Note: This document has been translated from a part of the Japanese original for reference purposes only. In the event of any
discrepancy between this translated document and the Japanese original, the original shall prevail.

Securities Code: 8154
Date of sending by postal mail: June 7, 2024
Start date of measures for electronic provision: June 5, 2024
To all of our shareholders
Ryoichi Kado
Representative Director, President & COO
KAGA ELECTRONICS CO., LTD.
20 Kandamatsunagacho, Chiyoda-ku, Tokyo, Japan

Notice of the 56th Ordinary General Meeting of Shareholders
We hereby inform you of the 56th ordinary general meeting of shareholders of KAGA ELECTRONICS CO., LTD.
(the “Company”) to be held as follows.
When convening this general meeting of shareholders, the Company takes measures for providing information that
constitutes the content of reference documents for the general meeting of shareholders, etc. (matters for whichmeasures for providing information in electronic format are to be taken) in electronic format, and posts thisinformation on each of the following websites. Please access one of the websites by using the Internet address
shown below to review the information.
The Company’s website:
https://www.taxan.co.jp/jp/ir/event/event_03.html (in Japanese)
Website for posted informational materials for the general meeting of shareholders
https://d.sokai.jp/8154/teiji/ (in Japanese)
TSE website (Listed Company Search):https://www2.jpx.co.jp/tseHpFront/JJK010010Action.do?Show=Show (in Japanese)(Access the TSE website by using the Internet address shown above, enter “KAGA ELECTRONICS” in “Issue
name (company name)” or the Company’s securities code “8154” in “Code,” and click “Search.” Then, click“Basic information” and select “Documents for public inspection/PR information.” Under “Filed information
available for public inspection,” click “Click here for access” under “[Notice of General Shareholders Meeting/Informational Materials for a General Shareholders Meeting].”)If you are unable to attend the meeting in person, you may exercise your voting rights via the Internet or in writing.
Please review the Reference Documents for the General Meeting of Shareholders, and exercise your voting rights
by 5:30 p.m. on June 25, 2024 (Tuesday) (Japan Time).
1. Date and Time
2. Place

10:00 a.m. on June 26, 2024 (Wednesday) (Japan Time)
Akihabara Business Center 4F, AP Akihabara
1-1 Akihabara, Taito-ku, Tokyo
3. Agenda of the Meeting
Matters to be reported
1. The Business Report and Consolidated Financial Statements for the 56th fiscal year (from April 1, 2023 toMarch 31, 2024), and results of the Audit Reports by the Accounting Auditor and the Board of Auditors of
the Consolidated Financial Statements
2. Non-consolidated Financial Statements for the 56th fiscal year (from April 1, 2023 to March 31, 2024)
Matters to be resolved
Proposal No. 1:
Distribution of Surplus
Proposal No. 2:
Election of Six (6) Directors
Proposal No. 3:
Election of One (1) Auditor-1-4. Other Matters Concerning the Meeting (Instructions on Exercise of Voting Rights)(1) If you exercise your voting rights in writing (by post), but indicate neither approval nor disapproval for a
proposal on the Exercise Voting Rights Form, it will be treated as an indication of approval.
(2) If you exercise your voting rights more than once via the Internet, only the last vote shall be deemed
effective.
(3) If you exercise your voting rights both via the Internet and in writing (by post), regardless of the date ofarrival, the vote via the Internet shall be deemed effective.
If you attend the meeting in person, please present the Exercise Voting Rights Form that was sent together with this notice at thereception on arrival at the meeting. If revisions to the matters subject to measures for electronic provision arise, a notice of therevisions and the details of the matters before and after the revisions will be posted on each website provided on the previous page.
For shareholders who have not made a request for delivery of paper-based documents, we have delivered the Reference Documents for
the General Meeting of Shareholders, along with selected sections of the Business Report. For shareholders who have made a request
for delivery of paper-based documents, we have delivered such documents stating the matters subject to measures for electronic
provision. However, in accordance with the provisions of laws and regulations and Article 16 of the Articles of Incorporation of theCompany, the following matters are not provided in the paper-based documents delivered to shareholders.
(i) Principal lines of business, Operating results by business segment, Employees, Major Creditors, Other Significant Information
Concerning the Current State of the Corporate Group, Accounting Auditor, and Company Structure and Policies in the Business Report(ii) Consolidated Statement of Comprehensive Income, Consolidated Statement of Changes in Equity, and Notes to the Consolidated
Financial Statements(iii) Statement of Changes in Equity and Notes to Non-consolidated Financial Statements
Accordingly, the Business Report, Consolidated Financial Statements, and Non-consolidated Financial Statements included in thepaper-based documents constitute a part of the documents audited by the Accounting Auditor in preparing the accounting audit reportand Auditors in preparing the audit report.

-2-

Instructions on Exercise of Voting Rights
Exercise of voting rights at the Company’s General Meeting of Shareholders is shareholders’ important right.
Please exercise your voting rights after reviewing the Reference Documents for the General Meeting of
Shareholders.
You may exercise your voting rights by one of the following three methods.
Attending the General Meeting of Shareholders
Please present the Exercise Voting Rights Form at the reception desk.
Date and Timea.m.)

