Article 5(1)With regard to assets, unless otherwise provided in laws and regulations other than this Ministerial Order or the Act, the acquisition values thereof must be entered to the accounting books.

(2)With regard to assets to be depreciated, a reasonable amount of depreciation must be carried out on the last day of the business year (if valuation is to be carried out on a day other than the last day of the business year, that day; the same applies hereinafter in this Part).

(3)With regard to the assets set forth in the following items, if the price provided in each respective item is to be entered on the last day of the business year, the price provided in each respective item must be entered:

(4)With regard to claims for which there is a risk of non-collection, the amount which is forecast to remain uncollected on the last day of the business year must be deducted.

(5)With regard to claims, if there is a difference between the acquisition value and the claim amount, or if there is another reasonable ground, the proper price may be entered.

(6)With regard to the assets set forth below, the market value or the proper price at the time may be entered on the last day of the business year:

Article 6(1)With regard to liabilities, unless otherwise provided in laws and regulations other than this Ministerial Order or the Act, the amount of liabilities must be entered in the accounting books.

(2)With regard to the liabilities set forth below, the market value or the proper price at the time may be entered on the last day of the business year:

Article 7If a company performs an entity conversion, it may not change the book value of assets and liabilities it holds on the grounds that the entity conversion is being performed.

Article 8(1)For the companies set forth in the following items, except cases in which the absorption-type merger or absorption-type company split constitutes an acquisition of control on the part of that company, or other cases where the market value of the assets subject to absorption-type restructuring is to be entered, the book value of the company provided in each respective item immediately prior to the absorption-type merger or absorption-type company split must be entered for the assets subject to absorption-type restructuring:

(2)The provisions of the preceding paragraph apply mutatis mutandis to consolidation-type mergers and incorporation-type company splits.

Article 9(1)If a membership company performs an entity conversion when immediately prior to the entity conversion the membership company is recording as assets claims concerning the right of a membership company to demand that contributions should be performed by its members, it is deemed that the membership company has determined that it will not record the claims as assets immediately prior to the entity conversion.

(2)The provisions of the preceding paragraph apply mutatis mutandis to cases where the membership company recording claims concerning the right to demand that contributions should be performed by its members as assets becomes a company disappearing in an absorption-type merger or a company disappearing in a consolidation-type merger.

Article 10If a corporation which is not a company becomes a company pursuant to the provisions of the Acts set forth below, the book values to be entered by that company to the assets and liabilities that company holds are the book values entered for the relevant assets and liabilities of that corporation immediately prior to becoming that company, unless otherwise provided in other laws and regulations:

Article 13(1)The maximum amount of increase in stated capital of a stock company (meaning the amount of property that persons who are shareholders as provided in Article 445, paragraph (1) of the Act have paid or delivered to the stock company, the same applies hereinafter in this Section) through share delivery occurring after the formation of the stock company (excluding share delivery upon performance of the actions set forth in the same Article, paragraph (5) of the Act), the amount of other capital surplus and other retained earnings, and the amount of consideration for treasury shares (meaning the amount of consideration for the treasury shares as provided in Article 150, paragraph (2), item (viii) and Article 158, item (viii), (b) hereof, and Article 446, item (ii) and Article 461, paragraph (2), item (ii), (b) and item (iv) of the Act; the same applies hereinafter in this Chapter) are to be governed by this Subsection.

(2)The phrase "share delivery occurring after the formation of a stock company" as provided in the preceding paragraph means the issuance of shares and the disposition of treasury shares (in the cases set forth in item (viii), item (ix), item (xii), item (xiv) and item (xv), the disposition of treasury shares) that occurs after the formation of a stock company in the cases set forth below:

Article 14(1)If the subscribers are solicited for shares for subscription pursuant to the provisions of Part II, Chapter II, Section 8 of the Act, the maximum amount of increase in stated capital is the amount obtained by subtracting the amount set forth in item (iv) from the amount obtained by multiplying by the share issue rate (meaning the rate obtained by dividing the number of shares issued at the solicitation by the sum of the number of shares issued and the number of treasury shares disposed of at the solicitation; the same applies hereinafter in this Article) the amount obtained by subtracting the amount set forth in item (iii) from the sum of the amounts set forth in item (i) and item (ii) (if this is less than zero; zero):

