Corporate Governance Report
CORPORATE GOVERNANCE

KOMEDA Holdings Co, Ltd.

Last Update:

May 29, 2024
KOMEDA Holdings Co., Ltd.

Yuichi Amari,Representative Director and President
Administration Headquarters
Contact:
General Affairs Department
Tel: 052-936-8880
3543

Securities code:
https://www.komeda-holdings.co.jp/
Note: This translation of the Corporate Governance Report is provided for reference purposes. In the event of any discrepancy, theoriginal Japanese version shall prevail.

The corporate governance of KOMEDA Holdings Co., Ltd. (“KOMEDA Holdings” or “the Company”) is described
below.

I. Basic Views on Corporate Governance, Capital Structure, Corporate Profile and Other Basic
Information
1.

Basic Views
To achieve sustainable growth and increase corporate value over the medium to long term, the Company maintains good
relationships with shareholders and all stakeholders, fulfills its social responsibilities as a company, and is working to strengthen
its corporate governance system with the aim of establishing a legal compliance system, building an effective internal control
system, and ensuring management objectivity and prompt decision-making.

Reasons for Non-compliance with Principles of the Corporate Governance Code
The Company is compliant with all principles.

Disclosure Based on the Principles of the Corporate Governance Code[Principle 1-4 Cross-shareholdings]
KOMEDA Holdings does not hold listed shares as cross-shareholdings.
[Principle 1-7 Related Party Transactions]
When conducting transactions with officers and major shareholders, etc., the Company obtains the approval of the Board of
Directors after consulting opinions from the Audit and Supervisory Committee members, deliberating them. Transactions with aconflict of interest are approved by the Board of Directors as required. Furthermore, in the event of transactions between these
related parties, disclosure will be made in accordance with relevant laws and regulations such as the Companies Act and the
Financial Instruments and Exchange Act, as well as the rules stipulated by stock exchanges.
[Supplementary Principle 2-4 (1) Ensuring Diversity in the Promotion, etc. of Core Personnel]
To provide customers with “an ideal space and service for KUTSUROGI” as well as contribute to the enhancement of corporate
value over the medium to long term and the realization of sustainable societies through its business activities, the Company
addressed material issues that should be prioritized (hereinafter referred to as "Materiality"). One such matter is "Promotion ofhuman resource diversity." To achieve this, the Company will embrace diversity (diversity and inclusion) in areas such as gender,1age, marriage, race, nationality, religion, and disability, and strive to create and improve a workplace environment where a wide
range of human resources can demonstrate their individuality and abilities.
The main initiatives for the above policy are as follows.
(Promoting the Advancement of Women)
To increase the number of female employees involved in management decision-making in the future, the Company has a woman
in the role of general manager, along with a Chief Store Operation Officer (CSOO) specializing in KOMEDA's store operations,and a Chief Smiling Ambassador (CSA) specializing in customer service. These three women participate in weekly departmental
management meetings to discuss and share information with other departments prior to decision-making.
In addition, three women have been appointed as department heads at Komeda Co., Ltd., a major subsidiary of the Company,
and two women as directors at affiliated companies.
Of note, in 2019 KOMEDA Co., Ltd. received a three-star "Eruboshi" rating indicating a company that promotes theadvancement of women. As of the end of the fiscal year ended February 2024, the ratio of female managers, including female
store managers, was 19.6%. To achieve the target of 23% by the end of February 2026, the Company will continuously promote
the creation of workplaces where women can play active roles.
(Active Participation of Non-Japanese Human Resources)
KOMEDA Holdings is also focusing on promoting the active participation of overseas human resources with the aim of
responding to the future decline in the working population and vitalizing human resources. In the fiscal year ended February
2023, the first 43 graduates of the KOMEDA Training Center in Myanmar entered Japan and are playing active roles in theoperations of KOMEDA Holdings Group’s directly managed stores and bakeries. In the fiscal year ended February 2024, theCompany began making preparations to welcome the second group of graduates. These non-Japanese employees are receiving
training aimed at promotion to management positions in the future.
In addition, KOMEDA Holdings Group has established local subsidiaries in Taiwan and Indonesia to expand its business. For
business growth, the Company is selecting and developing local management personnel in order to quickly and accurately grasp
the needs of diverse local customers and respond flexibly to such needs. Therefore, a voluntary and measurable target for theratio of foreign managers has not been set.
(Recruitment of diverse human resources)
In the era of an economic environment marked by VUCA (volatility, uncertainty, complexity, and ambiguity), KOMEDA
Holdings believes that diversity of human resources is important for continued expansion of its business, and has proactively
hired mid-career human resources with various career backgrounds. As a result, the ratio of mid-career hires of employees hasreached a high level on a par with that of the previous fiscal year. For this reason, the Company has not set a voluntary andmeasurable target for the ratio of mid-career hires to managerial positions, but will continue to actively promote recruitment andpromotion to core positions in order to reflect this diversity in management.
(Creating a Workplace Environment Comfortable for Diverse Human Resources)
KOMEDA Holdings strives to create a workplace environment that improve employee’s rewarding to ensure the diversity ofhuman resources, and is promoting the development of a workplace environment that makes the most of human resource diversity
in accordance with the following five materiality matters. In addition, the Company has focused on employee engagement, andadded engagement survey items to the annual Employee Satisfaction Survey.
Materiality

Details of Initiatives

Improvement of occupational health andsafety- Introduction of Super Flextime System and Variable Working
Hours System- Implementation of stress checks- Implementation of occupational health and safety training

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Securing Human Resources and Creating
an Environment that Supports Growth- Periodic review of plans of human resource recruitment anddevelopment, human resource allocation and organizational
restructuring strategies, and evaluation systems- Conducting of regular follow-up interviews with employees
who have joined the company- Establishment of various training systems, such as subsidies foracquiring qualifications

Revitalization of Diverse Human
Resources- Promotion of telework- Implementation of measures to promote maternity and childcare
leave, such as making maternity and childcare leave partially paid
- Establishment of a side job system

Good employment relationship andsuitable working conditions- Employee satisfaction survey (including engagement survey
items)- Encouraging employees to take paid leave

