Companies Act

A bond-issuing company, bond administrator or assistant bond administrator may state an opinion by having a representative or agent attend the bondholders meeting, or in writing; provided, however, that for bond administrators or assistant bond administrators, this does not apply if that bondholders meeting is convened for the appointment of a special agent under Article 707 (including cases applicable mutatis mutandis under Article 714-7).

Bondholders or conveners may, when they regard it as necessary, demand that the bond-issuing company's representative or agent attend a meeting. For attendance at a bondholders meeting, if a resolution must be passed to the effect that the demand will be made.

If a resolution for the postponement or continuation is passed at the bondholders meeting, the provisions of Articles 719 and 720 do not apply.

Minutes must be prepared with respect to the business of the bondholders meeting, pursuant to the provisions of Ministry of Justice Order.

A bond-issuing company must keep the minutes referred to in the preceding paragraph at its head office for a period of ten years from the day of a bondholders meeting.

The bond administrator, assistant bond administrator and bondholders may make the following requests at any time during the business hours of the bond-issuing company:

if the minutes in paragraph (1) are prepared in writing, requests for the inspection or copying of relevant documents; and

if the minutes in paragraph (1) have been prepared as an electronic or magnetic record, request to inspect or copy anything that is used in a manner prescribed by Ministry of Justice Order to display the information recorded in that electronic or magnetic record.

When a resolution is passed at a bondholders meeting, the convener must file a petition with the court for the approval of relevant resolution within one week of the day of relevant resolution.

The court cannot approve a resolution at a bondholders meeting in cases falling under any of the following:

if the procedures for the convocation of the bondholders meeting or the methods of the resolution at the bondholders meeting violates laws and regulations or the matters stated or recorded in materials used for explaining the business of the bond-issuing company or other matters regarding the solicitation in Article 676;

if the resolution was adopted by an unlawful method;

if the resolution is extremely unfair; or

if the resolution is contrary to the general interests of bondholders.

A resolution at a bondholders meeting does not become effective unless the approval of the court is obtained.

A resolution at a bondholders meeting is effective against all bondholders who hold bonds of the relevant class.

If a ruling has been given approving or rejecting a resolution at a bondholders meeting, the bond-issuing company must give public notice to that effect without delay.

If a bond-issuing company, bond administrator, assistant bond administrator or bondholder submits a proposal with respect to any matter that is the purpose of a bondholders meeting (in the case of an assistant bond administrator, concerning the consent of the bondholders meeting provided in Article 711, paragraph (1) applied mutatis mutandis pursuant to Article 714-7), if all persons who may vote with respect to the matter manifest their intention to agree to relevant proposal in writing or using an electronic or magnetic record, it is deemed that a resolution to approve relevant proposal has been passed at the bondholders meeting.

The bond-issuing company must keep the document or electronic or magnetic record referred to in the preceding paragraph at its head office for a period of ten years from the day when the resolution at the bondholders meeting is deemed to have been passed pursuant to the provisions of the preceding paragraph.

The bond administrator, assistant bond administrator and bondholders may make the following requests at any time during the business hours of the bond-issuing company:

a request to inspect a copy of the document of the preceding paragraph or to copy the document;

a request to inspect or copy anything which displays matters recorded in electronic or magnetic records referred to in the preceding paragraph in accordance with methods prescribed by the applicable Order of the Ministry of Justice.

If a resolution at the bondholders meeting is deemed to have been approved pursuant to the provisions of paragraph (1), the provisions of Article 732 through the preceding Article (excluding Article 734, paragraph (2)) does not apply.

By a resolution at a bondholders meeting, one or more representative bondholders from among bondholders who hold bonds representing not less than one thousandth of the total amount of bonds of the relevant class (excluding amounts already redeemed) may be appointed, and decisions on the matters on which resolutions are to be passed at bondholders meetings may be entrusted to the representative bondholders.

The provisions of Article 718, paragraph (2) apply mutatis mutandis to the total amount of the bonds provided for in the preceding paragraph.

If there are two or more representative bondholders, unless otherwise provided for at a bondholders meeting, the decisions on the matters provided for in paragraph (1) are made by a majority of those representative bondholders.

Resolutions at bondholders meetings are executed in accordance with the categories of the cases set forth in the following items by the person specified in each of those items; provided, however, that this does not apply if the person who executes resolutions at bondholders meetings is separately prescribed by a resolution at a bondholders meeting.

if there is a bond administrator: the bond administrator;

if there is an assistant bond administrator, if there is a resolution of the bondholders meeting to the effect that matters relating to conduct within the assistant bond administrator's authority are to be resolved by the bondholders meeting: the assistant bond administrator;

in cases other than the cases set forth in the preceding two items: the representative bondholders.

The provisions under Article 705, paragraphs (1) through (3), and under Articles 708 and 709 apply mutatis mutandis to cases where a representative bondholder or person responsible for the execution of resolutions at bondholders meetings prescribed under the provisions of the proviso to the preceding paragraph (hereinafter in this Chapter referred to as "resolution administrator") executes the resolutions at bondholders meetings.

