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May 2009

Update : May 25, 2009

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1. Review of Organizational Structure

The Tokyo Stock Exchange group has made the following two changes in its organizational structure.

One is to reorganize the "Marketing Office" into a "Corporate Marketing Management Department" and then to newly establish a "Trading Participants Services Office" within the department. The TSE group will then shift part of the operations that had been carried out by the "Trading Participants Services Department" to the "Trading Participants Services Office". The "Corporate Marketing Management Department" will assist the entire company in understanding and managing the needs of various customers. It will also strive to make the company thoroughly customer-driven to improve systems and rules as well as play a central role in attracting new customers and expanding its sales channel.

The other is to change the name of the "System Unit" to the "IT Unit" and to establish a new "IT Business Department" within the unit. Through this department, the TSE group will work to develop a system to plan and promote new IT-related businesses with a focus on the coming activation of our new systems.

These changes are scheduled to be implemented on June 25, 2009.

2. Adjustments to the Listing System based on "Listing System Improvement 2008"

Tokyo Stock Exchange, Inc. (TSE) publicized an action plan entitled "Adjustments to the Listing System based on the Listing System Improvement 2008" in May 2008. In the plan, "Improving conditions to enhance the corporate governance of listed companies" was identified as an important issue, and the TSE has been carrying out a review in regard to this matter. In addition, the TSE received a proposal "For Creating a Better Market Environment Where Investors Feel Secure" from the Advisory Group on Improvements to the TSE Listing System (publicized on Thursday, April 23, 2009). Taking this proposal and opinions from investors into consideration, the TSE has decided to make necessary adjustments to the listing system.

The TSE focuses on the following four points.

First, the TSE will classify items in the Corporate Code of Conduct into "items to be observed" and "items desired to be observed" to clarify items that listed companies should comply with at a minimum level. The TSE will then make the "items to be observed" a means to secure effectiveness such as publicizing the names, etc. of companies that violate the Corporate Code of Conduct. At the same time, the TSE will review the means in line with its diversification in recent years.

Secondly, the TSE will make adjustments to the listing system for private placements to third parties, reverse stock splits, etc. in an effort to improve the conditions domestic and foreign investors can invest with peace of mind. Through the adjustments, the TSE will prevent private placements to third parties that significantly violate the rights of existing investors and have material impact on confidence in the market. For example, the TSE will examine private placements to third parties that cause dilution of over 300% to existing investors and decide whether the company should be delisted or not.

Thirdly, in order to promote dialogue between shareholders and listed companies, the TSE will work to create an environment where shareholders can reach listed companies' information, such as invitation notices of general shareholders' meetings, through the TSE website as soon as possible.

Lastly, the TSE will make necessary adjustments to the "Items to be reviewed for the implementation of specific measures" in the "Follow-up on the Comprehensive Improvement Program for Listing System 2007". This was identified as a central theme in the above action plan. For example, the TSE will clarify points of examinations related to timely disclosure on corporate information to further improve timely disclosure.

These reviews are scheduled to be implemented in August 2009 after soliciting suggestions and opinions from the public from May 19, 2009 to June 18, 2009. However, reviews that require system adjustments will be excluded.

[For more information]
Improvements to TSE Listing System

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