10:00 a.m. on June 26, 2024 (Wednesday) (Japan Time) (Reception desk will open at 9:00

Exercising voting rights by postal mailPlease indicate your approval or disapproval of each proposal on the Exercise Voting Rights Form and return it
without affixing a stamp.
Deadline

To be received no later than 5:30 p.m. on June 25, 2024 (Tuesday) (Japan Time)

Exercising Voting Rights via the Internet
Please indicate whether you approve or disapprove of each proposal following the instructions on the next page.
Deadline

All data entry to be completed no later than 5:30 p.m. on June 25, 2024 (Tuesday) (JapanTime)

How to Fill Out Your Exercise Voting Rights Form
Please indicate whether you approve or disapprove of each proposal.
Proposal Nos. 1 and 3・ To mark your approval
Circle “Approve (賛)”・ To mark your disapproval
Circle “Disapprove (否)”Proposal No. 2・ To mark your approval for all candidates
Circle “Approve (賛)”・ To mark your disapproval for all candidates
Circle “Disapprove (否)”・ To mark your disapproval for certain candidates
Circle “Approve (賛)” and write the numberof the candidate(s) you wish to disapprove
Please note that your online vote will prevail should you exercise your voting rights both in writing (by post) and via
the Internet. If you exercise your voting rights more than once via the Internet, only the last vote shall be deemed
effective.

-3-

Guidance for Exercising Voting Rights via the Internet, Etc.
Scanning the QR CodeYou can log in to the website for the exercise of voting rights without entering the login ID or temporary password
printed on the Exercise Voting Rights Form.
1. Please scan QR Code provided on the Exercise Voting Rights Form.
* “QR Code” is a registered trademark of DENSO WAVE INCORPORATED.
2. Please follow the directions that appear on the screen to input approval or disapproval to each proposal.

Entering login ID and temporary password
1. Access the website for exercise of voting rights.
Website for exercise of voting rights: https://evote.tr.mufg.jp/ (in Japanese)
2. Log in by entering your “login ID” and “temporary password” presented on the Exercise Voting Rights Form.
Enter your “login ID” and “temporary password.”
Click “Login.”
3. Follow the directions that appear on the screen to input approval or disapproval to each proposal.

In case you need instructions for how to operate your personal computer or smartphone in order to exercise yourvoting rights via the Internet, please contact:
Corporate Agency Division (Help Desk), Mitsubishi UFJ Trust and Banking Corporation
Phone: 0120-173-027 (9:00 a.m. to 9:00 p.m. (Japan Time); toll free (Japan only))
Institutional investors may use the Electronic Voting Platform for institutional investors operated by ICJ, Inc.

-4-

Reference Documents for the General Meeting of Shareholders
Proposal No. 1

Distribution of Surplus

The Company intends to distribute the surplus as follows.
Matters related to year-end dividends
With respect to the year-end dividend for the 56th fiscal year, taking into account the Company’s business results inthe fiscal year under review and business development, etc., going forward, the Company proposes an ordinary
dividend of 110 yen per share of common stock of the Company. Note that the total amount of the dividends in thiscase will be 2,889,675,800 yen.
As a result, combined with the interim dividend of 110 yen per share already paid, the annual dividend payout willbe 220 yen per share and the total amount of the annual dividends will be 5,779,404,070 yen.
1.
Type of dividend property
Cash2.
Allotment of dividend property to shareholders and the total amount
110 yen per share of common stock of the Company(Ordinary dividend: 110 yen)
Total amount: 2,889,675,800 yen
3.
Effective date of distribution of surplus
June 27, 2024

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Proposal No. 2

Election of Six (6) Directors

The terms of office of five (5) current directors will expire at the conclusion of this general meeting. Additionally,
Director Akira Tamura was deemed to have retired from the office on March 15, 2024, following his passing.
Therefore, the Company proposes the election of six (6) Directors, an addition of one (1) to the current five (5)Directors.
Candidates for directors are as follows.
CandidateNo.

Name/Candidate attributes

1

Isao Tsukamoto

Reelection

2

Ryoichi Kado

Reelection

3

Shintaro Kakei

Reelection

Position in the
Company
Representative
Director, Founder &CEO
Representative
Director, President &COO
Director, Senior
Managing Executive
Officer

Reelection
OutsideOutside Director
Independent
Reelection
5
Noritomo Hashimoto
OutsideOutside Director
Independent
New candidate
6
Mamoru Yoshida
OutsideAdvisorIndependent
Reelection: Candidate for Director to be reelected
Outside: Candidate for Outside Director
Independent: Independent officer as defined by Tokyo Stock Exchange, Inc.
New candidate: Candidate for Director to be newly elected
4

Susumu Miyoshi★: Chairperson〇: Member-6-

Attendance atBoard ofDirectors
meetings

Committee the candidate is scheduled tojoin after the meeting
Nomination andSustainability
Compensation
Committee
Committee

17/19(89.5%)○

19/19(100%)○

19/19(100%)★
○

19/19(100%)○

18/19(94.7%)★

-○

Candidate
No.

1.

2.

Name
(Date of birth)

