Mitsubishi Paper Mills : Matters Concerning Electronic Provision Measure for the Convocation Notice for the 159th Ordinary Shareholders’ Meeting

Note: This document has been translated from the Japanese original FOR REFERENCE PURPOSES ONLY. In the event of any discrepancy between this translated document and the Japanese original, THE ORIGINAL SHALL PREVAIL.

Matters Concerning Electronic Provision Measure for

the Convocation Notice for the 159th Ordinary Shareholders' Meeting

(From April 1, 2023 to March 31, 2024)

Systems necessary to ensure the properness of operations

Outline of the situations of the operation of the systems necessary to ensure the properness of operations

Basic policy for controlling the management of the Company

Consolidated statements of changes in shareholders' equity

Notes to consolidated financial statements

Statements of changes in shareholders' equity

Notes to non-consolidated financial statements

Mitsubishi Paper Mills Limited

The description of each of the items listed above in the document (document describing matters concerning the electronic provision measure) to be delivered to shareholders who request delivery of documents is omitted pursuant to the provisions of laws and regulations and Article 15 of the Articles of Incorporation of the Company.

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Systems necessary to ensure the properness of operations

The following is the Company's basic policy on the system to ensure the conformity of the performance of duties of Directors to laws and regulations and the Company's Articles of Incorporation and the system to ensure the appropriateness of the Company's other operations and the operations of the corporate group consisting of the Company and its subsidiaries. (Last revised on: March 29, 2024)

- Core approach to corporate governance -

The Company carries out corporate activities based on the corporate philosophy of the MPM Group, including "living up to the trust of its customers in the world market," "staying constantly on the leading edge of technology," and "contributing to preserving the global environment and creating a recycling society." With this philosophy, the Company implements corporate group management focusing on the sustainable growth of the MPM Group and society, raises its management transparency, and works to improve its corporate governance.

To take specific steps towards achieving these goals, the Company has established Mitsubishi Paper Mills Limited Basic Policies on Corporate Governance.

- Overview of corporate organization -

The Company has adopted the company with an Audit & Supervisory Board as its institutional design. The Company has appointed three independent Outside Directors, who account for more than one-third of the total number of Directors, and has built a system that sufficiently plays the roles required of the Board of Directors. It separates the supervisory function and executive function and has adopted the Executive Officer system to streamline the Board of Directors, accelerate management decision-making, and define the responsibility for the performance of duties.

The Company has created a Nomination and Compensation Committee with an independent Outside Director as the chairperson as an advisory body to the Board of Directors in order to ensure objectivity and transparency of the designation and remuneration of management.

In addition to monthly meetings, the Board of Directors holds extraordinary meetings of the Board of Directors as necessary to determine and supervise matters specified by laws and regulations and the Articles of Incorporation and the performance of important duties.

Audit & Supervisory Board Members including Outside Audit & Supervisory Board Members have established the Audit & Supervisory Board and hold meetings of the Audit & Supervisory Board on a regular basis and as necessary.

Executive Officers and other executives hold management meetings, in principle, once a week to determine management policies and strategies and basic business strategies in an effort to ensure prompt and optimal decision-making, implement thorough group governance, discuss group strategies and share important information.

In the performance of duties, the Company has adopted a business unit system to strengthen its operational structure by assigning responsibility and delegating authority to each business unit for revenue.

The Company defines the scope of organizational responsibility according to the rules for the division of duties and makes decisions appropriately based on its internal rules.

The Company appoints an executive responsible for sustainability to implement corporate group management focusing on sustainability and establishes a Group-wide Sustainability Promotion Committee headed by the President. The committee coordinates the entire sustainability promotion activities (legal compliance, risk management, human resource management, safety and health, the environment, product safety and product quality, human rights and labor, information disclosure and public relation, social contribution, climate change and more) and establishes basic policies for sustainability promotion and yearly plans. The Board of Directors deliberates on such policies and plans.