Eradicating discrimination andharassment- Implementation of harassment prevention training- Establishment and operation of a harassment consultation desk
(helpline)[Principle 2-6 Roles of a Corporate Pension Fund as an Asset Owner]
Since KOMEDA Holdings Group has adopted a defined contribution corporate pension plan, there is no investment of thecorporate pension fund, and no impact on the Company’s financial position.
[Principle 3-1 Full Disclosure](1) KOMEDA Holdings Group publishes its management philosophy, management strategy, and management plan on its website.
Please refer to the following URL. https://komeda-holdings.co.jp/(2) The basic approach to corporate governance is described in "I.1 Basic View" of this report.
(3) The Company decides on policies and procedures for determining the amount of remuneration for Directors (excluding
directors who are Audit and Supervisory Committee Members, “Directors”) within the limits of the total amount of remuneration
for Directors as determined by the General Meeting of Shareholders, taking into account the role, responsibility, management
capability, performance, and degree of achievement of individual targets, etc. of each Director, and after deliberation by the Boardof Directors upon receiving a report from the Independent Advisory Committee (composed of four independent outside directors),
which is an advisory body to the Board of Directors. In addition, the policy and procedures for determining the amount of
remuneration for directors who are Audit and Supervisory Committee members ("Audit and Supervisory Committee members")
are determined by the Audit and Supervisory Committee within the limits of the total amount of remuneration for Audit andSupervisory Committee members as determined by resolution of the General Meeting of Shareholders, taking into account theirfull-time or part-time audit work status.
(4) The selection of candidates for a Director (excluding directors who are Audit and Supervisory Committee Members) isdecided by the Board of Directors after deliberation by the Human Resources Strategy Committee and the Independent Advisory
Committee based on a skill matrix that lists the skills expected of directors, bearing in mind the overall knowledge, experience,
and abilities of the Board of Directors as a whole, and that diversity is respected as possible in consideration of the number andsize of the Board of Directors of the Company. If it is recognized that a director is not fully performing his or her functions, suchas when a director violates laws and regulations or the Articles of Incorporation, causes significant loss or hindrance to business,or causes significant obstacles to the execution of duties, the Board of Directors will deliberate on the dismissal of the director.
(5) Regarding the appointment and nomination of individual directors and Audit and Supervisory Committee members, thebiographies of candidates are included in the Notice of Convocation of the Ordinary General Meeting of Shareholders and theannual securities report. In addition, the reasons for each appointment as a Director and Audit and Supervisory Committee
member candidate are described in the Notice of Convocation of the Ordinary General Meeting of Shareholders.
"Notice of Convocation of the 10th Ordinary General Meeting of Shareholders"
https://komeda-holdings.co.jp/english/wp-content/uploads/2024/05/Notice-of-Convocation-of-The-10th-Ordinary-GeneralMeeting-of-Shareholders-1.pdf

3

[Principle 3-1 (3) Initiative of Sustainability](1) The Company's basic sustainability policy is as follows.
To continue to provide customers with “an ideal space and service for KUTSUROGI”, KOMEDA Holdings will consider the
global environment and work to solve social issues.
(2) To promote sustainability activities across the entire business organization, the Company has established the Sustainability
Committee, chaired by the President and Representative Director. Positioned as a meeting body under the direct control of the
President and Representative Director, the Sustainability Promotion Division serves as the secretariat, the committee
continuously sets targets for sustainability activities, monitors progress, and evaluates achievements of each business internalorganization. In addition, the status of sustainability-related activities is reported to the Board of Directors each quarter.
(3) KOMEDA Holdings recognizes climate change initiatives to be an important management issue, and believes that it isnecessary to identify risks and opportunities, and link them to increasing corporate value over the medium to long term.
Accordingly, in addition to working to reduce CO2 emissions in the logistics field through the decentralization of factories, andpromoting the introduction of renewable energy at factories and stores, the Company discloses on its website the impact of risks
and opportunities related to climate change on its business activities and earnings, based on the framework of the TCFD
recommendations.
https://komeda-holdings.co.jp/sustainability/(4) Details of specific sustainability initiatives are disclosed on the Company’s website.
Please refer to the following URL. https://komedacomestrue.komeda.co.jp/(Investing in Human Capital)
As described in Supplementary Principle 2-4 (1), KOMEDA Holdings has identified "Promotion of human resource diversity."
as a materiality matter, and believes that it is necessary to create a workplace environment where diverse personnel candemonstrate their abilities, and to develop human resources. In the fiscal year ended February 2024, the Company conductedvarious measures including dispatching employees to external business schools, and conducting rank-based training to develop
the next generation of leaders.
Going forward, the Company will continue to pursue measures for diversity of human capital.
(Investing in Intellectual Property)
Since approximately 95% of KOMEDA’s Coffee and Okage-An stores are franchise stores, KOMEDA Holdings Group
recognizes that obtaining rights to trademarks used in stores is an important management issue. In 2018, after reviewing the scopeof trademark rights in Japan and overseas, the Company applied for registration of necessary trademarks.
Going forward, the Company will continue to consider the sales of each product and the possibility of resale, and periodically
apply for and acquire trademark rights that its deems necessary.
[Supplementary Principle 4-1 (1) Outline of Scope of the Matters Delegated to the Management]
Matters other than those stipulated by laws and regulations, internal rules, etc. as matters to be resolved by the Board of Directors
are delegated to Directors, etc.
[Principle 4-8 Effective Use of Independent Outside Directors]
The Company has appointed four independent outside directors to exercise the supervisory function of the Company's
management corporate activities from an objective, broad, and advanced perspective.
[Principle 4-9 Criteria for Determining the Independence and Qualifications for Independent Outside Directors]
This report II.-1 [Matters Concerning Independent Directors] The Company lists the independence judgment criteria for othermatters related to independent directors.
[Supplementary Principle 4-10 (1) Voluntary Committee on Nomination and Remuneration of Directors]
The concept, authority, and roles of the Voluntary Advisory Committee regarding the Nomination and Remuneration of Directors
is described in "II.-1 [Voluntary Established Committees]" in this report.

