hinder trading in the market of TSE.

Where a deposit agreement, etc. or any other agreement is terminated if a 22. Termination of Deposit listed foreign company is an issuer of such listed foreign stock depositary Agreement, etc. receipt, etc.; [Rule 604, Paragraph 1, Item 3 of the provided, however, that the same shall not apply to cases where such Regulations] deposit agreement, etc. or any other agreement is terminated because of [Rule 602, Paragraph 1, Item 4 of the a change in a depository, etc. pertaining to a listed foreign stock Regulations] depositary receipt, etc.

23. Others In addition to each of the preceding items, where TSE deems that [Rule 604, Paragraph 1, Item 2 of the delisting of such security is appropriate for the public interest or the Regulations] protection of investors. [Rule 601, Paragraph 1, Item 20 of the Regulations]

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(3) JASDAQ (Standard Market) (Primary Listing)

Item Requirements

1. Stock Price In the event that stock price is less than JPY 10, it does not increase to JPY [Rule 604-3, Item 1 of the Regulations] 10 or above within 3 months. [Rule 604-2, Paragraph 1, Item 2 of the Regulations]

The operating income and the cash flow in operating activities for the 4 2. Corporate Performance most recent consolidated fiscal years are negative and this state is not [Rule 604-3, Item 1 of the Regulations] resolved within 1 year (excluding cases where the 4 most recent [Rule 604-2, Paragraph 1, Item 2 of the consolidated fiscal years includes the 5 fiscal years prior to the fiscal year Regulations] following that in which the company made its listing application).

3. Number of Shareholders Where the number of shareholders is less than 150 in Japan as at the end [Rule 604-3, Item 2 of the Regulations] of a business year of a listed company, and the number does not reach at [Rule 601, Paragraph 1, Item 1 of the least 150 within a year. Regulations]

Where a listed stock falls under any of the following a. and b.

a. Where the number of tradable shares is less than 500,000 shares for 1,000-share unit stock, 250,000 shares for 500-share unit stock, 50,000 shares for 100-share unit stock, 25,000 shares for 50-share unit stock, 5,000 shares for 10-share unit stock, and 500 shares for 1-share unit stock, respectively, as of the end of a business year of a listed company, and the number does not reach at least 500,000 shares for 4. Tradable Shares 1,000-share unit stock, 250,000 shares for 500-share unit stock, [Rule 604-3, Item 2 of the Regulations] 50,000 shares for 100-share unit stock, 25,000 shares for 50-share unit [Rule 601, Paragraph 1, Item 2 of the stock, 5,000 shares for 10-share unit stock, and 500 shares for 1-share Regulations] unit stock, respectively, within a year;

b. Where the market capitalization of tradable shares is less than JPY250 million as of the end of a business year of a listed company, and it does not reach JPY250 million within a year; provided, however, that where the general market condition rapidly deteriorates and TSE deems that this criterion is not appropriate, TSE shall prescribe on a case by case basis;

Where a listed company has liabilities in excess of assets as of the end of 5. Liabilities in Excess of Assets a business year and the liabilities in excess of assets do not cease within a [Rule 604-3, Item 2 of the Regulations] year. [Rule 601, Paragraph 1, Item 5 of the

Regulations]

6. Suspension of Bank Where a bill, etc. issued by a listed company is dishonored and its bank

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Transactions transactions are suspended or their suspension becomes certain. [Rule 604-3, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 6 of the Regulations] Where a listed company become necessary to enter its bankruptcy proceedings, rehabilitation proceedings or reorganization proceedings on 7. Bankruptcy proceedings, the basis of the provisions of laws or where it falls under a situation rehabilitation proceedings or equivalent to these. In this case, it means circumstances where the reorganization proceedings company discloses a restructuring plan prescribed by the Enforcement [Rule 604-3, Item 2 of the Regulations] Rules and the market capitalization does not reach at least JPY 500 million [Rule 601, Paragraph 1, Item 7 of the for a month counting from the day following the day on which such Regulations] restructuring plan is disclosed.

8. Suspension of Business Where a listed company suspends its business activities or where it falls Activities into a situation equivalent to this. [Rule 604-3, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 8 of the Regulations]

In cases of the following a. or b., where TSE deems that such a. or b. is met:

9. Inappropriate Merger, etc. b. Where a company is listed subject to the following (a) through (c); and [Rule 604-3, Item 2 of the Regulations] TSE deems that a listed company as prescribed by the following (a) [Rule 601, Paragraph 1, Item 9 of the through (c) is not a substantial surviving company pertaining to such Regulations] company, and such company does not satisfy the criteria specified by [Rule 216-9, Item 1, 3 and 5 of the Reg the Enforcement Rules within three (3) years: ulations] (a) Where a listed stock, etc. is delisted due to dissolution caused by a merger of a listed company on the Main Markets: The newly created company or the surviving company, or the parent company of the surviving company pertaining to such merger; (b) Where a listed company on the Main Markets becomes a wholly-owned subsidiary of another company by a stock swap, stock transfer and other means or where it is specified by the Enforcement Rules as a status equivalent to this: Such other company or the parent of such other company; (c) Where a listed company on the Main Market is delisted due to falling under the case where a listed company on the Main Market ceases

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to be the party to the listing agreement by making another company succeed the listing agreement based on its agreement of a split by a merger or a plan of a split by creating a new company at the time of carrying out a shareholder directed spin-off: Such other company

10. Damage to Sound Where there is a change of a controlling shareholder due to private Transactions with Controlling placement, when TSE deems there is considerable damage to sound Shareholder transactions with the controlling shareholder within the coming 3 years. [Rule 604-3, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 9-2 of the Regulations]

Where Annual Securities Report or Quarterly Securities Report to which an 11. Delay in Submission of Annual audit report or a quarterly review report as specified in Article 3, Securities Report or Quarterly Paragraph 1 of the Cabinet Office Ordinance on Audit Certification Securities Report prepared by two (2) or more certified public accountants or an audit firm [Rule 604-3, Item 2 of the Regulations] is attached) is not submitted to the Prime Minister within one (1) month [Rule 601, Paragraph 1, Item 10 of the after a period specified in the Financial Instruments and Exchange Act. Regulations]

Where the following a. or b. is met:

a. Where a listed company makes a false statement in a securities report, etc. and, in addition, TSE deems that its effect is material; or 12. False Statement or Adverse Opinion, etc. b. Concerning an audit report attached to financial statements, etc. or a [Rule 604-3, Item 2 of the Regulations] Quarterly Review Report attached to Quarterly Financial Statements, [Rule 601, Paragraph 1, Item 11 of etc. of a listed company, where certified public accountants state an the Regulations] "adverse opinion" or a fact that "opinions are not expressed" in an audit report, and a "negative conclusion" or a fact that "conclusions are not expressed" in a quarterly review report and, in addition, TSE deems that such fact has a material impact.

Where the following a., b. or c. is met:

a. Where a listed company has committed a material breach of the listing 13. Breach of Listing Agreement, agreement as prescribed by the Enforcement Rules (Article 601, etc. Paragraph 10 of the Enforcement Rules); [Rule 604-3, Item 2 of the Regulations]

[Rule 601, Paragraph 1, Item 12 of b. Where a listed company has committed a material breach as to matters the Regulations] taken on oath in the Written Oath submitted; or [Rule 601, Item 10 of the Rules]

c. Where a listed company ceases to be a party to the listing agreement.

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14. Becoming a Wholly-Owned Where a listed company becomes a wholly-owned subsidiary of another Subsidiary company by stock swap or stock transfer [Rule 604-3, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 15 of the Regulations]

15. Unreasonable Restriction on Where the details of shareholders’ rights and their exercise are Shareholders’ Rights unreasonably restricted as specified by the Enforcement Rules (Article [Rule 604-3, Item 2 of the Regulations] 601, Paragraph 13 of the Enforcement Rules) [Rule 601, Paragraph 1, Item 17 of the Regulations] [Rule 601, Item 13 of the Rules]

16. Whole Acquisition Where a listed company acquires all shares pertaining to such stock. [Rule 604-3, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 18 of the Regulations]

17. Involvement of Anti-Social Where it has become clear that a listed company has relationships Forces prescribed in the Enforcement Rules as those in which the listed company [Rule 604-3, Item 2 of the Regulations] is involved with anti-social forces, when TSE deems that such condition [Rule 601, Paragraph 1, Item 19 of has considerably damaged shareholders and investors trust in the market. the Regulations]

18. Handling by Designated Where such security has ceased to be handled in the custody and Book-Entry Transfer Institution book-entry transfer operation of listed foreign stocks, etc. or the [Rule 604-3, Item 3 of the Regulations] book-entry transfer operation of a designated book-entry transfer [Rule 602, Paragraph 1, Item 2 of the institution. Regulations]

Where a listed foreign company imposes a transfer restriction on a listed 19. Restriction on Transfer of foreign stock, etc. issued by such company; Share Certificates, etc. provided, however, that the same shall not apply to cases where the [Rule 604-3, Item 3 of the Regulations] transfer restriction on a stock, etc. is deemed necessary to receive the [Rule 601, Paragraph 1, Item 3 of the application of the provisions of laws and regulations of a home country or Regulations] in cases equivalent thereto where the details are deemed not to hinder trading in the market of TSE.

