Companies Act

If a stock company carries out an act set forth in any item of paragraph (1) of the preceding Article in violation of the provisions of that paragraph, persons who received monies, etc. as a result of relevant act, as well as any executives (meaning executive directors (or, for a company with nominating committee, etc., executive officers; hereinafter the same applies in this paragraph) and other persons prescribed by Ministry of Justice Order as persons involved, in performing their duties, in the execution of the operations by relevant executive directors; hereinafter the same applies in this Section) who performed duties regarding relevant act and, if that act is any of the acts set forth below, the persons specified in each of those items are jointly and severally liable to relevant stock company for payment of monies in an amount equivalent to the book value of the monies, etc. delivered to the persons who were delivered relevant monies, etc.:

the acts set forth in paragraph (1), item (ii) of the preceding Article: the following persons:

if a resolution relating to a decision pursuant to the provisions of Article 156, paragraph (1) is passed at a shareholders meeting (limited to cases where the total amount of the monies, etc. under item (ii) of that paragraph decided by relevant resolution exceeds the distributable amount as at the day of relevant resolution), the proposing directors at shareholders meeting (meaning persons prescribed by Ministry of Justice Order as directors who submitted proposals to relevant shareholders meeting; hereinafter the same applies in this paragraph) relating to relevant shareholders meeting;

if a resolution relating to a decision pursuant to the provisions of Article 156, paragraph (1) is passed at a board of directors meeting (limited to cases where the total amount of the monies, etc. under item (ii) of that paragraph decided by relevant resolution exceeds the distributable amount as at the day of relevant resolution), the proposing directors at board of directors meeting (meaning persons prescribed by Ministry of Justice Order as directors who submitted proposals to relevant board of directors meeting (or, for a company with nominating committee, etc., directors or executive officers); hereinafter the same applies in this paragraph) relating to relevant board of directors meeting;

the acts set forth in paragraph (1), item (iii) of the preceding Article: the following persons:

if a resolution relating to a decision pursuant to the provisions of Article 157, paragraph (1) is passed at a shareholders meeting (limited to cases where the total amount under item (iii) of that paragraph decided by relevant resolution exceeds the distributable amount as at the day of relevant resolution), the proposing directors at shareholders meeting relating to relevant shareholders meeting;

if a resolution relating to a decision pursuant to the provisions of Article 157, paragraph (1) is passed at a board of directors meeting (limited to cases where the total amount under item (iii) of that paragraph decided by relevant resolution exceeds the distributable amount as at the day of relevant resolution), the proposing directors at board of directors meeting relating to relevant board of directors meeting;

the acts set forth in paragraph (1), item (iv) of the preceding Article:the proposing directors at shareholders meeting relating to the shareholders meeting under Article 171, paragraph (1) (limited to relevant shareholders meeting if the total amount of consideration for acquisition under item (i) of that paragraph decided by a resolution at the relevant shareholders meeting exceeds the distributable amount as at the day of relevant resolution);

the acts set forth in paragraph (1), item (vi) of the preceding Article: the following persons:

if a resolution relating to a decision pursuant to the provisions of the second sentence of Article 197, paragraph (3) is passed at a shareholders meeting (limited to cases where the total amount under item (ii) of that paragraph decided by relevant resolution exceeds the distributable amount as at the day of relevant resolution), the proposing directors at shareholders meeting relating to relevant shareholders meeting;

if a resolution relating to a decision pursuant to the provisions of the second sentence of Article 197, paragraph (3) is passed at a board of directors meeting (limited to cases where the total amount under item (ii) of that paragraph decided by relevant resolution exceeds the distributable amount as at the day of relevant resolution), the proposing directors at board of directors meeting relating to relevant board of directors meeting;

the acts set forth in paragraph (1), item (vii) of the preceding Article: the following persons:

if a resolution relating to a decision pursuant to the provisions of the second sentence of Article 234, paragraph (4) (including the cases where applied mutatis mutandis pursuant to Article 235, paragraph (2)) is passed at a shareholders meeting (limited to cases where the total amount under Article 234, paragraph (4), item (ii) (including the cases where applied mutatis mutandis pursuant to Article 235, paragraph (2)) decided by relevant resolution exceeds the distributable amount as at the day of that resolution), the proposing directors at shareholders meeting relating to relevant shareholders meeting;

if a resolution relating to a decision pursuant to the provisions of the second sentence of Article 234, paragraph (4) (including the cases where applied mutatis mutandis pursuant to Article 235, paragraph (2)) is passed at a board of directors meeting (limited to cases where the total amount under Article 234, paragraph (4), item (ii) (including the cases where applied mutatis mutandis pursuant to Article 235, paragraph (2)) decided by relevant resolution exceeds the distributable amount as at the day of relevant resolution), the proposing directors at board of directors meeting relating to relevant board of directors meeting;

the acts set forth in paragraph (1), item (viii) of the preceding Article: the following persons:

if a resolution relating to a decision pursuant to the provisions of Article 454, paragraph (1) is passed at a shareholders meeting (limited to cases where the book value of the dividend property decided by relevant resolution exceeds the distributable amount as at the day of relevant resolution), the proposing directors at shareholders meeting relating to relevant shareholders meeting;

if a resolution relating to a decision pursuant to the provisions of Article 454, paragraph (1) is passed at a board of directors meeting (limited to cases where the book value of the dividend property decided by relevant resolution exceeds the distributable amount as at the day of relevant resolution), the proposing directors at board of directors meeting relating to relevant board of directors meeting.

Notwithstanding the provisions of the preceding paragraph, executives and the persons specified in each of those items of that paragraph are not liable under relevant paragraph if relevant persons prove that they did not fail to exercise due care with respect to the performance of their duties.

An exemption from the obligations assumed by executives and the persons specified in each of those items of paragraph (1) pursuant to the provisions of that paragraph may not be given; provided, however, that this does not apply if all shareholders consent to the exemption from relevant obligations to the extent of the distributable amount as at the time of the act set forth in each item of paragraph (1) of the preceding Article.

In the cases provided for in paragraph (1) of the preceding Article, shareholders without knowledge with respect to the fact that the total book value of the monies, etc. delivered to shareholders as a result of the acts set forth in each item of Article 461, paragraph (1) exceeds the distributable amount as at the day when relevant act takes effect are not obligated to respond to the remedy that the executives who made the payment of monies under paragraph (1) of the preceding Article or the persons specified in each of those items of that paragraph have against relevant shareholders, with respect to the monies, etc. which relevant shareholders received.

In the cases provided for in paragraph (1) of the preceding Article, creditors of a stock company may have the shareholders who are liable pursuant to the provisions of that paragraph pay monies equivalent to the book value of the monies, etc. they have received (or, if relevant value exceeds the amount that the stock company owes to relevant creditors, the amount).

If a stock company acquires shares in response to a demand for appraisal pursuant to the provisions of Article 116, paragraph (1) or Article 182-4, paragraph (1), if the amount of the monies paid to the shareholders who made relevant demands exceeds the distributable amount as at the day when relevant payment is made, the executives who performed duties in relation to the acquisition of relevant shares are jointly and severally liable to the stock company for payment of relevant excess amount; provided, however, that this does not apply if relevant persons prove that they did not fail to exercise due care with respect to the performance of their duties.

Exemption from the obligations under the preceding paragraph may not be given without the consent of all shareholders.