4

[Supplementary Principle 4-11 (1) Composition of the Board of Directors and Policy and Procedures for Appointment of
Directors]
The Board of Directors nominates candidates from both inside and outside the Company with extensive experience, insight, andexpertise as director candidates, and by selecting them at the General Meeting of Shareholders, the Board of Directors strives toensure the diversity of the Board of Directors and the overall balance of knowledge, experience, abilities, and gender in an optimal
structure for the Company.
The policies and procedures concerning the appointment of directors are described in Principle 3-1 (iv).
In addition, the Company has appointed a person with management experience an outside company as an outside director.
The Company has prepared a skill matrix for directors and included it in the reference documents for the General Meeting of
Shareholders.
[Supplementary Principle 4-11 (2) Directors’ Concurrent Positions]
The status of officers in the annual securities report is described in the status of their concurrent positions.
[Supplementary Principle 4-11 (3) Analysis and Evaluation of the Effectiveness of the Board of Directors as a Whole]
The Company conducts an evaluation of the effectiveness of the Board of Directors in March every year as an opportunity toassess the candid opinions of directors regarding the activities of the Board of Directors. In evaluating the effectiveness of theBoard of Directors meetings (19 times in total) held from March 2023 to February 2024 for the fiscal year ended March 2024,
the Company conducted an anonymous questionnaire of nine directors (including four outside directors who are Audit andSupervisory Committee members). The questionnaire covered 1) the composition of the Board of Directors, 2) the operation of
the Board of Directors, and 3) the agenda of the Board of Directors. After analyzing the results of the questionnaire at the Audit
and Supervisory Committee, the Audit and Supervisory Committee held a discussion on the effectiveness of the Board of
Directors at an extraordinary meeting of the Board of Directors on May 8, 2024, and determined that the composition of theBoard of Directors, items to be deliberated, frequency of meetings, and deliberation hours were appropriate, and the compositionof officers was balanced. It was determined that the effectiveness of the Board of Directors was generally ensured in terms ofboth decision-making and supervision.
At the same time, to improve the effectiveness of the Board of Directors, views were exchanged regarding implementing
initiatives for the following two points.
First, regarding the composition of the Board of Directors, while diversity of the Board of Directors is being ensured byinviting certified public accountants, lawyers, and people with experience in corporate management, including women, fromoutside the Company and appointing them as outside directors (Audit and Supervisory Committee members), also the Company
is making effort to further enhancement of the diversity by nurturing women employees to be candidates for directors. Currently,
as results of investment in activities to promote the participation of women in the workplace and human resource development,
women within the Company have been appointed as general managers and department heads, as well as directors of subsidiaries,
an opinion was expressed that directors shall continue to be deeply involved in the development of candidates for directors,
including women, and systematize the training to develop the next generation of director candidates.
Second, regarding the operation and agenda of the Board of Directors, while there has been discussion of medium- to longterm management issues on semiannual management conferences held by the KOMEDA group management team, primarily by
the Board of Directors, including directors of subsidiaries, corporate officers of a major subsidiary of the Company and generalmanagers, it has not been necessary for outside directors with participating management liaison meeting and PDCA meeting
about mid-term plan issues, an opinion was expressed that it should be considered with holding regular meetings about
management issues to further enhancement of discussion among the Board of Directors.
Based on the above opinions, the Company will further promote initiatives to deeply discussion of human resource investment
and medium- to long-term management issues, for ensuring the effectiveness of the Board of Directors[Supplementary Principle 4-14 (2) Training Policy for Directors]
To enable directors to fully fulfill their functions, the Company uses training from external organizations in addition to thatprovided by the General Affairs Department, and provides opportunities for director training as appropriate. Training costs areborne by the Company.
[Principle 5-1 Policy and System for Constructive Dialogue with Shareholders]

5The Company is taking the following measures to promote constructive dialogue with shareholders.
(1) In addition to the General Meeting of Shareholders, the Company works to further enhance dialogue with shareholders to areasonable extent through opportunities such as individual interviews and briefings.
(2) The Company will provide feedback obtained through such dialogue to directors (including Audit and Supervisory Committee
members) and internal business organizations, and strive to appropriately reflect these views in corporate activities.
(3) The Company supervises overall dialogue with shareholders, establishes an officer in charge of IR and a department dedicatedto IR, and promotes timely and appropriate disclosure of corporate information and dialogue with shareholders.
(4) The Company has formulated various regulations to prevent insider trading and is working to ensure thorough management.
In addition, a certain period prior to the announcement of financial results is set as a silent period, and dialogue and interviews
with shareholders and investors are restricted.
[Principle 5-2 Formulation and Disclosure of Management Strategies and Plans]
The Company has set the following financial targets as priority strategies in the VALUES 2025 medium-term business plan
implemented in FYE 2/21.
・Growth:・Profitability:
・Financial Soundness:・Shareholder Returns:

EPS (Earnings per share)
ROIC* (Return on Invested Capital)
Capital ratio
Total payout ratio

Compound annual growth rate of 13%
11.5% or higher in the final year of the plan
40% or higher in the final year of the plan
50% or higher of the cumulative amount during the plan period* ROIC: Operating profit after tax ÷ (Average of interest-bearing debt at the beginning and end of the fiscal year excluding
lease liabilities + Average of equity at the beginning and end of the fiscal year)
Details of the VALUES 2025 medium-term management plan are disclosed on the Company’s website.
https://komeda-holdings.co.jp/english/management-plan/(Measures for the realization of management conscious of the cost of capital and stock price) (Disclosure in English)
The Company calculates the cost of capital based on the weighted average cost of capital. The weighted average cost of capitalused for assessing goodwill impairment in the annual securities report for FYE 2/24 is 5.85% (pre-tax discount rate of 8.27%).
The Company has adopted ROIC as a financial target to emphasize profitability and capital efficiency. ROIC for FYE 2/24
was 11.0%, remaining at a level well above the weighted average cost of capital.
In addition, based on a resolution approved at the General Meeting of Shareholders on May 25, 2023, the Company adopted
as a directors’ remuneration system performance-based restricted stock compensation. By setting as performance-linked
conditions the compound annual growth rate (CAGR) of earnings per share, ROIC, capital ratio, total payout ratio, and reductions
in CO2 emissions, the Company has enhanced incentives for internal directors to conduct management with an awareness ofincreasing corporate value.
(Disclosure of the status of basic policies and revisions related to the business portfolio)
Because KOMEDA Holdings Group’s main business is limited to the operation of franchise chains such as KOMEDA’s Coffee,
the Board of Directors has not established a basic policy regarding the business portfolio as of the latest update of this document.
However, the Board does evaluate capital efficiency each term through the formulation of its management plan.

6

2.

Capital Structure
Foreign Shareholding Ratio

10% or more and less than 20%

Status of Major Shareholders
Name or Company Name

Number of Shares Owned

Percentage (%)

The Master Trust Bank of Japan Ltd. (Trust account)

5,431,200

11.85

Custody Bank of Japan, Ltd. (Trust account)

3,042,500

6.64JAPAN POST INSURANCE Co., Ltd.

953,000

2.06

SUMITOMO LIFE INSURANCE COMPANY

788,500

1.72

STATE STREET BANK WEST CLIENT-TREATY 505234

623,000

1.36

SMBC Nikko Securities Inc.

519,200

1.13

BNYM AS AGT/CLTS NON TREATY JASDEC

432,900

0.94

STATE STREET BANK AND TRUST COMPANY 505225

418,800

0.91

JP MORGAN CHASE BANK 385166

360,900

0.79

Northern Trust Company ABB.F.C. RE US Tax Exempt Pension Funds

336,400

0.73

Security Lending

Name of Controlling Shareholder, if applicable(excluding Parent Company)
Name of Parent Company, if applicable－
None

Supplementary Explanation－

3.

