{"url_path":"/sec/mfg/10-k/2026/item-10","section_key":"item-10","section_title":"Item 10 ADDITIONAL INFORMATION","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-06-26","source_url":"https://www.sec.gov/Archives/edgar/data/1335730/0001193125-26-283791-index.html","accession_number":"0001193125-26-283791","cik":"0001335730","ticker":"MFG","issuer_name":"MIZUHO FINANCIAL GROUP INC","edgar_url":"https://www.sec.gov/Archives/edgar/data/1335730/0001193125-26-283791-index.html","primary_entity_key":"0001335730","primary_entity_name":"MIZUHO FINANCIAL GROUP INC"},"word_count":16530,"has_tables":true,"body_markdown":"ITEM 10.\n\nADDITIONAL INFORMATION\n\n10.A. Share Capital\n\nNot applicable.\n\n \n\n138\n\n10.B. Memorandum and Articles of Association\n\nObjects and Purposes in our Articles of Incorporation\n\nOur corporate purpose, as specified in Article 2 of our articles of incorporation, which is included in this annual report as Exhibit 1.1, is to engage in the following businesses as a bank holding company:\n\n \n\n \n•\n \n\noperation and management of bank holding companies, banks, specialized securities companies and other companies which we may own as our subsidiaries under the Banking Act, and any other business incidental thereto; and\n\n \n\n \n•\n \n\nany other business that a bank holding company may engage in under the Banking Act.\n\nOur Board of Directors\n\nUnder the Companies Act (Kaisha Hou) (Act No. 86 of 2005, as amended), because we have adopted the “Company with Three Committees” system, our directors have no power to execute our business except in limited circumstances as permitted by law. If a director also serves concurrently as an executive officer as defined in the Companies Act, then he or she can execute our business in the capacity of executive officer as defined in the Companies Act. There is no provision in our articles of incorporation as to our directors’ power to vote on a proposal, arrangement or contract in which a director is materially interested. The Companies Act, however, requires such director to refrain from voting on such matters at meetings of the board of directors.\n\nThe amount of compensation to each our director is determined by the Compensation Committee, which consists of our directors, the majority of whom are outside directors (see “Item 6.C. Board Practices”).\n\nThe borrowing powers have been delegated to the executive officers as defined in the Companies Act by the Board of Directors in accordance with the Companies Act.\n\nNeither the Companies Act nor our articles of incorporation set a mandatory retirement age for our directors.\n\nThere is no requirement concerning the number of shares an individual must hold to qualify as a director under the Companies Act or our articles of incorporation.\n\nCommon Stock\n\nGeneral\n\nUnless otherwise specified, set forth below is information concerning our shares of common stock as of the date hereof, including brief summaries of certain provisions of our articles of incorporation, our share handling regulations and the Companies Act relating to joint stock corporations (kabushiki kaisha) and certain related legislation, all as currently in effect.\n\nUnder our articles of incorporation, we are authorized to issue 4,800,000,000 shares of common stock.\n\nAs of March 31, 2026, 2,489,848,594 shares of common stock were issued.\n\nWhere relevant to the common stock, provisions of our preferred stock are also described below.\n\nDistribution of Surplus\n\nGeneral\n\nUnder the Companies Act, distribution of cash or other assets by a joint stock corporation to its shareholders, including dividends, takes the form of distribution of Surplus (as defined in “—Restriction on\n\n \n\n139\n\nDistribution of Surplus”). We are permitted to make distributions of Surplus to our shareholders any number of times per fiscal year, subject to certain limitations described in “—Restriction on Distribution of Surplus.” Under the Companies Act and our articles of incorporation, distributions of Surplus are in principle permitted by a resolution of the Board of Directors as long as our non-consolidated annual financial statements and certain documents for the latest fiscal year fairly present our assets and profit and loss, as required by an ordinance of the Ministry of Justice. Distributions of Surplus are, however, required to be authorized by a resolution of a general meeting of shareholders if the aforementioned condition is not met, and even if the aforementioned condition is met, distribution of Surplus may be authorized by a resolution of a general meeting of shareholders.\n\nDistributions of Surplus may be made in cash or in kind in proportion to the number of shares of common stock held by each shareholder. A resolution of the Board of Directors or a general meeting of shareholders authorizing a distribution of Surplus must specify the kind and aggregate book value of the assets to be distributed, the manner of allocation of such assets to shareholders, and the effective date of the distribution. If a distribution of Surplus is to be made in kind, we may, pursuant to a resolution of the Board of Directors or (as the case may be) a general meeting of shareholders, grant the right to our shareholders to require us to make such distribution in cash instead of in kind. If no such right is granted to shareholders, the relevant distribution of Surplus must be approved by a special resolution of a general meeting of shareholders (see “—Voting Rights” with respect to a “special resolution”).\n\nUnder our articles of incorporation, the record dates for annual dividends and interim dividends are March 31 and September 30, respectively, each year. In Japan, the “ex-dividend date” (the date from which purchasers of shares through Japanese stock exchanges will not be entitled to the dividends to be paid to registered shareholders as of any record date) and the record date for dividends precede the date of determination of the amount of the dividend to be paid. The ex-dividend date of the shares of common stock is generally the first business day prior to the record date.\n\nRestriction on Distribution of Surplus\n\nPayment of annual dividends on shares of common stock is subject to the prior payment of annual preferred dividends on the shares of any series of preferred stock. Payment of an interim dividend on shares of our common stock is also subject to the prior payment of an interim preferred dividend of one-half the annual preferred dividend amount on the shares of any series of preferred stock. In making a distribution of Surplus, we must set aside in our additional paid-in capital and/or legal reserve an amount equal to one-tenth of the amount of Surplus so distributed, until the sum of its additional paid-in capital and legal reserve reaches one-quarter of its stated capital.\n\nThe amount of Surplus at any given time must be calculated in accordance with the following formula:\n\nA + B + C + D - (E + F + G)\n\nIn the above formula:\n\n“A” = the total amount of other capital surplus and other retained earnings, each such amount being that appearing on our non-consolidated balance sheet as of the end of the last fiscal year\n\n“B” = (if we have disposed of our treasury stock after the end of the last fiscal year) the amount of the consideration for such treasury stock received by us less the book value thereof\n\n“C” = (if we have reduced our stated capital after the end of the last fiscal year) the amount of such reduction less the portion thereof that has been transferred to additional paid-in capital or legal reserve (if any)\n\n“D” = (if we have reduced our additional paid-in capital or legal reserve after the end of the last fiscal year) the amount of such reduction less the portion thereof that has been transferred to stated capital (if any)\n\n \n\n140\n\n“E” = (if we have cancelled our treasury stock after the end of the last fiscal year) the book value of such treasury stock\n\n“F” = (if we have distributed Surplus to our shareholders after the end of the last fiscal year) the total book value of the Surplus so distributed\n\n“G” = certain other amounts set forth in an ordinance of the Ministry of Justice, including:\n\n \n\n \n•\n \n\nif we have reduced Surplus and increased our stated capital, additional paid-in capital or legal reserve after the end of the last fiscal year, the amount of such reduction; and\n\n \n\n \n•\n \n\nif we have distributed Surplus to shareholders after the end of the last fiscal year, the amount set aside in our additional paid-in capital or legal reserve, if any, as required by ordinances of the Ministry of Justice. \n\nThe aggregate book value of Surplus distributed by us may not exceed a prescribed distributable amount (the “Distributable Amount”), as calculated on the effective date of such distribution. The Distributable Amount at any given time shall be the amount of Surplus less the aggregate of (a) the book value of our treasury stock, (b) the amount of consideration for any of our treasury stock disposed of by us after the end of the last fiscal year and (c) certain other amounts set forth in an ordinance of the Ministry of Justice, including (if the sum of one-half of our goodwill and deferred assets exceeds the total of the stated capital, additional paid-in capital and legal reserve, each such amount being the amount in our non-consolidated balance sheet as of the end of the last fiscal year) all or certain part of such exceeding amount as calculated in accordance with the ordinances of the Ministry of Justice.\n\nIf we have become at our option a company with respect to which its consolidated balance sheet should also be considered in the calculation of the Distributable Amount (renketsu haito kisei tekiyo kaisha), we shall further deduct from the amount of Surplus the excess amount, if any, of (x) the total amount of the shareholders’ equity appearing on our non-consolidated balance sheet as of the end of the last fiscal year and certain other amounts set forth by an ordinance of the Ministry of Justice over (y) the total amount of the shareholders’ equity and certain other amounts set forth by an ordinance of the Ministry of Justice appearing on our consolidated balance sheet as of the end of the last fiscal year. We did not opt for becoming such a company with respect to the fiscal year ended March 31, 2026.\n\nIf we have prepared interim financial statements as described below, and if such interim financial statements have been approved by the Board of Directors or (if so required by the Companies Act) by a general meeting of shareholders, then the Distributable Amount must be adjusted to take into account the amount of profit or loss, and the amount of consideration for any of our treasury stock disposed of by us, during the period in respect of which such interim financial statements have been prepared. We may prepare non-consolidated interim financial statements consisting of a balance sheet as of any date subsequent to the end of the last fiscal year and an income statement for the period from the first day of the current fiscal year to the date of such balance sheet. Interim financial statements so prepared by us must be audited by our corporate auditors and/or outside accounting auditor, as required by an ordinance of the Ministry of Justice.\n\nCapital and Reserves\n\nWe may reduce our additional paid-in capital or legal reserve generally by resolution of a general meeting of shareholders and, if so decided by the same resolution, may account for the whole or any part of the amount of such reduction as stated capital. On the other hand, we may reduce our stated capital generally by special resolution of a general meeting of shareholders and, if so decided by the same resolution, may account for the whole or any part of the amount of such reduction as additional paid-in capital or legal reserve. In addition, we may reduce our Surplus and increase either (i) stated capital or (ii) additional paid-in capital and/or legal reserve by the same amount, in either case by resolution of a general meeting of shareholders.\n\n \n\n141\n\nStock Splits\n\nWe may at any time split shares of common stock into a greater number of shares of common stock by determination by executive officers as defined in the Companies Act under the authority delegated by resolution of the Board of Directors. When a stock split is to be made, so long as our only class of outstanding stock is the common stock, we may increase the number of authorized shares in the same ratio as that of such stock split by amending our articles of incorporation, of which amendment may be effected by resolution of the Board of Directors without approval by shareholders.