The criteria for the selection of outside officers require that candidates shall not fall under any of the following categories.

1. A party who is or has been a Director, an Auditor or an employee at the Ryoyo Group in the past ten years or a relative within the second degree of kinship of such a party
2. A party that is or has been a Director, an Auditor or an employee of a major business partner (*1) of the Ryoyo Group in the past five years
3. A shareholder that holds 10% or more of the voting rights of the Company’ shares (in the case of an institutional shareholder, this shall apply to business executives at such an institutional shareholder)
4. A provider of specialist services (*2) that has received annual remuneration of 10 million yen or more from the Ryoyo Group during the past five years
5. A party that has received an annual donation of 10 million yen or more from the Ryoyo Group during the past five years
6. A party that has a relationship with the Ryoyo Group in which exchange of Directors is carried out by mutual dispatch
7. Any other party with a significant interest in the Ryoyo Group

*1.This signifies a business partner that has a relationship with the Ryoyo Group that constitutes 2% or more of the consolidated net sales of the Ryoyo Group in the most recent fiscal year.
*2.This signifies an attorney, a certified public accountant, a certified public tax accountant, a judicial scrivener, a consultant or an advisor.