(2)In the cases prescribed in the preceding paragraph, the amounts after the acts set forth in the same paragraph set forth in the following items are to be the amounts obtained by adding the amounts provided in those items to those respective amounts existing immediately prior to the act set forth in the same paragraph:

(3)In the cases prescribed in paragraph (1), the amount of consideration for treasury shares is the amount obtained by multiplying by the treasury share disposal rate the amount obtained by subtracting the amount set forth in item (iii) of the same paragraph from the sum of the amounts set forth in paragraph (1), item (i) and item (ii).

(4)The amount set forth in paragraph (2), item (i), (b), with respect to the application of the provisions of Article 150, paragraph (2), item (viii) and Article 158, item (viii), (b) hereof, and Article 446, item (ii), and Article 461, paragraph (2), item (ii), (b) and item (iv) of the Act, is also deemed to be included in the amount of consideration for treasury shares.

(5)With respect to the application of the provisions of paragraph (1), item (ii), the amount set forth in Article 199, paragraph (1), item (ii) of the Act, and the value set forth in the same paragraph, item (iii) regarding properties contributed in kind, and the book value of the properties contributed in kind (including the amounts of stated capital and capital reserves concerning the contributions) must not be interpreted as having to be the same amount.

Article 15(1)In the cases set forth below, the maximum amount of increase in stated capital is zero:

(2)In the cases set forth in each item of the preceding paragraph, the amount of consideration for treasury shares is the book value of the treasury shares disposed of in the cases set forth respectively in those items.

Article 16(1)If an allotment of shares without contribution is made, the maximum amount of increase in stated capital is zero.

(2)In the cases prescribed in the preceding paragraph, the amount of other capital surplus after an allotment of shares without contribution is the amount obtained by subtracting the book value of treasury shares disposed of in the allotment of shares without contribution from the amount of other capital surplus immediately prior to the allotment of shares without contribution.

(3)In the cases prescribed in paragraph (1), the amount of consideration for treasury shares is zero.

Article 17(1)If share options have been exercised, the maximum amount of increase in stated capital is the amount obtained by subtracting the amount set forth in item (v) from the amount obtained by multiplying by the share issue rate (meaning the rate obtained by dividing the number of shares issued upon exercise by the sum of the number of shares issued and the number of treasury shares disposed of upon exercise; the same applies hereinafter in this Article) the amount obtained by subtracting the amount set forth in item (iv) from the sum of the amounts set forth in item (i) through item (iii) (if this is less than zero; zero):

(2)In the cases prescribed in the preceding paragraph, the amounts after the exercising of share options set forth in the following items are to be the amounts obtained by adding the amounts as provided in those items to those respective amounts existing immediately prior to the exercising:

(3)In the cases prescribed in paragraph (1), the amount of consideration for treasury shares is the amount obtained by multiplying by the treasury share disposal rate the amount obtained by subtracting the amount set forth in item (iv) of the preceding paragraph from the sum of the amounts set forth in item (i) through item (iii) of the same paragraph.

(4)The amount set forth in paragraph (2), item (i), (b), with respect to the application of the provisions of Article 150, paragraph (2), item (viii) and Article 158, item (viii), (b) hereof, and Article 446, item (ii) and Article 461, paragraph (2), item (ii), (b) and item (iv) of the Act, is also deemed to be included in the amount of consideration for treasury shares.

(5)Regarding the application of the provisions of paragraph (1), item (i), if share options are share options for subscription, the matters set forth in Article 238, paragraph (1), item (ii) and item (iii) of the Act regarding the relevant share options for subscription and the book value referred to in paragraph (1), item (i) must not be interpreted as being required to be the same amount.

(6)With respect to the application of the provisions of paragraph (1), item (iii), the values set forth in Article 236, paragraph (1), item (ii) and item (iii) of the Act regarding properties contributed in kind, and the book value of the properties contributed in kind (including the amounts of stated capital and capital reserves concerning the contributions), must not be interpreted as being required to be the same amount.

