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TheStreet Open House

Notice Concerning Issuance Of New Shares And Secondary Offering Of Shares In Japan

Stocks in this article: IIJI

3. Use of Proceeds to be Raised

(1) Use of Proceeds to be Raised this time
  Out of proceeds from the Public Offering of new shares and the Issuance through Third-Party Allotment, which is estimated to be up to JPY18,773,000,000 in total, JPY10,122,000,000 is planned to be used for capital investment for the Network Services and Systems Integration business by the end of March 2015, JPY6,661,000,000 is planned to be used to repay debt for network equipment leased by the end of March 2013 and to be repaid by the end of March 2015 and JPY1,990,000,000 is planned to be used to repay debt to be repaid by August 2014.
  As of July 2 2013, our facility planning is as follows ("Paid" investment amount figures are as of June 30, 2013);
  Name of Company (Location of Key Office) Name of Segment Facility Investment Amount Fundraising Scheme Commencement and Completion Schedule
        Total (thousand yen) Paid (thousand yen)   Commencement Completion
  IIJ Data Centers (Mitaka, Tokyo and other cities) Network Services and Systems Integration business Leasehold improvement in data centers and other facilities 1,745,000 47,144 Cash on hand and capital increase April 2013 March 2015
  IIJ Data Centers (Mitaka, Tokyo and other cities) Network Services and Systems Integration business Data communications equipment, servers and other equipment 1,872,000 55,611 Cash on hand and capital increase April 2013 March 2015
  IIJ Matsue Data Center (Matsue, Shimane Pref.) Network Services and Systems Integration business Buildings, power supply and other facilities 1,200,000 6,734 Cash on hand and capital increase April 2013 September 2013
  IIJ Data Centers (Matsue, Shimane Pref. and other cities) Network Services and Systems Integration business Buildings, IT modules, power supply facilities, air-conditioning and other facilities 1,586,000 5,004 Cash on hand and capital increase April 2013 March 2015
  IIJ Headquarters (Chiyoda, Tokyo) Network Services and Systems Integration business Software to provide data communications services 2,415,000 196,537 Cash on hand and capital increase April 2013 March 2015
  IIJ Headquarters (Chiyoda, Tokyo) Network Services and Systems Integration business Back-office systems 1,633,000 17,708 Cash on hand and capital increase April 2013 March 2015
  Total 10,451,000 328,738  
  Note: Increase in capabilities per each facility investment is not described because such scales are not measurable.
(2) Change in the use of the proceeds raised last time
  No relevant matters
(3) Expected impact on business results
  The Company believes that the capital investment backed by the above-mentioned raised fund will increase sales and profits of the Company's Network Services and Systems Integration business operations and help achieve medium- and long-term growth and increase corporate value.

4. Other Matters

(1) Designation of party to receive distribution
  No relevant matters
(2) Lock-up
  Nippon Telegraph and Telephone Corporation, NTT Communications Co., Koichi Suzuki and KS Holdings Co., all of whom are shareholders of the Company, have agreed with one of the Underwriters that, during the period beginning on the Pricing Date and ending on the 90 th calendar day after the delivery date of the Public Offering (the "Lock-up Period"), they shall not in principle conduct a sale of shares of common stock of the Company without prior written consent of one of the Underwriters.
  The Company has agreed with one of the Underwriters that, during the Lock-up Period, it shall not conduct an issuance of shares of common stock of the Company, securities that are convertible or changeable into common stock of the Company nor any other securities with a right to purchase shares of common stock of the Company, etc. (other than the issuance of new shares conducted as a public offering, the above-mentioned Issuance through Third-Party Allotment or any issuance of shares conducted with respect to any stock split) without prior written consent of one of the Underwriters.
  In each case above, one of the Underwriters is entitled to cancel such agreement in whole or in part at their discretion even during the Lock-up Period.

Note: This press release does not constitute an offer of any securities for sale. This press release has been prepared for the purpose of publicly announcing that the Company has resolved matters relating to the issuance of new shares and the secondary offering of its shares and not for the purpose of soliciting investment or engaging in any other similar activities. This press release is not an offer of securities for sale in the United States. The securities referred to above have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "Securities Act"). The securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act.

About IIJ

Founded in 1992, Internet Initiative Japan Inc. is one of Japan's leading Internet-access and comprehensive network solutions providers. IIJ and its group companies provide total network solutions that mainly cater to high-end corporate customers. The company's services include high-quality systems integration and security services, Internet access, and cloud computing. Moreover, the company has built one of the largest Internet backbone networks in Japan that is connected to the United States and the United Kingdom. IIJ listed on NASDAQ in 1999 and on the First Section of the Tokyo Stock Exchange in 2006. For more information about IIJ, visit the IIJ Web site at http://www.iij.ad.jp/en/ .

The statements within this release contain forward-looking statements about our future plans that involve risk and uncertainty. These statements may differ materially from actual future events or results. Readers are referred to the documents furnished by Internet Initiative Japan Inc. with the SEC, specifically the most recent reports on Forms 20-F and 6-K, which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements.

CONTACT: For inquiries, contact:
         IIJ Investor Relations
         Tel: +81-3-5259-6500  E-mail: ir@iij.ad.jp
         URL: http://www.iij.ad.jp/en/ir

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