Career summary, position and responsibilities in the Company

Established Kaga Electronics Co., Ltd.
President & CEO
Apr. 2007
Founder & CEO
June 2021
Outside Director, ITbook Holdings Co., Ltd (topresent)
728,445
Apr. 2022
Representative Director, Founder & CEO (topresent)
Significant positions concurrently held
Outside Director, ITbook Holdings Co., Ltd.
Reasons for proposing the candidate for director
Isao Tsukamoto is the founder of the Company and served as President & CEO until 2007. Since then as Founder &CEO, he has used his extensive knowledge and human network, which goes beyond the industry, to give direction to
management group-wide. Based on our judgment that his wealth of knowledge and professional abilities related to
management will continue to be indispensable for the Group management and improvement of corporate value, wehave made him a candidate for director.
Mar. 1980
Joined Kaga Electronics Co., Ltd.
Apr. 1991
Division Manager of Sales Department No. 3,
Sales Headquarters
Apr. 1992
Division Manager of Amusement Products
Sales Department, Sales Headquarters
Apr. 1995
Division Manager of East Japan Sales
Department, High Tech Business Division
Ryoichi Kado
June
1995
Director(December 1, 1957)
Apr.
2002
Managing
DirectorReelection
Term of office
Apr. 2005
Senior Managing Director, General Manager of
68,59929 yearsSpecific Industry Business Headquarters
Attendance at Board ofApr. 2011
Senior Managing Director, Head of
Directors meetings
Entertainment Business Unit
19/19 (100%)
Apr. 2012
Vice President, Head of Components Business
Unit
Apr. 2014
President & COO
Apr. 2022
Representative Director, President & COO (topresent)
Significant positions concurrently held
Reasons for proposing the candidate for director
Since joining the Company, Ryoichi Kado has been involved in the major businesses of the Company and possesses
leadership based on his extensive knowledge and results. Since being elected President & COO in 2014, he has
contributed to improvement of corporate value by giving direction to Group management. Based on our judgment that
his broad-ranging experience and capabilities are indispensable to promotion of the Medium-Term Management Plan
and central to the Group’s management, we have made him a candidate for director.
Isao Tsukamoto(September 1, 1943)
Reelection
Term of office
56 years
Attendance at Board of
Directors meetings
17/19 (89.5%)

Sept. 1968

Number of theCompany’s shares
held

-7-

Candidate
No.

Name
(Date of birth)

Career summary, position and responsibilities in the Company
Apr. 1993
Apr. 1994

3.

4.

Number of theCompany’s shares
held

Joined Kaga Electronics Co., Ltd.
Manager of Asia Project Office, Sales
Headquarters No. 2
Apr. 1997
Division Manager of Overseas Sales
Department, Sales Headquarters
May 2000
Division Manager of Overseas Business
Division, Electronics Business Headquarters
Shintaro Kakei
June 2000
Director(November 9, 1956)
Apr. 2005
Managing Director
Reelection
Term of office
Apr. 2011
Managing Director, Head of Manufacturing
34,34824 years
Business Unit
Attendance at Board ofApr. 2014
Senior Managing Director, Head of
Directors meetings
Manufacturing Business Unit
19/19 (100%)
Apr. 2015
Senior Managing Director, Head of Corporate
Planning Department
Oct. 2015
Senior Managing Director
Apr. 2022
Director and Senior Executive Officer (topresent)
Significant positions concurrently held
Reasons for proposing the candidate for director
Since joining the Company, Shintaro Kakei has been involved in the overseas and EMS businesses and possesses asolid track record and broad-ranging knowledge, having established a revenue base for those businesses. Based on our
judgment that his business development results overseas and rich experience are indispensable to improve the corporate
value, we have made him a candidate for director.
Apr. 1963
Joined Toyota Motor Co., Ltd. (currently
Toyota Motor Corporation)
Sept. 1994
Director
June
2001
Executive Vice President and Representative
Susumu Miyoshi
Director(September 20, 1940)
June 2002
Consultant
Reelection
June 2002
President & COO of Osaka Toyopet Co., Ltd.
Outside(currently Osaka Toyota Motor Co., Ltd.)
Independent
3,100
Term of office
June 2005
Advisor to Toyota Motor Corporation
9 years
Chairman of Osaka Toyopet Co., Ltd. (currently
Attendance at Board of
Osaka Toyota Motor Co., Ltd.)
Directors meetings
June 2009
Executive Advisor to Hitachi Maxell, Ltd.
19/19 (100%)(currently Maxell Holdings, Ltd.)
June 2015
Outside Director of the Company (to present)
Significant positions concurrently held
Reasons for proposing the candidate for outside director and overview of expected role
Susumu Miyoshi has served as Executive Vice President at Toyota Motor Corporation, and we believe that his richexperience and broad-ranging knowledge as a member of management at various companies, will be leveraged tosupervise and provide advice on the Company’s overall management, and will strengthen the function of our Board of
Directors, so we have made him a candidate for outside director. If he is elected, he will be involved in the election ofcandidates for directors and the determination of remuneration for directors (and other officers) of the Company,
objectively and from a neutral position as a Nomination and Compensation Committee member.

-8-

Candidate
No.

Name
(Date of birth)

Career summary, position and responsibilities in the Company
Apr. 1977
Apr. 2009

5.

Number of theCompany’s shares
held

Joined Mitsubishi Electric Corporation
Executive Officer in charge of General Affairs,
Human Resources and Public Relations
June 2009
Director, Chairman of the Nomination
Committee, Chairman of the Compensation
Committee, Executive Officer, and in charge ofGeneral Affairs, Human Resources and Public
Noritomo Hashimoto
Relations(July 30, 1954)
Apr. 2012
Director, Chairman of the Nomination
Reelection
Committee, Chairman of the Compensation
OutsideCommittee, Senior Vice President, and in
Independent
charge of Corporate Strategic Planning and1,500
Term of office
Operations of Associated Companies
5 years
June 2012
Director, Member of the Nomination
Attendance at Board ofCommittee, Senior Vice President, and in
Directors meetings
charge of Corporate Strategic Planning and18/19 (94.7%)
Operations of Associated Companies
Apr. 2016
Director
July 2016
AdvisorJune 2019
Outside Director of the Company (to present)
Mar. 2021
Outside Director, Ibokin Corp. (to present)
Significant positions concurrently held
Outside Director, Ibokin Corp.
Reasons for proposing the candidate for outside director and overview of expected role
Noritomo Hashimoto has served as Director and Executive Officer at Mitsubishi Electric Corporation, and we believethat his rich experience and deep knowledge serving as the Chairman of the Nomination and Compensation Committees
as well as being in charge of departments such as General Affairs, Human Resources and Corporate Strategic Planning,
will be leveraged to supervise and provide advice on the Company’s overall management, particularly in the areas ofmanagement strategy and human resources, and will strengthen the function of our Board of Directors, so we havemade him a candidate for outside director. If he is elected, he will be involved in the election of candidates for directors
and the determination of remuneration for directors (and other officers) of the Company, objectively and from a neutral
position as a Nomination and Compensation Committee member.