\n\nShare Consolidation\n\nWe may at any time consolidate shares of common stock into a smaller number of shares of common stock by special resolution of a general meeting of shareholders. When a share consolidation is to be made, we must give public notice at least two weeks (or, in the case where any fractions of shares are left as a result of the share consolidation, 20 days) prior to the effective date of the share consolidation. We must disclose the reason for the share consolidation at the general meeting of shareholders.\n\nUnit Share System\n\nWe have adopted the unit share system under which shareholders will have one voting right for each unit of shares consisting of 100 shares held by them at general meetings of shareholders or at meetings of holders of a particular class of shares, and shares constituting less than a full unit will carry no voting rights. See “—Preferred Stock—Voting Rights” for information on the voting rights that holders of preferred stock may have at general meetings of shareholders. Our articles of incorporation provide that the holders of shares constituting less than a full unit will not have shareholder rights, except for those specified in an ordinance of the Ministry of Justice which include rights (i) to receive dividends, (ii) to receive cash or other assets in case of a consolidation or split of shares, share exchange or share transfer, or merger or (iii) to be allotted rights to subscribe for free for new shares and stock acquisition rights when such rights are granted to shareholders. Holders of shares constituting less than a full unit may at any time request us to purchase such shares constituting less than a full unit (a) at the current market price as determined pursuant to the Companies Act in cases of such shares having a market price (such as our common stock) or (b) at the price as determined through negotiations between the holders of shares constituting less than a full unit and us in cases where such shares have no market price (such as our preferred stock), which request may not be withdrawn without our consent. In addition, holders of shares constituting less than a full unit may require us to sell them such number of shares, which, when combined with the number of shares already held by such holder, shall constitute a whole unit of shares; provided that we will be obliged to comply with such request only when we own a sufficient number of shares to accommodate such request. As prescribed in our share handling regulations, such requests shall be made through an account managing institution at which such shareholder has its account and Japan Securities Depository Center, Inc. (“JASDEC”) pursuant to the rules of JASDEC, without going through the notification procedure required for the exercise of shareholders’ rights entitled regardless of record dates as described in “—Transfer of Shares.” The executive officers as defined in the Companies Act under the authority delegated by the Board of Directors may reduce the number of shares constituting one unit of shares or cease to use the unit share system by amendments to the articles of incorporation without a special resolution of the general meeting of shareholders which would otherwise be required.\n\nGeneral Meetings of Shareholders\n\nThe ordinary general meeting of shareholders shall be held no later than three months from the last day of each business year and is normally held in June of each year. In addition, we may hold an extraordinary general meeting of shareholders whenever necessary. The record date for an ordinary general meeting of shareholders is March 31 of each year.\n\n \n\n142\n\nUnder the Companies Act and our articles of incorporation, we shall take electronic provision measures (the “Electronic Provision”) for the information contained in the reference materials, etc., for our general meetings of shareholders.\n\nThe notice for a general meeting of shareholders must set forth the place, the time, the purpose thereof and the information in the reference materials, etc., for a general meeting of shareholders being provided through the Electronic Provision and the URL of the website used for the Electronic Provision, and must be given to each shareholder having voting rights (or, in the case of a non-resident shareholder, to its standing proxy or mailing address in Japan) at least two weeks prior to the date set for the meeting. The information in the reference materials, etc., for a general meeting of shareholders must be posted on a website from the earlier of the date three weeks prior to the date set for the meeting or the date on which the notice for the meeting is dispatched until the date on which three months have elapsed from the meeting. In general, any shareholder is entitled to request printed paper copies of the information in the reference materials, etc., for a general meeting of shareholders by the record date for voting rights of the relevant general meeting of shareholders.\n\nAny shareholder holding at least 300 voting rights or 1% of the total number of voting rights for six months or longer may propose a matter to be considered at a general meeting of shareholders, and request to include the proposal in a notice for a general meeting of shareholders, by submitting a request to a representative executive officer at least eight weeks prior to the date of such meeting. However, the number of proposals that such shareholder may request to be included in such notice is limited up to 10 proposals, and we are able to decline to include the excessive proposals in such notice in the case where the number of proposals requested by each shareholder exceeds 10. Any of the minimum percentages, time periods and number of voting rights necessary for exercising the minority shareholder rights described above may be decreased or shortened if our articles of incorporation so provide.\n\nVoting Rights\n\nOur shareholders have one voting right for each unit of shares held by them (regarding the voting rights held by holders of preferred stock, see “—Preferred Stock—Voting Rights”).\n\nExcept as otherwise provided by law or in our articles of incorporation, a resolution shall be adopted at a general meeting of shareholders by a majority of the voting rights held by the shareholders present at the meeting. Our articles of incorporation provide that the quorum for election of directors is one-third of the total number of voting rights. Our shareholders are not entitled to cumulative voting in the election of directors. A shareholder may exercise its voting rights in writing or through a proxy, provided that the proxy shall also be a holder of our shares having voting rights at such meeting.\n\nThe Companies Act provides that certain important matters shall be approved by a “special resolution” of a general meeting of shareholders. Under our articles of incorporation, the quorum for a special resolution is one-third of the total number of voting rights, and the approval of not less than two-thirds of the voting rights held by the shareholders present at the meeting is required for adopting a special resolution. Such important matters include:\n\n \n\n \n1.\n\nany amendment to our articles of incorporation (except for such amendments that may be authorized by executive officers as defined in the Companies Act under the authority delegated by the board of directors under the Companies Act such as (i) an increase of the number of authorized shares in the same ratio as that of a stock split, (ii) a reduction of the number of shares per unit of shares and (iii) abolishing the unit share system);\n\n \n\n \n2.\n\nour dissolution, merger or consolidation requiring shareholders’ approval;\n\n \n\n \n3.\n\nestablishment of a parent and wholly-owned subsidiary relationship by way of a share transfer (kabushiki-iten) or share exchange (kabushiki-kokan), or establishment of a parent and subsidiary relationship by way of a partial share exchange (kabushiki-kofu), requiring shareholders’ approval;\n\n \n\n143\n\n \n4.\n\ntransfer of the whole or a substantial part of our business;\n\n \n\n \n5.\n\ntransfer of the whole or a part of our shares in any of our subsidiaries requiring shareholders’ approval;\n\n \n\n \n6.\n\ntaking over of the whole of the business of another company requiring shareholders’ approval;\n\n \n\n \n7.\n\nour corporate split requiring shareholders’ approval;\n\n \n\n \n8.\n\nconsolidation of shares of common stock;\n\n \n\n \n9.\n\nacquisition of shares of common stock by us from a specific shareholder other than our subsidiary;\n\n \n\n \n10.\n\ndistribution of Surplus in kind (except when shareholders are granted the right to require to make such distribution in cash instead of in kind);\n\n \n\n \n11.\n\nissuance or transfer of new shares or existing shares held by us as treasury stock to persons other than the shareholders at a “specially favorable” price; and\n\n \n\n \n12.\n\nissuance of stock acquisition rights (including those incorporated in bonds with stock acquisition rights) to persons other than the shareholders at a “specially favorable” price or under “specially favorable” conditions.\n\nLiquidation Rights\n\nIn the event of our liquidation, the assets remaining after payment of all debts, liquidation expenses, taxes and distributions of residual assets relating to the then outstanding preferred stock will be distributed among holders of common stock in proportion to the respective numbers of shares held by them. Regarding distributions of residual assets relating to the then outstanding preferred stock, see “—Preferred Stock—Liquidation Rights.”\n\nIssue of Additional Shares and Pre-emptive Rights\n\nHolders of the common stock have no pre-emptive rights. Authorized but unissued shares of common stock may be issued at such times and upon such terms as executive officers as defined in the Companies Act under the authority delegated by the Board of Directors determine, subject to the limitations as to the issuance of new shares of common stock at a “specially favorable” price mentioned in “—Voting Rights.”\n\nIn the case of an issuance or transfer of shares or stock acquisition rights by way of an allotment to a third party whereby the third party will hold more than 50% of the voting rights of all shareholders, we shall give notice (including a public notice) to our shareholders in advance, and if shareholders who hold one-tenth or more of the voting rights of all shareholders dissent from the third-party allotment, the approval by an ordinary resolution of a general meeting of shareholders is generally required before the payment date for such issuance or transfer pursuant to the Companies Act. In addition, pursuant to the regulations of the stock exchanges in Japan, in the case of an issuance or transfer of shares or stock acquisition rights by way of an allotment to a third party which would dilute the outstanding voting shares by 25% or more or change the controlling shareholder, in addition to a determination by the executive officers as defined in the Companies Act, the approval of the shareholders or an affirmative opinion from a person independent of our management is generally required.\n\nExecutive officers as defined in the Companies Act under the authority delegated by the Board of Directors may, however, determine that shareholders of a particular class of stock shall be given subscription rights to new shares of the same class, in which case they must be given on uniform terms to all shareholders of that class as of a record date of which not less than two weeks’ prior public notice must be given. Each of the shareholders to whom such rights are given must also be given at least two weeks’ prior notice of the date on which such rights expire (but see “—Preferred Stock—Issue of Additional Shares and Pre-emptive Rights” regarding our preferred stock).\n\n \n\n144\n\nStock Acquisition Rights\n\nWe may issue stock acquisition rights (shinkabu yoyakuken). Holders of stock acquisition rights are entitled to acquire shares from us, upon payment of the applicable exercise price, and subject to other terms and conditions thereof. We may also issue bonds with stock acquisition rights (shinkabu yoyakuken-tsuki shasai). The issuance of stock acquisition rights and bonds with stock acquisition rights may be authorized by executive officers as defined in the Companies Act under the authority delegated by the Board of Directors unless it is made at a “specially favorable” price or under “specially favorable” conditions, as described in “—Voting Rights” and subject to the approval of the shareholders or an affirmative opinion from an independent person in certain cases, as described in “—Issue of Additional Shares and Pre-emptive Rights.”