June 29, 2011
To whom it may concern
Matters Regarding Controlling Shareholders
NIS Group Co., Ltd. (the “Company”) hereby announces the matters of controlling shareholders as follows:
1. Overview of parent company, controlling shareholders (except parent company), or other related companies
(As of March 31, 2011)
Voting Interest in the Company (%)
Name
Attribution
Directly Owned
Indirectly Owned
Total
Stock Exchange
Neoline Holdings Co., Ltd.
Other related company
49.67
-
49.67
-
NLHD Co., Ltd.
Other related company
-
49.67
49.67
-

Note: NLHD Co., Ltd. is a parent company of Neoline Holdings Co., Ltd.
2. Name and reason of parent company having the biggest impact on the Company
Company name: Neoline Holdings Co., Ltd.
Reason: Because Neoline Holdings Co., Ltd. entered into a basic agreement with the Company with regard to a capital and business alliance, and its voting interest in the Company is 49.67%

3. Relationship between the Company and the corporate group of the parent company
The Company entered into a basic agreement with Neoline Holdings Co., Ltd. (“Neoline”) with regard to a capital and business alliance on June 25, 2010. Pursuant to this basic agreement, the Company issued new shares of ¥4,000 million to Neoline through a third-party allotment. As a result, Neoline directly holds 49.67% of the Company’s voting interest and, accordingly, became the largest shareholder of the Company. The Company is having continuous cooperation of Neoline on financial support even after the aforementioned third-party allotment, and aims to strengthen relationship through expansion of synergy effects from the business alliance.
Two employees of the Company have been seconded to Neoline, and seven employees of Phlox Co., Ltd. (“Phlox”), an affiliate company of Neoline, have been seconded to Sales Department of the Company. In addition, the Company borrowed ¥1,484 million from Phlox as of May 31, 2011. The Company considers that these transactions are not constraints on its business, because these are personnel exchanges and financial supports as a part of the capital and business alliance. Also, three directors and two statutory auditors designated by Neoline Group are appointed as directors and statutory auditors of the Company. Of these directors and statutory auditors, however, two directors and two statutory auditors are outside directors and outside statutory auditors intended for management monitoring and supervision as well as advice on business operations, and Neoline is an investment company supporting business operations of portfolio companies aiming for improvement in their corporate values; therefore, the Company believes that it remains independent reasonably as a listed company.
(Concurrent posts of directors and statutory auditors)
Title Name Title at Neoline Group Reason for Appointment
President and Representative Director of the Board Joji Harakawa *Director of the Board of Neoline Holdings Co., Ltd. *President and Representative Director of the Board of AAD Co., Ltd. Appointed based on a capital and business alliance
Outside Director Yoshimasa Katsumata *Finance and Accounting Department of Neoline Holdings Co., Ltd. Appointed based on a capital and business alliance
Outside Director Takahiro Kondo *Administrative Department of Neoline Holdings Co., Ltd. *Statutory Auditor of AAD Co., Ltd. Appointed based on a capital and business alliance
Outside Statutory Auditor Mitsuji Ikeda Appointed based on a capital and business alliance
Outside Statutory Auditor Tsutomu Kasori *Chairman of the Board of Neoline Holdings Co., Ltd. Appointed based on a capital and business alliance

4. Transactions with controlling shareholders
Transaction between the Company and other related company for the year ended March 31, 2011.
Name of company
Location
Common stock
Business category
Description of transaction
Amount of transaction
Item in financial statements
Balance at year-end
Neoline Holdings Co., Ltd.
Minato-ku Tokyo
100
Investment Business
Sales of investment securities
(Note 1):
Amount of sales
Losses on sales
1,714
49
-
-

Notes: 1. Sales price of investment securities is decided by taking into consideration the quoted market price.
2. Consumption taxes are excluded from the transaction amounts and balances at year-end.