Article 18(1)When share options subject to call are acquired, the maximum amount of increase in stated capital is the amount obtained by subtracting the amount set forth in item (iv) from the amount obtained by multiplying by the share issue rate (meaning the rate obtained by dividing the number of shares issued at the acquisition by the sum of the number of shares issued and the number of treasury shares disposed of at the acquisition; the same applies hereinafter in this Article) the amount obtained by subtracting the sum of the amounts set forth in item (ii) and item (iii) from the amount set forth in item (i) (if this is less than zero; zero):

(2)In the cases prescribed in the preceding paragraph, the amounts after the acquisition of share options subject to call set forth in the following items are each to be the amounts obtained by adding the amounts as provided in those items to those respective amounts existing immediately prior to the acquisition of share options subject to call:

(3)In the cases prescribed in paragraph (1), the amount of consideration for treasury shares is the amount obtained by multiplying by the treasury share disposal rate the amount obtained by subtracting the sum of the amounts set forth in item (ii) and item (iii) of the preceding paragraph from the amount set forth in item (i) of the same paragraph.

(4)The amount set forth in paragraph (2), item (i), (b), with regard to the application of the provisions of Article 150, paragraph (2), item (viii) and Article 158, item (viii), (b) hereof, and Article 446, item (ii) and Article 461, paragraph (2), item (ii), (b) and item (iv) of the Act, is also deemed to be included in the amount of consideration for treasury shares.

Article 19(1)If a demand for the sale of shares less than one unit has been received, the maximum amount of increase in stated capital is zero.

(2)In the case prescribed in the preceding paragraph, the amount of other capital surplus after the demand for the sale of shares less than one unit is the amount obtained by subtracting the amount set forth in item (iii) from the sum of the amounts set forth in item (i) and item (ii):

(3)In the case prescribed in paragraph (1), the amount of consideration for treasury shares is the amount of charges concerning demand for the sale of shares less than one unit.

Article 20(1)If a stock company is to deliver shares corresponding to the shares acquired from a shareholder (including persons who bear the obligations jointly and severally with the shareholder) who performs the obligations as provided in Article 462, paragraph (1) of the Act that arise due to the fact that the shareholder acquired shares of the stock company, the maximum amount of increase in stated capital is zero.

(2)In the cases prescribed in the preceding paragraph, the amount of other capital surplus after the act referred to in the same paragraph is the amount obtained by subtracting the amount set forth in item (iii) from the sum of the amounts set forth in item (i) and item (ii):

(3)In the cases prescribed in paragraph (1), the amount of consideration for treasury shares is the amount of monies paid to a stock company by the shareholder (including persons who bear obligations jointly and severally with a shareholder) referred to in the same paragraph.

Article 21If the obligations set forth below have been performed, the amount of other capital surplus held by a stock company is to be increased by the amount of monies paid or any property other than monies delivered to the stock company through the performing of the obligations:

Article 22(1)If a stock company distributes dividends from surplus, the amount of capital reserves after distribution of dividends from surplus is the amount obtained by adding to the amount of capital reserves immediately prior to the distribution of dividends from surplus the amount as provided in the following items in accordance with the categories of cases set forth therein:

(2)If a stock company distributes dividends from surplus, the amount of retained earnings reserves after distribution of dividends from surplus is the amount obtained by adding to the amount of retained earnings reserves immediately prior to the distribution of dividends from surplus the amount as provided in the following items in accordance with the categories of cases set forth therein:

Article 23If a stock company distributes dividends from surplus, the amounts set forth in the following items after distribution of dividends from surplus are the amounts obtained by subtracting the amounts as provided in those items from those amounts immediately prior to the distribution of dividends from surplus;

Article 24(1)If a stock company acquires its own shares, the acquisition value is the amount of treasury shares that are to increase.

(2)If a stock company disposes of or cancels treasury shares, the book value is the amount of treasury shares that are to be reduced.

(3)If a stock company cancels treasury shares, the amount of other capital surplus after the cancellation of treasury shares is the amount obtained by subtracting the book value of the cancelled treasury shares from the amount of the treasury shares immediately prior to cancellation.