-9-Candidate
No.

Name
(Date of birth)

Career summary, position and responsibilities in the Company

Number of theCompany’s shares
held

Apr. 1979

6.

(Notes)Joined Matsushita Electric Industrial Co., Ltd.
(currently Panasonic Holdings Corporation)
Apr. 2009
Executive Officer, and Senior Vice President of
AVC Networks Company, Panasonic
Corporation (currently Panasonic Holdings
Corporation)
Apr. 2012Managing Executive Officer, and President of
AVC Networks Company
June 2012Managing Director, and President of AVC
Networks Company
Apr. 2013
Managing Director in charge of Technology,
Mamoru Yoshida
Intellectual Property and Information Systems(May 21, 1956)
Apr. 2015
Managing Director, Senior Vice President of
New candidate
Appliances Company, President of AirOutside
Conditioner Company, and in charge of TV
Independent–
Business
Term of office
June 2015
Managing Executive Officer, Senior Vice
President of Appliances Company, President ofAttendance at Board of
Air-Conditioner Company, and in charge of TV
Directors meetings
Business-/- (-%)
June 2016
Senior Audit & Supervisory Board Member
June 2020
Outside Director, NEC Networks & System
Integration Corporation (to present)
Oct. 2022
Outside Director, Nuvoton Technology
Corporation Japan (to present)
Apr. 2024
Adviser of the Company (to present)
Significant positions concurrently held
Outside Director, NEC Networks & System Integration
Corporation
Outside Director, Nuvoton Technology Corporation Japan
Reasons for proposing the candidate for outside director and overview of expected role
Mamoru Yoshida has served in top management roles in multiple fields, including overseas business, at PanasonicHoldings Corporation, and we believe that his high-level management and strategy formulation skills and his broadranging knowledge in manufacturing, marketing, governance and other aspects will be leveraged to supervise andprovide advice on the Company’s management objectively, and will strengthen the function of our Board of Directors,
so we have made him a candidate for outside director. If he is elected, he will be involved in the election of candidates
for directors and the determination of remuneration for directors (and other officers) of the Company, objectively andfrom a neutral position as a Nomination and Compensation Committee member.
1. No conflict of interest exists between any of the candidates and the Company.
2. Mr. Miyoshi, Mr. Hashimoto, and Mr. Yoshida are candidates for outside directors.
3. Mr. Miyoshi and Mr. Hashimoto are currently outside directors of the Company, and their tenure as outside directors will
come to nine (9) years for Mr. Miyoshi and five (5) years for Mr. Hashimoto at the conclusion of this meeting.
4. The Company has entered into contracts with Mr. Miyoshi and Mr. Hashimoto based on the provisions of the Companies
Act, Article 427, paragraph (1) to limit their liability for damages under Article 423, paragraph (1) of the said Act towithin the minimum liability amount stipulated in Article 425, paragraph (1) of the said Act. If the reelection of the twocandidates is approved, the Company plans to renew the aforementioned contracts with them. If the election of Mr.
Yoshida is approved, the Company plans to enter into a limited liability agreement under the same terms with him.
5. The Company has entered into a directors and officers liability insurance policy with an insurance company for theofficers, etc., stipulated in Article 430-3, paragraph (1) of the Companies Act. This insurance policy will cover any
damages that may arise due to the insured officers, etc. assuming responsibility for the execution of their duties, or fromclaims received in relation to the pursuit of such responsibility. If the election of the candidates for directors is approved,
all of them will be included in the insured persons of this insurance agreement. Furthermore, in the next renewal period,
the Company will renew this insurance policy with the same contents.
6. Mr. Miyoshi and Mr. Hashimoto satisfy the requirements for independent officers based on the provisions of the Tokyo
Stock Exchange; so the Company has registered them as independent officers. If the reelection of the two candidates isapproved, the Company plans for their appointment as independent officers to continue. Mr. Yoshida satisfies the- 10 -

requirements for an independent officer based on the provisions of the Tokyo Stock Exchange; so the Company plans toregister him as an independent officer.
7. The Company concluded an advisory contract with Mr. Yoshida from April 2024, but the contract associated withholding office as Director is scheduled to expire.