\n\nRecord Date\n\nAs mentioned above, March 31 is the record date for the payment of annual dividends and the determination of shareholders entitled to vote at the ordinary general meeting of shareholders. September 30 is the record date for the payment of interim dividends. In addition, by a determination by executive officers as defined in the Companies Act under the authority delegated by the Board of Directors and after giving at least two weeks’ prior public notice, we may at any time set a record date in order to determine the shareholders who are entitled to certain rights pertaining to our stock.\n\nJASDEC is required to give us notice of the names and addresses of our shareholders, the numbers of shares held by them and other relevant information as of such record date promptly after we set each record date.\n\nAcquisition by Us of Common Stock\n\nWe may acquire shares of common stock:\n\n \n\n \n1.\n\nby way of purchase on any Japanese stock exchange on which the shares of our common stock are listed or by way of tender offer (in either case pursuant to a resolution of the Board of Directors as long as our non-consolidated annual financial statements and certain documents for the latest fiscal year fairly present our assets and profit and loss, as required by an ordinance of the Ministry of Justice);\n\n \n\n \n2.\n\nfrom a specific shareholder other than any of our subsidiaries (pursuant to a special resolution of a general meeting of shareholders); or\n\n \n\n \n3.\n\nfrom any of our subsidiaries (pursuant to a determination by executive officers as defined in the Companies Act under the authority delegated by the Board of Directors).\n\nIn the case of 2. above, any other shareholder may make a request to us to be included as a seller in the proposed purchase, unless the purchase price or any other consideration to be received by the relevant specific shareholder will not exceed the last trading price of the shares on the relevant stock exchange on the day immediately preceding the date on which the resolution mentioned in 2. above was adopted (or, if there is no trading in the shares on the stock exchange or if the stock exchange is not open on such day, the price at which the shares are first traded on such stock exchange thereafter).\n\nThe total amount of the purchase price of shares of common stock may not exceed the Distributable Amount, as described in “—Distribution of Surplus—Restriction on Distribution of Surplus.”\n\nWe may hold the shares of common stock acquired, and may generally transfer or cancel such shares by a determination by executive officers as defined in the Companies Act under the authority delegated by the Board of Directors.\n\nDisposal of Shares of Common Stock Held by Shareholders whose Location is Unknown\n\nWe are not required to send notices to a shareholder if notices given by us to such shareholder fail to arrive for five consecutive years or more at its address registered in our register of shareholders or otherwise notified to us.\n\n \n\n145\n\nIn the above case, if the relevant shareholder also fails to receive dividends on the shares continuously for five years or more at its address registered in our register of shareholders or otherwise notified to us, then we may in general dispose of such shares at their then market price and hold or deposit the proceeds of such disposition on behalf of the relevant shareholder.\n\nReporting of Substantial Shareholders\n\nThe Financial Instruments and Exchange Act and its related regulations require any person who has become, beneficially and solely or jointly, a holder of more than 5% of the total issued shares of capital stock of a company that is listed on any Japanese stock exchange to file a report with the Director of the relevant Local Finance Bureau of the Ministry of Finance within five business days. With certain exceptions, a similar report must also be filed in respect of any subsequent change of 1% or more in the holding or of any change in material matters set forth in any previously filed reports. For the purpose of the reporting requirements mentioned above, shares of capital stock of a company issuable to any person upon conversion of convertible securities or exercise of share subscription warrants or stock acquisition rights by such person are taken into account in determining both the number of shares held by such person and the company’s total issued share capital. Any such report shall be filed with the Director of the relevant Local Finance Bureau of the Ministry of Finance through the Electronic Disclosure for Investors’ Network (EDINET) system.\n\nThere are other reporting requirements under the Banking Act. See “Item 4.B. Information on the Company—Business Overview—Supervision and Regulation—Japan—Examination and Reporting Applicable to Shareholders.”\n\nHolding of Shares of Our Common Stock by Foreign Investors\n\nThere are no limitations imposed by the laws of Japan, our articles of incorporation or our other constituent documents on the rights of non-residents or foreign shareholders to hold or exercise voting rights on our shares of common stock or preferred stock in general.\n\nFor the regulations relating to the acquisition and holding of our shares and voting rights by non-residents of Japan and the inward direct investment by foreign investors under the Foreign Exchange and Foreign Trade Act of Japan(Act No. 228 of 1949, as amended), see “Item 10.D. Exchange Controls.”\n\nTransfer of Shares\n\nAt present, JASDEC is the only institution that is designated by the relevant authorities as a clearing house which is permitted to engage in the clearing operations of listed shares under the Act on Book-Entry Transfer of Corporate Bonds, Stocks, etc. (Act No. 75 of 2001, including regulations promulgated thereunder; the “Book-entry Act”). Under the clearing system above, in order for any person to hold, sell or otherwise dispose of listed shares, such person must have an account at an account managing institution unless such person has an account at JASDEC. “Account managing institutions” are financial instruments business operators (i.e., securities companies), banks, trust companies and certain other financial institutions which meet the requirements prescribed by the Book-entry Act, and only those financial institutions that meet further stringent requirements of the Book-entry Act can open accounts directly at JASDEC. Under the Book-entry Act, any transfer of shares is effected through book entry, and title to the shares passes to the transferee at the time when the transferred number of the shares is recorded at the transferee’s account at an account managing institution or JASDEC. The holder of an account at an account managing institution or JASDEC is presumed to be the legal owner of the shares held in such account. Under the Companies Act and the Book-entry Act, in order to assert shareholders’ rights to which shareholders as of record dates are entitled (such as the rights to vote at a general meeting of shareholders or receive dividends) against us, a shareholder must have its name and address registered in our register of shareholders. Under the clearing system, such registration is made upon our receipt of necessary information from JASDEC. On the other hand, in order to assert shareholders’ rights to which shareholders are\n\n \n\n146\n\nentitled regardless of record dates such as minority shareholders’ rights including the right to propose a matter to be considered at a general meeting of shareholders and to request to include the proposal in a notice for a general meeting of shareholders, except for shareholders’ rights to request us to purchase or sell shares constituting less than a full unit (as described in “—Unit Share System”), upon the shareholder’s request, JASDEC shall issue a notice of certain information, including the name and address of such shareholder, to us. Thereafter, such shareholder is required to present us a receipt of the request of the notice in accordance with our share handling regulations. Under the Book-entry Act, the shareholder shall exercise such shareholders’ right within four weeks after the notice above. Non-resident shareholders are required to appoint a standing proxy in Japan or provide a mailing address in Japan. Each such shareholder must give notice of such standing proxy or mailing address to the relevant account managing institution. Such notice will be forwarded to us through JASDEC. Japanese securities companies and commercial banks customarily act as standing proxies and provide related services for standard fees. Notices from us to non-resident shareholders are delivered to such standing proxies or mailing addresses.\n\nUnder the clearing system, shares constituting less than one unit are transferable. Under the rules of the Japanese stock exchanges, however, shares constituting less than one unit do not comprise a trading unit, except in limited circumstances, and accordingly may not be sold on Japanese stock exchanges.\n\nOur transfer agent is Mizuho Trust & Banking, located at 3-3, Marunouchi 1-chome, Chiyoda-ku, Tokyo 100-8241, Japan.\n\nThe registered holder of deposited shares underlying the ADSs is the depositary for the ADSs. Accordingly, holders of ADSs will not be able to directly assert their shareholders’ rights against us.\n\nPreferred Stock\n\nUnless otherwise specified, the following is a summary of information concerning the shares of our preferred stock as of the date hereof, including brief summaries of the relevant provisions of our articles of incorporation, our share handling regulations and the Companies Act and certain related legislation, all as currently in effect. The detailed rights of our preferred stock are set forth in our articles of incorporation and the resolutions of our Board of Directors or a determination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors relating to the issuance of the relevant series of preferred stock.\n\nGeneral\n\nUnder our articles of incorporation, we are authorized to issue 90,000,000 shares of each of the first to fourth series of class XIV preferred stock (provided that the aggregate number of shares authorized to be issued with respect to the four series of class XIV preferred stock may not exceed 90,000,000 shares), 90,000,000 shares of each of the first to fourth series of class XV preferred stock (provided that the aggregate number of shares authorized to be issued with respect to the four series of class XV preferred stock may not exceed 90,000,000 shares), 150,000,000 shares of each of the first to fourth series of class XVI preferred stock (provided that the aggregate number of shares authorized to be issued with respect to the four series of class XVI preferred stock may not exceed 150,000,000 shares).\n\nAs of March 31, 2026, there was no outstanding preferred stock.\n\nPreferred Dividends\n\nPayment of annual dividends on shares of common stock is subject to the prior payment of the annual preferred dividends on shares of preferred stock. The amount of preferred dividends for each series of the preferred stock is as follows:\n\n \n\n \n•\n \n\nEach of the first to fourth series of class XIV preferred stock (currently not in issue) bears an annual non-cumulative dividend of the amount to be determined by resolution of the Board of Directors or\n\n \n\n147\n\n \n\ndetermination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors at the time of issuance, up to a maximum of ¥1,000 per share, and in the event we pay an interim dividend, holders are entitled to receive one half of such amount per share in preference to common stock.\n\n \n\n \n•\n \n\nEach of the first to fourth series of class XV preferred stock (currently not in issue) bears an annual non-cumulative dividend of the amount to be determined by resolution of the Board of Directors or determination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors at the time of issuance, up to a maximum of ¥1,000 per share, and in the event we pay an interim dividend, holders are entitled to receive one half of such amount per share in preference to common stock.\n\n \n\n \n•\n \n\nEach of the first to fourth series of class XVI preferred stock (currently not in issue) bears an annual non-cumulative dividend of the amount to be determined by resolution of the Board of Directors or determination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors at the time of issuance, up to a maximum of ¥1,000 per share, and in the event we pay an interim dividend, holders are entitled to receive one half of such amount per share in preference to common stock.    \n\nThe amount of any interim preferred dividend will be deducted from the annual preferred dividend payable on preferred stock in respect of the same fiscal year.\n\nNo payment of dividends on our preferred stock or any other stock may be made unless we have sufficient Distributable Amount and a resolution to pay such dividend is obtained at the Board of Directors or at the relevant general meeting of shareholders, as the case may be.