Corporate Attributes
Listed Stock Exchange and Market Segment

Prime Market in Tokyo, Premium in Nagoya

Fiscal Year-End

End of February

Business Sector

Wholesale Trade

Number of Employees (Consolidated) as of the Endof the Previous Fiscal YearNet Sales (Consolidated) as of the End of thePrevious Fiscal Year
Number of Consolidated Subsidiaries as of the Endof the Previous Fiscal Year4.

500 or more and fewer than 1,000¥10 billion or more and less than ¥100 billion

Fewer than 10

Policy on Measures to Protect Minority Shareholders in Conducting Transactions with Controlling
Shareholder
7

－

5.

Other Special Circumstances which May have Material Impact on Corporate Governance
－

8

II.

Business Management Organization and Other Corporate Governance Systems regarding
Decision-making, Execution of Business, and Oversight in Management

1.

Organizational Composition and Operation
Corporate Governance System

Company with Audit and Supervisory Committee

Directors
Number of Directors Stipulated in Articles ofIncorporation
Directors' Term of Office Stipulated in Articles ofIncorporation

11

1 yearChairperson of the Board

President

Number of Directors

9Election of Outside Directors

ElectedNumber of Outside Directors

4

Number of Independent Directors

4Outside Directors’ Relationship with the Company (1)Name

Relationship with the Company*

Attributes

Hisashi SHIRAHATA

CPA

Hisashi HORI

From another company

Chiaki ODA

LawyerTomoe MATSUDA

From another company

a

b

c

d

e

f

g

h

i

j

k

*Categories for “Relationship with the Company”.
(Use “○” when the director presently falls or has recently fallen under the category; “△” when the director fell under the category
in the past; “●” when a close relative of the director presently falls or has recently fallen under the category; and “▲” when a close
relative of the director fell under the category in the past.)
a. Person who executes business of the Company or a subsidiary
b. Person who executes business or a non-executive director of a parent company
c. Person who executes business of a fellow subsidiaryd. Person/entity for which the Company is a major client or a person who executes business for such person/entity
e. Major client of the Company or a person who executes business for such clientf. Consultant, accounting expert, or legal expert who receives large amounts of cash or other assets in addition to director/Audit
and Supervisory Board Member compensation from the Company
g. Major shareholder of the Company (in cases where the shareholder is a corporation, a person who executes business of thecorporation)h. Person who executes business for a client of the Company (excluding persons categorized as any of d, e, or f above) (applies
to self only)
i. Person who executes business for another company holding cross-directorships/cross-auditorships with the Company (applies
to self only)
j. Person who executes business for an entity receiving contributions from the Company (applies to self only)
k. Other9Outside Directors’ Relationship with the Company (2)NameMembership ofSupervisory
Committee

Designation as
Independent
Director

Supplementary
Explanation of
the Applicable
Relationship

Reasons for Appointment

〇

〇

－

As a certified public accountant and utilizing his
abundant experience and insight in accounting andfinance at financial institutions, the Company has
judged that he will contribute to strengthening thedecision-making and supervisory functions of theBoard of Directors of the Company from astandpoint independent of management.
There is no conflict of interest in the Company.

〇

〇

－

As
representative
directorof
POKKA
CORPORATION (currently POKKA SAPPORO
Food & Beverage Co., Ltd.) from December 2005,
he led the management of the company for many
years and played major roles in its growth. He has awealth of knowledge and experience in corporate
management, business strategy, sales and marketingmeasures, and the Company has judged that he willcontribute to the further and company-wide growth,
the strengthening of the decision-making andsupervisory functions of the Board of Directors.
There is no conflict of interest in the Company.

Chiaki ODA

〇

〇

－

He has a high level of expertise, experience, andinsight as a lawyer in terms of such fields as overseas
business development and M&A set forth in the
Company's medium-term management plan. In
addition, since he is from and lives in Nagoya, he
has the perspective of a customer of KOMEDA
Coffee, and together with the above high level ofexperience and insight, the Company has judged that
he will contribute to strengthening the decisionmaking and management supervision functions of
the Board of Directors of the Company.
There is no conflict of interest in the Company.

Tomoe

〇

〇

－

She has been involved with business relating tocommunication with people for many years, and hasa wealth of knowledge and experience regarding“People and Job Satisfaction,” one of the Company's
material issues that it considers a priority(materiality), such as delivering lectures on mental
health as a clinical psychological counselor. The
Company has judged that she will contribute tostrengthening the decision-making and supervisory
functions of the Board of Directors. There is no

Hisashi
SHIRAHATA

Masatoshi
HORI

MATSUDA

conflict of interest in the Company.

10Supervisory Committee
Composition of Supervisory Committee and Attributes of the Chairperson
All Committee
Members
Supervisory
Committee

Full-time Members

Inside Directors

04

Appointment of Directors and/or Staff to Support theSupervisory Committee

Outside Directors

Committee Chair

4

Outside Director

0

Appointed

Matters Concerning Independence of Said Directors and/or Employees from Executive Officers
The Audit and Supervisory Committee conducts audit activities systematically using the internal control system, appoints
employees to assist in their duties, and has direct command and order authority over the Internal Audit Office.
The Internal Audit Office, which is three assistant employees, is not appointed by the Audit and Supervisory Committee andconducts internal audits based on instructions from the President. If there are any inconsistent instructions from the President andthe Audit and Supervisory Committee, the instructions of the Audit and Supervisory Committee shall take precedence.
In addition, to ensure independence from directors, etc. other than Audit and Supervisory Committee members, the Company
shall appoint such assistant employees and transfer personnel (including transferees). Personnel evaluations, disciplinary
measures, etc. require the consent of the Audit and Supervisory Committee.

Status of Coordination between Audit and Supervisory Committee, Accounting Auditor, and Internal Audit Department
The Company has concluded an audit agreement with EY Shin Nihon LLC and has appointed as an accounting auditor.
The Audit and Supervisory Committee Members, the Internal Audit Office, and the Accounting Auditor exchange information
as necessary, enhance mutual cooperation, and take all possible measures to ensure the legality and appropriateness of theCompany's operations.