Where a deposit agreement, etc. or any other agreement is terminated if a 20. Termination of Deposit listed foreign company is an issuer of such listed foreign stock depositary Agreement, etc. receipt, etc.; [Rule 604-3, Item 3 of the Regulations] provided, however, that the same shall not apply to cases where such [Rule 602, Paragraph 1, Item 4 of the deposit agreement, etc. or any other agreement is terminated because of Regulations] a change in a depository, etc. pertaining to a listed foreign stock [Rule 206, Paragraph 1, Item 4 of the depositary receipt, etc. Regulations]

21. Others In addition to each of the preceding items, where TSE deems that [Rule 604-3, Item 2 of the Regulations] delisting of such security is appropriate for the public interest or the

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[Rule 602, Paragraph 1, Item 20 of protection of investors. the Regulations]

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(4) JASDAQ (Growth Market) (Primary Listing)

Item Requirements

1. Stock Price In the event that stock price is less than JPY10, it does not increase to JPY [Rule 604-5, Item 1 of the Regulations] 10 or above within 3 months. [Rule 604-4, Paragraph 1, Item 1 of the Regulations] [Rule 604-2, Paragraph 1, Item 1 of the Regulations]

2. Corporate Performance The operating income and the cash flow in operating activities for the 4 [Rule 604-5, Item 1 of the Regulations] most recent consolidated fiscal years are negative and this state is not [Rule 604-4, Paragraph 1, Item 1 of the resolved within 1 year (excluding cases where the 4 most recent Regulations] consolidated fiscal years includes the 5 fiscal years prior to the fiscal year [Rule 604-2, Paragraph 1, Item 2 of the following that in which the company made its listing application). Regulations]

In the event where the operating income for the consolidated fiscal year 3. Operating Income of a listing application is negative and the operating income for the 9 fiscal [Rule 604-5, Item 1 of the Regulations] years after it is listed are negative, the operating income of the listed [Rule 604-4, Paragraph 1, Item 3 of the company's corporate group does not become positive within 1 year. Regulations]

4. Number of Shareholders Where the number of shareholders is less than 150 in Japan as of the end [Rule 604-5, Item 2 of the Regulations] of a business year of a listed company, and the number does not reach at [Rule 601, Paragraph 1, Item 1 of the least 150 within a year. Regulations]

Where a listed stock falls under any of the following a. and b.

a. Where the number of tradable shares is less than 500,000 shares for 1,000-share unit stock, 250,000 shares for 500-share unit stock, 50,000 shares for 100-share unit stock, 25,000 shares for 50-share unit stock, 5,000 shares for 10-share unit stock, and 500 shares for 1-share unit stock, respectively, as of the end of a business year of a listed company, and the number does not reach at least 500,000 shares for 5. Tradable Shares 1,000-share unit stock, 250,000 shares for 500-share unit stock, [Rule 604-5, Item 2 of the Regulations] 50,000 shares for 100-share unit stock, 25,000 shares for 50-share unit [Rule 601, Paragraph 1, Item 2 of the stock, 5,000 shares for 10-share unit stock, and 500 shares for 1-share Regulations] unit stock, respectively, within a year;

b. Where the market capitalization of tradable shares is less than JPY 250 million as at the end of a business year of a listed company, and it does not reach JPY 250 million within a year; provided, however, that where the general market condition rapidly deteriorates and TSE deems that this criterion is not appropriate, TSE e shall prescribe on a case by case basis.

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6. Liabilities in Excess of Assets Where a listed company has liabilities in excess of assets as at the end of [Rule 604-5, Item 2 of the Regulations] a business year and the liabilities in excess of assets do not cease within a [Rule 601, Paragraph 1, Item 5 of the year. Regulations] 7. Suspension of Bank Where a bill, etc. issued by a listed company is dishonored and its bank Transactions transactions are suspended or their suspension becomes certain. [Rule 604-5, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 6 of the Regulations]

Where a listed company become necessary to enter its bankruptcy proceedings, rehabilitation proceedings or reorganization proceedings on 8. Bankruptcy proceedings, the basis of the provisions of laws or where it falls under a situation rehabilitation proceedings or equivalent to these. In this case, it means circumstances where the reorganization proceedings company discloses a restructuring plan prescribed by the Enforcement [Rule 604-5, Item 2 of the Regulations] Rules and the market capitalization does not reach at least JPY 500 million [Rule 601, Paragraph 1, Item 7 of the for a month counting from the day following the day on which such Regulations] restructuring plan is disclosed.

9. Suspension of Business Where a listed company suspends its business activities or where it falls [Rule 604-5, Item 2 of the Regulations] into a situation equivalent to this. [Rule 601, Paragraph 1, Item 8 of the Regulations]

In cases of the following a. or b., where TSE deems that such a. or b. is met:

a. Where a listed company carries out an absorption-type merger of an unlisted company or an act specified by the Enforcement Rules as an act classified as this: Where TSE deems that such listed company is not a substantial surviving company and such listed company does not satisfy the 10. Inappropriate Merger, etc. criteria specified by the Enforcement Rules within three (3) years; or [Rule 604-5, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 9 of the b. Where a company is listed subject to the following (a) through (c); and Regulations] TSE deems that a listed company as prescribed by the following (a) [Rule 216-9, Item 1, 3 and 5 of the Reg through (c) is not a substantial surviving company pertaining to such ulations] company, and such company does not satisfy the criteria specified by the Enforcement Rules within three (3) years: (a) Where a listed stock, etc. is delisted due to dissolution caused by a merger of a listed company on the Main Markets: The newly created company or the surviving company, or the parent company of the surviving company pertaining to such merger; (b) Where a listed company on the Main Markets becomes a wholly-owned subsidiary of another company by a stock swap, stock transfer and other means or where it is specified by the Enforcement

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Rules as a status equivalent to this: Such other company or the parent of such other company; (c) Where a listed company on the Main Market is delisted due to falling under the case where a listed company on the Main Market ceases to be the party to the listing agreement by making another company succeed the listing agreement based on its agreement of a split by a merger or a plan of a split by creating a new company at the time of carrying out a shareholder directed spin-off: Such other company

11. Damage to Sound Where there is a change of a controlling shareholder due to private Transactions with Controlling placement, when TSE deems there is considerable damage to sound Shareholder transactions with the controlling shareholder within the coming 3 y ears. [Rule 604-5, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 9-2 of the Regulations]

Where Annual Securities Report or Quarterly Securities Report to which an 12. Delay in Submission of Annual audit report or Quarterly Review Report as specified in Article 3, Securities Report or Quarterly Paragraph 1 of the Cabinet Office Ordinance on Audit Certification Securities Report prepared by two (2) or more certified public accountants or an audit firm [Rule 604-5, Item 2 of the Regulations] is attached) is not submitted to the Prime Minister within one (1) month [Rule 601, Paragraph 1, Item 10 of the after a period specified in the Financial Instruments and Exchange Act. Regulations]

Where the following a. or b. is met:

a. Where a listed company makes a false statement in a securities report, etc. and, in addition, TSE deems that its effect is material; or 13. False Statement or Adverse Opinion, etc. b. Concerning an audit report attached to financial statements, etc. or a [Rule 604-5, Item 2 of the Regulations] Quarterly Review Report attached to Quarterly Financial Statements, [Rule 601, Paragraph 1, Item 11 of etc. of a listed company, where certified public accountants state an the Regulations] "adverse opinion" or a fact that "opinions are not expressed" in an audit report, and a "negative conclusion" or a fact that "conclusions are not expressed" in a Quarterly Review Report and, in addition, TSE deems that such fact has a material impact.