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- Basic policy -

1. System to ensure that the execution of the duties of Directors and employees conforms with laws, regulations, and the articles of incorporation
   The Company has established the Code of Conduct of the Mitsubishi Paper Mills Group and Mitsubishi Paper Mills Group Compliance Conduct Standards. The President repeatedly explains the spirit of such standards to the executives and employees of the Company and carries out activities to promote a deeper understanding of corporate ethics, thereby ensuring that legal compliance is a precondition for all corporate activities.
   The Compliance Committee, which operates under the control of the Corporate Governance Management Dept. as a secretariat, will be placed under the Sustainability Promotion Committee. The Compliance Committee will carry out training and educational activities to disseminate the Code of Conduct and Standards and ensure legal compliance for penetration throughout the Group.
   If executives and employees discover a compliance problem, they will promptly report it to the department responsible for handling the problem through their office organization or report it through the internal hotline under the jurisdiction of the Internal Audit Dept. or through a more independent external hotline. The department to handle such problem will determine measures to prevent recurrence after consultations with Corporate Governance Management Dept., Human Resources Dept., or Internal Audit Dept.
   The Internal Audit Dept. examines and evaluates the systems of management and operation in overall business activities and the status of implementation in view of lawfulness and rationality and ensures the reliability of financial reports and raises management efficiency.
   The General Administration Dept. is responsible for preserving the Company's assets and manages the acquisition, use, and disposal of assets to ensure appropriate procedures taken and approval obtained.
   The General Administration Dept. reports the overview of such compliance activities and the state of whistleblowing to the Board of Directors.
2. Systems to store and manage information on the execution of duties by Directors

To manage and maintain information related to the performance of duties of Directors, the Company records and preserves information related to their performance of duties as documents or electromagnetic information according to Document Management Regulations and Information Management Regulations. Directors and Audit & Supervisory Board Members may inspect these documents, etc. at all times.

3. Regulations concerning the management of risk of loss and other systems

The Company considers it important to appropriately manage various risks arising from corporate activities for the development of the Company and an increase in its corporate value.

Under the Sustainability Promotion Committee, Risk Management Committee controlled by General Administration Dept. is established to operate risk management of the entire Group. The Risk Management Committee recognizes and understands risks affecting corporate management, develops systems in response to such risks, and reports their status to the Board of Directors. Head office departments and factories establish rules and prepare manuals to ensure appropriate operations, build advance preventive systems at normal times, take measures to prevent recurrence when a problem has arisen, and develop a system of promptly responding to an emergency.

4. System to ensure the efficient execution of duties by Directors

The Company establishes a consolidated basic plan as targets in its Medium-term Management Plan. Directors in charge determine specific targets and efficient methods for achievement to be implemented by each department (including delegation of authority to Executive Officers). The Company sets key performance indicators (KPIs) in each fiscal period and manages the progress. The Board of Directors regularly evaluates the results and promotes improvement such as the reduction or elimination of factors hindering efficiency, thereby building a system to raise company-wide operation efficiency.

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5. System to ensure the proper business operation of the Group consisting of the Company and its subsidiaries

According to its Subsidiary Management Regulations, the Company supervises and provides guidance to its subsidiaries to raise the appropriateness of the Group's subsidiary management based on a policy of placing importance on independence and respecting the autonomous decision-making of subsidiaries.

A. System to report matters concerning the execution of duties by Directors of subsidiaries to the Company

According to its Subsidiary Management Regulations, the Company builds a system for departments to receive reports from subsidiaries under their management on a regular basis and as necessary and a system requiring subsidiaries to obtain the approval of departments controlling them.

Key subsidiaries provide the Company's executives with regular management reports.

B. Rules and other systems for managing the risk of loss at subsidiaries

The Company has its subsidiaries participate in the Risk Management Committee and coordinates the Group's risk management.

C. System to ensure that Directors, etc. of subsidiaries efficiently perform their duties

The Company's departments in charge of subsidiaries supervise and provide them with guidance according to the Subsidiary Management Regulations to achieve the basic plan set as a target in its Medium-term Management Plan. The Company sets KPIs also for its subsidiaries and manages the progress.

D. System to ensure that subsidiaries' Directors, etc. and employees' performance of their duties conforms with laws, regulations and the Articles of Incorporation

The Company has established the Code of Conduct of the Mitsubishi Paper Mills Group and Mitsubishi Paper Mills Group Compliance Conduct Standards, has its subsidiaries participate in the Compliance Committee, and improves the legal compliance of the Group, including the subsidiaries.

The Company provides the entire Group, including subsidiaries, with compliance training every year to ensure legal compliance of the Group.

It establishes hotlines including subsidiaries as a system of direct reporting to the Company's Internal Audit Dept. or an external specialized company. In addition, relevant departments perform audits of subsidiaries as necessary according to the Subsidiary Management Regulations to ensure the appropriateness of the Group's operations.

