Sawai : Annual Report (SEC Filing - 20-F)

(Trade Name)

(Purpose)

To hold shares or equity in domestic and/or overseas companies engaging in any business relating to medical and healthcare services, including manufacture and sale of pharmaceutical products and medical equipment, as well as various businesses incidental or relating to the same, and thereby manage business activities of such companies and provide management support or guidance to such companies;

To perform, on commission, the operations of any companies in which the Company holds shares or equity, such as management affairs, planning/public relations activities or the like, in whole or in part; and

To carry out any and all lawful businesses incidental or relating to any of the foregoing.

(Location of Head Office)

(Establishment of Organizations)

Board of Directors;

Audit & Supervisory Board Members;

Audit & Supervisory Board; and

Accounting Auditors.

(Method of Public Notice)

(Total Number of Shares Authorized to Be Issued)

(Acquisition by the Company of Treasury Shares)

(Number of Shares Constituting One Unit)

(Rights Pertaining to Shares Constituting Less Than One Unit)

The rights provided for in each item of Article 189, Paragraph 2 of the Companies Act of Japan;

The right to make a demand pursuant to the provisions of Article 166, Paragraph 1 of the Companies Act of Japan; and

The right to receive an allotment of shares for subscription and stock acquisition rights for subscription in accordance with the number of shares held by such shareholder.

(Shareholder Register Administrator)

The Company shall have a shareholder register administrator.

The shareholder register administrator and its handling office shall be determined by a resolution of the Board of Directors and public notice thereof shall be given by the Company.

The preparation of and keeping of, and other operations relating to, the shareholder register and the stock acquisition right register of the Company shall be entrusted to the shareholder register administrator, and will not be handled by the Company.

(Share Handling Regulations)

(Convocation)

(Convener and Chair)

Unless otherwise provided for by applicable laws and regulations, the Director and President shall, by a resolution of the Board of Directors, convene the General Meetings of Shareholders and act as the chair thereof.

In case where the Director and President is unable to act, other Representative Director (or in case where such Representative Director is unable to act, other Director who is designated in accordance with an order of priority determined in advance by the Board of Directors) shall convene the General Meetings of Shareholders and act as the chair thereof.

(Disclosure through Internet and Deemed Provision of Reference Materials, Etc. for General Meeting of Shareholders)

(Method of Adopting Resolutions)

Unless otherwise provided for by applicable laws and regulations or these Articles of Incorporation, resolutions of a General Meeting of Shareholders shall be adopted by a majority of the voting rights of the attending shareholders entitled to exercise their voting rights.

Resolutions provided for in Article 309, Paragraph 2 of the Companies Act of Japan shall be adopted by not less than two-thirds of the voting rights of the attending shareholders who hold not less than one-third of the voting rights of shareholders entitled to exercise their voting rights.

(Exercising of Voting Right through Proxy)

A shareholder may exercise his/her voting right through one proxy who shall be another shareholder of the Company entitled to vote.

In case of falling under the preceding paragraph, the shareholder or proxy thereof shall submit a written document evidencing an authority of the representation to the Company for each General Meeting of Shareholders.

(Number of Directors)

(Method of Election)

Director(s) shall be elected at a General Meeting of Shareholders.

A resolution for the election of Director(s) shall be adopted by a majority of the voting rights of the attending shareholders who hold not less than one-third of the voting rights of shareholders entitled to exercise their voting rights.

Resolutions for the election of Directors shall not be made by cumulative voting.

(Term of Office)

(Representative Director(s) and Directors with Special Titles)

The Board of Directors shall appoint Representative Director(s) by its resolution.

The Board of Directors shall appoint one Director and Chairman, and one Director and President, respectively, from among Directors by its resolution. The Board of Directors may also appoint one or more Director and Vice Chairman, Director and Vice President, Senior Managing Director and Managing Director, as necessary.

(Convener and Chair of Meetings of the Board of Directors)

Unless otherwise provided for by applicable laws and regulations, the Director and Chairman shall convene meetings of the Board of Directors and act as the chair thereof.