\n\nDividends on our preferred stock are non-cumulative. If the full amount of any dividend is not declared on our preferred stock in respect of any fiscal year, holders of our preferred stock do not have any right to receive dividends in respect of the deficiency in any subsequent fiscal year, and we will have no obligation to pay the deficiency or to pay any interest regardless of whether or not dividends are paid in respect of any subsequent fiscal year. The holders of our preferred stock are not entitled to any further dividends or other participation in or distribution of Surplus.\n\nLiquidation Rights\n\nIn the event of our voluntary or involuntary liquidation, holders of our preferred stock will be entitled, equally in rank as among themselves and in preference over shares of common stock, to receive a distribution of ¥10,000 per share out of our residual assets upon our liquidation.\n\nHolders of our preferred stock are not entitled to any further dividends or other participation in or distribution of our residual assets upon our liquidation.\n\nVoting Rights\n\nNo holder of preferred stock has a right to receive notice for, or to vote at, a general meeting of shareholders, except as otherwise specifically provided under the Companies Act or other applicable law or our articles of incorporation. Under our articles of incorporation, holders of units of our preferred stock will be entitled to receive notice for, and to vote at, general meetings of shareholders:\n\n \n\n \n•\n \n\nfrom the commencement of any ordinary general meeting of shareholders if an agenda for approval to declare a preferred dividend is not submitted to such meeting (except in the case where a resolution of the Board of Directors to pay the preferred dividends is made pursuant to our articles of incorporation between the last day of the business year and the date of such meeting); or\n\n \n\n148\n\n \n•\n \n\nfrom the close of any ordinary general meeting of shareholders if a proposed resolution to declare a preferred dividend is not approved at such meeting,    \n\nuntil such time as a resolution of the Board of Directors to pay the preferred dividends is made pursuant to our articles of incorporation or a resolution of an ordinary general meeting of shareholders declaring a preferred dividend is approved.\n\nA separate resolution of a meeting of the holders of the preferred stock is required in order to approve the following matters which would prejudice the interests of the holders of the relevant preferred stock:\n\n \n\n \n(i)\n\nan amendment to the articles of incorporation to add new classes of shares to be issued, alter the terms of the shares or increase the number of authorized number of shares or authorized number of any class of shares, with certain exceptions;\n\n \n\n \n(ii)\n\nconsolidation or split of shares;\n\n \n\n \n(iii)\n\npro rated allocation of shares or stock acquisition rights to shareholders without any consideration;\n\n \n\n \n(iv)\n\ngranting pre-emptive rights for new shares or stock acquisition rights to shareholders;\n\n \n\n \n(v)\n\namalgamations or mergers;\n\n \n\n \n(vi)\n\ncertain corporate splits;\n\n \n\n \n(vii)\n\nshare exchanges;\n\n \n\n \n(viii)\n\nshare transfers;\n\n \n\n \n(ix)\n\npartial share exchanges; and\n\n \n\n \n(x)\n\nother matters set forth in the articles of incorporation.\n\nSuch separate resolution is not required when the articles of incorporation so provide, except in the case of (i) above.\n\nA separate resolution of a meeting of the holders of the common stock is also required in cases where the above matters would prejudice the interests of the holders of the common stock.\n\nUnder our articles of incorporation, in cases where a matter to be resolved at an ordinary general meeting of shareholders is required to be approved by such separate resolution, the record date for the relevant meeting of the holders of the common stock or the preferred stock, as the case may be, is the same date as the record date for the ordinary general meeting of shareholders, when is March 31 of each year.\n\nRanking\n\nWe will not (unless the requisite sanction has been given by holders of preferred stock) create or issue any other shares ranking, as regards order of participation in the profits or assets of us on a liquidation or otherwise, in priority to the preferred stock in issue, but we may issue, without obtaining the consent of holders of the preferred stock in issue, other preferred stock ranking pari passu with the preferred stock in issue as regards the order of such participation in profits or assets of us and carrying such rights as to rates of preferred dividends or terms of conversion as the Board of Directors may determine, subject to the limitations set forth in our articles of incorporation and the Companies Act.\n\nAcquisition of Preferred Stock\n\nWe may, if required, subject to regulatory approval, acquire any shares of the preferred stock then outstanding at any time out of the Distributable Amount (as defined in “—Common Stock—Restriction on Distribution of Surplus”). On or after the date to be determined by a resolution of the Board of Directors or a\n\n \n\n149\n\ndetermination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors relating to the issuance of the relevant preferred stock, we may also acquire all or a portion of each series of the first to fourth series of class XV (currently not in issue) or the first to fourth series of class XVI preferred stock (currently not in issue) at the acquisition price to be determined by a resolution of the Board of Directors or a determination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors relating to the issuance of the relevant preferred stock on the date separately determined by a resolution of the Board of Directors or a determination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors, without consent of the holders of such preferred stock. When a portion of a certain class of preferred stock is acquired, such acquisition shall be made from each holder thereof in number of shares determined by way of a lot or pro rata allocation.\n\nStock Splits\n\nOur articles of incorporation provide that no stock split, stock consolidation or free distribution of stock shall be made in respect of the preferred stock unless otherwise provided for in any law or regulation.\n\nIssue of Additional Shares and Pre-emptive Rights\n\nOur articles of incorporation provide that no holder of our preferred stock has any pre-emptive right to subscribe for or purchase shares, stock acquisition rights or bonds with stock acquisition rights in the event of an issuance of additional shares or bonds and that no free distribution of stock acquisition rights may be made to the holders of our preferred stock.\n\nConversion\n\nOur articles of incorporation provide that holders of the first to fourth series of class XIV (currently not in issue) or the first to fourth series of class XV (currently not in issue) preferred stock may, at their option, convert their shares to common stock by requesting us to acquire such shares and issue or transfer common stock to them. Other classes of our preferred stock are non-convertible.\n\nOur articles of incorporation also provide that the first to fourth series of class XIV (currently not in issue) or the first to fourth series of class XV (currently not in issue) preferred stock outstanding on the last day of the acquisition period will be mandatorily acquired by us on the immediately following day (the “mandatory conversion date”) in consideration of shares of common stock of which number shall be calculated at the then-current market price per share of our common stock (the “mandatory conversion price”).\n\nAcquisition of Preferred Stock without Consideration or in Exchange for Common Stock\n\nIn order to enable the relevant preferred stock to meet the criteria for inclusion in Additional Tier 1 capital under the capital adequacy guidelines of the Financial Services Agency under the Basel III rules, the first to fourth series of class XIV (currently not in issue), the first to fourth series of class XV (currently not in issue) and the first to fourth series of class XVI (currently not in issue) preferred stock have the following feature.\n\nIn respect of the first and second series of class XIV (currently not in issue), the first and second series of class XV (currently not in issue) and the first and second series of class XVI (currently not in issue) preferred stock, upon the occurrence of an event determined by a resolution of the Board of Directors or a determination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors relating to the issuance of the relevant preferred stock as an event where a write-off of the relevant preferred stock or a conversion of the relevant preferred stock into common stock, or financial support or other similar measures taken by a public sector, without which we would become non-viable, is determined to be necessary, we shall mandatorily acquire the relevant preferred stock, in whole, free of consideration, on a date which falls\n\n \n\n150\n\nafter the occurrence of such event as determined by the resolution of the Board of Directors or a determination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors relating to the issuance of the relevant preferred stock and which date shall be separately determined by a resolution of the Board of Directors or a determination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors after the issuance of the relevant preferred stock, or a date which falls after the occurrence of the relevant certain event and which date shall be determined by the resolution of the Board of Directors or a determination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors relating to the issuance of the relevant preferred stock, giving due consideration to the capital adequacy requirements applicable to us and other factors.\n\nIn respect of the third and fourth series of class XIV (currently not in issue), the third and fourth series of class XV (currently not in issue) and the third and fourth series of class XVI (currently not in issue) preferred stock, upon the occurrence of an event determined by a resolution of the Board of Directors or a determination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors relating to the issuance of the relevant preferred stock as an event where a write-off of the relevant preferred stock or a conversion of the relevant preferred stock into common stock, or financial support or other similar measures taken by a public sector, without which we would become non-viable, is determined to be necessary, we shall mandatorily acquire the relevant preferred stock, in whole, on a date which falls after the occurrence of such event as determined by the resolution of the Board of Directors or a determination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors relating to the issuance of the relevant preferred stock and which date shall be separately determined by a resolution of the Board of Directors or a determination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors after the issuance of the relevant preferred stock, or a date which falls after the occurrence of the relevant certain event and which date shall be determined by the resolution of the Board of Directors or a determination by executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors relating to the issuance of the relevant preferred stock, giving due consideration to the capital adequacy requirements applicable to us and other factors, and instead, we shall deliver our own common stock to holders of the relevant preferred stock. In this case, the terms of acquisition, including the number of shares of the common stock to be delivered in exchange for the acquisition of one (1) share of the relevant preferred stock, shall be determined by the resolution of the relevant Board of Directors or the determination by relevant executive officer(s) as defined in the Companies Act under the authority delegated by the Board of Directors relating to the issuance of the relevant preferred stock, giving due consideration to the market price of common stock, the subscription price of the relevant preferred stock and other factors.\n\n10.C. Material Contracts\n\nThere were no material contracts entered into by us for the two years preceding the filing of this annual report that were not entered into in the ordinary course of business.