6. Systems to ensure that audits by Audit & Supervisory Board Members are performed effectively The Company implements the following and builds a system of supporting the audits performed by Audit & Supervisory Board Members to ensure their effectiveness.

A. Matters concerning the system of ensuring the effectiveness of audits performed by Audit & Supervisory Board Members

The Company holds regular meetings for Audit & Supervisory Board Members to improve their mutual understanding with the President and Chief Executive Officer about the Company's business issues, the development of the audit environment of the Audit & Supervisory Board Members, etc.

Audit & Supervisory Board Members, Internal Audit Dept., and accounting auditors exchange opinions to establish effective cooperation.

The Company cooperates with the Audit & Supervisory Board Members in their performance of duties to facilitate communication with Directors and Audit & Supervisory Board Members of subsidiaries and the collection and exchange of information and develops an environment for cooperation with external experts such as lawyers and certified public accountants if deemed necessary by the Audit & Supervisory Board Members.

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B. Matters concerning employees when an Audit & Supervisory Board Member requests that employees assist with his/her duties

The Company may appoint assistants to the Audit & Supervisory Board Members, who assist the duties of the Audit & Supervisory Board Members, and have the Internal Audit Dept. or Finance Dept. as assistant organizations. Audit & Supervisory Board Members may instruct employees in the Internal Audit Dept. and Finance Dept. as necessary.

C. Matters concerning the independence of the employees specified in B from Directors, and matters intended to ensure the effectiveness of instructions given to such employees

The Company ensures that employees assisting the duties of Audit & Supervisory Board Members follow the orders of the Audit & Supervisory Board Members, and that Directors, supervisors, etc. do not unreasonably limit the orders of the Audit & Supervisory Board Members given to such employees.

D. Systems related to reporting to an Audit & Supervisory Board Member

• Systems of reporting to Audit & Supervisory Board Members by Directors and employees Directors of the Company report the following to Audit & Supervisory Board Members to promote the effective performance of duties of Audit & Supervisory Board Members: 1. Matters discussed or reported at management meetings, 2. Matters that may cause significant damage to the Company, 3. Matters important for the monthly management status, 4. Important matters concerning internal audits and risk management, 5. Serious violations of laws and regulations or the Articles of Incorporation, 6. The status and details of reporting through hotlines (a system in which reports to external liaisons are directly sent to Audit & Supervisory Board Members), and 7. Other matters important for legal compliance. Important decision-makingdocuments of head office departments are delivered to Audit & Supervisory Board Members.
• System to report to the Audit & Supervisory Board Members by Directors, etc. and employees of the Company's subsidiaries, and people who have received reports from them
  According to the Subsidiary Management Regulations, the Company uses a system in which departments that have received important reports from subsidiaries also report to Audit & Supervisory Board Members. Subsidiaries may directly report to the Audit & Supervisory Board Members of the Company, and the Audit & Supervisory Board Members may also directly interview subsidiaries.

E. System for ensuring that personnel who make a report under paragraph D. do not receive unfavorable treatment due to such report

The Company clearly states in Mitsubishi Paper Mills Group Compliance Conduct Standards that the mere act of making a report would not place the reporter at any disadvantage and ensures that no reporter would be treated unfairly by the Company and its subsidiaries.

F. Policy on treatment of expenses incurred in the performance of the duties of Audit & Supervisory Board Members

The Company promptly handles expenses incurred in the performance of duties of Audit & Supervisory Board Members upon receiving a request for payment.

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Outline of the situations of the operation of the systems necessary to ensure the properness of operations

On March 1, 2023, the Company revised the Code of Conduct of the Mitsubishi Paper Mills Group. Recognizing that the importance of sustainability is growing, the Company has reviewed the Code of Conduct, the action guidelines for the Group's executives and employees, by reaffirming its priority on safety and its emphasis on compliance.

The overview of the operation status of the system to ensure the appropriateness of operations implemented in the fiscal year ended March 31, 2024, is as follows.

(Systems for the execution of duties)

During the fiscal year ended March 31, 2024, eight Directors (including three independent Outside Directors) who make up the Board of Directors, four Audit & Supervisory Board Members (including two Outside Audit & Supervisory Board Members) who make up the Audit & Supervisory Board, and 17 Executive Officers (including five Executive Officers concurrently holding the position of Directors) performed their duties. Systems for the execution of duties were enhanced from the perspective of diversity by selecting one female Director and one female member of the Audit & Supervisory Board. A total of 12 ordinary meetings of the Board of Directors, four extraordinary meetings of the Board of Directors, and 17 meetings of the Audit & Supervisory Board were held to make important decisions on the Company's management and supervise and audit the performance of duties.

