Cosmo Energy to Pursue Absorption-type Company Split as it Transitions to a Business Structure Comprising a Holding Company and Three Core Operating Companies

November 5, 2015

Cosmo Energy Holdings Co., Ltd.

Cosmo Energy Holdings Co., Ltd. (hereinafter referred to as “Cosmo Energy” or “the Company”) announced that its Board of Directors today passed a resolution to separate its Group Corporate Planning, Group Management Support, and Group Corporate Management businesses from its wholly owned subsidiary, Cosmo Oil Co., Ltd. (hereinafter referred to as “Cosmo Oil”), and transfer these businesses to the Company, effective January 1, 2016 (hereinafter referred to as “this Company Split”).

Since this Company Split constitutes a reorganization involving the Company and its wholly owned subsidiary, certain disclosure items and details have been omitted.

Cosmo Energy Holdings Co., Ltd. was incorporated on October 1, 2015 as a holding company (sole parent company of Cosmo Oil) based on a resolution passed by the Board of Directors of Cosmo Oil on May 12, 2015 and its General Meeting of Shareholders on June 23 of the same year. In conjunction with its incorporation, the Company transitioned to a holdings company structure through the establishment of Cosmo Oil Marketing Co., Ltd. on October 1, 2015 by transferring sales-related businesses from Cosmo Oil to Cosmo Oil Marketing in an absorption-type company split.

This Company Split will facilitate the transition to a business structure comprising a holdings company and three core operating companies, thereby strengthening the competitiveness of the Cosmo Energy Group and propelling its growth strategy forward.

(1) Schedule for company split

The above scheduled date for this Company Split may be subject to change as required depending on procedural progress or other reasons. In addition, since this Company Split is a simplified absorption-type company split under Article 796, Paragraph 2 of the Companies Act, it will be executed without the holding of a General Meeting of Shareholders.

(2) Method of company split
Cosmo Oil will be the splitting company and the Company will be the successor company in this absorption-type company split.

(3) Allotment of shares associated with this Company Split
There will be no allotment of shares or other money, etc. as a result of this Company Split.

(4) Treatment of stock acquisition rights and bonds with stock acquisition rights accompanying this Company Split
Not applicable

(5) Change in capital as a result of this Company Split
There will be no increase or decrease in capital for the Company as a result of this Company Split.

(6) Rights and obligations transferred to the successor company in this Company Split
In this Company Split, all assets, liabilities, and contractual rights and obligations of the Group Corporate Planning Business, Group Management Support Business, and Group Corporate Management Business will be succeeded by the Company as of the effective date of this Company Split. In addition, the succession of obligations will be based on the concomitant assumption method.

(7) Ability to fulfill obligations
The Company and Cosmo Oil have determined that there is no problem in terms of each party being able to fulfill their respective obligations after the effective date of this Company Split.

(1)  Businesses engaged in Cosmo Energy Group company management

1) Description of the businesses
Businesses engaged in Group Corporate Planning, Group Management Support, and Group Corporate Management as it related to the Cosmo Energy Group

2) Sales recorded by the businesses (FY2014)
Nil

3) Book value of assets and liabilities to be split (as of September 30, 2015)

With the exception of paid-in capital, this Company Split will not involve any changes to the trade name, business activities, registered address, representative, or accounting period for Cosmo Oil, the splitting company. In addition, there will be no changes in the trade name, business activities, registered address, representative, paid-in capital, or the accounting period for the Company, the successor company.

This Company Split is expected to have a negligible impact on consolidated business results due to it involving the Company and its wholly owned subsidiary.

【Current】

【January 1, 2016 (scheduled)】

Cosmo Oil passed a resolution at its Board of Directors meeting held on November 5, 2015 to issue 1,200 new class shares through a shareholder allotment to the Company. The payment is scheduled to be made on January 1, 2016.