Voluntary Established Committee(s)Voluntary Establishment of Committee(s) equivalent toNomination Committee or Remuneration Committee

Established

Status of Voluntarily Established Committee(s), Attributes of Members Constituting the Committee and the Committee
Chair (Chairperson)
Committee’s
Name
Voluntarily
Established
Committee
Equivalent toNomination
Committee

All
Members

Full-timeMembers

InsideDirectors

OutsideDirectors

OutsideExperts

4

0

0

4

0

Other

Chairperson

Independent Ad
visory Committ
ee

11

0

Outside Director

Voluntarily
Established
Committee
Equivalent toRemuneration
Committee

Independent
Advisory

4

0

0

4

0

0

Outside Director

Committee

Supplementary Explanation
In order to ensure transparency and objectivity, the Independent Advisory Committee, which consists of all four members of theCompany's independent outside directors (Audit and Supervisory Committee members), reports from an independent standpoint
in response to consultation from the Board of Directors in order to comply with the relevant principles* of the Corporate
Governance Code, such as ensuring diversity in the Board of Directors, selecting and dismissing director candidates, anddeliberating on the remuneration of directors.
The Board of Directors deliberates and decides on the appointment and remuneration of Directors in accordance with thereports from the Independent Advisory Committee. Furthermore, by the procedure, the Board of Directors enhance objectivity
and transparency in decision-making, aim to enhance the management supervision function.
*Principle 3-1 (iii.), principle 3-1 (iv.), supplementary principle 4-1 (3), supplementary principle 4-2 (1), principle 4-3,
supplementary principle 4-3 (1), supplementary principle 4-3 (2), supplementary principle 4-3 (3), supplementary principle 4-11
(1)

Matters Concerning Independent Directors
Number of Independent Directors

4

Other Matters Concerning Independent Directors
All outside officers who meet the qualifications of independent officers have been designates by the Company as independent
officers.
In addition, based on the requirements for independent directors stipulated by financial instruments exchanges in Japan suchas the Tokyo Stock Exchange, Inc., if it is determined that any of the following items do not apply, independence is considered
to exist.
1. Executive of the Company or its subsidiaries (hereinafter referred to as the "Group") *1
2. Major shareholders of the Group (persons and companies that directly or indirectly hold 10% or more of total voting rights) or
executives thereof
3. Companies, etc. in which the Group directly or indirectly holds 10% or more of total voting rights, or their executives
4. Major business partners*2 of the Group or their executives
5. Business partners*3 or executives thereof whose main business partners are the Group
6. A person who oversees auditing work of the Group as an accounting auditor of the Group or an employee thereof
7. Consultants, accounting experts, or legal professionals who receive a large amount of money or other assets*4 from the Groupin addition to officer remuneration (if the person receiving such assets is an organization such as a corporation or association, aperson who belongs to that organization)
8. A person who receives a large amount of money or other assets*4 from the Group, or an executive of a corporation, organization,etc. that receives donations
9. An executive of a company that accepts directors from the Group or its parent company or subsidiary
10. Those who have fallen under the above 2~9 in the last 3 years
11. Close relatives, etc. of those who fall under 1~10 above (those in important positions*5)*6*1 An executive officer is an executive director, executive officer, or other employee who has been a member of the Group in
the last 10 years.
*2 Major business partners of the Group refer to business partners who have paid the Company an amount of 2% or more of12the Company's annual consolidated net sales in the most recent fiscal year, or business partners who have loaned theCompany 2% or more of the consolidated total assets of the Company as of the end of the most recent fiscal year.
*3 A business partner whose principal business partner is the Group refers to a business partner who has received payment
from the Company of 2% or more of the annual consolidated sales of the business partner in the most recent fiscal year.
*4 "Large amount of money or other assets" refers to an amount of 10 million yen or more per year other than officer
remuneration and other property benefits in the most recent fiscal year. (If the person acquiring the property is anorganization such as a corporation or partnership, it means monetary or other property interests exceeding 2% of the total
income of the organization in the most recent business year.) In the case of a donation, it also refers to an amount of 10
million yen or more and other property benefits.
*5 Persons in important positions are directors (excluding outside directors), executive officers, and employees in managerial
positions at the level of general manager or higher.
*6 "Close relatives" refer to spouses and relatives within the second degree of kinship.

Incentives
Implementation Status of Measures related toIncentives Granted to Directors

Introduction of Performance-linked Remuneration Scheme

Supplementary Explanation for Applicable Items- In April 2023, the Company revised the officer remuneration system to replace the existing stock option system and stockcompensation system with the aim of enhancing incentives for the sustainable improvement of the corporate value of theCompany, realizing value sharing with shareholders on a more long-term basis, and enhancing the link between the Company's
business performance and the remuneration of eligible directors. The Company introduced a new restricted stock compensation
plan for continuous service and a performance-linked restricted stock compensation plan.
- Under the new performance-linked restricted stock compensation plan, in order to provide incentives for achieving the targets
set forth in the medium-term management plan, in addition to the financial targets set forth in the medium-term management plan
(average annual growth rate of earnings per share (EPS), return on invested capital (ROIC), capital ratio, and total payout ratio),the Company has set CO2 emission reductions as indicators to solve social issues.

Persons Eligible for Stock Options

Inside Directors / Employees / Subsidiaries’ Directors / Subsidiaries’
Employees

Supplementary Explanation for Applicable Items
In 2014 and 2015, stock options were granted to internal directors, employees of the Company, directors, executive officers, andemployees of the Company's subsidiaries with the aim of increasing motivation and morale to improve the Group's businessperformance. Since April 2018, when the restricted stock compensation plan was introduced, incentives in the form of restricted
shares have been granted to these target persons.

Director Remuneration
Status of Disclosure of Individual Directors’

No Disclosure for any Directors

Remuneration

Supplementary Explanation for Applicable Items
For each category of director and director who are Audit and Supervisory Committee members, the total amount of remuneration
by type is disclosed in the business report and annual securities report.

13

The following are the results for the fiscal year ended February 29, 2024.
- 6 Directors Total amount of remuneration, etc.: 188 million yen (of which fixed remuneration is 90 million yen, performance
evaluation standard remuneration is 71 million yen, stock-based remuneration is 27 million yen)
- 5 Directors (Audit and Supervisory Committee Members) Total amount of remuneration, etc.: 22 million yen (of which fixed
remuneration: 22 million yen, performance evaluation standard remuneration: None, stock remuneration: None)

Policy on Determining Remuneration Amounts andthe Calculation Methods Thereof

Established

Disclosure of Policy on Determining Remuneration Amounts and the Calculation Methods Thereof
The amount of remuneration for the Directors and Audit and Supervisory Committee members of the Company is limited by theamount based on the resolution of the Ordinary General Meeting of Shareholders . The amount of remuneration for each Director
is determined by the Board of Directors taking into account the position and responsibilities of each Director, the scope ofmanagement, the level of other companies, etc., as well as the company-wide business performance and the degree of contribution
to the company-wide goals.
In addition, the amount of remuneration for each Audit and Supervisory Committee member is determined by the Audit andSupervisory Committee, taking into account their full-time or part-time audit work status.
The details of the policy for determining the amount and calculation method of remuneration for officers of the Company aredescribed in the annual securities report for the fiscal year ended February 29, 2024, "4. Status of the Submitting Company, 4
Status of Corporate Governance, etc., and (4) Remuneration of Officers, etc."
https://www.komeda-holdings.co.jp/ir/securities.html

Support System for Outside Directors
To provide accurate and necessary information to outside directors (Audit and Supervisory Committee members), a person
responsible for providing such information has been appointed to the Internal Audit Office.