\n\n10.D. Exchange Controls\n\nForeign Exchange and Foreign Trade Act\n\nThe following is a general summary of major Japanese foreign exchange controls regulations applicable to holders of our shares, voting rights or ADSs who are non-residents of Japan or foreign investors, each as described below. The statements regarding Japanese foreign exchange control regulations set forth below are based on the laws and regulations in force and as interpreted by the Japanese authorities as of the date of this annual report and are subject to subsequent changes in the applicable Japanese laws or interpretations thereof. This summary is not exhaustive of all possible foreign exchange controls considerations that may apply to a particular investor, and potential investors are advised to satisfy themselves as to the overall foreign exchange controls consequences of the acquisition, ownership and disposition of our shares, voting rights or ADSs by consulting their own advisors.    \n\n \n\n151\n\nThe Foreign Exchange and Foreign Trade Act of Japan (Act No. 228 of 1949, as amended) and the cabinet orders and ministerial ordinances incidental thereto, collectively the Foreign Exchange Act, set forth, among other matters, the regulations relating to the receipt by non-residents of Japan of payment with respect to shares to be issued by us and the acquisition and holding of our shares and voting rights by non-residents of Japan and the inward direct investment by foreign investors, each as described below. It also applies to the acquisition and holding of ADSs representing authority to exercise our voting rights by foreign investors that constitutes an inward direct investment. Generally, the Foreign Exchange Act currently in effect does not affect the right of a non-resident of Japan to purchase or sell ADSs outside Japan for non-Japanese currency unless such transaction constitutes an inward direct investment and requires prior notification filing.\n\n“Non-residents of Japan” are defined as individuals who are not resident in Japan and corporations whose principal offices are located outside Japan. Generally, the branches and offices of non-resident corporations that are located in Japan are regarded as residents of Japan while the branches and offices of Japanese corporations located outside Japan are regarded as non-residents of Japan.\n\n“Foreign investors” are the following persons who make “inward direct investments,” which are described below:\n\n \n\n \n•\n \n\nindividuals who are non-residents of Japan;\n\n \n\n \n•\n \n\njudicial persons or other organizations that are organized under the laws of foreign countries or whose principal offices are located outside Japan; \n\n \n\n \n•\n \n\ncorporations of which 50% or more of the voting rights are held by (i) individuals who are non-residents of Japan, (ii) judicial persons or other organizations that are organized under the laws of foreign countries or whose principal offices are located outside Japan, (iii) corporations of which 50% or more of the capital are held by such individuals falling within (i) above and/or judicial persons or other organizations falling within (ii) above, and/or (iv) subsidiary corporations (as defined under the Japan’s Companies Act, but excluding judicial persons or other organizations that are organized under the laws of foreign countries or whose principal offices are located outside Japan) of such corporation falling within (iii) above;\n\n \n\n \n•\n \n\npartnerships under the Civil Code of Japan (Act No. 89 of 1896, as amended) established to invest in corporations, limited partnerships for investment under the Limited Partnership Act for Investment of Japan (Act No. 90 of 1998, as amended) or any other similar partnerships under the laws of foreign countries of which (i) 50% or more of the contributions are made by individuals who are non-residents of Japan, judicial persons or other organizations that are organized under the laws of foreign countries or whose principal offices are located outside Japan and/or any other persons or organizations prescribed in the Foreign Exchange Act, or (ii) a majority of the general partners are individuals who are non-residents of Japan, judicial persons or other organizations that are organized under the laws of foreign countries or whose principal offices are located outside Japan and/or any other persons or organizations prescribed in Foreign Exchange Act; and\n\n \n\n \n•\n \n\njudicial persons or other organizations, a majority of officers (or a majority of officers having the power of representation) of which are individuals who are non-residents of Japan.\n\nAn “inward direct investment” is a certain action defined in the Foreign Exchange Act and includes the following actions conducted by a foreign investor:\n\n \n\n \n•\n \n\nacquisition of shares or voting rights of a corporation listed on a Japanese stock exchange (the “listed corporation”), including authority to exercise, either directly or through instructions, such voting rights owned by others, that result in such foreign investor, together with parties that have a special relationship with that foreign investor, holding or having authority to exercise 1% or more of the total issued shares or voting rights;\n\n \n\n152\n\n \n•\n \n\nacceptance of authority to exercise proxy voting rights on behalf of another shareholder of a listed corporation in respect of certain matters controlling or having material influence on its management (as prescribed in the Foreign Exchange Act), including election or removal of directors or transfer of its business, that result in such foreign investor, together with parties that have a special relationship with that foreign investor, holding or having authority to exercise 10% or more of the total voting rights;\n\n \n\n \n•\n \n\nobtaining consent from another foreign investor holding the voting rights of a listed corporation to exercise, either directly or through instructions, voting rights jointly, that result in such foreign investor obtaining such consent and such other foreign investor making such consent, together with parties that have a special relationship with those foreign investors, respectively, holding or having authority to exercise 10% or more of the total voting rights;\n\n \n\n \n•\n \n\nmaking consents at the general meeting of shareholders of a listed corporation to certain proposals having material influence on its management (as prescribed in the Foreign Exchange Act), including (a) election of the foreign investor making such consent or its related persons (as defined in the Foreign Exchange Act) as its directors or corporate auditors, or (b) transfer or discontinuation of its business, if such foreign investor, together with parties that have a special relationship with that foreign investor, holds or has authority to exercise 1% or more of the total voting rights. \n\nDividends and Proceeds of Sales\n\nUnder the Foreign Exchange Act, dividends paid on, and the proceeds of sales in Japan of, shares held by non-residents of Japan may in general be converted into any foreign currency and repatriated abroad. The acquisition of our shares by non-residents of Japan by way of a stock split is not subject to any notification or reporting requirements.\n\nAcquisition of Shares\n\nIn general, a non-resident of Japan who acquires shares from a resident of Japan is not subject to any prior filing requirement, although the Foreign Exchange Act empowers the Minister of Finance of Japan to require prior approval for any such acquisition in certain limited circumstances. While such prior approval is not required in general, in the case where a resident of Japan transfers shares of a Japanese company for consideration exceeding 100 million yen to a non-resident of Japan, the resident of Japan that transfers the shares is required to report the transfer to the Minister of Finance of Japan within 20 days from the date of the transfer or the date of the payment for such transfer, whichever is later, unless the transfer is made through a bank or financial instruments business operator licensed or registered under Japanese law.\n\nInward Direct Investment\n\nPrior Notification Requirements\n\nIf a foreign investor intends to consummate an action in respect of a listed corporation that constitutes an inward direct investment as described above, in certain circumstances, such as where the foreign investor is in a country that is not listed on an exemption schedule in the Foreign Exchange Act, or where that listed corporation is engaged in certain businesses designated by the Foreign Exchange Act (the “Designated Businesses”), prior notification of the relevant inward direct investment must be filed with the Minister of Finance and any other competent Ministers.\n\nHowever, a foreign investor seeking to acquire shares or voting rights, including authority to exercise, either directly or through instructions, voting rights owned by others, of a listed corporation that constitutes an inward direct investment may be eligible for the exemptions from the prior notification requirement, if certain conditions as described below are met. In the case of an acquisition of shares or voting rights, including authority to exercise, either directly or through instructions, voting rights owned by others, of a listed corporation engaged in\n\n \n\n153\n\ncertain Designated Businesses designated by the Foreign Exchange Act as core sector businesses (the “Core Sector Designated Businesses”), the foreign investor may be generally exempted from the prior notification requirement, if, as a result of such acquisition, the foreign investor, together with parties that have a special relationship with that foreign investor, holds or has authority to exercise less than 10% of the total issued shares or voting rights of such corporation, and such foreign investor complies with certain exemption conditions (the “Exemption Conditions”) (as prescribed in the Foreign Exchange Act), which are generally as follows:\n\n \n\n \n•\n \n\nthe foreign investor or its closely-related persons (as defined in the Foreign Exchange Act) will not become directors or corporate auditors of such corporation;\n\n \n\n \n•\n \n\nthe foreign investor will not make certain proposals (as prescribed in the Foreign Exchange Act) at the general meeting of shareholders, including transfer or discontinuation of the Designated Businesses of such corporation;    \n\n \n\n \n•\n \n\nthe foreign investor will not access non-public technical information in relation to the Designated Businesses of such corporation, or take certain other actions that may lead to the leak of such non-public technical information (as prescribed in the Foreign Exchange Act);\n\n \n\n \n•\n \n\nthe foreign investor will not attend, or not cause any persons designated by it to attend, meetings of such corporation’s board of directors, or meetings of committees having authority to make important decisions, in respect of the Core Sector Designated Businesses of such corporation; and\n\n \n\n \n•\n \n\nthe foreign investor will not make, or not cause any persons designated by it to make, proposals to such board or committees or their members in writing or electronic form requesting any response or actions by certain deadlines in respect of the Core Sector Designated Businesses of such corporation.\n\nNotwithstanding the above, if a foreign investor falls under a category of disqualified investors designated by the Foreign Exchange Act (including (a) investors who have records of certain sanctions due to violations of the Foreign Exchange Act, (b) foreign governments, etc. (as prescribed in the Foreign Exchange Act), and (c) certain investors who are owned by, or have certain other relationships with, foreign governments, etc., excluding those who are accredited by the Minister of Finance), in no event may such foreign investor be eligible for the exemptions described above. On the other hand, if a foreign investor, excluding the disqualified investors described in the foregoing sentence, falls under a category of certain foreign financial institutions (as prescribed in the Foreign Exchange Act) and complies with the first three conditions included in the Exemption Conditions as described above, such foreign investor may be eligible for the exemptions, even if, as a result of acquisition of shares or voting rights, including authority to exercise, either directly or through instructions, voting rights owned by others, such foreign investor, together with parties that have a special relationship with that foreign investor, holds or has authority to exercise 10% or more of the total issued shares or voting rights of a listed corporation engaged in the Core Sector Designated Businesses.