INES : Earnings Document

ARTICLES OF INCORPORATION

Chapter 1 General Provisions

(Trade Name)

Article 1 The name of the Company shall be called Kabushiki Kaisha INES and indicated as INES Corporation in English.

(Objectives)

Article 2 The objectives of the Company shall be to engage in the following business:

1. Processing of information using computers;
2. Development and sales, lease and rental of software;
3. Provision of advanced communications services;
4. Manufacturing, sales, lease and rental of computers and related apparatus;
5. Management and operation of computer systems;
6. Provision of database services;
7. Provision of investigation, research, education, consultation and other professional services;
8. Worker dispatching business;
9. Contracting for construction work and equipment work for information communications services;
10. Rental and management of real estate; and
11. Any and all businesses incidental or related to each item above.

(Location of Head Office)

Article 3 The head office of the Company shall be located in Tsuzuki-ku, Yokohama City, Kanagawa Prefecture.

(Organizational Bodies)

Article 4 The Company shall have the following organizational bodies in addition to the general meeting of shareholders and Corporate Directors:

1. Board of Corporate Directors;
2. Audit and Supervisory Committee; and
3. Accounting Auditors.

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(Method of Public Notices)

Article 5 Public notice of the Company shall be made electronically; provided, however, that if electronic notice is impossible due to any accident or other unavoidable reasons, it shall be made by publication in the Nikkei Shimbun.

Chapter 2

Shares

(Total Number of Shares Authorized to be Issued)

Article 6 The total number of shares authorized to be issued by the Company shall be 175,477,400 shares.

(Acquisition of Treasury Shares)

Article 7 The Company may acquire treasury shares through market transactions, etc., by a resolution of the Board of Corporate Directors pursuant to the provisions of Article 165 (2) of the Companies Act.

(Number of Shares per Unit)

Article 8 The number of shares per unit of shares of the Company shall be one hundred (100)

shares.

(Rights pertaining to Shares Less than One Unit)

Article 9 A shareholder of the Company shall not exercise any rights pertaining to shares less than one (1) unit held by such shareholder, except for the following rights:

1. Rights provided for in items listed in Article 189 (2) of the Companies Act;
2. The right to receive dividends of surplus;
3. The right to make a demand pursuant to the provisions of Article 166 (1) of the Companies Act; and
4. The right to receive allotment of shares for subscription or share options for subscription in proportion to the number of shares held by the shareholder.

(Additional Purchase of Shares Less than One Unit)

Article 10 A shareholder of the Company may make a demand to the Company that the Company sell to the shareholder such number of shares which, together with the number of shares less than one unit held by such shareholder, will constitute one unit, pursuant to the provisions of the Share Handling Regulations.

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(Shareholder Registry Administrator)

Article 11 The Company shall have a shareholder register administrator.

1. The shareholder register administrator and its place of business shall be designated by a resolution of the Board of Corporate Directors and then published.
2. Preparation and keeping of the shareholder register and the share option register of the Company and other administrative work related to the shareholder register and the share option register shall be entrusted to the shareholder register administrator and shall not be handled by the Company.

(Share Handling Regulations)

Article 12 Handling of the shares and share options of the Company and the procedures and fees for the exercise of shareholder rights shall be governed by the Share Handling Regulations established by the Board of Corporate Directors, as well as laws and regulations and these Articles of Incorporation.

(Record Date)

Article 13 The Company shall deem shareholders holding voting rights who are recorded in the latest shareholder register as of March 31 of each year as shareholders who are entitled to exercise their rights at the ordinary general meeting of shareholders pertaining to such business year.

2. In addition to the provisions of these Articles of Incorporation, if necessary, the Company may, upon giving prior public notice, deem shareholders or registered pledgees of shares who are recorded in the latest shareholder register as of certain date as shareholders or registered pledgees of shares who are entitled to exercise their rights.

Chapter 3 General Meeting of Shareholders

(Convocation)

Article 14 An ordinary general meeting of shareholders shall be convened within three (3) months after the end of each business year, and an extraordinary meeting of shareholders shall be convened at any time when necessary.

