Article 79-29Requirements for Incorporation

①In order to incorporate a fund, 20 or more financial instruments business operators that seek to become its members must become the founders.

②After preparing the articles of incorporation and operational rules, the founders must invite persons seeking to become members, and hold an organizational meeting, issuing public notice of the articles of incorporation and operational rules as well as the date, time, and place of the meeting by two weeks prior to the day of the meeting.

③The approval of the articles of incorporation and operational rules and decisions about other necessary particulars for incorporation of a fund must be made by the resolution at the organizational meeting.

④The articles of incorporation and operational rules may be amended at the organizational meeting.

⑤The items of organizational meeting business that are referred to in paragraph (3) are decided with at least a two-thirds majority of the votes of attendees, at a meeting where at least half of the financial instruments business operators that have proposed themselves as members to the founders before the opening of the meeting (hereinafter, each such financial instruments business operator is referred to as an "expected member" in this Article) and the founders, are present.

⑦The provisions of Article 79-43 apply mutatis mutandis to the items of business at an organizational meeting that are referred to in the preceding paragraph. In this case, in that Article, the term "all members" is deemed to be replaced with "the financial instruments business operators that have proposed themselves as members to the founders before the opening of the meeting, and the founders".

⑧Each of the expected members holds an equal voting right for organizational meetings.

⑨An expected member not attending an organizational meeting may vote in writing or by proxy.

⑩An expected member may, in lieu of voting in writing based on the provisions of the preceding paragraph, vote by electronic or magnetic means (meaning by means of using an electronic data processing system or by any other means using information and communications technology that Cabinet Office Order and Ministry of Finance Order specify; the same applies in Article 79-44-4, paragraph (3)), pursuant the provisions of the articles of incorporation.

⑪The provisions of paragraphs (8) and (9) do not apply if it is otherwise provided for in the articles of incorporation.

⑫If an organizational meeting resolution concerns the relationship between a fund and a specific expected member, that expected member has no voting right.