If a stock company carries out the acts set forth in any of the following items, if the sum of the amounts set forth in Article 461, paragraph (2), items (iii), (iv) and (vi) when approval under Article 438, paragraph (2) (or, in cases provided for in the first sentence of Article 439, approval under Article 436, paragraph (3)) is obtained with respect to the financial statements for the business year that contains the day on which relevant act is carried out (or, if the business year immediately preceding relevant business year is not the most recent business year, the business year immediately preceding the business year) exceeds the amount set forth in item (i) of that paragraph, the executives who performed duties in relation to the acts set forth in each relevant item are jointly and severally liable to relevant stock company for payment of the excess amount (or, if relevant excess amount exceeds the amount set forth in each relevant item, the amount set forth in each relevant item); provided, however, that this does not apply if relevant executives prove that they did not fail to exercise due care with respect to the performance of their duties:

the purchase of shares of relevant stock company in response to a demand under Article 138, item (i), (c) or item (ii), (c) of the same Article:the total book value of the monies, etc. delivered to shareholders as a result of the purchase of relevant shares;

the acquisition of shares of relevant stock company based on a decision pursuant to the provisions of Article 156, paragraph (1) (limited to acquisitions of shares by relevant stock company in cases provided for in Article 163 or Article 165, paragraph (1)):the total book value of the monies, etc. delivered to shareholders as a result of the acquisition of relevant shares;

the acquisition of shares of relevant stock company based on a decision pursuant to the provisions of Article 157, paragraph (1):the total book value of the monies, etc. delivered to shareholders as a result of the acquisition of relevant shares;

the acquisition of shares of relevant stock company pursuant to the provisions of Article 167, paragraph (1):the total book value of the monies, etc. delivered to shareholders as a result of the acquisition of relevant shares;

the acquisition of shares of relevant stock company pursuant to the provisions of Article 170, paragraph (1):the total book value of the monies, etc. delivered to shareholders as a result of the acquisition of relevant shares;

the acquisition of shares of relevant stock company pursuant to the provisions of Article 173, paragraph (1):the total book value of the monies, etc. delivered to shareholders as a result of the acquisition of relevant shares;

the purchase of shares of relevant stock company based on a demand pursuant to the provisions of Article 176, paragraph (1):the total book value of the monies, etc. delivered to shareholders as a result of the purchase of relevant shares;

the purchase of shares of relevant stock company pursuant to the provisions of Article 197, paragraph (3):the total book value of the monies, etc. delivered to shareholders as a result of the purchase of relevant shares;

the purchase of shares of relevant stock company pursuant to the provisions set forth in the following (a) or (b): the total book value of the monies, etc. delivered to the persons specified in the relevant (a) or (b) as a result of the purchase of relevant shares:

Article 234, paragraph (4):the persons specified in each of those items of paragraph (1) of the same Article;

Article 234, paragraph (4) applied mutatis mutandis pursuant to Article 235, paragraph (2):the shareholders;

distribution of dividends of surplus (excluding those set forth in (a) through (c) below): the sum of the amounts set forth in Article 446, item (vi), (a) through (c) with respect to relevant distribution of dividend of surplus:

distribution of dividends of surplus if the matters set forth in each item of Article 454, paragraph (1) are decided at an annual shareholders meeting (or, in cases provided for in the first sentence of Article 439, an annual shareholders meeting or a board of directors meeting under Article 436, paragraph (3));

distribution of dividends of surplus if the matters set forth in each item of Article 454, paragraph (1) are decided at a shareholders meeting for the purpose of deciding the matters set forth in each item of Article 447, paragraph (1) (limited to the cases where the amount under item (i) of that paragraph (or, if there are monies to be paid to shareholders of disqualified shares pursuant to the provisions of Article 456, the aggregate amount thereof) does not exceed the amount under Article 447, paragraph (1), item (i) and there are no provisions with respect to the matters set forth in item (ii) of that paragraph);

distribution of dividends of surplus if the matters set forth in each item of Article 454, paragraph (1) are decided at a shareholders meeting for the purpose of deciding the matters set forth in each item of Article 448, paragraph (1) (limited to the cases where the amount under item (i) of that paragraph (or, if there are monies to be paid to shareholders of disqualified shares pursuant to the provisions of Article 456, the aggregate amount thereof) does not exceed the amount under Article 448, paragraph (1), item (i) and there are no provisions with respect to the matters set forth in item (ii) of that paragraph).

Exemption from the obligations under the preceding paragraph may not be given without the consent of all shareholders.