Article 25(1)Apart from what is specified in Subsection 1 and Section 4, the amount of stated capital of a stock company is to be increased by the amounts specified respectively in the following items only in the cases set forth in those items:

(2)The amount of stated capital of a stock company is to be reduced by an amount corresponding to the amount under in Article 447, paragraph (1), item (i) of the Act, only in cases pursuant to the provisions of the same Article. In such cases, the amount of stated capital must not be interpreted as being reduced in the cases set forth below:

Article 26(1)Beyond what is specified in Subsections 1 and 2, and Section 4, the amount of capital reserves of a stock company is to be increased by the amounts specified respectively in the following items only in the cases set forth in those items:

(2)The amount of capital reserves of a stock company is to be reduced by an amount corresponding to the amount (limited to amounts concerning capital reserves) under in Article 448, paragraph (1), item (i) of the Act, only in cases pursuant to the provisions of the same Article. In such cases, the provisions of the second sentence of paragraph (2) of the preceding Article apply mutatis mutandis.

Article 27(1)Beyond what is specified in Subsection 1 and Section 4, the amount of other capital surplus of a stock company is to be increased by the amounts specified respectively in the following items only in the cases set forth in those items:

(2)Beyond what is specified in the preceding three Subsections and Section 4, the amount of other capital surplus of a stock company is to be reduced by the amounts specified respectively in the following items only in the cases set forth in those items:

(3)In the cases referred to in the preceding paragraph, in the preceding three subsections and in Section 4, when it is necessary and appropriate that all or part of the amount of other capital surplus to be reduced pursuant to those provisions should not be reduced, then notwithstanding those provisions, with regard to amounts for which non-reduction is appropriate, the amount of other capital surplus may not be reduced.

Article 28(1)Beyond what is specified in Subsection 2 and Section 4, the amount of retained earnings reserves of a stock company is to be increased by an amount corresponding to the amount set forth in Article 451, paragraph (1), item (i) of the Act (limited to amounts concerning other retained earnings), only if the amount of surplus is reduced pursuant to the provisions of the same Article.

(2)The amount of retained earnings reserves of a stock company is to be reduced by an amount corresponding to the amount under Article 448, paragraph (1), item (i) of the Act (limited to amounts concerning retained earnings reserves), only in the cases prescribed in the same Article.

Article 29(1)Beyond what is specified in Section 4, the amount of other retained earnings of a stock company is to be increased by the amounts set forth respectively in the following items only in the cases set forth in those items:

(2)Beyond what is specified in the following paragraph, the amount of other retained earnings of a stock company is to be reduced by the amounts set forth respectively in the following items only in the cases set forth in those items:

(3)If there is an amount of other capital surplus to be reduced which may not be reduced pursuant to the provisions of Article 27, paragraph (3), an amount equal to the amount that may not be reduced is to be subtracted from that other retained earnings amount.

Article 35(1)If all or part of the consideration in an absorption-type restructuring is shares or equity interests of the company surviving the absorption-type merger, the total amount of changes in shareholders' equity, etc. in the company surviving absorption-type merger (referred to as the "amount of changes in shareholders' equity, etc." in the following paragraph) is determined according to the methods as provided in the following items in accordance with the categories of cases set forth therein:

(2)In the cases referred to in the preceding paragraph, the amount of increase in the stated capital and the capital surplus of a company surviving an absorption-type merger are each to be determined by the company surviving an absorption-type merger in accordance with the provisions of the absorption-type merger agreement, within the scope of the amount of changes in shareholders' equity, etc., and the amount of retained earnings is not to change; provided, however, that if the amount of changes in shareholders' equity, etc. is less than zero, within the amount of changes in shareholders' equity, etc., the amount of loss arising from the disposition of treasury shares used as consideration is to be the amount of decrease in other capital surplus (if the company surviving absorption-type merger is a membership company, the capital surplus; the same applies in the following Article); any remaining amount is to be from the amount of decrease in other retained earnings (if the company surviving absorption-type merger is a membership company, the retained earnings; the same applies in the following Article); and the amounts of the stated capital, the capital reserves, and the retained earnings reserve are not to change.