Statuses of Persons who have Retired as Representative Director and President, etc.
Information on Persons Holding Advisory Positions (Sodanyaku, Komon, etc.) after Retiring as Representative Director
and President, etc.

Name

Job title/
position

OkitaneSeniorUSUIAdvisorResponsibilities

Terms and Conditions of
Employment(Full/part time, with/without
remuneration, etc.)

Date when former
role as president/
CEO ended

Part-timeMay 25, 2023

Provide advice at therequest of the current
management, without
participating inmanagement
decision-making

Paid

Number of Persons Holding Advisory Positions (Sodanyaku, Komon, etc.)
After Retiring as Representative Director and President, etc.

14

Term
1 yearrenewable

1Other Related Matters
Okitane Usui, former Representative Director and Chairman of the Company, retired from his positions as a director and chairman
on the date of the Ordinary General Meeting of Shareholders held on May 25, 2023, and has served as a senior advisor to theGroup and has been providing advice at the request of management.

2.

Matters Concerning Functions of Business Execution, Auditing and Supervision, Nomination, andRemuneration Decisions (Overview of Current Corporate Governance System)
KOMEDA Holdings is a company with an Audit and Supervisory Committee, and as an organization based on the Companies
Act, in addition to the General Meeting of Shareholders, the Board of Directors and the Audit and Supervisory Committee havebeen established, and the Compliance Committee and the Risk Countermeasures Committee have been established as a means ofbuilding a governance system. In addition, to enhance transparency and objectivity in the determination of director candidates
and director remuneration, the Company has established the Independent Advisory Committee (consisting of four independent
outside directors) as an advisory body to the Board of Directors and the Human Resources Strategy Committee (consisting offive directors (excluding Audit and Supervisory Committee members)), as an advisory body to the President and Representative
Director.
The Board of Directors, which consists of nine directors (including four outside directors and four members of the Audit andSupervisory Committee Members), meets regularly once a month and as necessary to make important decisions for the Company
and supervise the execution of duties by directors.
The Audit and Supervisory Committee consists of four outside directors. Outside Director Hisashi Shirahata is a certified public
accountant, and Outside Director Chiaki Oda is a lawyer, and each has considerable knowledge of finance, accounting, and legal
affairs. Audit and Supervisory Committee members exercise legal authority to investigate business and assets through attendanceat meetings of the Board of Directors and to listen to reports from the Directors, employees, and accounting auditors. In addition,
the Audit and Supervisory Committee gives direct instructions to the Internal Audit Office for the conduct of audit activities
systematically using the internal control system, and receives reports from the Internal Audit Office on the results.
The Company has established the Internal Audit Office as the department in charge of internal audits, and one general manager
and two assistants of the Internal Audit Office audit the overall operations of each division of the Group based on an internal
audit plan approved by the president. After the internal audit is completed, the facts are confirmed with the head of the audited
department (site manager), the results of the internal audit are immediately reported to the head of the audited department, andan internal audit report is prepared and reported to the president. Regarding points to be improved, the president issues instructionsin the name of the president requesting the submission of an improvement plan to the audited department and improves operations.
In addition, the Internal Audit Office must receive instructions directly from the Audit and Supervisory Committee and report theresults, and if the instructions of the President differ from the instructions of the Audit and Supervisory Committee, theinstructions of the Audit and Supervisory Committee shall take precedence.
The accounting auditor has concluded an audit agreement with EY Shin Nihon LLC, which provides, from an independent andimpartial standpoint, audits of accounting and consultation and exchange of opinions as needed. There is no special interest
between the Company and EY Shin Japan LLC or the certified public accountants who execute the business.
In addition to the above, regarding the Company's risk management system, the Company has established "Risk Compliance
Regulations" for the purpose of identifying, evaluating, and preventing risks by taking a comprehensive view of various risks,
minimizing damage by responding promptly and appropriately when risks materialize, preventing recurrence, protecting
corporate value, and complying with laws and regulations. The structure is managed by the Risk Countermeasures Committee
and the Compliance Committee under the direct control of the President. The Risk Countermeasures Committee and theCompliance Committee are chaired by the President and are composed of members appointed by the Chairperson, with the
General Affairs Department of the Administration Headquarters serving as the secretariat. In addition to the Secretariat's request15

to the Chairperson to hold meetings as needed, meetings are held regularly once a quarter.
The Independent Advisory Committee, which consists of all four members of the Company's independent outside directors (Audit
and Supervisory Committee members), is an organization that reports from an independent standpoint in response to consultations
from the Board of Directors and exchanges information for management supervision in order to comply with the relevant
principles of the Corporate Governance Code*. It meets twice a year in principle.
The Human Resources Strategy Committee, which consists of all five directors (excluding Audit and Supervisory Committee
members) of the Company, is an organization that deliberates, formulates, and reports on human resource strategies that promote
the sustainable growth of the Group in addition to candidates for directors in response to consultation from the President andRepresentative Director of the Company. It meets four times a year in principle.
*Principles 3-1 (iii.), 3-1 (iv.), Supplementary Principle 4-1(3), Supplementary Principle 4-2(1), Principle 4-3,
Supplementary principles 4-3 (1), Supplementary principles 4-3 (2), Additional principles 4-3 (3), Additional Principles 4-11 (1)3.

Reasons for Adoption of Current Corporate Governance System
The Company is working to strengthen the supervisory function of the Board of Directors by having Audit and Supervisory
Committee members, who have voting rights at the Board of Directors, be involved in management decision-making. In addition
to strengthening the supervisory function of the Board of Directors, realizing fair and highly transparent management by having
multiple outside directors, and establishing the Human Resources Strategy Committee, Independent Advisory Committee,
Sustainability Committee, Risk Countermeasures Committee, and Compliance Committee, the Risk Management System andCompliance, the current corporate governance system was selected because the Company recognizes that soundness, efficiency,
and transparency of management can be ensured by establishing a promotion system and an internal audit system, and cooperatingwith these organizations.