Where the following a., b. or c. is met: 14. Breach of Listing Agreement, etc. a. Where a listed company has committed a material breach of the listing [Rule 604-5, Item 2 of the Regulations] agreement as prescribed by the Enforcement Rules (Rule 601, [Rule 601, Paragraph 1, Item 12 of Paragraph 10 of the Enforcement Rules); the Regulations] [Rule 601, Item 10 of the Rules] b. Where a listed company has committed a material breach as to matters taken on oath in the Written Oath submitted; or

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c. Where a listed company ceases to be a party to the listing agreement.

15. Becoming a Wholly-Owned Where a listed company becomes a wholly-owned subsidiary of another Subsidiary company by stock swap or stock transfer. [Rule 604-5, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 15 of the Regulations]

16. Unreasonable Restriction on Where the details of shareholders’ rights and their exercise are Shareholders’ Rights unreasonably restricted as specified by the Enforcement Rules (Rule 601, [Rule 604-5, Item 2 of the Regulations] Paragraph (xiii) of the Enforcement Rules). [Rule 601, Paragraph 1, Item 17 of the Regulations] [Rule 601, Item 13 of the Rules]

17. Whole Acquisition Where a listed company acquires all shares pertaining to such stock. [Rule 604-5, Item 2 of the Regulations] [Rule 601, Paragraph 1, Item 18 of the Regulations]

18. Involvement of Anti-Social Where it has become clear that a listed company has relationships Forces prescribed in the Enforcement Rules as those in which the listed company [Rule 604-5, Item 2 of the Regulations] is involved with anti-social forces, when TSE deems that such condition [Rule 601, Paragraph 1, Item 19 of has considerably damaged shareholders and investors trust in the market. the Regulations] 19. Handling by Designated Where such security has ceased to be handled in the custody and Book-Entry Transfer Institution book-entry transfer operation of listed foreign stocks, etc. or the [Rule 604-5, Item 3 of the Regulations] book-entry transfer operation of a designated book-entry transfer [Rule 602, Paragraph 1, Item 2 of the institution. Regulations] Where a listed foreign company imposes a transfer restriction on a listed foreign stock, etc. issued by such company; 20. Restriction on Transfer of provided, however, that the same shall not apply to cases where the Share Certificates, etc. transfer restriction on a stock, etc. is deemed necessary to receive the [Rule 604-5, Item 3 of the Regulations] application of the provisions of laws and regulations of a home country or [Rule 602, Paragraph 1, Item 3 of the in cases equivalent thereto where the details are deemed not to hinder Regulations] trading in the market of TSE.

21. Termination of Deposit Where a deposit agreement, etc. or any other agreement is terminated if a Agreement, etc. listed foreign company is an issuer of such listed foreign stock depositary [Rule 604-5, Item 3 of the Regulations] receipt, etc.; [Rule 602, Paragraph 1, Item 4 of the provided, however, that the same shall not apply to cases where such Regulations] deposit agreement, etc. or any other agreement is terminated because of [Rule 206, Paragraph 1, Item 4 of the a change in a depository, etc. pertaining to a listed foreign stock Regulations] depositary receipt, etc.

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22. Others In addition to each of the preceding items, where TSE deems that [Rule 604-5, Item 3 of the Regulations] delisting of such security is appropriate for the public interest or the [Rule 601, Paragraph 1, Item 20 of protection of investors. the Regulations]

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13. Delisting Criteria (Multiple Listing)

For the purpose of maintaining market quality and liquidity at certain level, we set up strict and detailed listing criteria. Listing criteria for each market are as follows.

(1) Main Markets (TSE 1st Section and 2nd Section)(Multiple Listing)

The delisting criteria for multiple listing are mostly same as the delisting criteria for primary listing, however, the following criteria are different from each other. In addition, for the delisting criteria for primary listing, please refer to sections at section 12 (1).

Item Multiple listing Primary Listing 1. Number of Shareholders None Where the number of shareholders is less [Rule 602, Paragraph 1, Item 1 of the than 400 as at the end of the business Regulations] year of the listed company, and the [Rule 601, Paragraph 1, Item number does not reach at least 400 1 of the Regulations] within a year

None Where a listed domestic stock, etc. falls under any of the following a. through c.;

a. Where the number of tradable shares is less than 2,000 units as at the end of the business year of the listed company, and the number does not reach at least 2,000 units within a year

2. Number of Tradable b. Where the market capitalization of Shares tradable shares is less than 500 million [Rule 602, Paragraph 1, Item 1 of the yen as at the end of the business year Regulations] of the listed company, and it does not [Rule 601, Paragraph 1, Item 2 of the reach 500 million yen within a year; Regulations] provided, however, that where the general market condition rapidly deteriorates and TSE deems that this criterion is not appropriate, TSE shall prescribe on a case by case basis; or

c. Where the number of tradable shares is less than 5% of the total number of a listed stock, etc. as at the end of the business year of the listed company

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and the listed company does not submit a scheduled plan of public offering, secondary offering, or distribution with a quantitative limit by the day specified by the Enforcement Rules;

None Where the following a. or b. is met; provided, however that the same shall not apply to cases where public offering, secondary, offering, or off-auction distribution is carried out as specified by the Enforcement Rules (Rule 601(2) of 3. Trading Volume the Enforcement Rules) within three (3) [Rule 602, Paragraph 1, Item 1 of the months after the following a. or b. is met: Regulations] [Rule 601, Paragraph 1, Item 3 of the a. Where the average monthly trading Regulations] volume of a listed stock, etc. for each [Rule 601, Item 2 of the Rules] year ending December 31 is less than ten (10) units; or

b. Where no trade has been made for three (3) months before the end of every month

delisting is deemed to be inappropriate in consideration of reasons for delisting such listed foreign stock, etc. from a foreign financial instruments exchange, etc. or in consideration of the trading status at TSE and any other event

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The status of trading in a listed None 5. Status of Trading foreign stock, etc. is deemed to have radically deteriorated as at the end [Rule 602, Paragraph 2, Item 2 of the of a business year of a listed foreign Regulations] stock, etc.

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(2) Mothers (Multiple Listing)

Item Multiple listing Primary listing None Where the number of shareholders is less than 400 as at the end of the business year of the listed company, 1. Number of Shareholders and the number does not reach at [Rule 604, Paragraph 1, Item 1 of the least 400 within a year (within a Regulations] period of ten (10) years since [Rule 603, Paragraph 1, Item 1 of the listing, where the number is less Regulations] than 150, and the number does not reach at least 150 within a year (where ten (10) years since listing elapsed during such year, at least 400))

None Where a listed domestic stock, etc. falls under any of the following a. through c.; provided, however, that the same shall not apply to cases where the Enforcement Rules specify otherwise:

a. Where the number of tradable 2. Number of Tradable Shares shares is less than 2,000 units as [Rule 604, Paragraph 1, Item 1 of the at the end of the business year of Regulations] the listed company, and the [Rule 603, Paragraph 1, Item 2 of the number does not reach at least Regulations] 2,000 units within a year (within

a period of ten (10) years since

listing, where the number is less than 1,000 units, and the number does not reach at least 1,000 units within a year (where ten (10) years since listing elapsed during such year, at least 2,000 units));

b. Where the market capitalization

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of tradable shares is less than 500 million yen as at the end of the business year of the listed company, and it does not reach 500 million yen within a year (within a period of ten (10) years since listing, where it is less than 250 million yen, and it does not reach at least 250 million yen within a year (where ten (10) years since listing elapsed during such year, at least 500 million yen)); provided, however, that where the general market condition rapidly deteriorates and TSE deems that this criterion is not appropriate, TSE shall prescribe on a case by case basis; or

c. Where the number of tradable shares is less than 5% of the total number of the listed stock, etc. as at the end of the business year of the listed company and the listed company does not submit a scheduled plan of public offering, secondary offering, or distribution with a quantitative limit by the day specified by the Enforcement Rules;

None Where the following a. or b. is met; provided, however, that the same shall not apply to cases where public offering, secondary offering 3. Trading Volume or off-auction distribution is carried [Rule 604, Paragraph 1, Item 1 of the out as specified by the Enforcement Regulations] Rules (Rule 601(2) of the [Rule 603, Paragraph 1, Item 2 of the Enforcement Rules) within three (3) Regulations] months after the following a. or b. is

met: a. Where the average monthly trading volume of a listed stock, etc. for each year ending

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December 31 is less than ten (10) units; or b. Where no trade has been made for three (3) months before the end of every month

Where delisting of a listed foreign None stock, etc. from a foreign financial instruments exchange, etc. is decided or where TSE deems that circumstances have changed to a degree where market prices, etc. of such listed foreign stock, etc. on a 4. Delisting from a Foreign foreign financial instruments Financial Instruments exchange, etc. cannot be obtained Exchange, etc. immediately; [Rule 604, Paragraph 1, Item 3 of the provided, however, that the same Regulations] shall not apply to cases where [Rule 602, Paragraph 2, Item 1 of delisting is deemed to be the Regulations] inappropriate in consideration of reasons for delisting such listed foreign stock, etc. from a foreign financial instruments exchange, etc. or in consideration of the trading status at TSE and any other event

5. Status of Trading The status of trading in a listed None foreign stock, etc. is deemed to [Rule 604, Paragraph 1, Item 3 of the have radically deteriorated as at the Regulations] end of a business year of a listed [Rule 602, Paragraph 2, Item 2 of foreign stock, etc. the Regulations]

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(3) JASDAQ (Standard and Growth Markets) (Multiple Listing)

In the case of multiple listing the following criteria are required to be met in addition to the satisfaction of criteria required for primary listing. In addition, for the delisting criteria for primary listing, please refer to sections 12 (3) and 12 (4).