Article 36(1)Notwithstanding the provisions of the preceding Article, if all of the consideration in an absorption-type restructuring is shares or equity interests of the company surviving the absorption-type merger, when it is appropriate to calculate the shareholders' equity, etc. of the company disappearing in the absorption-type merger immediately prior to the absorption-type merger as being carried over, the amounts of stated capital, capital surplus and retained earnings of the company disappearing in the absorption-type merger immediately prior to the absorption-type merger may each be taken as amounts of changes in stated capital, capital surplus and retained earnings of the company surviving absorption-type merger; provided, however, that if there are treasury shares used as consideration or previously acquired shares, etc., the amount obtained by subtracting the book value of the treasury shares used as consideration or the previously acquired shares, etc. from the amount of other capital surplus of the company disappearing in the absorption-type merger immediately prior to the absorption-type merger is the amount of changes in other capital surplus of the company surviving the absorption-type merger.

(2)If there is no consideration in an absorption-type restructuring, when it is appropriate to calculate the shareholders' equity, etc. of the company disappearing in the absorption-type merger immediately prior to the absorption-type merger as being carried over, the sum of the amounts of stated capital and capital surplus of the company disappearing in the absorption-type merger immediately prior to the absorption-type merger may be taken as the amount of changes in other capital surplus of the company surviving absorption-type merger, and the amount of retained earnings immediately prior to the absorption-type merger may be taken as the amount of changes in other retained earnings of the company surviving absorption-type merger; provided, however, that if there are previously acquired shares, etc., the amount obtained by subtracting the book value of the previously acquired shares, etc. from the sum of stated capital and capital surplus of the company disappearing in the absorption-type merger immediately prior to the absorption-type merger is the amount of changes in other capital surplus of the company surviving the absorption-type merger.

Article 37(1)If all or part of the consideration in an absorption-type restructuring is shares or equity interests of a company succeeding in an absorption-type split, the total amount of changes in shareholders' equity, etc. in the company succeeding in the absorption-type split (referred to as "amount of changes in shareholders' equity, etc." in the following paragraph) is determined according to the methods as provided in the following items in accordance with the categories of cases set forth therein:

(2)In cases referred to in the preceding paragraph, the amount of increase of the stated capital and the capital surplus of a company succeeding in an absorption-type split are each to be determined by the company succeeding in an absorption-type split in accordance with the provisions of the absorption-type split agreement, within the scope of the amount of changes in shareholders' equity, etc., and the amount of retained earnings is not to change; provided, however, that if the amount of changes in shareholders' equity, etc. is less than zero, within the amount of changes in shareholders' equity, etc., the amount of loss arising from the disposition of treasury shares used as consideration is to be deducted from other capital surplus (if the company succeeding in the absorption-type split is a membership company, the capital surplus; the same applies in the following Article); any remaining amount is to be deducted from other retained earnings (if the company succeeding in the absorption-type split is a membership company, the retained earnings; the same applies in the following Article); and the amounts of the stated capital, the capital reserves, and the retained earnings reserves are not to change.

Article 38(1)Notwithstanding the provisions of the preceding Article, if all of the consideration in an absorption-type restructuring in a company split by absorption-type split-off is shares or equity interests of the company succeeding in an absorption-type split, when it is appropriate to calculate all or part of the shareholders' equity, etc. of the company splitting in the absorption-type split immediately prior to the absorption-type company split as being carried over, the amounts of stated capital, capital surplus and retained earnings of the company splitting in the absorption-type split that change due to the company split by absorption-type split-off may each be taken as amounts of changes in stated capital, capital surplus and retained earnings of the company succeeding in the absorption-type split; provided, however, that if there are treasury shares used as consideration, the amount obtained by subtracting the book value of the treasury shares used as consideration from the amount of other capital surplus of the company splitting in the absorption-type split that change due to the absorption-type company split is the amount of changes in other capital surplus of the company succeeding in the absorption-type split.

(2)If consideration in an absorption-type restructuring does not exist, when it is appropriate to calculate all or part of the shareholders' equity, etc. of the company splitting in the absorption-type split immediately prior to an absorption-type company split as being carried over, the sum of the amounts of stated capital and capital surplus of the company splitting in the absorption-type split that change due to the absorption-type company split may be taken as the amount of changes in other capital surplus of the company succeeding in the absorption-type split, and the amount of retained earnings of the company splitting in the absorption-type split that change due to the absorption-type company split may be taken as the amount of changes in other retained earnings of the company succeeding in the absorption-type split.