In case where the office of Director and Chairman is vacant or the Director and Chairman is unable to act, the Director and President (or in case where the Director and President is unable to act, another Director who is designated in accordance with an order of priority determined in advance by the Board of Directors) shall convene the meetings of the Board of Directors and act as the chair thereof.

(Notice to Convene Meetings of the Board of Directors)

Notice to convene a meeting of the Board of Directors shall be dispatched to each Director and Audit & Supervisory Board Member at least two (2) days prior to the date set for the meeting; provided, however, that such period may be shortened in the case of an emergency.

A meeting of the Board of Directors may be held without taking the procedures of convocation with the unanimous consent of all Directors and Audit & Supervisory Board Members.

(Omission of Resolution of the Board of Directors)

(Rules of the Board of Directors)

(Compensations)

(Liability Limitation Agreements with Directors)

(Number of Audit & Supervisory Board Members)

(Method of Election)

Audit & Supervisory Board Member(s) shall be elected at a General Meeting of Shareholders.

A resolution for the election of Audit & Supervisory Board Member(s) shall be adopted by a majority of the voting rights of the attending shareholders who hold not less than one-third of the voting rights of shareholders entitled to exercise their voting rights.

In accordance with the provisions of Article 329, Paragraph 3 of the Companies Act of Japan, the Company may elect Substitute Audit & Supervisory Board Member(s) at the General Meeting of Shareholders, in order to prepare for cases where the Company lacks the number of Audit & Supervisory Board Members required by applicable laws and regulations.

A resolution regarding the election of Substitute Audit & Supervisory Board Member(s), as described in the previous paragraph, shall be effective until the commencement of the Annual General Meeting of Shareholders pertaining to the final business year ending no more than four years after the date when the resolution was made, provided that the resolution itself does not stipulate a shorter term of validity.

(Term of Office)

The term of office of an Audit & Supervisory Board Member shall be until the conclusion of the Annual General Meeting of Shareholders pertaining to the final business year ending no more than four years after he/she was elected as the Audit & Supervisory Board Member.

The term of office of an Audit & Supervisory Board Member who was elected as a substitute for an Audit & Supervisory Board Member who retired before the expiration of his/her term of office, shall expire at the same time as the original term of office of the retired Audit & Supervisory Board Member. However, where a Substitute Audit & Supervisory Board Member, who was elected in accordance with Paragraph 3 of the previous Article, assumes the office of Audit & Supervisory Board Member, his/her term of office may not extend beyond the time of conclusion of the Annual General Meeting of Shareholders pertaining to the final business year ending no more than four years after the date when he/she was elected as the Substitute Audit & Supervisory Board Member.

(Standing Audit & Supervisory Board Member(s))

(Notice to Convene Meetings of the Audit & Supervisory Board)

Notice to convene a meeting of the Audit & Supervisory Board shall be dispatched to each Audit & Supervisory Member at least two (2) days prior to the date set for the meeting; provided, however, that such period may be shortened in the case of an emergency.

A meeting of the Audit & Supervisory Board may be held without taking the procedures of convocation with the unanimous consent of all Audit & Supervisory Board Members.

(Rules of the Audit & Supervisory Board)

(Compensations)

(Liability Limitation Agreements with Audit & Supervisory Board Members)

(Business Year)

(Record Date for Dividends from Surplus)

The record date for year-end dividends of the Company shall be March 31 of each year.

In addition to the dividends in the preceding paragraph, the Company may pay dividends by specifying a different record date(s) therefor.

(Interim Dividends)

(Period of Exclusion Concerning Dividends)

In case where the dividend property consists of monies, if such property remains unreceived upon the expiration of three full years from the date of commencement of the payment thereof, the Company shall be exempted from its obligation to make such payment.

Unpaid dividends shall not bear any interest.

(Initial Business Year)

(Compensations)

Notwithstanding the provision of Article 26, the amount of the Compensations for Directors shall be within 670 million yen (670,000,000 yen) for a year; provided, however, that such amount for the Compensations for Directors do not include the employee salaries of Directors who concurrently serve as employees.

Notwithstanding the provision of Article 34, the amount of the Compensations for Audit & Supervisory Board Members shall be within 50 million yen (50,000,000 yen) for a year.

(Deletion of these Supplementary Provisions)