Item Requirements When the delisting of foreign stock, etc. on a foreign financial instruments Delisting from Foreign Financial and exchange is determined or TSE determines that the quoted prices of Instruments Exchange, etc. stock, etc. on a foreign financial instruments and exchange can not be observed immediately; [Rule 604-3, Paragraph 1, Item 3 of the provided that this will not apply to cases where the delisting is determined Regulations] to be inappropriate in consideration of reason for delisting on the foreign [Rule 602, Paragraph 2, Item 1 of the financial instruments and exchange and the status of distribution, and Regulations] other factors.

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14. Listing Fees Consumption taxes and local consumption taxes will be levied on various dues and fees mentioned in this chapter.

(1) Fees for Initial Listing on TSE (Listing Examination Fee, Initial Listing Fee, and Public Offering/Secondary Offering Fee)

A foreign company, when applying for listing on TSE, shall pay fees consisting of listing examination fee, initial listing fee, and public offering/sales fee.

When TSE is the main When TSE is not market the main market Second First & Second First Section Section Sections Mothers JASDAQ Listing Examination ¥4,000,000 ¥2,000,000 ¥2,000,000 ¥2,000,000 Fee ¥2,500,000 Initial Listing ¥15,000,000 ¥12,000,000 + Fixed rate fee ¥1,000,000 ¥6,000,000 Fee (See below) Number of new shares Number of new offered×offer price× shares offered×offer Public (9/10,000) price× (9/10,000) Offering/Sales ― ― Number of existing shares Number of existing Fee sold×sales price× shares sold×sales (1/10,000) price× (1/10,000)

Furthermore, in cases where an applicant previously filed a listing application or preliminary application and the applicant intends to file a re-application within three years counting from the beginning date of the business year to which the most recent application date pertains (in case of the preliminary application, the date which was described in the preliminary application form for listing of securities as the date on which the listing application was expected to be filed), the listing fees is expected to be halved.

When TSE implements a field visit or meeting, etc. at locations remote from Japan, in particular including Europe, the United States, and so on, TSE will separately charge to the applicant the amount equivalent to actual expenses incurred for the field visit and meeting purposes.

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Initial Listing Fee for Foreign Stock, etc. with a Main Market Listing on any Overseas Exchange

Initial listing fee for foreign stock, etc. with a main market listing on any overseas exchange is computed as 2.5 million yen plus a fixed rate fee as shown in the table below:

Ratio of number of foreign stock, etc. held by individuals and legal entities having address and residence in Japan to Initial Listing Fee the total number of listed foreign stock. etc. ¥2,500,000＋Number of Listed Foreign Stock, etc.× More than 5% (225/10,000) ×1/10 More than 2% and less than or equal to ¥2,500,000＋Number of Listed Foreign Stock, etc.× 5% (225/10,000) ×1/20 ¥2,500,000＋Number of Listed Foreign Stock, etc.× Less than or equal to 2% (225/10,000) ×1/50

(2) Annual Listing Fee (Main Market (First & Second Sections) and Mothers)

After the listing on TSE, listed foreign companies shall pay the Annual Listing Fee, which shall be the amount defined in the table below (tax excluded) plus TDnet usage fee of ¥120,000 (tax excluded). In addition, as for foreign companies listed in Mothers market, for the initial three (3) years after the listing, the annual listing fee shall be half of the amount defined in the table below (tax excluded) plus TDnet usage fee of ¥120,000 (tax excluded).

When TSE is the Main Market When TSE is not Second First Section Mothers the Main Market Market Cap at IPO Section Less than or equal to ¥5 billion ¥960,000 ¥720,000 ¥480,000 ¥120,000 More than ¥5 billion and less than ¥1,680,000 ¥1,440,000 ¥1,200,000 ¥240,000 or equal to ¥25 billion More than ¥25 billion and less ¥2,400,000 ¥2,160,000 ¥1,920,000 ¥480,000 than or equal to ¥50 billion More than ¥50 billion and less ¥3,120,000 ¥2,880,000 ¥2,640,000 ¥600,000 than or equal to ¥250 billion More than ¥250 billion and less ¥3,840,000 ¥3,600,000 ¥3,360,000 ¥720,000 than or equal to ¥500 billion More than ¥500 billion ¥4,560,000 ¥4,320,000 ¥4,080,000 ¥840,000

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(3) Annual Listing Fee (JASDAQ)

After listing on TSE, listed foreign companies shall pay the Annual Listing Fee, which shall be the amount defined in the table below (tax excluded) plus TDnet usage fee of ¥85,000 (tax excluded).

Market Cap at IPO JASDAQ ¥100 billion or less ¥1,000,000 More than ¥100 billion ¥1,200,000

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15. Securities Taxation System (Japanese Investors [1] Investing in

TSE Listed Foreign Stocks)

Tax treatments for dividends, etc. on JDR are as follows [2]:

(1) Taxation for Individual Investors (Dividend income) Taxes on dividend income received by individual investors will be withheld at the source at the following tax rates. Period Tax rate, etc. January 1, 2014 to December 20.315% (Income tax & Special reconstruction income tax, 15. 31, 2037 315%; Residential tax, 5%) January 1, 2038 and later 20% taxation (Income tax 15%; Residential tax 5%)

Irrespective of the dividend amount, an individual investor may elect to apply (1) an exemption from filing declaration, (2) the self-assessed separated taxation on dividend income by filing a tax return, or (3) general taxation. When an individual investor elects to apply (1) an exemption from filing declaration, the tax on the dividend income will be withheld at the source at the aforementioned tax rates when the dividend income is paid. The tax relationship will be complete through the withholding of the tax amount at the source. The above tax rates will also apply if an individual investor elects to apply (2) the self-assessed separated taxation on dividend income by filing a tax return, but in that case the investor may aggregate any gains and losses on the sale of listed stocks or certain public or corporate bonds.

(Gain on sales) No taxes will be withheld at the source for gains on the sales of Japanese Depository Receipts (JDRs), unless the investor designates a specified account for withholding taxes. Gains on the sales of JDRs will be subject to the separated taxation for a filing declaration at the tax rates below. .Also, any losses on the sales of JDRs can be aggregated and offset by dividend income, etc. on the listed stocks (only applicable to self-assessed separated taxation).

Period Tax rates, etc. January 1, 2014 to December 20.315% (Income tax & Special reconstruction income tax, 15. 31, 2037 315%; Residential tax, 5%) January 1, 2038 and later 20% (Income tax 15%; Residential tax 5%)

If, on the other hand, an individual investor designates a specified account for withholding taxes, the tax will be withheld at the source at the above tax rates applied to the sales of JDRs, and the tax relationship will be complete through the withholding of the tax amount at the source (no tax return filing is required).

[2] See p113 and p114 of the 2017 Securities Report of Techpoint, Inc.

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(2) Taxation on corporations (Dividend income) For corporations, the tax rates below shall apply to the amount ofmoney for which the relevant tax is withheld at the source in the home country based on the tax rates provided under the tax treaty concluded between Japan and the home country of the listed foreign company. Period Taxation procedures January 1, 2014 to December 15.315% (Income tax & Special reconstruction income tax, 15. 31, 2037 315%) January 1, 2038 and later 15% (only income tax 15%) Foreign tax credits will apply.