(3)Regarding changes to the amounts of stated capital, capital surplus or retained earnings of the company splitting in the absorption-type split upon the absorption-type company split in the cases referred to in the preceding two paragraphs, these are to be governed by the provisions of Part II, Chapter V, Section 3, Subsection 2 of the Act and any other provisions of the Act.

Article 39(1)If all or part of the consideration in an absorption-type restructuring is shares or equity interests of a wholly owning parent company resulting from a share exchange, the total amount of changes in shareholders' equity, etc. in the wholly owning parent company resulting from a share exchange (hereinafter referred to as "amount of changes in shareholders' equity, etc." in this Article) is determined according to the methods as provided in the following items in accordance with the categories of cases set forth therein:

(2)In the cases referred to in the preceding paragraph, the amounts of increase of the stated capital and capital surplus of a wholly owning parent company resulting from a share exchange are to be determined by the wholly owning parent company resulting from the share exchange in accordance with the provisions of the share exchange agreement, within the scope of the amount of changes in shareholders' equity, etc., and the amount of retained earnings are not to change; provided, however, that in cases other than those where procedures under the provisions of Article 799 of the Act (including cases where it is applied mutatis mutandis pursuant to Article 802, paragraph (2) of the Act following the deemed replacement of terms) are undertaken, the amounts of increase of the stated capital and capital reserves of a wholly owning parent company resulting from a share exchange are each to be amounts that are determined by the wholly owning parent company resulting from a share exchange (if the wholly owning parent company resulting from a share exchange is a membership company, the amount of changes in shareholders' equity, etc.) in accordance with the provisions of the share exchange agreement, within a scope ranging from the amount obtained by multiplying by the share issue rate (meaning the rate obtained by dividing the number of shares issued at the share exchange by the sum of the number of those shares and the number of treasury shares used as consideration) the amount obtained by adding the book value of treasury shares used as consideration to the amount of changes in shareholders' equity, etc. to the amount of changes in shareholders' equity, etc. (if the amount obtained by multiplying by the share issue rate the amount obtained by adding the book value of treasury shares used as consideration to the amount of changes in shareholders' equity, etc. exceeds the amount of changes in shareholders' equity, etc., the amount of changes in shareholders' equity, etc.), and the amounts obtained by subtracting the sum of the increased amounts from the amount of changes in shareholders' equity, etc. are the amount of changes in other capital surplus.

(3)Notwithstanding the provisions of the preceding paragraph, if the amount of changes in shareholders' equity, etc. is less than zero, within the amount of changes in shareholders' equity, etc., the amount of losses arising from the disposition of treasury shares used as consideration is to be deducted from other capital surplus (if the wholly owning parent company resulting from a share exchange is a membership company, the capital surplus); any remaining amount is to be deducted from other retained earnings (if the wholly owning parent company resulting from a share exchange is a membership company, the retained earnings); and the amounts of the stated capital, the capital reserves, and the retained earnings reserves are not to change.

Article 43(1)The amount of property paid or delivered to the relevant stock company by a person who is the shareholder prescribed by Article 445, paragraph (1) of the Act concerning the issuance of shares taking place at the time of incorporation of a stock company if a stock company is incorporated through the methods set forth in the items of Article 25, paragraph (1) of the Act is the amount obtained by subtracting the amount set forth in item (iii) from the sum of the amounts set forth in item (i) and item (ii) (if this is less than zero; zero):

(2)The amount of other capital surplus of a stock company at the time of incorporation (limited to the methods set forth in the items of Article 25, paragraph (1) of the Act; the same applies hereinafter in this Article) is zero.

(3)The amount of retained earnings reserves of a stock company at the time of incorporation is zero.

(4)The amount of other retained earnings of a stock company at the time of incorporation is zero (if the amount obtained by subtracting the amount set forth in item (iii) of paragraph (1) from the sum of the amounts set forth in item (i) and item (ii) of the same paragraph is less than zero, that amount).