With regard to matters to be discussed at Board meetings, the Company has enhanced the prior briefings for Outside Directors and Outside Audit & Supervisory Board Members to facilitate their understanding of the deliberations and invigorate discussions.

In addition, to evaluate the effectiveness of the Board of Directors, the Company surveys and interviews all Directors and Audit & Supervisory Board Members and discusses the results at meetings of the Board of Directors to share the understanding of the current condition and how to deal with issues among them in order to raise the effectiveness of the Board of Directors.

(Compliance structure)

During the fiscal year ended March 31, 2024, the Compliance Committee met twice, primarily to develop a training plan and confirm their implementation, confirm trends related to business and human rights and conduct a study on the relationship between the Group and human rights, consider initiatives to address human rights issues, inspect the status of legal procedures, and confirm the status of reports made through the hotline.

Seminars for line managers and training based on the cascade method (theme: elimination of harassment) for all employees (including part-time and dispatched employees) of the Group companies in Japan were conducted, with line managers deploying the training to their workplaces.

Using the compliance promotion leader system, appointed promotion leaders are developing initiatives to share information and raise compliance awareness at each workplace. In addition, the intranet is used to provide information on a regular basis, and promotion leaders are working to elevate their skill levels.

(Risk management structure)

During the fiscal year ended March 31, 2024, the Risk Management Committee met twice to oversee and promote activities related to the Group's risk management, including identifying, analyzing and evaluating risks that exist in the Group in response to changes in the business environment, formulating risk response measures, examining the business continuity plan (BCP), and conducting training on emergency responses. In addition, viewing responses to climate change as an important business issue, the Group examined and disclosed climate change-related risks in a company-wide,cross-functional TCFD response project team under the Risk Management Committee.

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(Management of subsidiaries)

The Company's relevant department provides subsidiaries with guidance and supervises them to rationalize and improve the Group's subsidiary management according to its Subsidiary Management Regulations. In the fiscal year ended March 31, 2024, the Company facilitated integration of subsidiaries (from 17 to 12 companies) to strengthen the Group's integrated management promotion system, and the relevant departments in charge conducted audits of subsidiaries to confirm that they are managed appropriately. The Company will continue to integrate the subsidiaries in the fiscal year ending March 31, 2025.

(Internal audits)

Internal Audit Department conducted audits of overall business activities in line with the J-SOX to confirm that they are operated appropriately.

(Audit & Supervisory Board Members' audits)

Full-time members of the Audit & Supervisory Board attend meetings of the Board of Directors as well as management meetings and confirm decision-making on business execution, etc. Outside members of the Audit & Supervisory Board attend the management briefing for outside officers (once a month in principle; Outside Directors and Full-time members of the Audit & Supervisory Board also attend the briefing) to be informed about the content of management meetings. In addition, opinion exchange workshops are held periodically with Representative Directors, the accounting auditor and Outside members of the Audit & Supervisory Board in order to enhance the effectiveness of audits.

Basic policy for controlling the management of the Company

Basic policy for controlling the management of the Company

(i) Details of the Basic Policy

The Group carries out corporate activities based on the corporate philosophy of the MPM Group, including "living up to the trust of its customers in the world market," "staying constantly on the leading edge of technology," and "contributing to preserving the global environment and creating a recycling society." The Company's duty is to maximize its corporate value or the common interests of shareholders through the sustainable growth of the Group and society based on this philosophy, and its principle is to be supported by people who have become its shareholders through free market trading. However, the Company's Basic Policy on a threat that such corporate value and/or the common interests of shareholders may be impaired by an individual and/or his/her group ("Hostile Bidders") aiming to acquire shares of the Company having 20% or more of voting rights ("Controlling Shares") is to take measures necessary to protect and increase the Company's corporate value and the common interests of shareholders within the limit allowed by laws and regulations and the Articles of Incorporation by regarding such Hostile Bidders as unqualified to have control over decisions about the financial and business policies of the Company.

