Companies Act

A stock company must treat its shareholders equally in accordance with the features and number of the shares they hold.

Notwithstanding the provisions of the preceding paragraph, a stock company that is not a public company may provide in its articles of incorporation to the effect that each shareholder is treated differently with respect to the matters regarding the rights set forth in each item of Article 105, paragraph (1).

If there are provisions in the articles of incorporation that is provided for in the preceding paragraph, the shares held by the shareholders under that paragraph are deemed to be class shares with different features with respect to the matters regarding the rights under that paragraph, and the provisions of this Part and Part V apply.

If it is intended to create, as a feature of all shares to be issued by a stock company, provisions in the articles of incorporation with respect to the matters set forth in Article 107, paragraph (1), item (iii) by amending the articles of incorporation, or to effect any amendment (excluding that which abolishes the provisions of the articles of incorporation with respect to relevant matters) in the articles of incorporation with respect to relevant matters (excluding the case where the stock company is a company with class shares), the consent of all shareholders must be obtained.

If a company with class shares intends, after it has issued a certain class of shares, to create, as a feature of relevant class shares, a provision in the articles of incorporation with respect to the matters set forth in Article 108, paragraph (1), item (vi) by amending the articles of incorporation, or to effect any amendment to the articles of incorporation with respect to the matters (excluding any amendment which abolishes the provisions of the articles of incorporation with respect to the matters), the consent of all class shareholders who hold relevant class shares must be obtained.

If a company with class shares intends to create, as a feature of a certain class of shares, provisions in the articles of incorporation with respect to the matters set forth in Article 108, paragraph (1), item (iv) or (vii), relevant amendment to the articles of incorporation does not become effective unless a resolution is passed at a general meeting of class shareholders constituted by the following class shareholders (if there are two or more classes of shares relating to relevant class shareholders, referring to the respective general meetings of class shareholders constituted by class shareholders categorized by the class of relevant two or more classes of shares; hereinafter the same applies in this Article); provided, however, that this does not apply to cases where there is no class shareholder who can exercise voting right at relevant general meeting of class shareholder:

the class shareholders of shares of relevant class;

the class shareholders of shares with put options for which there are provisions that the relevant other shares referred to in Article 108, paragraph (2), item (v), (b) are to be the shares of relevant class; or

the class shareholders of shares subject to call for which there are provisions that the relevant other shares referred to in Article 108, paragraph (2), item (vi), (b) are to be the shares of relevant class.

The provisions in the articles of incorporation on the matters set forth in Article 108, paragraph (2), item (ix) (limited to those on directors) are deemed to have been abolished, if the number of directors is less than the number prescribed in this Act or the articles of incorporation, and hence it is not possible to elect directors in a number sufficient to satisfy the requirement.

The provisions of the preceding paragraph apply mutatis mutandis to the provisions of the articles of incorporation on the matters set forth in Article 108, paragraph (2), item (ix) (limited to those on company auditors).

A stock company may not abolish the provisions on the total number of authorized shares by amending its articles of incorporation.

If it is intended to reduce the total number of authorized shares by amending the articles of incorporation, the total number of authorized shares after the amendment may not be less than the total number of the issued shares at the time when relevant amendment to the articles of incorporation becomes effective.

In the following cases, the total number of authorized shares after relevant amendment in the articles of incorporations may not exceed the number four times the total number of the issued shares at the time when that amendment to the articles of incorporation becomes effective:

if a public company amends the articles of incorporation and increases the total number of authorized shares; or

if a stock company that is not a public company amends the articles of incorporation and becomes a public company.

The number of the shares which a holder of share options (excluding share options for which the first day of the period prescribed in Article 236, paragraph (1), item (iv) has not yet arrived) acquire pursuant to the provisions of Article 282, paragraph (1) may not exceed the number obtained by subtracting the total number of the issued shares (excluding treasury shares (meaning shares in a stock company owned by that stock company itself; the same applies hereinafter)) from the total number of authorized shares.

If it is intended to reduce the total number of authorized shares in a class of a certain class of shares by amending the articles of incorporation, the total number of authorized shares in a class of relevant class of shares after the amendment may not be less than the total number of the issued shares of relevant class at the time when relevant amendment to the articles of incorporation becomes effective.