(5)With respect to the application of the provisions of paragraph (1), item (ii), the amount determined in the articles of incorporation regarding properties contributed in kind, and the book value of the properties contributed in kind (including the amounts of stated capital and capital reserves concerning the contributions) must not be interpreted as being required to be the same amount.

Article 44(1)The amount of stated capital of a membership company at the time of incorporation (excluding incorporation through consolidation-type mergers or incorporation-type company splits; the same applies hereinafter in this Article) is: within the scope of the amounts obtained by subtracting the amounts set forth in (ii) from the amounts set forth in (i) (if this is less than zero; zero), the amount determined by persons desiring to become members (limited to amounts equal to or greater than zero):

(2)The amount of capital surplus at the time of incorporation of a membership company is the amount obtained by subtracting the amount set forth in item (ii) from the amount set forth in item (i):

(3)The amount of retained earnings at the time of incorporation of a membership company is zero (if the amount obtained by subtracting the amount set forth in item (ii) of paragraph (1) from the amount set forth in item (i) of the same paragraph is less than zero, that amount).

Article 45(1)If a consolidation-type merger is an acquisition of control, the total amount of shareholders' equity, etc. at the time of incorporation of the company incorporated in the consolidation-type merger is the sum of the amounts as provided in the following items (referred to as "amount of changes in shareholders' equity, etc." in the following paragraph) in accordance with the categories of the portions set forth therein:

(2)In the cases referred to in the preceding paragraph, the amount of stated capital and capital surplus at the time of incorporation of the company incorporated in the consolidation-type merger is determined by the company disappearing in the consolidation-type merger in accordance with the provisions of the consolidation-type merger agreement, within the scope of the amount of changes in shareholders' equity, etc., and the amount of retained earnings is zero; provided, however, that if the amount of changes in shareholders' equity, etc. is less than zero, that amount is the amount of other retained earnings at the time of incorporation (if the company incorporated in the consolidation-type merger is a membership company, the retained earnings; the same applies in Article 47, paragraph (2)), and the amounts of stated capital, capital surplus and retained earning reserves are zero.

(3)Notwithstanding the provisions of the preceding two paragraphs, in the cases set forth in paragraph (1), when all of the consideration in a consolidation-type restructuring delivered to shareholders, etc. of the acquiring company in consolidation-type merger is shares or equity interests of the company incorporated in the consolidation-type merger, the amounts of stated capital, capital surplus and retained earnings at the time of incorporation of the company incorporated in the consolidation-type merger may be taken as the sum of the amounts calculated through mutatis mutandis application of the provisions of the following items in accordance with the categories of the portions set forth therein:

Article 46(1)If all of the companies disappearing in a consolidation-type merger are under common control, the total amount of shareholders' equity, etc. at the time of incorporation of the company incorporated in the consolidation-type merger is the amount determined in accordance with a method of calculation (for portions that rely on the method prescribed in paragraph (1), item (ii) of the preceding Article, that method) taking as its base the book value of assets subject to consolidation-type restructuring immediately prior to the consolidation-type merger.

(2)In the cases referred to in the preceding paragraph, the amounts of stated capital, capital surplus and retained earnings at the time of incorporation of the company incorporated in the consolidation-type merger are the sum of the amounts calculated through mutatis mutandis application of the provisions of the following items in accordance with the categories of the portions set forth therein:

Article 47(1)In the cases referred to in paragraph (1) of the preceding Article, when all of the consideration in a consolidation-type restructuring is shares or equity interests of the company incorporated in a consolidation-type merger, and, when it is appropriate to calculate the shareholders' equity, etc. of the companies disappearing in the consolidation-type merger immediately prior to the consolidation-type merger as being carried over, the sum of each of the amounts of stated capital, capital surplus and retained earnings of each of the companies disappearing in the consolidation-type merger immediately prior to the consolidation-type merger may each be taken as the amounts of stated capital, capital surplus and retained earnings at the time of incorporation of the company incorporated in a consolidation-type merger; provided, however, that if there are previously acquired shares, etc., the amount obtained by subtracting the book value of the previously acquired shares, etc. from the sum of other capital surplus (if the company incorporated in the consolidation-type merger is a membership company, the capital surplus; hereinafter the same applies in this Article) of each of the companies disappearing in the consolidation-type merger immediately prior to the consolidation-type merger is the amount of other capital surplus at the time of incorporation of the company incorporated in a consolidation-type merger.