(Gains or losses on sales) In principle, the taxation on gains and losses on the sales of TSE-listed stocks will be the same as that applied to gains and losses on the sales or purchases by Japanese corporations of TSE-listed stocks.

・ These materials have been developed based on reliable information, but they do not guarantee the accuracy and completeness of the contents. ・ These materials have been developed based on laws and regulations effective as of June 30, 2018 or laws and regulations that are certain to be enforced, but the contents may change due to future tax reform, etc. ・ Consult with a relevant tax accountant or tax office, etc. for any implementation issues of specific taxation.

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15. Q&A (1) Insider Trading Regulations Q. Tell me about the Insider Trading Regulations. A. Foreign stocks, etc. trading and JDRs trading are subject to the Insider Trading Regulations. For details, please refer to “FAQ on Consultation Examples for Insider Trading”published by Tokyo Stock Exchange. FAQ on Consultation Examples for Insider Trading (Japanese Only) https://www.jpx.or.jp/self-regulatory-activities/ensuring/preventing/insider-faq.html

(2) Tender Offer Rules (TOB Rules) Q. Tell me about Regulations on Tender Offer in Japan. A. Tender Offer Rules (TOB Rules) are defined for Japanese stocks, etc. with the aim of ensuring transparency and fairness for securities trading which would potentially affect control of a company, etc. When a person (“Tender Offeror”) tries to purchase a large quantity of stock, etc. through off-market trading, the Tender Offeror is required to disclose the tender offer period, number of stocks to be purchased, price of shares and other relevant facts so as to provide the shareholders with equal opportunities to sell the relevant stocks, etc. The Tender Offeror is required to make such a tender offer with adequate disclosure, if any of the following conditions apply: ・ When the stocks, etc. are purchased by a large number of persons (meaning more than ten (10) persons during 60 days), and the number of shares owned to exceed five (5) percent of the shares issued after the purchase; or ・ When the stocks, etc. are purchased by an extremely small number of persons (meaning ten or fewer persons during 60 days), and the number of shares owned to exceed one-third of the shares issued after the purchase.

(3) Large Shareholding Reporting System Q. What’s the Large Shareholding Reporting System? A. With regards to Japanese stocks, there are rules in Japan as indicated below with the aim of notifying investors about the state of large shareholding of stocks, etc.: ・ A person who has become a holder of the listed stocks, etc. whose shareholding ratio exceeds five (5) percent shall submit a large shareholding report within five (5) business days from the reference date. ・ If the shareholding ratio of any such large shareholder later increases or decreases by more than one (1) percent, the person shall file an amendment report within five business days. Exceptional measure for reduction of reporting frequency is taken separately for institutional investors engaging in a large amount of transactions in day-to-day business operations, such as securities companies, banks, trust banks, insurance companies, investment trust companies and investment advisory companies, etc. in consideration of their administrative workload.

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(4) Listing on TSE through the Establishment of a Japanese Company Q. How is the setup of a company in Japan for the purpose of having its stock listed on TSE treated? A. Please refer to “New Listing Guidebook - 1st and 2nd sections”, “New Listing Guidebook – Mothers” and “New Listing Guidebook – JASDAQ” in cases where a Japanese entity’s common stock is listed on TSE. The New Listing Guidebook is available at: https://www.jpx.co.jp/english/equities/listing-on-tse/new/guide/index.html

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A. Forms of Documents, etc. to be Filed for Initial Listing Application

(Foreign Stocks) (1) Confirmation Report prior to Initial Listing Application (for Applicant Company)

(Reference Transaction)

Confirmation Report prior to Initial Listing Application (for Applicant Company)

Submitted: MM/DD/YYYY

To President and CEO of Tokyo Stock Exchange, Inc.

Company name Name and title of representative Name of agent Seal Address and contact details of agent

(Note 1) Applied exchange rate: JPY XXX (The middle rate between the telegraphic transfer selling rate and the telegraphic transfer buying rate in Tokyo foreign exchange market as of MM/DD/YYYY) (Note 2) In the case of an initial listing application for foreign stock depositary receipts (hereafter "DRs"; the same shall apply hereafter), please include matters concerning such DRs in a manner equivalent to that of stocks.

[Matters for Attention]

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3. The company shall not object to the provision of this report to Japan Securities Depository Center, Inc. (hereafter "JASDEC"), and the utilization of its contents from the perspective of facilitating smooth handling of securities issued by the company at JASDEC. 4. The company confirms that all matters stated in this report are true. Furthermore, where it is found that any statement in this report is false, the company shall not object to any disposition made by TSE. In addition, this report shall be written in Japanese.

I. Summary of Applicant Company

1. Governing law for incorporation and related laws and regulations (1) Governing laws for incorporation (2) Describe major matters which are subject to special regulations by the abovementioned laws in comparison with a general company in terms of major laws and regulations, administrative guidance, etc. that regulate the operations, etc. of the applicant company

2. Details of securities issued by the company other than the initial listing application stock, etc. Where the applicant company has issued securities whose rights differ from those of the initial listing application stock, etc., state details of rights included in such securities.

3. Relationship with the government in the home country (*) (permission and authorization, and contractual and transactional relationship, etc.) Where the applicant company and its major affiliates have permission or authorization from the government in the home country, or are under contract or have transactions with the government, state details of such permission, authorization, contracts or transactions. State whether the applicant company has any special contracts or transactional relationship with the government.

* In addition to the country of incorporation of the applicant company, please include countries where major businesses operate in the home country.

4. Relationship with major shareholders (holding 10% of voting rights) (holding ratio, contractual and transactional relationship, etc.) Where the applicant company and its major affiliates are under contract or have transactions with a major shareholder, state details of such contracts or transactions. State whether the applicant company is under contract or has transactions with special conditions for each contract or transaction in comparison with those with other third parties.

5. Relationship with officers (Shareholding ratio, contractual and transactional relationship, etc.) Where the applicant company and its major affiliates have a contract or transactional relationship with an officer(s) of the applicant company (including companies in which the officer(s) make equity contributions, describe details of such contracts or transactions). If the applicant company is under contract or has transactions with special conditions for each contract or transaction in comparison with those with other third parties.

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6. Financial results for the most recent five years State the financial results in the most recent five years and the main factors behind changes Year ended in Year ended in Year ended in Year ended in Year ended MMMM MMMM MMMM MMMM in MMMM Sales Operating income Ordinary income Extraordinary income Extraordinary los Net income before tax Net in come Total assets Net assets

(Example) If changes are due to any of the following, describe a reason(s) for such changes ・ Where there was a large change from the previous year ・ Where performance shows a declining trend ・ Where there is an abnormal value due to a change(s) in accounting processing ・ Where there is the effect of a merger, or acquisition, etc. (Note 1) If it is difficult to state results of 5 full years, results for less than five years are also allowed (Note 2) Where financial documents include consolidated financial statements, state such consolidated figures. Where financial documents do not include consolidated financial statements, state figures in financial statements or combined financial statements.

7. Corporate reorganization Where the applicant company has implemented or plans a major merger, transfer or acquisition of business, making a company(s) its subsidiary, or disposition of a subsidiary(s) (hereafter collectively "corporate reorganization"), state the purpose, specific method, and effect of the corporate reorganization.

8. Defense measures against hostile takeovers Where the applicant company has introduced a takeover defense measure, or has plans to introduce or is considering introducing such a measure, state the following matters. (1) Date (or schedule) of introducing such measure (2) Introduction procedure (including decision-making body) (3) Outline (i) Details of scheme (ii) Trigger conditions and decision procedures (including decision-making body) (iii) Conditions for non-implementation and decision procedures (including decision-making body) (iv) Conditions for abolishing such measure and decision procedures (4) Where, in the last three years, there has been a hostile takeover entity(s) and the takeover defense measure was triggered, not implemented, or abolished, provide outlines of such cases. (Whether there was a fact or rumor of a hostile takeover entity(s), attach a copy(s) of news articles related to such case) (5) Legal system, etc. on hostile takeovers in the home country

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9. Establishment of an agent and a person for handling information, or an entity responsible for information handling State the applicant company's possibility of appointing "the agent prescribed in Rule 426 of the Securities Listing Regulations" and "the entity responsible for information handling prescribed in Rule 417" of the same regulations (excluding cases where the main market of the listed shares or listed DRs issued by the applicant company is not the TSE market), or a person for handling information (excluding cases where the main market of the listed shares or listed DRs issued by the applicant company is not the TSE market.) for appropriately issuing notices to TSE and conduct disclosure in Japan with regard to material facts. (Note 1) Even though the material facts include "issuance, etc. of shares, "merger with other company(s), and "cessation of business activity," the applicant company will be required to notify TSE of other matters pursuant to Rule 407, etc. of the Securities Listing Regulations. (Note 2) The agent prescribed in Rule 426 of the Securities Listing Regulations shall be appointed from among the following persons: ・Officers or employees of a listed company(s) ・Officers or employees of a subsidiary or affiliate company(s) ・Attorneys-at-law (Note 3) The person for handling information shall be able to communicate with TSE in Japanese or English, and, as a general rule, satisfy the following items. ・Person handling disclosure of corporate information in the home country. ・Person handling disclosure of corporate information to the financial instruments exchange in the home country.