- 11 -

Proposal No. 3

Election of One (1) Auditor

The terms of office of auditor Yoichi Sato will expire at the conclusion of this general meeting. Therefore, theCompany proposes that one (1) auditor be elected.
Furthermore, the Board of Auditors has given acknowledgment of this proposal.
A candidate for auditor is as follows.
Name(Date of birth)

Career summary and position in the Company

Number of theCompany’s shares
held

Apr. 1977
Assistant Judge at Tokyo District Court
Yoichi Sato
(July 29, 1951)
Apr. 1989
Judge at Tokyo District Court
Reelection
Apr. 1996
Judge at Tokyo High Court
OutsideAug. 2016
Admitted to the bar,
Independent
Joined Alpha Partners Law Offices (to present)
Term of office
June 2018
Outside Auditor of the Company (to present)–
6 years
Nov. 2021
Auditor, Bouygues Asia K.K. (to present)
Attendance at Board of Directors Significant positions concurrently held
meetings
Lawyer (of counsel), Alpha Partners Law Offices
19/19 (100%)
Auditor, Bouygues Asia K.K.
Attendance at Board of Auditors
meetings
17/17 (100%)
Reasons for proposing the candidate for outside auditor
Yoichi Sato possesses advanced legal expertise cultivated over years of practice as a lawyer and judge, and accordingly, although he
has no experience of being directly involved in management in the past other than serving as an outside officer, the Company
believes that he will be able to perform accurate audits and supervision, taking his professional insight and experience into
consideration, and so we have made him a candidate for auditor.
(Notes)1. No conflict of interest exists between the candidate and the Company.
2. Mr. Sato is a candidate for an outside auditor.
3. Mr. Sato is currently an outside auditor of the Company, and his tenure as outside auditor will come to six (6) years at
the conclusion of this meeting.
4. The Company has entered into a contract with Mr. Sato based on the provisions of the Companies Act, Article 427,
paragraph (1) to limit his liability for damages under Article 423, paragraph (1) of the said Act to within the minimum
liability amount stipulated in Article 425, paragraph (1) of the said Act. If the reelection of Mr. Sato is approved, theCompany plans to renew the aforementioned contract with him.
5. The Company has entered into a directors and officers liability insurance policy with an insurance company for theofficers, etc., stipulated in Article 430-3, paragraph (1) of the Companies Act. This insurance policy will cover any
damages that may arise due to the insured officers, etc. assuming responsibility for the execution of their duties, or fromclaims received in relation to the pursuit of such responsibility. If the election of Mr. Sato is approved, he will be
included in the insured persons of this insurance agreement. Furthermore, in the next renewal period, the Company will
renew this insurance policy with the same contents.
6. Mr. Sato serves concurrently as a lawyer (of counsel) at Alpha Partners Law Offices. The Company has signed a legal
advisor agreement with partners at Alpha Partners Law Offices. However, as Mr. Sato is not a partner at Alpha Partners
Law Offices, he does not engage in their management or operations. Therefore, he satisfies the requirements forindependence as defined by the Tokyo Stock Exchange; if the reelection of Mr. Sato is approved, the Company plans tocontinue to register him as an independent officer based on the provisions of the Tokyo Stock Exchange.

- 12 -

<Reference> Table of Officer Structure After Approval of Proposal Nos. 2 and 3 and Area of Expertise of Each Director and Auditor
Driven by our corporate philosophy of “Everything we do is for our customers,” we establish skill criteria aligned with the functions
required of the Board of Directors and the Board of Auditors, as well as with our management strategy and business domains. Our aim
is to maintain a well-balanced composition of directors and auditors, each possessing the requisite skills.
Area of Expertise
Corporate
Management

Name

〇
〇

Director

Isao Tsukamoto
Ryoichi Kado
Shintaro Kakei
Susumu Miyoshi

OutsideIndependent〇

Noritomo Hashimoto

OutsideIndependent〇

Mamoru Yoshida

OutsideIndependent〇

AuditorEiji Kawamura
Susumu Kitsunai

OutsideIndependent

Yoichi Sato

OutsideIndependent

Kyoko Oyanagi

OutsideIndependent〇

GlobalSales andMarketing

〇
〇
〇

〇
〇
〇
〇

Law and
Risk
Management

FinanceandAccounting

Personneland
Human
Resources
Development

IT andDigital

〇

〇

〇
〇
〇

〇

〇

〇

〇

〇
〇

〇

〇

〇

〇

〇

Technology and
Manufacture

〇

〇

〇

〇

〇

〇
〇

* A maximum of four particular areas expected of each person are presented. The above table does not represent all of the knowledge
possessed by the officers.

- 13 -

<Reference> Basic Policies and Structure of Corporate Governance (after the 56th Ordinary General Meeting of
Shareholders)
The Company recognizes that the fulfillment of corporate governance is an important management issue and has
established a corporate governance system with the basic policy and objective to ensure sound, efficient andtransparent management and to enhance corporate value while promoting thorough compliance with corporate
ethics and laws and regulations and strengthening internal control systems. In light of the importance of corporate
governance, the Company has established the Sustainability Committee and the Nomination and Compensation
Committee to strengthen its structure.
We are a company with a Board of Directors and a Board of Auditors and have adopted a corporate governancesystem based on the collaboration of the Board of Directors, the Nomination and Compensation Committee, theauditors and the Board of Auditors, and the accounting auditors. In addition to regular monthly meetings, the Boardof Directors holds extraordinary meetings as needed to make decisions on issues stipulated by law and importantmanagement issues as well as to monitor the execution of duties of each director. The number of directors is six (6),including three (3) outside directors, and the Company has established a system that allows for sufficient discussion
and accurate and prompt decision-making. In addition, on April 1, 2005, the Company introduced an employmenttype executive officer system. However, on April 1, 2022, the Company introduced an engagement-type executive
officer system in order to further improve corporate governance. In doing so, the Company has built a systemcapable of providing swift response to external environmental change while strengthening the Board of Directors’
function and the business execution function through promoting separation of the decision making and supervisory
functions related to management from the business execution function and clarifying the respective roles. The
Board of Auditors consists of four (4) members, including three (3) outside auditors, and the auditors attend Boardof Directors meetings at all times and actively participate in important internal meetings to perform their duties.
The structure of corporate governance by the Company is described below.