\n\nPursuant to the amendments to the Foreign Exchange Act which took effect in May 2025, the scope of the above-mentioned disqualified investors, who are not eligible for the exemptions described above, was expanded to include (a) certain foreign investors who have obligations to cooperate with foreign governments, etc. in collecting information pursuant to agreements with foreign governments, etc. or foreign laws and regulations, and (b) certain foreign investors who are owned by, or who have certain other relationships with, the foreign investors set forth in (a) above (collectively, the “Specified Foreign Investors”) (each, as prescribed in the Foreign Exchange Act), excluding those who are accredited by the Minister of Finance. In addition, the exemption from the prior notification requirement was amended so as to be inapplicable to the case where a foreign investor equivalent to the Specified Foreign Investor (the “Quasi-Specified Foreign Investor”) (as prescribed in the Foreign Exchange Act), which includes a foreign investor (i) whose managerial decision is made substantially by the foreign investor set forth in (a) above, (ii) whose managerial decision is made in a country other than the country of incorporation and affected by laws and regulations, etc. imposing obligations to cooperate with foreign governments, etc. in collecting information, or (iii) who has obligations to disclose information to cooperate with foreign governments, etc. pursuant to agreements with the Specified Foreign\n\n \n\n154\n\nInvestor or the foreign investor set forth in (iii) seeks to acquire shares or voting rights, including authority to exercise, either directly or through instructions, voting rights owned by others, of a listed corporation which is engaged in the Core Sector Designated Businesses and also falls under the “Specified Essential Infrastructure Service Providers” as defined in the Economic Security Promotion Act (the “Designated Core Business Entity”), even if such foreign investor, (x) as a result of an acquisition of such shares or voting rights, including authority to exercise, either directly or through instructions, voting rights owned by others, of such listed corporation, together with parties that have a special relationship with that foreign investor, holds or has authority to exercise less than 10% of the total issued shares or voting rights of such listed corporation, or (y) falls under a category of certain foreign financial institutions (as prescribed in the Foreign Exchange Act) set forth in the preceding paragraph. Further, the Exemption Conditions, which must be complied with for a foreign investor to be exempted from the prior notification requirement, were amended to include the following two additional conditions, when they apply to the case of an acquisition by a Quasi-Specified Foreign Investor of shares or voting rights, including authority to exercise, either directly or through instructions, voting rights owned by others, of a listed corporation which is engaged in the Core Sector Designated Businesses but is not the Designated Core Business Entity, as a result of which acquisition, such Quasi-Specified Foreign Investor, together with parties that have a special relationship with that Quasi-Specified Foreign Investor, holds or has authority to exercise less than 10% of the total issued shares or voting rights of the above-mentioned corporation:\n\n \n\n \n•\n \n\nthe foreign investor will not access non-public information in relation to the Core Sector Designated Businesses of such corporation, or take certain other actions that may lead to the leak of such non-public information (as prescribed in the Foreign Exchange Act); and\n\n \n\n \n•\n \n\nthe foreign investor will not work, or not cause its closely- related persons (as prescribed in the Foreign Exchange Act) to work, as an employee for such corporation in respect of the Core Sector Designated Businesses of such corporation, or will not solicit any officers or employees of such corporation to work for the foreign investor or any third party.\n\nA subsidiary of ours currently engages in the business of software related to cybersecurity and such business falls into the category of the Core Sector Designated Businesses. For reference purposes only, the Minister of Finance publishes, and may update from time to time, a list that classifies listed corporations into the following categories: (i) corporations engaged only in businesses other than the Designated Businesses; (ii) corporations engaged in the Designated Businesses other than the Core Sector Designated Businesses; (iii) corporations engaged in the Core Sector Designated Businesses; and (iv) corporations falling into the Designated Core Business Entity category. According to the list most recently published by the Minister of Finance as of June 26, 2026, we are classified within category (iii) above.\n\nIn addition, if a foreign investor intends to (i) accept authority to exercise proxy voting rights on behalf of another shareholder of a listed corporation engaged in the Designated Businesses, (ii) obtain consent from another foreign investor holding the voting rights of such corporation to exercise voting rights jointly, or (iii) consent to a proposal at the general meeting of shareholders of such corporation, in each case, that constitutes an inward direct investment as described above, prior notification of the relevant inward direct investment must be filed with the Minister of Finance and any other competent Ministers. In such cases, the exemptions from the prior notification requirements described above may not be available, except for cases where a foreign investor obtains consent from another foreign investor holding the voting rights of such corporation to exercise voting rights jointly in respect of matters other than certain matters controlling or having a material influence on the management of such corporation (as prescribed in the Foreign Exchange Act), including election or removal of directors or transfer of business.\n\nIf such prior notification is filed, the proposed inward direct investment may not be consummated until after 30 days have passed from the date of filing, although this screening period may be shortened unless the Minister of Finance and any other competent Ministers deem it necessary to review the proposed inward direct investment. The Ministers may extend the screening period up to five months if they deem it necessary to review the proposed inward direct investment and may recommend any modification or prohibition of the proposed\n\n \n\n155\n\ninward direct investment and, if the foreign investor does not accept such recommendation, the Ministers may order the modification or prohibition of such inward direct investment. In addition, if a foreign investor (i) consummates such inward direct investment without filing the prior notification described above, (ii) consummates such inward direct investment before the expiration of the screening period described above, (iii) makes false statements in the prior notification described above, or (iv) does not follow the recommendation or order issued by the Ministers to modify or prohibit such inward direct investment, the Ministers may order such foreign investor to dispose of all or part of the shares acquired or take other necessary measures.\n\nIf a foreign investor who consummated an inward direct investment without filing the prior notification due to the exemptions from such prior notification requirements as described above does not comply with any Exemption Conditions, the Ministers may recommend to take necessary measures and, if the foreign investor does not accept such recommendation, the Ministers may order to take such measures. If such foreign investor does not follow the order issued by the Ministers to take such measures, the Ministers may order such foreign investor to dispose of all or part of the shares acquired or take other necessary measures.\n\nPost Facto Reporting Requirements\n\nA foreign investor who consummates an inward direct investment as described above through an acquisition of shares or voting rights, including authority to exercise, either directly or through instructions, voting rights owned by others, of a listed corporation engaged in the Designated Businesses, including us (as of the date of this annual report), but is not subject to the prior notification requirements described above due to the exemptions from such prior notification requirements, in general, must file a report of the relevant inward direct investment with the Minister of Finance and any other competent Ministers within 45 days of the date when, as a result of such acquisition, the foreign investor (excluding, in the cases of (i) and (ii) below, a foreign investor who falls under a category of certain foreign financial institutions (as prescribed in the Foreign Exchange Act)), together with parties that have a special relationship with that foreign investor, holds or has authority to exercise (i) 1% or more but less than 3% of the total issued shares or voting rights, for the first time, (ii) 3% or more but less than 10% of the total issued shares or voting rights, for the first time, or (iii) 10% or more of the total issued shares or voting rights.\n\nAcquisition of ADSs and Deposit and Withdrawal under American Depositary Facility\n\nIn respect of the acquisition of ADSs upon the deposit of shares with Mizuho Bank, in its capacity as custodian and agent for the depositary, in Tokyo, or otherwise, or the withdrawal of the underlying shares upon the surrender of the ADR, in each case by a foreign investor, where such acquisition of ADSs or withdrawal of the underlying shares constitutes an inward direct investment, in general, a prior notification will be required unless the exemption is available, as noted above, and if such prior notification is not required due to the exemption, a report will be required, as noted above.\n\n10.E. Taxation\n\nJapanese Taxation\n\nThe following is a general summary of major Japanese tax consequences (limited to national tax) to holders of shares of our common stock or ADSs representing shares of our common stock who are non-residents of Japan or non-Japanese corporations without a permanent establishment in Japan, which we refer to as “non-resident holders” in this section. The statements regarding Japanese tax laws set forth below are based on the laws and treaties in force and as interpreted by the Japanese tax authorities as at the date of this annual report and are subject to changes in the applicable Japanese laws or tax treaties, conventions or agreements, or interpretations thereof, occurring after that date. This summary is not exhaustive of all possible tax considerations that may apply to a particular investor, and potential investors are advised to satisfy themselves as to the overall tax consequences of the acquisition, ownership and disposition of shares of our common stock or ADSs, including\n\n \n\n156\n\nspecifically the tax consequences under Japanese law, the laws of the jurisdiction of which they are resident, and any tax treaty, convention or agreement between Japan and their country of residence, by consulting their own tax advisers.    \n\nFor the purpose of Japanese tax law and the current income tax treaty between the United States and Japan (the “Treaty”), a U.S. holder of ADSs will generally be treated as the owner of the shares underlying the ADSs evidenced by the ADRs.\n\nGenerally, a non-resident holder of shares of our common stock or ADSs is subject to Japanese income tax collected by way of withholding on dividends paid by us, and such tax will be withheld prior to payment of dividends. Stock splits are, in general, not a taxable event.\n\nIn the absence of any applicable tax treaty, convention or agreement reducing the maximum rate of Japanese withholding tax or allowing exemption from Japanese withholding tax, the rate of Japanese withholding tax applicable to dividends paid by Japanese corporations on their shares of stock to non-resident holders is generally 20.42% under Japanese tax law. However, with respect to dividends paid on listed shares issued by a Japanese corporation (such as shares of our common stock or ADSs) to non-resident holders, other than any non-resident holder who is an individual holding 3% or more of the total number of shares issued by the relevant Japanese corporation, the aforementioned 20.42% withholding tax rate is reduced to 15.315% for dividends due and payable on or before December 31, 2047. Due to the imposition of a special additional withholding tax (2.1% of the original withholding tax amount) to secure funds for reconstruction from the Great East Japan Earthquake (the “reconstruction surtax”), the original withholding tax rate of 15% and 20%, as applicable, has been effectively increased, respectively, to 15.315% and 20.42%. This overall 15.315% and 20.42% withholding tax rate continues to apply until December 31, 2047, while the breakdown of the 0.315% and 0.42% surtax portion is (i) the reconstruction surtax of 0.315% (or 2.1% of 15%) and 0.42% (or 2.1% of 20%) until December 31, 2026, and (ii) during the period beginning on January 1, 2027 and ending on December 31, 2047, the reconstruction surtax of 0.165% (or 1.1% of 15%) and 0.22% (or 1.1% of 20%) and another special additional withholding tax of 0.15% (or 1.0% of 15%) and 0.2% (or 1.0% of 20%) to fund the strengthening of Japan’s national defense capabilities (the “defense surtax”). The 2026 tax reform, which was promulgated on March 31, 2026, has introduced the defense surtax, while accordingly reducing the reconstruction surtax, to maintain the overall 15.315% and 20.42% withholding tax rate.