Matters related to the status of the Group’s businesses and financial position that could have a significant impact on investors’ decisions are discussed below. Statements about the future are based on the judgment of Nippon Steel Corporation.

1. Our business is substantially affected by changes in macroeconomic conditions and recessions or prolonged periods of weak growth in the global economy, or the economies of our key markets have in the past had, and in the future would be likely to have, a material adverse effect on our business, results of operations and financial condition.

2. Japan is our most important market, and our current business and future growth could be materially and adversely affected if economic conditions in Japan deteriorate.

3. Excess capacity, oversupply and the severely competitive environment in the steel industry may adversely affect our business.

4. We rely on export sales for a significant portion of our total revenue. Adverse economic and financial developments in markets to which we export, particularly Asia, may have an adverse effect on the demand for our products.

5. Protracted low steel prices would be likely to have an adverse effect on our results of operations.

6. Significant increases in market prices of essential raw materials, energy or transportation, as well as supply disruptions, could adversely affect our results of operations.

7. Fluctuations in foreign currency exchange rates may make our export products less competitive or negatively affect the principal consumers of steel, including the automotive, energy and resources, construction, appliance, machinery and equipment industries, reducing the demand for our products.

8. Competition from materials other than steel as well as advancements in the automobile industry could reduce the market price of, and demand for, steel products.

9. We are highly dependent on our steelmaking and steel fabrication business.

10. We may fail to reduce costs, improve profit margins and increase our global market share as planned.

11. Our capital expenditures may require additional financing and adversely affect our financial condition and results of operations.

12. We have grown through acquisitions and may continue to do so. We may fail to manage external growth or face difficulties completing planned acquisitions or integrating acquired companies.

13. Turning Nisshin Steel into a wholly owned subsidiary may not produce the benefits we anticipate.

14. Accidents or malfunctioning equipment at our facilities may disrupt our production and negatively impact our business.

15. Our plans to invest in production bases in growing markets overseas are subject to financing, execution and completion risks.

16. Product liability and other customer claims could have a material adverse financial impact on us and product quality issues involving our products, or the products of other steel manufacturers, particularly in Japan, could have a material adverse financial impact on our financial condition and reputation.

17. We face risks associated with our investments in joint ventures and associates.

18. Our export products have been and may become subject to tariffs, anti-dumping or countervailing duty proceedings.

19. Changes in our assumptions underlying the carrying value of certain of our assets, including as a result of adverse market conditions, could result in the impairment of assets, including good will.

20. We may incur losses on our equity securities portfolio if domestic or foreign stock markets decline.

21. We may suffer large losses in the event of a natural disaster such as an earthquake.

22. We may not be able to adequately protect our intellectual property rights in foreign countries and we may become involved in intellectual property disputes.

23. We rely on trade secrets and other unpatented proprietary know-how to maintain our competitive position, and unauthorized disclosure of our trade secrets or other unpatented proprietary know-how could negatively affect our business.

24. Fluctuations in the prevailing market interest rate for borrowings and debts, in the financial market as well as in the financing environment could harm our business, results of operations and financial condition.

25. We may face difficulties hiring and retaining qualified employees.

26. Our internal controls may not be effective in preventing misstatements of our financial condition and results of operations.

27. We are subject to economic policy, political, social and legal risks and uncertainties in the emerging markets in which we operate or propose to operate.

28. Our insurance policies provide limited coverage, potentially leaving us uninsured against some business risks.

29. Our income tax liability may substantially increase if the tax laws and regulations in countries in which we operate change or become subject to adverse interpretations or inconsistent enforcement.

30. Our reputation and business could be materially harmed as a result of system failure, data breaches, data theft, unauthorized access or successful hacking. Furthermore, our business could be adversely affected as a result of the rising costs of maintaining sufficient cybersecurity in light of continuous technological advances.

31. We are subject to regulatory and compliance risks, which may expose us to governmental investigations or penalties, including in connection with antitrust laws and regulations, and private lawsuits.

32. We are subject to strict environmental, health and safety laws and regulations that could give rise to a significant increase in costs and liabilities.

33. Further issuances of shares by us may have an adverse effect on the market value of our shares and may dilute existing shareholders.

34. Our shareholders of record on a record date may not receive the dividends they anticipate.

35. Investors holding less than a unit of shares will have limited rights as shareholders.

36. Because of daily price range limitations under Japanese stock exchange rules, investors may not be able to sell their shares of our common stock at a particular price on any particular trading day, or at all.

37. Rights of shareholders under Japanese law may be more limited than under the laws of other jurisdictions.

38. It may not be possible for investors to effect service of process within the United States upon us or our directors, executive officers or audit & supervisory board members, or to enforce against us or those persons judgments obtained in U.S. courts predicated upon the civil liability provisions of the federal securities laws of the United States.

39. We plan to terminate our registration under the Exchange Act and cease to be an SEC reporting company as soon as practicable in accordance with applicable rules and regulations.

40. ADS holders must act through the depositary to exercise these rights and have fewer rights than shareholders.

41. There are restrictions on the withdrawal of shares from our depositary receipt facility.

42. Fluctuations in the exchange rate between the Japanese yen and the U.S. dollar could affect the market price of ADSs, as well as the dividends received by ADS holder.