Nomination and Compensation Committee
The Company has established the Nomination and Compensation Committee to ensure transparency and objectivity
in the evaluation and decision-making processes related to the nomination and remuneration of directors, auditorsand engagement-type executive officers, thereby strengthening the supervisory function of the Board of Directors
and enhancing the corporate governance system.
Audit Office
The Company has established the Audit Office, which conducts internal audits in cooperation with the auditors. In
addition to prior discussions between the auditors and the Audit Office regarding audit plans, the Audit Office- 14 -

reports audit results to the auditors on a regular basis, and the auditors collaborate with the Audit Office, requesting
reports from the Audit Office when necessary.
Sustainability Committee
The Company has established the Sustainability Committee, chaired by the Representative Director, President &COO, which oversees the Compliance Committee, Risk Management Committee, Information Disclosure
Committee, Environmental Management Promotion Committee, Diversity Promotion Committee, and GovernanceCommittee as its subordinate organizations. These committees work to ensure the appropriateness of decisionmaking and the execution of business operations throughout the Group, formulate policies, measures, and targets
for ESG issues, and monitor progress.
Outside Officers
The Company has elected three (3) outside directors and three (3) outside auditors. With respect to the election ofoutside directors, the Company refers to the independence standards of the Tokyo Stock Exchange and requires
candidates to have no special interest in the Company and to possess a wide range of experience and insight incorporate management. In addition, the Company requires auditors to have a high level of expertise as well as
independence from those who execute the business.
The Company has established the Board of Directors Administrative Office and distributed materials on issues tobe discussed by the Board of Directors to all officers, including outside officers, prior to the Board of Directors
meetings. The Company provides outside officers with sufficient advance information, including supplementary
explanations as necessary, to encourage lively discussions at Board of Directors meetings. The Company sets theschedule of regular meetings of the Board of Directors for the following fiscal year by the end of each fiscal year
and informs all officers, including outside officers, of the schedule in an effort to improve the attendance rate.

- 15 -

[The Company’s Rationale Regarding Independence for Outside Officers]
・ As the Company elects outside officers in accordance with “Qualifications Required of Outside Officers”(Notes), which is based on requirements in the Companies Act in addition to the criteria for determining
independence as set forth by the Tokyo Stock Exchange, the Company has judged that the independence ofoutside officers is sufficiently maintained, and submitted notification to the Tokyo Stock Exchange
concerning the designation of all outside officers as independent officers.
・ The Board of Directors resolved that all outside officers will become independent officers as it was
confirmed that there are no issues with “Qualifications Required of Outside Officers” as a standard for
determining the independence of outside officers.
(Notes) Qualifications Required of Outside Officers
・ The following qualification requirements have been established between new candidates for outside officer
and the companies and organizations to which they belong and the Company.
1. Has not been a representative officer or employee of the accounting auditor in the five years prior to being
nominated as a candidate for director or auditor
2. Is not a major shareholder of the Group (person who holds shares with 10% or more of total voting rights)
and, where a major shareholder of the Group is a corporation, not a director, auditor, officer, executive officer
or employee of such major shareholder
3. Is not a director, auditor, officer, executive officer or employee of a major business partner (*) of the Group(*) A major business partner is a company that has transactions with the Group where the amount paid or
received amounts to 3% or more of the consolidated net sales of the Group or the business partner
4. Has not received remuneration of 10 million yen or more from the Group other than remuneration as adirector or auditor
5. Does not have a familial relationship (within the second degree of kinship) with any of the Group’s directors,
auditors or executive officers
6. Is not involved in the mutual dispatch of directors, auditors, officers or executive officers to and from theGroup
7. Has any other interest in the Group, and independence is not called into question when carrying out duties as
outside director or outside auditor- 16 -

(Attached documents)

Business Report(From April 1, 2023 to March 31, 2024)
I. Business Progress and Achievement of the Corporate Group
Overview of Business(i)

Business activities and results
Looking at the global economy during the consolidated fiscal year under review, the outlook remained
uncertain due to the impact of monetary tightening in the U.S. and Europe, economic stagnation in China,
heightening geopolitical risks notably in Ukraine and the Middle East, and other factors. Meanwhile, inJapan, amid price increases and ongoing depreciation of the yen, the economy continued to follow a
gradual recovery trend, supported largely by a rebound in personal consumption and an increase in
inbound tourist demand.
In the electronics industry to which the Group belongs, the automotive market continued to enjoy demand
growth along with easing of supply shortages of semiconductors and electronic components, on the backof vehicle electrification and other trends, but demand in the industrial equipment and other markets
remained in an adjustment phase.
Under such circumstances, during the consolidated fiscal year under review, the electronic components
business was affected by such factors as disappearance of spot demand given easing of supply shortagesof semiconductors and electronic components, diminution of transactions with a certain client of an
overseas subsidiary of Excel Co., Ltd., and inventory adjustment taking place on a full-scale from thethird quarter of the consolidated fiscal year under review. As a result, net sales decreased by 10.8% year
on year to 542,697 million yen.
Operating income decreased by 19.9% year on year to 25,845 million yen, with efforts made to reduce
selling, general and administrative expenses in the face of a decline in gross profit due to lower net sales,
while ordinary income decreased by 20.7% year on year to 25,976 million yen.
Profit attributable to owners of parent decreased by 11.8% year on year to 20,345 million yen, reflecting
in part posting of extraordinary income that included 1,420 million yen in gain on sale of investment
securities and 481 million yen in gain on bargain purchase associated with a corporate acquisition.