\n\nUnder the Treaty, the maximum rate of Japanese withholding tax which may be imposed on dividends paid to a qualified United States resident eligible to enjoy treaty benefits that is either a corporation owning, directly or indirectly, less than 10% of the voting stock of a Japanese corporation or an individual is generally reduced to 10% of the gross amount actually distributed, except where such United States resident conducts business in Japan through a permanent establishment situated therein and the holding in respect of which the dividends are paid is effectively connected with such permanent establishment. Dividends paid to pension funds which are qualified United States residents eligible to enjoy treaty benefits are exempt from Japanese income taxation by way of withholding or otherwise unless such dividends are derived from the carrying on of a business, directly or indirectly, by such pension funds. Under Japanese tax law, any reduced maximum rate applicable under a tax treaty shall be available when such maximum rate is below the rate otherwise applicable under the Japanese tax law referred to in the preceding paragraph with respect to the dividends to be paid by us on shares of our common stock or ADSs. A non-resident holder of shares of our common stock who is entitled, under any applicable tax treaty, to a reduced rate of Japanese withholding tax, or exemption therefrom, as the case may be, is required to submit an Application Form for Income Tax Convention Regarding Relief from Japanese Income Tax and Special Income Tax for Reconstruction on Dividends (together with any other required forms and documents) in advance, through the withholding agent, to the relevant tax authority before payment of dividends. A standing proxy for a non-resident holder may provide such application service. In addition, a certain simplified special filing procedure is available for non-resident holders to claim treaty benefits of exemption from or reduction of Japanese withholding tax, by submitting a Special Application Form for Income Tax Convention Regarding Relief from Japanese Income Tax and Special Income Tax for Reconstruction on Dividends of Listed\n\n \n\n157\n\nStocks (together with any other required forms and documents). With respect to ADSs, this reduced rate or exemption will be applicable to non-resident holders of ADSs if the depositary or its Agent submits two Application Forms (one before payment of dividends and the other within eight months after the record date concerning such payment of dividends), together with certain other documents. To claim this reduced rate or exemption, non-resident holders of ADSs will be required to file a proof of taxpayer status, residence and beneficial ownership, as applicable, and to provide other information or documents as may be required by the depositary. Non-resident holders who are entitled, under any applicable tax treaty, to a reduced rate of Japanese withholding tax below the rate otherwise applicable under Japanese tax law, or exemption therefrom, as the case may be, but fail to submit the required application in advance may nevertheless be entitled to claim a refund from the relevant Japanese tax authority of withholding taxes withheld in excess of the rate under an applicable tax treaty (if such non-resident holders are entitled to a reduced treaty rate under the applicable tax treaty) or the full amount of tax withheld (if such non-resident holders are entitled to an exemption under the applicable tax treaty), as the case may be, by complying with a certain subsequent filing procedure.\n\nWe do not assume any responsibility to ensure withholding at the reduced rate, or exemption therefrom, for non-resident holders who would be so eligible under an applicable tax treaty but where the required procedures as stated above are not followed.\n\nGains derived from the sale or other disposition of shares of our common stock or ADSs outside Japan by a non-resident holder, who is a portfolio investor, are not, in general, subject to Japanese income tax or corporation tax.\n\nAny deposits or withdrawals of shares of our common stock by a non-resident holder in exchange for ADSs are, in general, not subject to Japanese income or corporation tax.\n\nJapanese inheritance and gift taxes, at progressive rates, may be payable by an individual who has acquired shares of our common stock or ADSs from an individual, as a legatee, heir or donee, even if none of the acquiring individual, the decedent or the donor is a Japanese resident.\n\nU.S. Taxation\n\nThe following sets forth the material U.S. federal income tax consequences of the ownership of shares of common stock (for purposes of this discussion, “shares”) and ADSs of our company. The discussion set forth below is applicable to U.S. holders (as defined below) (i) who are residents of the United States for purposes of the Treaty, (ii) whose shares or ADSs are, for purposes of the Treaty, neither effectively connected with nor attributable to a permanent establishment in Japan and (iii) who otherwise qualify for the full benefits of the Treaty.\n\nThe following summary is not a complete analysis or description of all potential U.S. federal income tax consequences to a particular U.S. holder. It does not address all U.S. federal income tax considerations that may be relevant to all categories of potential purchasers, certain of which (such as banks or other financial institutions, insurance companies, dealers in securities or currencies, tax-exempt entities, non-U.S. persons, persons holding a share or an ADS as part of a “straddle,” “hedge,” conversion or integrated transaction, partnerships or other pass-through entities for U.S. federal income tax purposes, traders in securities who have elected the mark-to-market method of accounting for their securities, regulated investment companies, real estate investment trusts, holders whose “functional currency” is not the U.S. dollar, holders liable for alternative minimum tax, persons required to accelerate the recognition of any item of gross income with respect to shares or ADSs as a result of such income being recognized on an applicable financial statement and holders of 10% or more of our stock by vote or value) are subject to special tax treatment. This summary does not address the Medicare tax on net investment income, U.S. federal estate and gift taxes or any foreign, state, local or other tax consequences of investments in our shares or ADSs.\n\nThis summary addresses only shares or ADSs held as capital assets.\n\n \n\n158\n\nAs used herein, a “U.S. holder” is a beneficial owner of shares or ADSs, as the case may be, that is, for U.S. federal income tax purposes:\n\n \n\n \n•\n \n\nan individual who is a citizen or resident of the United States;\n\n \n\n \n•\n \n\na corporation (or other entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States or any political subdivision thereof;\n\n \n\n \n•\n \n\nan estate the income of which is subject to U.S. federal income tax regardless of its source; or\n\n \n\n \n•\n \n\na trust if it (1) is subject to the primary supervision of a court within the United States and the control of one or more U.S. persons as described in Section 7701(a)(30) of the Code (as defined below) or (2) has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person.    \n\nIf a partnership (or other entity or arrangement treated as a partnership for U.S. federal income tax purposes) holds shares or ADSs, the tax treatment of a partner will generally depend on the status of the partner and the activities of the partnership. If you are a partner of a partnership holding shares or ADSs, you should consult your tax advisor.\n\nThe discussion below is based upon the provisions of the Internal Revenue Code of 1986, as amended (the “Code”), and regulations, rulings and judicial decisions thereunder as of the date hereof, as well as the Treaty, and such authorities may be replaced, revoked or modified so as to result in U.S. federal income tax consequences different from those discussed below. In addition, this summary assumes that the deposit agreement and all other related agreements will be performed in accordance with their terms.\n\nWe urge U.S. holders to consult their own tax advisors concerning the U.S. federal, state and local and other tax consequences to them of the purchase, ownership and disposition of shares or ADSs.\n\nADSs\n\nIf a U.S. holder holds ADSs, for U.S. federal income tax purposes, such holder will generally be treated as the owner of the underlying shares that are represented by such ADSs. Accordingly, deposits or withdrawals of shares in exchange for ADSs are not subject to U.S. federal income tax.\n\nTaxation of Dividends\n\nSubject to the discussion under “—U.S. Taxation—Passive Foreign Investment Company Rules” below, the gross amount of any distribution (other than certain pro rata distributions of our shares) received with respect to our shares or ADSs (including amounts withheld to reflect Japanese withholding taxes) will be taxable as dividends, to the extent paid out of our current or accumulated earnings and profits (as determined for U.S. federal income tax purposes). The amount of a distribution of property other than cash will be the fair market value of such property on the date of the distribution. Such cash or non-cash income, including withheld taxes, will be includable in a U.S. holder’s gross income as ordinary income on the day actually or constructively received by such U.S. holder in the case of shares, or by the depositary in the case of ADSs. Such dividends received by a U.S. holder will not be eligible for the “dividends-received deduction” allowed to U.S. corporations in respect of dividends received from other U.S. corporations. To the extent that an amount received by a U.S. holder exceeds such holder’s allocable share of our current and accumulated earnings and profits, such excess will be applied first to reduce such holder’s tax basis in its shares or ADSs, thereby increasing the amount of gain or decreasing the amount of loss recognized on a subsequent disposition of the shares or ADSs. Then, to the extent such distribution exceeds such U.S. holder’s tax basis, such excess will be treated as capital gain. However, we do not expect to keep earnings and profits in accordance with U.S. federal income tax principles. Therefore, U.S. holders should expect that a distribution will generally be reported as a dividend.\n\n \n\n159\n\nThe amount of any dividend paid in yen will be the U.S. dollar value of the yen payments received. This value will be determined at the spot yen/U.S. dollar rate on the date the dividend is received by the depositary in the case of U.S. holders of ADSs, or by the shareholder in the case of U.S. holders of shares, regardless of whether the dividend payment is in fact converted into U.S. dollars at that time. If the yen received as a dividend are not converted into U.S. dollars on the date of receipt, a U.S. holder will have basis in such yen equal to their U.S. dollar value on the date of receipt, and any foreign currency gains or losses resulting from the conversion of the yen will generally be treated as U.S. source ordinary income or loss.