DOWA : Notice of Change in the Number of Shares Constituting One Unit of Shares, Share Consolidation, and Partial Amendment of Articles of Incorporation

common shares

On October 1, 2017, the shares held by shareholders recorded in the latest share register as of September 30, 2017 will be consolidated at the ratio of five shares to one share.

200,000,000 shares (1,000,000,000 shares before the Share Consolidation)
The provision of the Articles of Incorporation specifying the total number of authorized shares will be deemed to have been amended in accordance with the above on the effective date of the Share Consolidation (October 1, 2017).

The Company will sell all of the fractional shares resulting from the Share Consolidation, if any, and distribute the proceeds to shareholders with such fractional shares in proportion to their respective portions.

Q1. What is the purpose of the change in the number of shares in a unit of shares and the Share Consolidation?

A1. Japanese securities exchanges are promoting the Action Plan for Consolidating Trading Units to uniformly set the trading units of common shares (the number of shares in one unit of shares) of domestically listed companies at 100 shares for the purpose of increasing the convenience of investors and other market participants. In light of the intent of this action plan, the Company decided to change the number of shares in a unit of shares from 1,000 to 100.
In connection with the change in the number of shares per unit of shares from 1,000 to 100, the Company has decided to implement the consolidation of its shares, in which every five shares will be consolidated into one share, taking into consideration the investment unit level considered desirable for the Company's shares by the securities exchanges (50,000 yen or more and less than 500,000 yen).

Q2. What is the specific schedule going forward?

A2. The summary (planned) schedule for the change in the number of shares in a unit of shares and share consolidation is as follows:

Q3. Will the Share Consolidation have any impact on the asset value of the Company?

A3. While the Share Consolidation will reduce the number of shares held by shareholders to one-fifth of the original number, the Company's assets and capital will remain unchanged after the Share Consolidation, so the asset value per share will increase five times. Accordingly, aside from changes in the share market and other factors, there will be no impact on the asset value of the Company's shares held by its shareholders.
The stock price after the Share Consolidation will also be, in theory, five times the price before the Share Consolidation.

Q4. How will the number of shares and voting rights be affected?

A4. The number of shares held by each shareholder after the Share Consolidation will be the number of shares derived by multiplying the number of shares recorded in the latest share register as of September 30, 2017 by one-fifth (if there is any fraction less than one share, rounded down to the nearest whole share).
The number of voting rights will be one for each 100 shares held after the Share Consolidation.
Specifically, the numbers of shares held and the numbers of voting rights before and after the effective date (scheduled to be October 1, 2017) of the change in the number of shares in a unit of shares and the Share Consolidation are as follows:

Q5. Are there any procedures that shareholders must undertake?

A5. No special procedures are necessary.

Q6. Is there any way to ensure that there are no fractional shares?

A6. Shareholders may avoid having fractional shares by requesting the additional purchase or sale of shares constituting less than one unit of shares prior to the effective date of the Share Consolidation.
Requests for the additional purchase or sale of shares in less than one unit of shares are accepted at the shareholders' securities dealers. Shareholders who do not have an account with a securities dealer should make inquiries with the administrator of the share register specified at the end of this document.

Q7. Will you accept the purchase or sale of odd-lot shares even after the Share Consolidation?

A7. The same as prior to the effective date of the Share Consolidation, shareholders holding odd-lot shares that cannot be traded in the market are still eligible for the odd-lot share sale program or additional purchase program.
For information on specific procedures, eligible shareholders should contact their securities dealer or the Company's administrator of the share register specified at the end of this document.

Q8. Will the dividends received by shareholders be affected by the reduction in the number of shares held as a result of the Share Consolidation?

A8. While the Share Consolidation will reduce the number of shares held by shareholders to one-fifth of the original number, the Company will determine the amount of dividend per share in light of the ratio of consolidation, and thus the total amount of dividends received by shareholders will not be affected by the Share Consolidation unless there is an impact of a decline in the Company's financial performance or other factors.
Dividends will not be paid, however, on any fraction of a share resulting from the Share Consolidation.

Please contact your securities dealer or the following administrator of the share register with any questions about the change in the number of shares in a unit of shares or the Share Consolidation.

Securities Agency Department, Sumitomo Mitsui Trust Bank, Limited
1-4-1 Marunouchi, Chiyoda-ku, Tokyo
Phone: 0120-782-031 (toll free)
Business hours: 9:00 a.m. to 5:00 p.m. on weekdays, except public holidays