(ii) Status of assets and profit/loss in the last three fiscal years preceding the fiscal year under review
Fiscal year ended
March 2021

Fiscal year ended
March 2022

Fiscal year ended
March 2023

Fiscal year ended
March 2024

Net sales (million yen)

422,365

495,827

608,064542,697

Operating income (million yen)

11,467

20,91532,24925,845

Ordinary income (million yen)

11,241

21,45632,73925,976

Profit attributable to owners ofparent (million yen)

11,39915,401

23,07020,345

13.5

15.7

19.6

14.5

Total assets (million yen)

237,004

272,139

286,217

286,792

Net assets (million yen)

95,062

105,800

129,737

151,231

Earnings per share (yen)415.07576.46878.65774.61

Net assets per share (yen)3,311.24

4,026.22

4,935.36

5,742.22

38.4

38.8

45.3

52.6

Item

ROE (%)

Equity ratio (%)- 17 -

(Note) The Company has applied the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29, March 31, 2020)
and relevant ASBJ regulations from the beginning of the fiscal year ended March 2022, and each figure for the fiscal year
ended March 2022 and thereafter is the figure after applying the accounting standard and relevant ASBJ regulations.

Electronic Components
Description of business

Development, manufacture, and sale of semiconductors, general electronic components,and other products, the EMS(Note 1), and other activities
In this business, the components sales business enjoyed robust sales of SoC*2 products by Kaga FEI Co., Ltd., but
sales of semiconductors and electronic components in general were sluggish, affected by disappearance of spot
demand given easing of supply shortages of semiconductors and electronic components that had continued for two
consecutive years until the previous fiscal year, diminution of transactions with a certain client of an overseas
subsidiary of Excel Co., Ltd., and inventory adjustment taking place on a full-scale from the third quarter.
In the EMS business, sales in the automotive sector increased due to improved supply and demand balance ofsemiconductors and electronic components, whereas sales in applications related to medical and industrial
equipment decreased due partly to investment adjustment at key customers.
As a result, net sales decreased 12.4% year on year to 472,583 million yen and segment income decreased 26.2%
year on year to 20,887 million yen.

(Notes) 1.
2.

Electronics Manufacturing Service: Provision of product development and manufacturing services on an outsourcing
basis.
Abbreviation for System on a Chip. A design technique of integrating all the functions necessary for operation of adevice or system on a single semiconductor chip.

Information Equipment
Description of business

Sales of PCs, PC peripherals, home electric appliances, photograph and imaging
products, original brand products, and other products
In this business, net sales remained robust with continued strong sales of PCs for educational institutions andsecurity software, although sales of PCs for mass retailers struggled due to weak demand. In the LED installation
business, sales of a large-scale project that the Group started pushing forward on a full scale in the previous fiscal
year contributed.
As a result, net sales increased 1.4% year on year to 44,305 million yen and segment income increased 19.4% year
on year to 2,924 million yen.
SoftwareDescription of business

Production of computer graphics, planning and development of amusement products,
and other activities

In this business, orders for computer graphics production remained generally steady. Net sales decreased by 14.4%
year on year to 2,567 million yen while segment income increased by 29.0% year on year to 370 million yen,
attributable partly to the effect of containing cost of sales through operational efficiency improvement and otherefforts.
OthersDescription of business

Repair and supports for electronics equipment, manufacture and sales of amusement
equipment, and sales of sports goods, and other activities

In this business, the PC and PC peripheral recycling business remained strong, and so did sales of amusement
equipment and sporting goods. Net sales increased by 5.4% year on year to 23,241 million yen, and segment
income increased by 41.2% year on year to 1,555 million yen.
(iii) Capital investments
Capital investment made in the fiscal year under review was 5,417 million yen (based on acquisition costof property, plant, and equipment), and this was mainly due to expansion of facilities at overseas
manufacturing bases.

- 18 -

(iv) Financing activities
There are no particular matters of notes regarding financing during this fiscal year, and we proceeded withrepayment centering on long-term borrowings. In addition, the Company has entered into a loan
commitment line agreement with financial institutions totaling 15 billion yen, however no debt isoutstanding as of the end of this fiscal year.
(v) Status of transfers of business, absorption-type company split or incorporation-type company split
Not applicable(vi) Status of acquisition of business of other companies
Not applicable(vii) Status of assumption of rights and duties relating to the business of other companies through absorptiontype merger or company split
KAGA FEI Co., Ltd. has taken over the rights and obligations related to the UI/UX business of Candera
GmbH through an absorption-type company split, effective August 1, 2023.
(viii) Status of acquisition or disposal of shares, other equity interests, or share acquisition rights and the like ofother companies


Status of acquisition of shares
Date

AcquireeAcquirer

Percentage

StatusAugust 1, 2023

Candera GmbHKAGA FEI Co., Ltd.

100.0%

Now a consolidated
subsidiary

October 19, 2023

TAXAN SWE (H.K.)
MANUFACTURING
COMPANY LIMITEDKAGA (H.K.)
ELECTRONICS
LIMITED

51.0%

Now a consolidated
subsidiaryStatus of disposal of shares
Date

Name of Company

Acquirer

Percentage

StatusJanuary 4, 2024

SANKOHENGINEERING CO.,LTD.

KAGA MICROSOLUTION CO., LTD.

100.0%

Shares transferred- 19 -

Significant Parent Companies and Subsidiaries(i)

Parent companies
Not applicable(ii) Significant subsidiaries
Directly owned subsidiaries
Name of Company

Percentage ofvoting rights heldby the Company

CapitalPrincipal lines of business

KAGA TECH CO., LTD.