\n\nUnder the Treaty, the maximum rate of withholding tax on dividends paid is generally reduced to 10%. As discussed under “—Japanese Taxation” above, if the Japanese statutory rate applicable to a U.S. holder is higher than the maximum Treaty rate, such holder will be required to properly demonstrate to the Japanese tax authorities such holder’s entitlement to the reduced withholding rate under the Treaty. Subject to certain limitations and the Foreign Tax Credit Regulations (as defined below), the Japanese tax withheld (at a rate not exceeding the applicable Treaty rate) may be creditable against the U.S. holder’s U.S. federal income tax liability. For foreign tax credit limitation purposes, the dividend will be income from sources outside the United States. The limitation on foreign taxes eligible for credit is calculated separately with respect to specific classes of income. For this purpose, dividends we pay will generally constitute “passive category income.” However, Treasury regulations addressing foreign tax credits (the “Foreign Tax Credit Regulations”) impose additional requirements for foreign taxes to be eligible for a foreign tax credit, and there can be no assurance that those requirements will be satisfied if a U.S. holder does not elect to apply the benefits of the Treaty. The Department of the Treasury and the Internal Revenue Service (the “IRS”) are considering proposing amendments to the Foreign Tax Credit Regulations. In addition, notices from the IRS provide temporary relief by allowing taxpayers that comply with applicable requirements to apply many aspects of the foreign tax credit regulations as they previously existed (before the release of the current Foreign Tax Credit Regulations) for taxable years ending before the date that a notice or other guidance withdrawing or modifying the temporary relief is issued (or any later date specified in such notice or other guidance). Further, in certain circumstances, if a U.S. holder:\n\n \n\n \n•\n \n\nhas held shares or ADSs for less than a specified minimum period during which such U.S. holder is not protected from the risk of loss; or\n\n \n\n \n•\n \n\nis obligated to make payments related to the dividends,\n\nsuch U.S. holder will not be allowed a foreign tax credit for foreign taxes imposed on dividends paid on shares or ADSs. Instead of claiming a foreign tax credit, a U.S. holder may be able to deduct Japanese withholding taxes on dividends in computing such holder’s taxable income, subject to generally applicable limitations under U.S. law (including that a U.S. holder is not eligible for a deduction for creditable foreign income taxes paid or accrued in a taxable year if such U.S. holder claims a foreign tax credit for any foreign income taxes paid or accrued in the same taxable year). The rules governing U.S. foreign tax credits and deductions for foreign taxes are very complex and U.S. holders should consult their tax advisors regarding the availability of foreign tax credits or deductions under their particular circumstances.\n\nSubject to applicable limitations (including a minimum holding period requirement), dividends received by non-corporate U.S. investors from a qualified foreign corporation may be treated as “qualified dividend income” that is subject to reduced rates of taxation. A qualified foreign corporation generally includes a corporation that is eligible for the benefits of a comprehensive income tax treaty with the United States which the U.S. Treasury Department determines to be satisfactory for these purposes and which includes an exchange of information provision. The U.S. Treasury Department has determined that the Treaty meets these requirements. In addition, it is expected that we will be eligible for the benefits of the Treaty. A foreign corporation is also generally treated as a qualified foreign corporation with respect to dividends paid by that corporation on shares (or ADSs backed by such shares) that are readily tradable on an established securities market in the United States. U.S. Treasury Department guidance indicates that our ADSs (which are listed on the New York Stock Exchange), but not our shares, are readily tradable on an established securities market in the United States. There can be no assurance that our ADSs will be considered readily tradable on an established securities market in the United States in later\n\n \n\n160\n\nyears. Non-corporate U.S. holders will not be eligible for reduced rates of taxation on any dividends received from us if we are a passive foreign investment company (as discussed under “—U.S. Taxation—Passive Foreign Investment Company Rules” below) in the taxable year in which such dividends are paid or in the preceding taxable year. U.S. holders should consult their own tax advisors regarding the application of the foregoing rules to their particular circumstances.\n\nDisposition of Shares or ADSs\n\nUpon a sale or other taxable disposition of shares or ADSs, a U.S. holder will recognize gain or loss in an amount equal to the difference between the U.S. dollar value of the amount realized and the U.S. holder’s tax basis, determined in U.S. dollars, in such shares or ADSs. Subject to the discussion under “—U.S. Taxation—Passive Foreign Investment Company Rules” below, such gain or loss will be capital gain or loss and will be long-term capital gain or loss if the U.S. holder’s holding period for such shares or ADSs exceeds one year. A U.S. holder’s tax basis in its shares or ADSs will generally be the cost to the holder of such shares or ADSs. Any such gain or loss realized by a U.S. holder upon disposal of the shares or ADSs will generally be income or loss from sources within the United States for foreign tax credit limitation purposes. The deductibility of capital losses is subject to limitations.\n\nPassive Foreign Investment Company Rules\n\nBased on the past and projected composition of our income and assets and the valuation of our assets, we do not believe that we were a passive foreign investment company (“PFIC”) for our most recent taxable year and do not expect to become one in the current taxable year or the foreseeable future, although there can be no assurance in this regard. However, PFIC status is a factual determination that is made annually. Accordingly, it is possible that we may become a PFIC in the current or any future taxable year due to changes in the composition of our income or assets or the valuation of our assets.\n\nIn general, a foreign corporation is considered a PFIC for any taxable year if either:\n\n \n\n \n•\n \n\nat least 75% of its gross income is passive income; or\n\n \n\n \n•\n \n\nat least 50% of the value of its assets is attributable to assets that produce or are held for the production of passive income.\n\nFor this purpose, passive income generally includes dividends, interest, royalties and rents (other than certain income derived in the active conduct of a banking business as discussed below, and royalties and rents derived in the active conduct of a trade or business and not derived from a related person). In addition, cash and other assets readily convertible into cash are generally considered passive assets. The 50% of value test is generally based on the average of the value of our assets for each quarter during the taxable year. If we own at least 25% by value of another company’s stock, we will be treated, for purposes of the PFIC rules, as owning the proportionate share of the assets and receiving our proportionate share of the income of that company.\n\nOur PFIC determination is based in part upon certain proposed U.S. Treasury regulations (the “Proposed Regulations”) that are not yet in effect (although the U.S. Treasury Department has released guidance indicating that taxpayers may currently rely on them) and are subject to change in the future. The Proposed Regulations and other administrative pronouncements from the IRS provide special rules for determining the character of income derived in the active conduct of a banking business for purposes of the PFIC rules. Although we believe we have adopted a reasonable interpretation of the Proposed Regulations and administrative pronouncements, there can be no assurance that the IRS will follow the same interpretation.\n\nIf we are a PFIC for any taxable year during which a U.S. holder holds shares or ADSs (and the U.S. holder does not make a timely mark-to-market election, as described below), the U.S. holder will be subject to special tax rules with respect to any “excess distribution” that the U.S. holder receives and any gain the U.S. holder realizes from the sale or other disposition (including a pledge) of the shares or ADSs.\n\n \n\n161\n\nThese special tax rules generally will apply even if we cease to be a PFIC in future years. Distributions U.S. holders receive in a taxable year that are greater than 125% of the average annual distributions they received during the shorter of the three preceding taxable years or their holding period for the shares or ADSs will be treated as excess distributions. Under these special tax rules:\n\n \n\n \n•\n \n\nthe excess distribution or gain will be allocated ratably over the U.S. holder’s holding period for the shares or ADSs;\n\n \n\n \n•\n \n\nthe amount allocated to the current taxable year, and any taxable year prior to the first taxable year in which we were a PFIC, will be treated as ordinary income; and\n\n \n\n \n•\n \n\nthe amount allocated to each other year will be subject to tax at the highest tax rate in effect for that year for individuals or corporations, as applicable, and the interest charge generally applicable to underpayments of tax will be imposed on the resulting tax attributable to each such year.\n\nAlternatively, a U.S. holder could make a mark-to-market election and avoid the special tax rules described above, provided that our shares or ADSs (as applicable) are regularly traded on a qualified exchange. Under current law, the mark-to-market election may be available to U.S. holders of ADSs because the ADSs are listed on the New York Stock Exchange, which constitutes a qualified exchange, although there can be no assurance that the ADSs will be “regularly traded” for purposes of the mark-to-market election. Under current law, the mark-to-market election may be available to U.S. holders of shares because the shares are listed on the Tokyo Stock Exchange, which constitutes a qualified exchange, although there can be no assurance that the shares will be “regularly traded” for purposes of the mark-to-market election. U.S. holders should consult their own tax advisors regarding the potential availability and consequences of a mark-to-market election. In addition, a U.S. investor that owns shares or ADSs in a PFIC can sometimes avoid the rules described above by electing to treat the company as a “qualified electing fund” under Section 1295 of the Code. This option is not available to U.S. holders of our shares or ADSs because we do not intend to comply with the requirements necessary to permit U.S. holders to make this election.\n\nIf a U.S. holder holds shares or ADSs in any year in which we are classified as a PFIC, such holder will generally be required to file IRS Form 8621. Additionally, non-corporate U.S. holders will not be eligible for reduced rates of taxation on any dividends received from us if we are a PFIC in the taxable year in which such dividends are paid or in the preceding taxable year.\n\nU.S. holders should consult their own tax advisors concerning the determination of our PFIC status and the U.S. federal income tax consequences of holding shares or ADSs if we are considered a PFIC in any taxable year.\n\nInformation Reporting and Backup Withholding\n\nIn general, information reporting requirements will apply to dividends in respect of the shares or ADSs or the proceeds from the sale, exchange or other disposition of the shares or ADSs paid within the United States (and, in some cases, outside of the United States) to a U.S. holder, unless such holder is an exempt recipient. In addition, backup withholding tax may apply to those amounts if a U.S. holder fails to provide an accurate taxpayer identification number or fails either to report interest and dividends required to be shown on such holder’s U.S. federal income tax returns or to make certain certifications. The amount of any backup withholding from a payment to a U.S. holder will be allowed as a refund or credit against such holder’s U.S. federal income tax liability, provided such holder furnishes the required information to the IRS.\n\nCertain U.S. holders are required to report information with respect to their investment in shares or ADSs, subject to certain exceptions (including an exception for shares or ADSs held in accounts maintained by certain financial institutions), by attaching a complete IRS Form 8938, Statement of Specified Foreign Financial Assets, with their tax return for each year in which they hold the shares or ADSs. Investors who fail to report the\n\n \n\n162\n\nrequired information could become subject to substantial penalties. Potential investors are urged to consult with their own tax advisors regarding the possible implications of these rules on their investment in our shares or ADSs.\n\n10.F. Dividends and Paying Agents\n\nNot applicable.\n\n10.G. Statement by Experts\n\nNot applicable.\n\n10.H. Documents on Display\n\nWe file annual reports on Form 20-F with, and furnish periodic reports on Form 6-K to, the U.S. Securities and Exchange Commission via the Electronic Data Gathering, Analysis, and Retrieval system. These reports, including this annual report on Form 20-F and the exhibits thereto, and other information can be inspected on the Commission’s website (https://www.sec.gov).\n\n10.I. Subsidiary Information\n\nNot applicable.\n\n10.J. Annual Report to Security Holders\n\nWe furnished an English translation of our annual report for the fiscal year ended March 31, 2026, to security holders, to the U.S. Securities and Exchange Commission on Form 6-K on May 28, 2026, in accordance with the requirements of Form 6-K.\n\n \n\n163"}