(2)Notwithstanding the provisions of the preceding paragraph, in the cases referred to in the same paragraph, when there is a company consolidated without delivering consideration, the sum of the stated capital and capital surplus of the company consolidated without delivering consideration is deemed to be the amount of other capital surplus of the company consolidated without delivering consideration, the amount of retained earnings of the company consolidated without delivering consideration is deemed to be the amount of other retained earnings of the company consolidated without delivering consideration, and the provisions referred to in the same paragraph apply.

Article 48In cases other than the cases prescribed in Article 45, paragraph (1) and Article 46, paragraph (1), the amounts of stated capital, capital surplus and retained earnings at the time of incorporation of a company incorporated in a consolidation-type merger are calculated pursuant to the provisions of the same Articles and the preceding Article.

Article 49(1)The total amount of shareholders' equity, etc. at the time of incorporation of a company incorporated in an incorporation-type split (except for a company incorporated in an incorporation-type split in the case that two or more companies effect an incorporation-type company split; the same applies hereinafter in this Article and the following Article) is the amount (referred to as the "amount of changes in shareholders' equity, etc." in the following paragraph) determined in accordance with a method of calculation taking as its base the book value of assets subject to consolidation-type restructuring immediately prior to the incorporation-type company split according to the company splitting in an incorporation-type split (if the market value is to be entered for the assets subject to consolidation-type restructuring, a method of calculation taking as its basis the market value of consideration in a consolidation-type restructuring or the market value of the assets subject to consolidation-type restructuring).

(2)In the cases referred to in the preceding paragraph, the amount of stated capital and capital surplus of a company incorporated in an incorporation-type split is determined by the company splitting in an incorporation-type split in accordance with the provisions of the plan for the incorporation-type company split, within the scope of the amount of changes in shareholders' equity, etc.; the amount of retained earnings is zero; provided, however, that if the amount of changes in shareholders' equity, etc. is less than zero, the amount of changes in shareholders' equity, etc. is the amount of other retained earnings (if the company incorporated in an incorporation-type split is a membership company, the retained earnings); the amounts of stated capital, capital surplus and retained earning reserves are zero.

Article 50(1)Notwithstanding the provisions of the preceding Article, if all of the consideration in a consolidation-type restructuring of an incorporation-type company split-off is shares or equity interests of the company incorporated in an incorporation-type split, when it is appropriate to calculate all or part of the shareholders' equity, etc. of the company splitting in an incorporation-type split immediately prior to the incorporation-type company split as being carried over, the amounts of stated capital, capital surplus and retained earnings of the company splitting in an incorporation-type split that change due to the incorporation-type company split may each be taken as the amounts of stated capital, capital surplus and retained earnings at the time of incorporation of the company incorporated in an incorporation-type split.

(2)Regarding changes to the amounts of stated capital, capital surplus or retained earnings upon an incorporation-type company split in the company splitting in an incorporation-type split in cases referred to in the preceding paragraph, the governing provisions are Part II, Chapter V, Section 3, Subsection 2 of the Act and any other provisions of the Act.

Article 51If two or more companies effect an incorporation-type company split, the shareholders' equity or members' equity of the companies incorporated in an incorporation-type split is to be calculated in accordance with what is set forth in the following items:

Article 52(1)The total amount of shareholders' equity at the time of incorporation of a wholly owning parent company incorporated in a share transfer is the sum of the amounts set forth in the items below (referred to as "amount of changes in shareholders' equity" in the following paragraph) in accordance with the categories of the portions set forth therein:

(2)In the cases referred to in the preceding paragraph, the amount of stated capital and capital surplus at the time of incorporation of the wholly owning parent company incorporated in the share transfer are each to be determined by the wholly owned subsidiary company resulting from the share transfer in accordance with the provisions of the share transfer plan, within the scope of the amount of changes in shareholders' equity, and the amount of retained earnings is zero; provided, however, that if the amount of changes in shareholders' equity is less than zero, that amount is the amount of other capital surplus at the time of incorporation, and the amounts of stated capital, capital surplus, and retained earnings reserves are zero.