(ii) Special initiatives to contribute to the realization of the Basic Policy

The Company is executing a new "Medium-Term Management Plan (FY2023/3-FY2025/3)" that incorporates measures to transform its business portfolio and contribute to carbon neutrality from a medium- to long-term perspective and is based on the future vision of the Group. It is working toward transforming itself with the creation of a new Mitsubishi Paper Mills Group, while enhancing its corporate value and maximizing the common interests of shareholders. Also, the Group is working on sustainability promotion activities by establishing the Sustainability Promotion Committee and assigning a director in charge, in order to grow sustainably by creating social values and contribute to a sustainable society through its business. Moreover, in accordance with the Basic Policies on Corporate Governance formulated in October 2015 (final revision in June 2022), the Company is also working to enhance the corporate governance.

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1. Activities to prevent decisions on the Company's financial affairs and business policies from being controlled by an inappropriate party in light of the Basic Policy
   At the Board of Directors' meeting held on May 30, 2022, the Company passed a resolution to continue its policy on responses to large-scale purchases of the Company's shares (the "Former Plan"), which had been approved by shareholders at the 154th Ordinary Shareholders' Meeting held on June 26, 2019, as one of the activities to prevent decisions on the Company's financial affairs and business policies from being controlled by an inappropriate party in light of the Basic Policy after a necessary revision (the "Plan"), which was approved by shareholders at the 157th Ordinary Shareholders' Meeting held on June 28, 2022. Additionally, the Company appointed three Independent Committee members, Mr. Yoshihiro Kataoka, Mr. Kazunori Shinohara, and Mr. Somitsu Takehara, due to the continuation of the above plan. The overview of the Plan is provided below. For more details, please read the press release, "Notice of Partial Amendments to the Response Policies on Large-Scale Purchases of MPM's Shares (Takeover Defense Measures) and Continuance Thereof" dated May 30, 2022, on the Company's website.
   (URL for reference:https://www.mpm.co.jp/company/news/pdf/2022/20220530-3.pdf)

1. Objectives of the Plan

The purpose of the Plan is to require the Large-Scale Purchaser to provide necessary information in advance and to have a period of consideration and examination, thereby enabling shareholders to make an appropriate decision on whether to accept such a large-scale purchase, enabling MPM's Board of Directors to present its opinions on whether to accept such proposal to shareholders or an alternative proposal in response to a recommendation from the Independent Committee, or enabling the Board of Directors to negotiate with the Large-Scale Purchaser for the benefit of shareholders, thereby preventing decisions on the Company's financial affairs and business policies from being controlled by an inappropriate party in light of the Basic Policy and ensuring and raising the Company's corporate value or/and the common interests of shareholders.

B. Procedures for taking the countermeasures based on the Plan

(a) Large-scale purchases subject to the measures

The measures based on the Plan may be taken when an act corresponding to or that may correspond to the overview or any of the following 1 through 3 has been or will be conducted.

1. Purchase of shares of the Company that makes the percentage (the percentage of shares, etc. defined in paragraph 4, Article 27-23 of the Financial Instruments and Exchange Act; the same applies hereinafter) of shares held by a specific shareholder of the Company 20% or higher
2. Purchase of shares of the Company that makes the sum total of the percentage (the percentage of shares, etc. defined in paragraph 8, Article 27-2 of the Financial Instruments and Exchange Act; the same applies hereinafter) of shares held by a specific shareholder of the Company and the percentage of shares held by a specially related party of the specific shareholder of the Company 20% or higher
3. An act conducted by a specific shareholder of the Company and another shareholder of the Company, which results in an agreement or other acts making them joint holders of the Company's shares or an act of establishing a controlling or cooperative relationship between the two shareholders (limited to a case in which the sum total of the percentages of shares held by the two shareholders becomes 20% or higher)

1. Request to Large-Scale Purchaser for information

The Large-Scale Purchaser must submit and provide a letter of intent and information about a large- scale purchase in advance of the start or implementation of an act of large-scale purchase.

(c) Establishment of assessment period for the Board of Directors

The Board of Directors establishes a period of up to 60 days for a purchase of all shares of the Company through a takeover bid accepting only cash (yen currency) as the consideration and up to 90 days for large-scale purchase in other forms, as the assessment period for the Board of Directors to evaluate, examine, raise opinions, develop an alternative plan, and negotiate with the Large-Scale Purchaser in

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view of ensuring and increasing the Company's corporate value and/or the common interests of shareholders.

(d) Recommendation of Independent Committee and resolution of the Board of Directors

The Independent Committee recommends that the Board of Directors to take measures against a large- scale purchase within, in principle, five business days following the demand of the Board of Directors to the Large-Scale Purchaser for correction if the Large-Scale Purchaser has committed a serious violation of the rules for large-scale purchase.