10. Management of corporate information State internal rules and structure to prevent insider trading and whether or not there is an actual case(s) of insider trading which violated laws and regulations in the home country, etc.

11. Development and management of accounting system State issues that were pointed out by an auditor(s) with regard to developments and operations of the accounting system during the one year period prior to the application date, as well as the applicant company's response to such issues. (Such developments and operations include "development of and compliance with the accounting regulation" and "development of and compliance with the internal control system and internal audit system," and also include that of consolidated subsidiaries, etc.)

12. Disclosure of earnings report and quarterly earnings report (The following documents are required to be disclosed in Japanese in Japan) With respect to earnings reports and quarterly earnings reports, state how many days it will take to conduct disclosure after the end of the fiscal year or quarterly period.

13. Other State that there is no issue in terms of the public interest or social nature.

II. Other Matters to be Confirmed

1. Stock Company System (1) Stock System (i) Restrictions on acquisition, transfer, and assignment of stocks as well as the governing laws and regulations or provisions of the articles of incorporation, etc. pertaining to such restrictions a. Restrictions on domestic or overseas investors, the governing laws and regulations or provisions of the articles of incorporation pertaining to such restrictions 210

b. Restrictions on foreign nominees and the governing laws and regulations, or provisions of the articles of incorporation, etc. pertaining to such restrictions c. Where there is a limit on the number of shares to be held, the method of understanding, identifying, and proving the number of shares held by residents, and non-residents, etc. (including nominees) whose share holdings are subject to restrictions (ii) Rights, procedures, and restrictions related to dividend a. Dividend payment schedule Item Actual date, etc. Announcement date Date of resolution by the board of － directors (Date of resolution by general shareholders meeting) Record date Dividend amount per share Dividend payment date Ex-dividend date at the foreign financial － instruments exchange, etc. (Note) State for the most recent two years and the year of the application. Where there is no information for such years, state the latest information in the most recent five years. In addition, where a method other than record date (share provision date) is used to fix the shareholders who have right to dividend, state such method, actual cases, and announcement dates. b. Provisions of laws and regulations or the articles of incorporation, etc. for date of fixing shareholders eligible for dividend c. The name of the body which has the authority to determine dividend payment (for example, the board directors in the case of interim dividends, or the general shareholders meeting in the case of year-end dividends) d. Venue of dividend payment, payment method (route), and payment currency e. Restrictions related to dividend payment f. Oversight regulations in the foreign exchange market, such as restrictions on remittance of dividends to Japan and conversion into Japanese yen (2) General shareholders meeting (i) Venue for the general shareholders meeting (ii) Date and time for exercising voting rights at the general shareholders meet ings Item Actual date Announcement date Date of resolution by the board of － directors Record date Date of the general shareholders meeting (Note) State for the most recent two years and the year of the application. Where there is no information for such years, state the latest information in the most recent five years. In addition, where a method other than record date (share provision date) is used to fix the shareholders who have right to dividend, state such method, actual cases, and announcement dates. (iii) Provisions of laws and regulation or the articles of incorporation, etc. pertaining to the date of fixing shareholders who can exercise voting rights

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(iv) Restrictions on voting rights exercise by domestic and overseas investors, and the governing laws for such restrictions (v) Restrictions on voting right exercise by proxy (vi) Possibility of a system of non-uniformed exercise of voting rights (vii) Method of exercising voting rights (ballot, etc.) (viii) Notice of general shareholders meeting (convocation notice), deadline for notifying shareholders of documents and reference materials required for voting right exercise (ix) Possibility of creating Japanese translation of documents and reference materials required for voting right exercise in order to allow beneficial shareholders in Japan sufficient time to give proxy voting instructions (3) Issuance of new shares (i) With respect to new share issuance, in addition to provisions of the company law in the home country, matters uniquely stipulated in the articles of incorporation (ii) Possibility of sales of new shares, subscription warrants, subsidiary shares, etc. at venues such as a foreign market in cases of granting or allotting such shares, etc. (iii) Oversight regulations on the foreign exchange market, such as restrictions on remittance of proceeds from selling such shares, etc. to Japan and restrictions on conversion into Japanese yen (iv) Stock split (including stock dividend and bonus issue): Fill out the following items as well as resources (capital surplus, retained earnings, etc.) and diff erence of rights between new shares and pre-split shares. Item Actual date, etc. Announcement date Date of resolution by the board of － directors (Date of resolution by general shareholders meeting Record date Split ratio (with or without change in face value) Date of delivery of new shares Ex-right date at the foreign financial － instruments exchange, etc. (Note) State for the most recent two years and the year of application. Where there is no information for such years, state the latest information in the most recent five years. In addition, where a method other than record date (share provision date) is used to fix the shareholders who have right to dividend, state such method, actual cases, and announcement dates

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(v) Capital increase via allotment shares to shareholders (including rights offering): Fill out the following items as well as whether or not there is a subscription rights market, trading period, and difference of rights between new shares and pre-split shares. Item Actual date, etc. Announcement Date Date of resolution by the board of － directors (Date of resolution by general shareholders meeting) Record date Allotment ratio Payment amount per share Application period Deadline for payment Date of delivery of new shares Ex-right date at the foreign financial － instruments exchange, etc. (Note 1) State for the most recent two years and the year of application. Where there is no information for such years, state the latest information in the most recent five years. In addition, where a method other than record date (share provision date) is used to fix shareholders who have right to dividend, state such method, actual cases, and announcement dates. (Note 2) Where there is no negotiability of subscription rights, state the governing provisions. (vi) Form of capital increase conducted in the most recent two years and the year of application, schedule of the announcement until new share delivery, and procedures f or payment (including those for reinvesting dividend, granting of options for stock dividend, etc., but excluding those stated in (iii) and (iv) above). Where there was no case during such period, state the latest information in the most recent five years. (vii) The name of the institution having authority over new share issuance and the announcement method in the home country, etc.

2. Disclosure and notification (1) State the possibility of notifying TSE by two weeks before for the deadline (record date), etc. for fixing entities who can exercise shareholder rights or will receive new share allotment. (If it is difficult to notify two weeks in advance, state the possibility of notifying TSE by the deadline for notification, etc. required in the home country.) (2) State where the applicant company has violated disclosure rules (laws and regulations in the home country, etc. or rules and regulations of the exchange pertaining to corporate information disclosure.

3. Other matters that specially requested by TSE for confirmation in advance

III. Attached materials (if available, attach Japanese or English translation)

1. Company overview document (Documents which can understand an overview of the company such as, Securities Report for Initial Listing Application (Part I), etc.): 1 copy

2. Notice to shareholders or announcement documents pertaining to general shareholders meetings in the last two years (Notice of general shareholders meeting, etc.): 1 copy

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3. Materials sent to shareholders about capital increase via allotment of shares to shareholders (including rights offering) in the last two years (in cases where there is no such case during such two years, the last among cases during the most recent five years (prospectus, etc.)): 1 copy

4. Annual reports sent to shareholders and holders of DRs during the most recent five years (for Mothers, one year): 1 copy

5. Semi-annual reports and quarterly reports sent to shareholders and holders of foreign stock depositary receipts during the most recent five years (for Mothers, one year): 1 copy

6. Securities reports, annual reports, semi-annual reports, quarterly reports, and extraordinary reports submitted to the Prime Minister, etc. in the recent two years (for Mothers, one year): 1 copy

7. Securities registration statements (including amendment statements) submitted to the Prime Minister, etc. in cases of public offering or secondary distribution of securities in the most recent two years (for Mothers, one year): 1 copy

8. Press releases and newspaper announcements regarding the following items during the most recent year: 1 copy each ・ Announcement of financial results ・ Dividends ・ Stock splits ・ Capital increase via allotment of shares to shareholders (including rights offering) ・ Other material facts

DISCLAIMER: This translation may be used for reference purposes only. This English version is not an official translation of the original Japanese document. In cases where any differences occur between the English version and the original Japanese version, the Japanese version shall prevail. This translation is subject to change without notice. Tokyo Stock Exchange, Inc., Japan Exchange Group, Inc., Osaka Securities Exchange Co., Ltd., Tokyo Stock Exchange Regulation and/or their affiliates shall individually or jointly accept no responsibility or liability for damage or loss caused by any error, inaccuracy, misunderstanding, or changes with regard to this translation.