16

III.
1.

Implementation of Measures for Shareholders and Other Stakeholders
Measures to Vitalize the General Shareholder Meetings and Facilitate Exercise of Voting Rights
Supplementary Explanation
Early Posting of Notice of the General
Shareholders Meeting
Scheduling of the General Shareholders
Meeting During Non-Peak Days
Electronic Exercise of Voting Rights
Participation in a Platform for the Electronic
Exercise of Voting Rights and Other Initiatives

To ensure that shareholders can fully deliberate on the content of the agenda
items, the convocation notice is posted early on TDnet, the electronic voting
platform, and the Company's website prior to the dispatch of the convocation
notice.
The Company's settlement for financial results is in the end of February, andthe Ordinary General Meeting of Shareholders is held in May every year, so as
to avoid days on which many companies hold shareholder meetings.
The Company has introduced the exercise of voting rights via the internet(including smartphones, etc.).
The Company has been participating in the electronic voting platform since the
7th Ordinary General Meeting of Shareholders (held on May 27, 2021).

to Enhance Environment for Institutional
Investors to Exercise Voting Rights
Provision of Notice (or Summary of Notice) of
the General Shareholders Meeting in English
Other

2.

The convocation notice and reference documents are disclosed in English in alimited manner on TDnet, the electronic voting platform, and the Company's
website.
－Status of IR-related Activities
Supplementary Explanation

Explanation by arepresentative
director or arepresentative
executive officer

Formulation and Publication of Disclosure
Policies
Regular Investor Briefings held for Individual
Investors
Regular Investor Briefings held for Analysts
and Institutional Investors

Disclosed on the Company’s website.
Quarterly supplementary financial results explanatory
materials are disclosed on the Company’s website.

Not Held

The Company holds financial results briefings (interim
and full year financial results).

Held

Not held.

Not Held

Regular Investor Briefings held for Overseas
Investors
Online Disclosure of IR Information
Establishment of Department and/or Placementof a Manager in Charge of IR

Financial results disclosure materials, supplementaryfinancial results explanations, etc. are disclosed on the
Company's website.
The Company has established an IR department to conduct
activities for shareholders and investors.

17

3.

Status of Measures to Ensure Due Respect for Stakeholders
Supplementary Explanation
Establishment of Internal Rules Stipulating
Respect for the Position of Stakeholders

Implementation of Environmental Preservation
Activities and CSR Activities, etc.

To embody the Group's management philosophy, the Company has establisheda Corporate Code of Conduct, which clearly states respect for the position ofeach stakeholder. In addition, the Corporate Code of Conduct is disclosed on
the Company's website.
https://komeda-holdings.co.jp/code-of-conduct/
The Group has established a dedicated department to promote corporate
sustainability activities. To realize a sustainable society and the sustainabilityof the KOMEDA chain, the Company has identified Materiality that considerssocial and business issues, and is engaged in company-wide sustainability
activities.
In addition, the Company has begun mainly sustainable procurement of coffee
beans as food material.
In terms of the environment, the Company is installing solar panels,
introducing renewable energy, and conducting forest conservation activities in
the KOMEDA Forest.
The Company strives to improve environmental awareness and knowledge
internally, such as by making the Environmental Society Certification Test
(ECO certification) mandatory for department heads. To contribute to the SDGs
(Sustainable Development Goals), the Company will continue to work together
with our customers, franchisees, and business partners to solve social issues ina unique manner toward the realization of a sustainable and better society.

Formulation of Policies, etc. on Provision ofInformation to Stakeholders

The Corporate Code of Conduct stipulates as policy regarding the provision of
information: "We will disclose corporate information in a timely andappropriate manner, conduct highly transparent management, pay due attention
to internal information management, and prevent insider trading and leakageof personal information." As a measure to ensure this, the Company has
established "Insider Trading Management Regulations" and "Personal
Information Protection Management Regulations".

Other

18

IV.
1.

Matters Concerning the Internal Control System
Basic Views on Internal Control System and Status of Development
The Company has established the following basic policy regarding the internal control system in order to comply with laws,
regulations and the Articles of Incorporation and to ensure the efficiency and appropriateness of operations.
1. System to ensure that the execution of duties by directors and employees complies with laws and regulations and the Articles
of Incorporation(1) Outside directors who do not execute duties and Audit and Supervisory Committee members conduct audits to ensure thatmatters related to the execution of important duties decided at the Board of Directors meeting held in principle monthly and asnecessary comply with internal rules such as laws and regulations, the Articles of Incorporation, and the Rules of the Board of
Directors.
(2) Recognizing that compliance with laws and regulations and thorough corporate ethics are the starting points of management,
directors shall actively promote compliance based on the Risk Compliance Regulations and the Corporate Code of Conduct.
(3) For employees, the Company will thoroughly comply with laws, regulations, and corporate ethics through complianceeducation and corporate conduct that utilizes the operation of risk and compliance regulations and training systems.
(4) Based on the Risk Management and Compliance Regulations, the Compliance Committee shall convent regularly under the
direct supervision of the Representative Director, identify matters to be thoroughly enforced, and educate and raise awareness for
directors and employees on compliance.
(5) Establish and operate internal rules that clearly state legal and appropriate procedures and procedures in business.
(6) Audits shall be conducted by the Internal Audit Office to confirm that legal and appropriate business operations are being
conducted.
(7) As a whistleblowing system, a helpline shall be established for compliance in general.
(8) The Company's Code of Conduct stipulates that it shall not have any relationship with antisocial or similar groups orindividuals. In addition, the Company will create a manual for dealing with antisocial forces, and based on this manual, willpromptly respond as an organization, such as by coordinating with external specialized organizations such as the police.
2. System for storing and managing information related to the execution of duties by directors
Information related to the execution of duties by directors shall be appropriately stored and managed in accordance with laws andregulations, document management regulations, information system security regulations, and other related regulations that
stipulate management methods such as retention periods.
3. Regulations and other systems for managing the risk of loss
(1) Based on the Risk Management and Compliance Regulations, the Risk Countermeasures Committee shall be held on a regularbasis under the direct control of the Representative Director, and the Administration Division shall comprehensively grasp andmanage the risks of the Group. In addition, the Administration Division shall consider countermeasures together with the Risk
Countermeasures Committee of each department and strive to minimize risks.
(2) From the perspective of risk prevention, the Internal Audit Office conducts internal audits on the status of risk managementin each department and reports the results to the Representative Director, the Audit and Supervisory Committee, and the Risk
Countermeasures Committee.
4. System to ensure efficient execution of duties by directors(1) The Board of Directors shall meet once a month in principle and occasionally when necessary, and may make resolutions inwriting in accordance with laws and regulations.
(2) The basic framework of the responsibilities and authorities of each position and the business shall be clarified in accordancewith the regulations of approval authorities, and prompt and appropriate decision-making and efficient business execution shallbe conducted.
(3) The Company shall develop a management cycle of planning, implementation, and control evaluation based on the basic
management policies and plans for each fiscal year, as the foundation of the medium-term management plan.