If, however, the Large-Scale Purchaser has complied with the rules for large-scale purchase, the Independent Committee recommends the Board of Directors, in principle, not to take measures against the large-scale purchase. However, the Independent Committee recommends that the Board of Directors take measures if the Large-Scale Purchaser is deemed to have certain characteristics, such as a so-called greenmailer.

The Board of Directors decides whether to take measures and resolves other issues while respecting the recommendation of the Independent Committee to the maximum extent possible.

(e) Resolution of a general meeting of shareholders to confirm the shareholders' intention

If the Board of Directors has determined that it should go through procedures to confirm the shareholders' intention when it determines whether or not to implement the countermeasure under the Plan and if the Board of Directors deems it reasonable to implement the countermeasure in the case where the Large-Scale Purchaser complies with the Large-Scale Purchase Rules, the Board of Directors will convene a general meeting of shareholders to confirm the shareholders' intention as soon as possible. If the proposal to implement the countermeasure has been passed at the general meeting of shareholders to confirm the shareholders' intention, the Board of Directors will make a resolution on the implementation of the countermeasure against the Large-Scale Purchaser. However, if the proposal to implement the countermeasure is rejected, the countermeasure will not be implemented against the Large-scale Purchase.

(f) Specific contents of the countermeasure

The measures against large-scale purchases taken by the Company based on the Plan will, in principle, be the allotment of share acquisition rights without contribution.

C. Feature of the Plan

(a) Establishment of the Basic Policy

The Plan was adopted after the Basic Policy for the conditions of a party that controls the Company's financial affairs and business policy was established.

(b) Establishment of Independent Committee

The Company establishes the Independent Committee to ensure the necessity and appropriateness of the Plan. When calling for countermeasures, the Board of Directors must ensure the fairness of the decision and respects the recommendation of the Independent Committee to the maximum extent possible in order to eliminate any arbitrary decision by the Board of Directors.

(c) Approval for the Plan at Shareholders' Meeting

The continuation of the anti-takeover measures under the Plan was approved by the Company's shareholders at the 157th Ordinary Shareholders' Meeting held on June 28, 2022.

(d) Timely disclosure

The Board of Directors makes the timely and appropriate disclosure of the required information pursuant to the applicable laws and regulations and the rules of the financial instrument exchange.

(e) Effective term of the Plan

The term of the Plan shall expire at the conclusion of the Ordinary Shareholders' Meeting pertaining to the last business year ending within three (3) years after the conclusion of the 157th Ordinary Shareholders' Meeting held on June 28, 2022.

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D. Influence on our shareholders

(a) Impact of the revision of the Former Plan on shareholders

The revision of the Former Plan to the Plan has no direct and specific effect on the legal rights and economic interests of shareholders.

(b) Impact of issuing share acquisition rights on shareholders

While the per share value of MPM's shares held by the shareholders would be diluted when share acquisition rights are issued without contribution as a countermeasure, the value of all shares of MPM held by the shareholders would not be diluted. Therefore, no direct, specific impact on the legal rights and economic interests of the shareholders is expected to occur. However, the legal rights and economic interests of those who correspond to the exceptions specified in the Plan may be affected as a consequence of the countermeasures implemented.

(iv) Decision of the Board of Directors on the above activities and reason for the decision

The special activities contributing to the realization of the Basic Policy specified in the above section (ii) are specific measures for raising the corporate value of MPM and/or the common interests of shareholders, which are considered to be precisely in line with the Basic Policy of MPM.

As stated in the paragraph A in the above section (iii), the Board of Directors of MPM believes that the Plan was adopted for the purpose of ensuring and raising the corporate value and/or the common interests of shareholders and is in line with the Basic Policy. The Board of Directors of MPM does not believe that the Plan will impair the corporate value of MPM or the common interests of shareholders and will not act to maintain the positions of the executives of MPM, in particular due to the following: 1) the Plan will be abolished immediately if a proposal to abolish the Plan is approved at a Shareholders' Meeting, and the intentions of shareholders are prioritized in the sense that the continuation of the Plan is contingent on shareholder approval, and in certain cases, the confirmation of the will of shareholders at the general meeting of shareholders to confirm the shareholders' intention is required regarding the appropriateness of implementing countermeasures, 2) the Plan requires the establishment of an Independent Committee maintaining a high level of independence, whose recommendation is required when taking countermeasures in all cases, and 3) the standards used to make decisions on whether to take, not to take, or to cancel a countermeasure has been established.

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