2. The Company may hold a general meeting of shareholders without designating a location.

(Convener and Chairperson)

Article 15 A general meeting of shareholders shall be convened by the Representative Director and the Representative Director shall act as chairperson thereof; provided, however, that if the

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Company has two or more Representative Directors, one of the Representative Directors, in the order predetermined by the Board of Corporate Directors, shall convene a general meeting of shareholders and act as chairperson thereof.

2 If the Representative Director is unable to act due to any accident or other unavoidable circumstances, one of the other Corporate Directors shall convene a general meeting of shareholders and act as chairperson thereof in accordance with the order predetermined by the Board of Corporate Directors.

(Measures for Provision in Electronic Format, etc.)

Article 16 At the occasion of convocation of a general meeting of shareholders, the Company shall take measures for provision in electronic format with regard to information including the content of reference documents for general shareholders meeting.

2 With regard to all or any part of matters for which measures for provision in electronic format are taken and which are stipulated by the Ordinance of the Ministry of Justice, the Company may decide not to describe such matters in documents to be issued to a shareholder who applied for the issuance of documents prior to the record date for the voting rights.

(Method of Resolutions)

Article 17 Unless otherwise provided for in laws and regulations or in these Articles of Incorporation, resolutions of a general meeting of shareholders shall be made by a majority of the votes of the shareholders present at the meeting and entitled to exercise their voting rights.

2. A resolution as provided for in Article 309 (2) of the Companies Act shall be made by two- thirds (2/3) or more of the votes of the shareholders present at a meeting where shareholders holding one-third (1/3) or more of the voting rights of the shareholders entitled to exercise their voting rights are present.

(Proxy Voting)

Article 18 A shareholder may exercise his/her voting rights by appointing as proxy one (1) of the other shareholders holding voting rights of the Company; in such case, the shareholder or his/her proxy shall submit to the Company a document evidencing the authority of proxy.

(Minutes)

Article 19 The summary and outcome of the proceedings of a general meeting of shareholders and other matters provided for in laws and regulations shall be described or recorded in the minutes, which shall be kept at the Company.

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Chapter 4 Corporate Directors and Board of Corporate Directors and Audit and

Supervisory Committee

(Number of Corporate Directors)

Article 20 The Company shall have not more than twenty (20) Corporate Directors.

2. Not more than ten (10) of the Corporate Directors set forth in the preceding paragraph shall be the Audit and Supervisory Committee members.

(Method of Election)

Article 21 Corporate Directors of the Company shall be elected at a general meeting of shareholders separately between those who are Audit and Supervisory Committee members and those who are not.

1. A resolution to elect Corporate Directors shall be made by a majority of the votes of the shareholders present at a meeting where shareholders holding one-third (1/3) or more of the voting rights of the shareholders entitled to exercise their voting rights are present.
2. No cumulative voting shall be used for resolutions to elect Corporate Directors.

(Term of Office)

Article 22 The term of office of a Corporate Director (excluding those who are Audit and Supervisory Committee members) shall expire at the close of the ordinary general meeting of shareholders for the last business year ending within one (1) year from his/her election.

1. The term of office of a Corporate Director who is an Audit and Supervisory Committee member shall expire at the close of the ordinary general meeting of shareholders for the last business year ending within two (2) years from his/her election.
2. The term of office of any Corporate Director (excluding a person who is an Audit and Supervisory Committee member) elected as a substitute of a Corporate Director (excluding a person who is an Audit and Supervisory Committee member) who resigned prior to the expiration of his/her term or any Corporate Director elected to increase the number of Corporate Directors (excluding those who are Audit and Supervisory Committee members) shall be the same as the term of Corporate Directors (excluding those who are Audit and Supervisory Committee members) currently in office.
3. The term of office of any Corporate Director who is an Audit and Supervisory Committee member elected as a substitute of a Corporate Director who was an Audit and Supervisory Committee member and resigned prior to the expiration of his/her term shall expire when the term of office of the resigning Corporate Director who was an Audit and Supervisory Committee member expires.

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