19

5. System to ensure the appropriateness of business operations in the corporate group consisting of the Company and its
subsidiaries (hereinafter referred to as "the Group")(1) System for reporting matters related to the execution of duties by directors of subsidiaries to the Company
1) The Company shall stipulate a headquarters to supervise subsidiaries in the Group Company Management Regulations,approve important matters or receive reports based on these headquarters, and appropriately manage subsidiaries.
2) The Company shall receive regular reports on the financial results, business status, and other important business execution
status of subsidiaries at the Board of Directors of the Company.
(2) Regulations and other systems for managing the risk of loss at subsidiaries
1) The Company shall establish risk and compliance regulations related to risk management as common regulations withsubsidiaries, and establish a system for comprehensively managing risks for the entire Group.
2) The Company's Internal Audit Office shall conduct internal audits of the entire Group.
(3) System to ensure efficient execution of duties by directors, etc. of subsidiaries
1) Based on the Group's strategies stipulated in the Medium-Term Management Plan, etc., the Administration Division shalltake responsibility for managing and guiding subsidiaries to improve the efficiency and optimization of operations of theentire Group.
(4) System to ensure that the execution of duties by directors and employees of subsidiaries complies with laws and regulations
and the Articles of Incorporation
1) The Compliance Committee shall manage the compliance of subsidiaries and establishes a compliance system for theentire Group.
2) The Internal Audit Office shall conduct audits to confirm whether subsidiaries are executing their business legally andappropriately.
3) A helpline shall be established as a whistleblowing system for the Group that can be used by directors and employees ofsubsidiaries.
6. System to ensure the reliability of financial reporting
The Group shall establish a basic policy on internal control over financial reporting and ensure the reliability of financial
reporting.
7. System to ensure that audits by the Audit and Supervisory Committee are conducted effectively(1) Matters relating to the system for directors (excluding Audit and Supervisory Committee members) and employees to assist
the Audit and Supervisory Committee in its duties, and ensuring both independence from such directors and other directors of
employees (excluding Audit and Supervisory Committee members), and the execution of the of the Audit and Supervisory
Committee to the directors and employees concerned
1) The Internal Audit Office shall assist the Audit and Supervisory Committee. The appointment of employees of the Internal
Audit Office, personnel changes (including transferees), personnel evaluations, disciplinary measures, etc. shall be subject
to the consent of the Audit and Supervisory Committee, and independence from directors (excluding Audit and Supervisory
Committee members) shall be ensured.
2) When assisting the duties of the Audit and Supervisory Committee, employees of the Internal Audit Office shall givepriority to the instructions and orders of the Audit and Supervisory Committee.
3) The Audit and Supervisory Committee may independently appoint assistant employees who have sufficient ability andknowledge to assist in audit work.
4) Auxiliary employees are not required to be full-time, but must give priority to the directives and authority of the Audit
and Supervisory Committee. Appointment and transfer (including the destination of transfers) of such assistant employees,
personnel evaluations, disciplinary measures, etc. require the consent of the Audit and Supervisory Committee.
(2) Directors of the Group (excluding Audit and Supervisory Committee members) and a system for employees to report to the
Audit and Supervisory Committee
1) The Company shall ensure opportunities for Audit and Supervisory Committee members to attend and express theiropinions at important meetings other than those of the Board of Directors.
2) The Audit and Supervisory Committee Members shall, as necessary, inspect or copy important information of the Groupand make copies of the Group's important information, and directors (excluding Audit and Supervisory Committee members).
and may request an explanation from the employee.

203) Directors (excluding Audit and Supervisory Committee members) and employees shall report to the Audit and Supervisory
Committee on matters that may cause significant damage to the Group, the status of internal audits, the content of reports
based on the whistleblowing system, and other matters deemed necessary by the Audit and Supervisory Committee.
4) The Company shall not treat persons who have reported to the Audit and Supervisory Committee or who have provided
information to the whistleblowing system disadvantageously because of such reporting.
5) The Audit and Supervisory Committee shall regularly exchange opinions with the Representative Director, the Internal
Audit Office, and the Accounting Auditor.
(3) Matters relating to procedures for advance payment or reimbursement of expenses arising from the execution of duties by
Audit and Supervisory Committee members and other policies concerning the processing of expenses or reimbursement
arising from the execution of such duties
If the Audit and Supervisory Committee Members request the Company for expenses related to the execution of their duties,
the Company shall bear such expenses, unless it is deemed unnecessary for the duties of the Audit and Supervisory Committee
Members.

2.

Basic Views on Measures for Eliminating Anti-Social Forces and Status of Development
The Company has adopted the "Charter of Corporate Behavior: Implementation Guide (6th Edition)" (September 2010) and the"Guidelines for Preventing Damage by Antisocial Forces" (June 2007, Proposal of the Executive Committee of the Ministerial
Council on Crime Countermeasures) published by the Japan Keidanren as a basic principle, and has established and implementeda system in accordance with these guidelines. Regarding the policies of the KOMEDA Group, the KOMEDA Group's "Code ofCorporate Conduct" states that it shall have no relationship whatsoever with antisocial forces, and caution is urged from time totime at major internal meetings. In addition, the Company has prepared a manual for dealing with antisocial forces, and in theevent of unreasonable demands, etc. by antisocial forces, the department in charge centrally manages information and has shallestablish a system to take prompt measures, including consultation with the competent police station and corporate lawyers.
In addition, the Company actively participates in seminars on antisocial forces held by police stations and related organizations,mainly officers and employees of management-related departments, and strives to collect information while ensuring thoroughawareness.
In addition, as a precaution, in addition to strengthening relationships with the consultation desk of the competent police station
and building an emergency system through simulations of corporate lawyers, the Company is strengthening the cooperative
system by joining the Aichi Prefectural Council for the Elimination of Violence.
With regard to checking business partners, in the case of new business partners, the basic method for individuals if they arebusiness partners at the start of new transactions, and for companies and representatives if they are corporations, is to search theinternet and Nikkei Telecon, with any concerns reported to the General Manager of the Administration Headquarters and inquiries
and consultations made to external organizations (police, Center for the Promotion of Movement to Expulsion of Organized
Crime Groups, bar associations, etc.). The Company also solicits information from financial institutions and business partners.
In the case of existing business partners, once a year if business volume is 1% or more of the total transaction amount, and once
every two years if it is less than 1%, if the business partner is an individual, the company / representative of the company /representative if it is a corporation, the basic method is to search the internet and Nikkei Telecon, with any concerns reported to
the general manager of the management headquarters and external organizations (police, center for the promotion of expulsionof organized crime groups, bar associations, etc.). The Company also solicits information from financial institutions and business
partners.

V.

Other

1.

Adoption of Anti-Takeover Measures
Adoption of Anti-Takeover Measures

Not Adopted

21

Supplementary Explanation for Applicable Items－

2.

Other Matters Concerning the Corporate Governance System－

END

22