The total sum of the numbers set forth below for a certain class of shares may not exceed the number obtained by subtracting the total number of the issued shares of relevant class (excluding treasury shares) from the total number of authorized shares in a class of that class of shares:

the number of the relevant other shares prescribed in Article 167, paragraph (2), item (iv) which is to be acquired pursuant to the provisions of Article 167, paragraph (2) by the shareholders (excluding the relevant stock company) of shares with put options (excluding those for which the first day of the period prescribed in Article 107, paragraph (2), item (ii), (f) has not yet arrived);

the number of the relevant other shares prescribed in Article 170, paragraph (2), item (iv) which is to be acquired pursuant to the provisions of Article 170, paragraph (2) by the shareholders (excluding the relevant stock company) of shares subject to call; and

the number of the shares which holders of share options (excluding those for which the first day of the period prescribed in Article 236, paragraph (1), item (iv) has not yet arrived) acquire pursuant to the provisions of Article 282, paragraph (1).

If a company with class shares is a public company, if the number of the shares of a certain class with restriction in relation to matters on which voting right can be exercised at a shareholders meeting (hereinafter in this Article referred to as "shares with restricted voting right") has exceeded one half of the total number of the issued shares, the stock company must immediately take measures necessary to reduce the number of the shares with restricted voting right below one half of the total number of the issued shares.

In the cases set forth in the following items, dissenting shareholders may demand that the stock company purchase, at a fair price, the shares prescribed in these items that they hold:

if it is intended to effect an amendment to the articles of incorporation to create a provision on matters set forth in Article 107, paragraph (1), item (i) as a feature of all shares issued by a stock company:All shares;

if it is intended to effect an amendment to the articles of incorporation to create provisions on matters set forth in Article 108, paragraph (1), item (iv) or (vii) as the feature of a certain class of shares:the shares prescribed in each item of Article 111, paragraph (2);

if any act set forth below is to be performed, and any detriment is likely to be suffered by class shareholders who hold a certain class of shares (limited to those provided for in the articles of incorporation under the provisions of Article 322, paragraph (2)): the shares of the class:

consolidation of shares or splitting of shares;

allotment of shares without contribution provided for in Article 185;

amendment to the articles of incorporation on the share unit;

solicitation of persons to subscribe for the shares of relevant stock company (limited to solicitation for which the stock company provides for the matters set forth in each item of Article 202, paragraph (1));

solicitation of persons to subscribe for the share options of relevant stock company (limited to solicitation for which the stock company provides for the matters set forth in each item of Article 241, paragraph (1));

allotment of share options without contribution provided for in Article 277.

The "dissenting shareholders" provided for in the preceding paragraph means the shareholders provided for in the following items in the cases set forth in the same items:

if a resolution at a shareholders meeting (including a general meeting of class shareholders) is required to perform an act in any item of the preceding paragraph: the following shareholders:

shareholders who gave notice to relevant stock company to the effect that they dissented from relevant act prior to relevant shareholders meeting and who dissented from relevant act at relevant shareholders meeting (limited to those who can exercise voting right at relevant shareholders meetings);

shareholders who cannot exercise voting right at relevant shareholders meetings;

in cases other than those prescribed in the preceding item:all shareholders.

A stock company that intends to perform an act in any item of paragraph (1) must give notice to the shareholders of the shares provided for in each item of that paragraph to the effect that it intends to perform relevant act, no later than twenty days prior to the day when relevant act becomes effective (hereinafter in this Article and in the following Article referred to as "effective day").

A public notice may be substituted for the notice pursuant to the provisions of the preceding paragraph.

To make a demand under the provisions of paragraph (1) (hereinafter in this Section referred to as the "exercise of appraisal rights"), a dissenting shareholder must indicate the number of shares with regard to which the shareholder is exercising appraisal rights (or, for a company with class shares, the classes of the shares and the number of shares for each class), between twenty days prior to the effective day and the day immediately preceding the effective day.

When intending to exercise appraisal rights of shares for which share certificates have been issued, a shareholder of relevant shares must submit the share certificates representing those shares to the stock company; provided, however, that this does not apply to a person who makes a request pursuant to the provisions of Article 223 concerning relevant shares.

Shareholders exercising appraisal rights may withdraw their demands for appraisal only with the approval of the stock company.

The demands of the shareholders exercising appraisal rights lose effect if the stock company cancels the action referred to in the items of paragraph (1).

The provisions of Article 133 do not apply to shares that are subject of the exercise of appraisal rights.