By a resolution at a bondholders meeting, at any time, the representative bondholders or resolution administrators may be dismissed, or the matters entrusted to them may be changed.

If a bond-issuing company fails to pay interest on bonds, or fails to periodically partially redeem bonds if it must carry out that redemption, pursuant to a resolution at a bondholders meeting, the person executing the resolution may give written notice to the bond-issuing company to the effect that it must make payment within a defined period of time, and to the effect that, if payment is not made within relevant period of time, the bond-issuing company will forfeit the benefit of time as to the total amount of relevant bonds; provided, however, that relevant period may not be less than two months.

A person who executes a resolution under the preceding paragraph may, in lieu of the written notice under the provisions of that paragraph, provide the matters to be notified under the provisions of that paragraph by electronic or magnetic means, with the approval of the bond-issuing company, pursuant to the provisions of Cabinet Order. In these cases, the person who executes relevant resolution is deemed to have given relevant written notice.

If a bond-issuing company fails to make the payment in paragraph (1) within the period in that paragraph, it will forfeit the benefit of time with respect to the total amount of relevant bonds.

In order for a bondholder to raise an objection under the provisions of Article 449, Article 627, Article 635, Article 670, Article 779 (including cases where applied mutatis mutandis under Article 781, paragraph (2)), Article 789 (including cases where applied mutatis mutandis under Article 793, paragraph (2)), Article 799 (including cases where applied mutatis mutandis under Article 802, paragraph (2)), Article 810 (including cases where applied mutatis mutandis in Article 813, paragraph (2)) or Article 816-8, the objection must be raised by a resolution at a bondholders meeting. In these cases, the court may, in response to a petition by interested parties, extend the period during which objections can be raised on behalf of bondholders.

Notwithstanding the provisions of the preceding paragraph, a bond administrator may raise objections on behalf of bondholders; provided, however, that this does not apply if there are provisions to the contrary in a contract relating to entrustment under the provisions of Article 702.

For the purpose of the application of the provisions of Article 449, paragraph (2), Article 627, paragraph (2), Article 635, paragraph (2), Article 670, paragraph (2), Article 779, paragraph (2) (including cases where applied mutatis mutandis under Article 781, paragraph (2); hereinafter the same applies in this paragraph), Article 789, paragraph (2) (including cases where applied mutatis mutandis under Article 793, paragraph (2); hereinafter the same applies in this paragraph), Article 799, paragraph (2) (including cases where applied mutatis mutandis under Article 802, paragraph (2); hereinafter the same applies in this paragraph), Article 810, paragraph (2) (including cases where applied mutatis mutandis under Article 813, paragraph (2); hereinafter the same applies in this paragraph), and Article 816-8, paragraph (2) to a bond-issuing company, the term "known creditors" in Article 449, paragraph (2), Article 627, paragraph (2), Article 635, paragraph (2), Article 670, paragraph (2), Article 779, paragraph (2), Article 799, paragraph (2), and Article 816-8, paragraph (2) is deemed to be replaced with "known creditors (if there is a bond administrator or assistant bond administrator, including relevant bond administrator or assistant bond administrator)" and the phrase "known creditors (limited to those who can raise objections under the provisions of that paragraph)" in Article 789, paragraph (2) and Article 810, paragraph (2) is deemed to be replaced with "known creditors (limited to those who can raise objections under the provisions of that paragraph, and, if there is a bond administrator or assistant bond administrator, including relevant bond administrator or assistant bond administrator)".

With the permission of the court, a bond-issuing company may be made to bear the cost of the remuneration to be paid to the bond administrator, assistant bond administrator, representative bondholders or resolution administrator, the costs necessary for handling the administration of the bond-issuing company, and the interest that accrues from and including the day of disbursement of the remuneration and costs, as well as amounts of compensation for losses suffered by those persons for handling the administration of the bond-issuing company in the absence of negligence, unless this is provided for in the contract with the bond-issuing company.

The petition for permission referred to in the preceding paragraph is made by the bond administrators, assistant bond administrators, representative bondholders or resolution administrator.

With respect to the remuneration, costs and interest as well as amounts of compensation in paragraph (1), the bond administrators, assistant bond administrators, representative bondholders or resolution administrator have the right to obtain reimbursement, before the bondholders, from the proceeds of payments received under Article 705, paragraph (1) (including cases where that paragraph is applied mutatis mutandis under Article 737, paragraph (2)) or Article 714-4, paragraph (2), item (i).

The costs of bondholders meetings are borne by the bond-issuing company.

The costs of the petition in Article 732 are borne by the bond-issuing company; provided, however, that the court may in response to the petition by the bond-issuing company or other interested parties or ex officio, separately prescribe a person from among the convener and other interested parties to bear some or all of the costs.