(July 16, 2014)

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(2) Confirmation Report prior to Initial Listing Application (for Trading Participant Handling Matters)

(Reference Translation)

Confirmation Report prior to Initial Listing Application (for Trading Participant Handling Matters)

Submitted: MM/DD/YYYY

To President and CEO of Tokyo Stock Exchange, Inc. Name of trading participant handling matters Seal Name and title of representative Seal

(Note 1) Applied exchange rate: JPY----- (The middle rate between the telegraphic transfer selling rate and telegraphic transfer buying rate in the Tokyo foreign exchange market as of MM/DD/YYYY.) (Note 2) In the case of an initial listing application for foreign stock depositary receipts (hereafter "DRs"; the same shall apply hereafter), please include matters concerning such DRs in a manner equivalent to that of stocks.

[Matters for Attention]

The company shall agree to the following matters and state such fact at the beginning of each report. 1. After submitting this report, in cases where there is a change or addition in facts of such statements or where there arises a new fact, the company shall report it accordingly to Tokyo Stock Exchange (hereafter "TSE"). 2. The company shall cooperate with TSE where it confirms the contents of this report. 3. The company shall not object to the provision of this report to Japan Securities Depository Center, Inc. (hereafter "JASDEC"), and the utilization of its contents from the perspective of facilitating smooth handling of securities issued by the applicant company at JASDEC.

In addition, this report shall be written in Japanese.

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(Point for Attention regarding Report) When content of the governing law and regulations, articles of incorporation and etc., are described in this report, please also describe the number or place of relevant provisions of governing law and regulations, articles of incorporation and etc.

I. Matters concerning Stock Company System

1. Stock System (1) Rights and Obligations of Shareholders (i) Rights of Shareholders a. Single shareholder right (right to dividend, voting right, and residual claim, etc.) b. Minority shareholder right (book inspection right, general shareholders meeting convocation right, etc. (ii) Obligations of shareholders (2) Stock acquisition, transfer, and assignment (i) Procedures for stock acquisition, transfer, and assignment (ii) Restrictions on stock acquisition, transfer, and assignment (3) Dividend (i) Dividend notice (ii) Method of fixing shareholders (iii) Restrictions related to dividend (iv) Deadline for notifying the financial instruments exchange, etc. in the home country, etc. (Not required in cases where the company will only be listed on TSE or cases where any other TSE-listed foreign company is listed on the financial instruments exchange, etc. in the same home country as the company.)

2. Company Organization (1) General Shareholders Meeting (i) Type of general shareholders meetings (annual, extraordinary, and class shareholders meetings) (ii) Matters to be put forth, matters to be reported and quorum for each type of general shareholders meetings (iii) Method of fixing shareholders (iv) Procedure for convening general shareholders meetings (method of issuing notice to shareholders and notice deadline) and deadline for notifying the financial instruments exchange, etc. in the home country, etc. (v) Resolution method (types of resolutions, required number of voting rights for approval, voting by proxy, and carte-blanche in proxy voting) (2) Directors and Representative directors (i) Procedure for appointing and removing directors, their authorities, obligations, and responsibilities (ii) Procedure for appointing and removing representative directors, their authorities, obligations , and responsibilities (3) Authorities, obligations, and responsibilities of the board of directors

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(4) Auditors and Board of Auditors (i) Procedure for appointing and removing auditors, their authorities (duties), obligations , and responsibilities (ii) Board of auditors' authorities (duties), obligations, and responsibilities

3. Procedures for Amending Articles of Incorporation

4. Issuance of New Shares (1) Type and procedure of new share issuance and deadline for notifying the financial instruments exchange, etc. in the home country, etc. (i) Issuance of shares via allotment to shareholders (ii) Issuance of shares via a stock split (Incorporation of reserves to capital, stock dividend, etc.) (iii) Issuance of shares by public offering, private placement, and other methods (iv) Issuance of shares other than common shares (2) Procedures for issuing subscription warrants, as well as methods for exercising such warrants and assigning such warrants (If not available for assignment, such provisions)

5. Capital Reduction Method and Procedures

6. Procedures for Merger

7. Bankruptcy Legal System and Procedures

II. Disclosure System

1. Indirect Disclosure (1) Statutory disclosure (i) Governing laws and regulations (ii) Type and content of documents, submission period (deadline), entity for submission, and public inspection method (2) Disclosure documents required by exchange (Not required in cases where the company will only be listed on TSE) (i) Applied rules (ii) Type and content of documents, submission period (deadline), entity for submission, and public inspection method

2. Direct Disclosure to Shareholders (1) Statutory disclosure (i) Governing laws and regulations (ii) Type and content of documents, submission (public announcement) period (deadline), entity for submission, and public inspection method (2) Disclosure documents required by the exchange (Not required in cases where the company will only be listed on TSE) (i) Applied rules

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(ii) Type and content of document (public announcement), submission (public announcement) period (deadline), entity for submission, and public inspection method

3. Listing Supervision (Not required in cases where the company will only be listed on TSE) (1) Procedures for trading halts and typical duration of a trading halt (2) Delisting criteria and procedures

4. Penalties Responsibility of, penalties on, and disciplinary actions against the related parties (officers of the issuer company, accountants, attorneys-at-law, financial instruments business operators) in the case of a violation of related laws and regulations or exchange rules, or other similar acts

III. Trading Supervision Rules and Systems (Not required in cases where the company will only be listed on TSE)

1. Laws, Regulations, and Rules of the Exchange regarding Trading Supervision, and their Content (1) Method for trade execution (2) Daily price limits (3) Procedures (schedule, etc.) for ex-rights (dividend, new share issuance) and applied provisions

2. Rules on Unfair Trading and Penalties (1) Market manipulation (2) Market stabilization (3) Insider trading (4) Tender offer (5) Others

IV. Settlement System

1. Matters listed below regarding stock custody at the central depository or banks offering custody services in the home country of the applicant company (1) Method of exercising voting rights concerning shares in custody (2) Dividend distribution method concerning shares in custody (3) Form of holding shares (registered names of shares in custody, etc.) (In the case of dematerialized shares, overview of registration system, etc.) (4) Existence of causes which impede share deposit or withdrawal or rights acquisition such as delay of rights transfer procedure in transfer of shares

2. Necessity of notification to or registration with the administrative authorities or the issuer company in the case where a foreign nominee (JASDEC) puts shares in custody, or deposits to, or withdraws from a local custodian or a bank.

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V. Tax Regime

1. Tax on dividend (1) Tax regime in the home country of the applicant company (any taxes, tax classification, tax rate, etc.) (limited to those pertaining to Japanese beneficiaries) (2) Necessity of refund application procedure (3) Deadline and method of refund application procedure (4) Availability of procedure of batch refund application for beneficial shareholders by JASDEC (5) Refund payment period (6) Possibility of receiving dividends for which reduced tax rates are applied from the outset in accordance with tax treaties, without refund application procedure

2. Other Taxes (1) Where JASDEC deposits to or withdraws from the custodian of JASDEC, or transfers to a JASDEC nominee, any taxes applicable to parties that deposit or withdraw shares. (2) Any taxes on transactions at exchanges (3) Existence of capital gain tax, etc. on proceeds from selling subscription warrants (limited to those pertaining to Japanese beneficial shareholders)

VI. Other Matters Specially Requested by the Exchange for Confirmation in Advance

VII. Attached Documents 1. Act(s) under which the applicant company was established (in Japanese or English translation) 2. A set of documents required for refund application procedure (If applicable) 3. A copy of the checklist submitted to the Financial Services Agency regarding the accounting and audit systems in the home country, etc. (If applicable)

(July 16, 2014)

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B. Tokyo Stock Exchange Listing by US Companies(Overview of Disclosure)

When a US company conducts a primary listing on Tokyo Stock Exchange (TSE), the domestic US statutory disclosures are generally implemented in addition to domestic Japanese statutory disclosures. Like domestic Japanese disclosure, the statutory disclosure requirements determined by the US Securities and Exchange Commission (SEC) involve two types of disclosure: offering disclosure when stocks are issued, and subsequent continuous disclosure.

