Management

Notice of Partial Amendment to the Articles of Incorporation in Conjunction with the Transition to a Company with an Audit & Supervisory Committee

May 16, 2016

TOKYO, May 16, 2016 – Kobe Steel, Ltd. (hereinafter the “Company”) announces that it passed a resolution at its Board of Directors meeting held today, that it will propose to the 163rd Ordinary General Meeting of Shareholders (hereinafter the “Ordinary Meeting of Shareholders”) to be held in late June 22, 2016, the partial amendment to the Articles of Incorporation as below according to the policy announced in February 2, 2016, to transition to a company with an Audit & Supervisory Committee.

1. Purpose of the Partial Amendments to the Article of Incorporation

To ensure continued growth and improve its corporate value over the years, the Company has strengthened its corporate governance system with the appointment of more than one outside director and five Audit & Supervisory Board members, in which the Companies Act stipulates that three or more Audit & Supervisory Board Members must be appointed. To further strengthen the supervisory function of the Board of Directors and to accelerate decision-making with regard to management, the Company decided to transition from a company with an Audit & Supervisory Board to a company with an Audit & Supervisory Committee. Accordingly, partial amendments to some provisions in the Articles of Incorporation which are necessary to transition to a company with an Audit & Supervisory Committee are scheduled as below.

(1) As the Company will transition from being a company with Audit & Supervisory Board to a company with an Audit & Supervisory Committee, deletion of provisions relating to Audit & Supervisory Board Members and an Audit & Supervisory Board, establishment of provisions relating to Audit & Supervisory Committee Members and an Audit & Supervisory Committee, establishment of supplemental provisions as transitional measures as a result of deleting provisions regarding liability exemption of Audit & Supervisory Board Members, and amendments to other provisions are being proposed.

Deleting provisions relating to Audit & Supervisory Board Members and an Audit & Supervisory Board (Articles 29 to 36 of the current Articles of Incorporation).
Establishing provisions relating to Audit & Supervisory Committee and Audit & Supervisory Committee Members (Article 4 of the proposed amendments, the title of Chapter V of the proposed amendments, and Article 30 to Article 33 of the proposed amendments).
Establishing supplemental provisions as transitional measures resulting from the deletion of provisions regarding liability exemption of Audit & Supervisory Board Members (Supplemental provisions of the proposed amendments)
Other necessary amendments (Article 18, Article 19, Article 22, Article 23, Article 24 Article 25, and Article 28 of the proposed amendments).

(2) In order to further separate management supervision and business execution, a provision stating that when resolved by the Board of Directors, all or part of decisions of execution of important operation may be delegated to Directors is being proposed (Article 26 of the proposed amendments).

(3) In order to clarify the position and duties of Directors along with the Company’s transition to a company with an Audit & Supervisory Committee, a reconsideration of provisions relating to Directors with Special Titles is being proposed (Articles 20 and 21 of the proposed amendments).

2. Contents of Partial Amendments to the Articles of Incorporation

The contents of partial amendments to the Articles of Incorporation are as set forth in the Attachment hereto.

Contents of Partial Amendments to the Articles of Incorporation

3. Summary Schedule

Ordinary General Meeting of Shareholders to Amend the Articles of Incorporation: June 22, 2016 (scheduled)
　
　
The Effective Date of Amendments to the Articles of Incorporation: June 22, 2016 (scheduled)

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