Date issued: March 31, 2005
Date revised: May 10, 2006

Basic Principles of the Company

1. We respect the Company as a member of the global society and, being owned by its shareholders, we endeavor to make a maximum fair profit and to divide such profit among shareholders while providing an appropriate allotment for Company's employees.
2. We supply our customers with safe and high quality products/services which benefit our society, satisfy our customers and increase their confidence in the Company.
3. We abide by the applicable law, Company regulations and contracts while we carry out Company business in every country and region where the Company does business.
4. We keep fair and transparent relationships with people and business partners, including government offices concerned.
5. We cooperate with our community as a "good corporate citizen" trusted by the people of the community, while having active interest in protection of the global environment and contributing to the community with our best efforts.

Code of Conduct

1. We have an internal control system (corporate governance system) which we effectively execute, check and continuously improve.
2. We respect the fundamental human rights and do not discriminate against any person by his or her nationality, race, sex, birthplace, political creed or religion. Sexual harassment, violent acts and intimidation are strictly prohibited especially when they are committed by any person taking advantage of his or her position (superior position) in the office or the trade relation.
3. We carry out fair, transparent and legitimate trades in free competition, which make a fair profit for the Company.
4. We must strictly observe the laws and ordinances as well as the manners and customs of the country and area where the Company office is located, always remembering that they should contribute to the development of the country and area concerned.
5. We don't take any acts which would cause the Company damage and harm. We don't have a relation with any party or person who intends to cause the Company damage and harm. We don't have a relation with any party or person who is doing an anti-social activity.
6. In our distribution business, we respect equally both customers and principals (suppliers). We try to keep a harmonious relationship and to build a communication bridge between both parties.
7. We are allowed to give a gift and/or entertain our business partners only within the limit permitted by the law, commercial, moral and social common sense.
8. We make contracts and promises only by tangible means such as a written form of document. After such contracts and/or promises are made, we correctly execute it, thus enhancing the Company's reputation.
9. The Company respects the freedom of any individual of the Company to have any personal creed for politics and religion, however we must ensure that our business/job is not affected in any manner by our personal political and religious creed.
10. We are not allowed to use Company property for our private purpose, steal, give or sell Company's property/assets to any other party or person without the Company's permission.
11. We respect the intellectual property belonging to the Company or business partners.
12. We strictly control the confidential information of the Company and business partners. We ensure that we don't use such information which has become known while carrying out business with them for any purpose other than the justifiable use for Company business.
13. We are allowed to use the information network of the Company legitimately and properly according to the company regulations.
14. We positively participate in environmental protection and quality control activity conducted by the Company while also participating in the same activity promoted by business partners. In addition, we understand the spirit of Corporate Social Responsibility and execute it accordingly.
15. We disclose information of the Company required by it's stakeholders with correct and sufficient contents, a proper timing and proper manner.
16. In case we have acquired any confidential in-house-information of the Company or business partner while conducting business, we are not allowed to trade stocks of such company before the information is formally released to the public. Also, we are strictly prohibited to propagate such information.
17. We must be sure not to export or offer any transfer of products or technology prohibited by laws and regulation in order to maintain national and international security.
18. For any person who feels it is difficult to report the illegal or violated acts made by the Company, business partner or their employees openly or who wants to keep the reporting act confidential, there is a “window” which accepts such information and keeps the secrecy of the reporting person. The Company guarantees that the reporting person is protected in accordance with laws and Company regulations.

Note

1. The word "Company" in this paper includes every company belong to Hakuto group in Japan and overseas.
2. The phrase "business partner" in this paper includes every supplier, customer and any party which have business relation with Hakuto group companies and their employees too.