(1) Offering Disclosure

In a public offering in the US, the issuer must submit a registration statement to the SEC before selling, buying or applying to do so (Section 5 of US Securities Act of 1933 (hereinafter, “Securities Act”)). The contents of the registration statement are provided under Section 7 of the Securities Act and schedule A. Specifically, the content of accounting information, including financial documents, is determined by Regulation S-X, and the content of non-accounting information, including the issuer, conditions on distribution and use of proceeds, and the registrant’s securities information, is provided by Regulation S-K. In the case of a primary listing, even though no issuance of securities within the US is planned, an issuer’s registration statement is typically submitted based on the relevant US regulations on such securities transactions prior to an IPO of foreign company stocks in Japan14. Regarding the registration statement, the forms of the statement are decided based on the nature of the securities issuer. In the case of a US firm undertaking a primary listing in Japan, a registration statement using Form S-1 is normally filed. Disclosure is implemented by submitting Form S-1 and other disclosure documents, as well as their attachments, through the EDGAR system.

(2) Continuous Disclosure

An issuer that has submitted the registration statement in accordance with the Securities Act must also submit annual, quarterly and extraordinary reports to the SEC in compliance with the Securities Exchange Act of 1934 (hereinafter, “the Exchange Act”). As with the registration statement, these disclosure documents and their attachments are submitted through the EDGAR system for disclosure.

14 The SEC stipulates a safe harbor rule under Regulation S to the effect that the filing of a registration statement to the SEC shall not be required when shares are offered or distributed outside the United States. However, while non-US companies (foreign issuers) are comparatively easily qualified for an exemption from registration (Rule 903(b)(1) of the General Rules and Regulations promulgated under the Securities Act), US companies (domestic issuers) are bound by strict qualification requirements (requirements for registration exemption application when issuing equity-related securities (Rule 903(b)(3) of the General Rules and Regulations promulgated under the Securities Act). Seemingly, the application of the safe harbor rule would be difficult due to the background above.

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(a) Annual Reports i. Annual Reports

An issuer that has submitted a registration statement must submit an annual report each business year using Form 10-K (Section 13 of the Exchange Act). The annual report includes information on the issuer, financial documents for the business year concerned and discussions and analysis by managers of the firm’s financial state, business performance, etc. This information on the issuer consists of more or less the same content as that included in the registration statement at the time of issuance. Depending on the public float of the company submitting the annual report, and whether continuous disclosure has been performed to date, submission may be required 60, 75, or 90 days after the end of the business year. Since an annual securities report in Japan comparable to the US annual report is required to be filed within six months of the end of the business year (Article 24, Paragraph (1) of the Financial Instruments and Exchange Act; and Article 3-4 of the Order for Enforcement of the Financial Instruments and Exchange Act), preparation of the former is normally based on the annual report submitted in the US.

ii. Internal Control Reports

An issuer that undertakes a commitment to continuous disclosure is required to establish and maintain appropriate internal control systems relevant to financial reporting. An internal control report must be submitted as part of the annual report 15. Based on the Sarbanes-Oxley Act (hereinafter, “SOX”), the internal control report must state the responsibility of the management for establishing and maintaining internal control related to financial reporting and contain an assessment of the effectiveness of internal controls, as well as a record showing that an accounting auditor has issued certification of this evaluation. In addition, an accounting auditor who has issued an audit report of an issuer is required to audit whether the management assessed the effectiveness of internal controls in an appropriate manner or not.16

15 Since an audit control report is also required to be submitted together with an annual securities report in Japan, there are cases in which an internal control report submitted within the US can be approved to be filed in Japan instead of one produced domestically (Article 24-4-4, Paragraph (1) of the Financial Instruments and Exchange Act; and Article 12 of the Cabinet Office Ordinance on Disclosure of Information, etc.). 16 It is assumed that there would be a difference in timing between the United States and Japan with regards to the time when the obligation to audit the internal control report arises. This is partly because Emerging Growth Companies (issuer with net sales of $1 billion or less in the most recent accounting period) are not subject to the audit of the internal control report for five years at the longest under the Jumpstart Our Business Startups (JOBS) Act, and partly because each issuer is required to commence the audit of the internal control report from the business year following the that of listing shares even in the cases where the relevant issuer does not fall under the category of Emerging Growth Company or is not subject to the JOBS Act. In such cases, even if the obligation to audit the internal control report does not arise in the United States, the audit is voluntarily conducted in practice in consideration of the audit obligations defined in Japan.

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(b) Quarterly Reports

An issuer that has submitted a registration statement must submit a quarterly report every three months using Form 10-Q (Article 13 of the Exchange Act and Exchange Act Rule 13a-13). The quarterly report indicates the issuer’s current status. The deadline for submission can be either 40 or 45 days after the end of the quarter depending, as with the annual report, on the public float of the issuing company and whether it has engaged in continuous disclosure. In Japan, companies that submit quarterly reports must do so within 45 days of the end of the quarter (Article 24-4-7, Paragraph (1) of the Financial Instruments and Exchange Act). In order to submit quarterly reports required domestically in both the US and Japan, it is necessary to prepare for submission of the domestic Japanese quarterly report in parallel with preparations for the domestic US report. In practice, however, given the differences in content between quarterly reports in the US and those in Japan, as well as the time required to translate financial and other documents, a submission deadline extension request can be filed for the Japanese quarterly report (Article 24-4-7, Paragraph (1) of the Financial Instruments and Exchange Act; and Article 17-15-2, Paragraph (1) of the Cabinet Office Ordinance on Disclosure of Corporate Information, etc.).

Under SOX, an issuer that undertakes a commitment to continuous disclosure is required to include written confirmation in its annual and quarterly reports on the appropriateness of the financial reporting and other information on the issuer’s financial status and business operations included in the documentation disclosed with the reports. Together with the pertinent disclosed documentation, the issuer is also required to file a written statement certified by a CEO and CFO. The CEO and CFO should certify that the financial status and business performance are appropriately presented in the disclosed documentation, and the CEO and CFO are responsible for the establishment and maintenance of internal control systems.

(d) Extraordinary Reports

In the event that a matter of significant to the issuing company occurs, the issuer who has submitted a registration statement must submit an extraordinary report on the important matter using Form 8-K, in principle, within four days of its occurrence (Article 13 of the Exchange Act and Exchange Act Rule 13a-11). The 8-K is triggered by certain significant events in which additional information emerges regarding changes to the firm’s financial or operational status. Specifically, these events may include (i) entering into or terminating a material definitive contract not made in the ordinary course of business of the issuer, (ii) initiation of bankruptcy proceedings, (iii) completion of acquisition or disposition of important assets, (iv) notice of delisting or failure to satisfy listing rules or standard, (v) change of certified public accountants, (vi) change of corporate control, and (vii) departure of directors or certain officers, etc. Some of these

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items are similar to the domestic Japanese criteria requiring extraordinary reports. Therefore, whenever an event occurs meriting an extraordinary report in either Japan or the US, it is regarded as appropriate to confirm whether it will be necessary to submit an extraordinary report in the other country as well.

(e) Regulation FD

Selective disclosure, by the issuer to a limited number of persons, of important information regarding the issuer or the issuer’s securities is categorized under insider trading and restricted under Regulation FD. These persons include brokers, dealers, investment advisors, institutional investment managers, investment firms, and holders of securities who can reasonably be expected to conduct transactions based on such information. When disclosure to such persons is intentional, the relevant information must be publicly disclosed simultaneously, and in cases where partial disclosure is non-intentional, public disclosure must be accomplished promptly. Persons with a fiduciary or confidentiality obligation to the issuer, however, are not obligated to disclose the relevant information publicly. The method of disclosure is, in principle, in accordance with Form 8-K.

(f) Procedures for submission of Earnings Reports, Form 10-K, Form 10-Q and Form 8-K

When an issuer listed on a stock exchange has determined the content of documents for an accounting period, whether a business year, cumulative quarterly period, consolidated fiscal year, or cumulative quarterly consolidated period, that issuer is obligated to immediately disclose such content in the form of the earnings reports or quarterly earnings reports prescribed by the exchange. In practice, disclosure in Japan of earnings reports and quarterly earnings reports is executed at virtually the same time as disclosure in the US using Forms 10-K and 10-Q. In addition, upon the disclosure in Japan of earnings reports and quarterly earnings reports, notice of such disclosure and its content are immediately disclosed in the US using Form 8-K.

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