60,000 thousandyen

100.0%

Sale of electronic components, electronicequipment, etc.

KAGA DEVICES CO., LTD.

395,200 thousandyen

100.0%

Sale of electronic components, electronicequipment, etc.

KAGA SOLUTION NETWORK
CO., LTD.

310,000 thousandyen

100.0%Development, design, installation, andmaintenance of computer network systems,
and sale of information equipment, software,photosensitive material, and opticalequipment, etc.

AD DEVICE CO., LTD.

301,200 thousand
yen

96.7%

Sale of electronic components, electronicequipment, etc.

KAGA MICRO SOLUTION CO.,LTD.

300,050 thousandyen

100.0%Development, manufacture, sale, andrecycling of computers, computer peripheral
equipment, and electric equipment, etc.

Digital Media Lab., Inc.

106,000 thousandyen

100.0%

Planning, development, and sale of computer
graphics

KAGA SPORTS CO., LTD.

50,000 thousandyen

100.0%

Manufacture, wholesale, and sale of sports
goods, etc.

KAGA AMUSEMENT CO., LTD.

50,000 thousandyen

100.0%

Sale of electronic components, electronicequipment, etc.

KAGA TECHNO SERVICE CO.,LTD.

42,000 thousandyen

100.0%

Electrical and telecommunications
equipment business, and interior
construction business

4,877,683 thousandyen

100.0%

Sale of electronic components, electronicequipment, etc.

KAGA EMS TOWADA CO., LTD.

30,000 thousandyen

100.0%

Board mounting and assembly of on-board
automotive electronic equipment andmedical devices

EXCEL CO., LTD.

400,000 thousandyen

100.0%

Sale of electronic components, electronicequipment, etc.

Kyokuto Electric Co., Ltd.

99,000 thousandyen

100.0%

Manufacture and sale of electronicequipment, electric equipment, etc.

KAGA AEROSYSTEMS CO., LTD.

99,000 thousandyen

100.0%

Import and export, sale, and leasing ofaircraft and related parts

KAGA (H.K.) ELECTRONICS
LIMITED

2,580 thousand
U.S. dollars

100.0%

Sale of electronic components, electronicequipment, etc.

943 thousand U.S.
dollars

100.0%

Sale of electronic components, electronicequipment, etc.

KAGA (TAIWAN) ELECTRONICS
CO., LTD.

50,000 thousand
TW dollars

100.0%

Sale of electronic components, electronicequipment, etc.

KAGA (SHANGHAI)
ELECTRONICS CO., LTD.

15,017 thousand
RMB

100.0%

Manufacture and sale of electronicequipment, electronic components, etc.

KAGA ELECTRONICS(THAILAND) COMPANY
LIMITED

102,000 thousand
Thai baht

100.0%

Manufacture and sale of electronicequipment, electronic components, etc.

600 thousand
British pounds

100.0%

Sale of electronic components, electronicequipment, etc.

KD TEC s.r.o.

12,000 thousand
Czech koruna

100.0%

Assembly of electric and electronic units,
sale of electronic components, etc.

TAXAN MEXICO S.A. DE C.V.

861,642 thousand
Mexican pesos

100.0%

Manufacture and sale of electronicequipment, electronic components, etc.

KAGA FEI Co., Ltd.

KAGA (SINGAPORE)
ELECTRONICS PTE LTD

KAGA (EUROPE) ELECTRONICS
LTD.

- 20 -

Percentage ofvoting rights heldby the Company

Name of Company

CapitalPrincipal lines of business

KD TEC TURKEY ELECTRONIKSANAYI VE TICARET LIMITEDSIRKETI

122,991 thousand
Turkish lira100.0%

Assembly of electric and electronic units,
sale of electronic components, etc.

KAGA ELECTRONICS INDIA
PRIVATE LIMITED

239,000 thousand
Indian rupees

100.0%

Manufacture and sale of electronicequipment, electronic components, etc.

KAGA COMPONENTS(MALAYSIA)SDN.BHD.

7,000 thousand
Malaysian ringgit

100.0%

Manufacture and sale of electric equipment,
etc.

KAGA ELECTRONICS(VIETNAM) CO., LTD.

253,632 million
Vietnamese dongs

100.0%

Manufacture and sale of electronicequipment, electronic components, etc.

(Notes) 1. As of March 31, 2024, the Group has 60 subsidiaries subject to consolidation (19 domestic and 41 overseas); of
these, 28 are directly owned subsidiaries and 32 are indirectly owned subsidiaries.
2. In addition to the above, 2 investment cooperatives are considered directly owned subsidiaries.

Principal Business Locations (as of March 31, 2024)
Domestic Networks●: Electronic Components ■: Information Equipment

Aomori
Miyagi● KAGA EMS TOWADA CO., LTD., Headquarters/The Second Plant● KAGA ELECTRONICS CO., LTD., Sendai Business Office■ KAGA TECHNO SERVICE CO., LTD., Sendai Office

Yamagata
Fukushima
Niigata▲ KAGA MICRO SOLUTION CO., LTD., Yamagata Office▲ KAGA MICRO SOLUTION CO., LTD., Fukushima Office● KAGA ELECTRONICS CO., LTD., Niigata Business Office● KAGA FEI Co., Ltd., Nagaoka Sales OfficeGunma
Ibaraki● KAGA FEI Co., Ltd., Takasaki Development Center● KAGA FEI Co., Ltd., Toride Sales Office● EXCEL CO., LTD., Mito Sales Office

Saitama● KAGA ELECTRONICS CO., LTD., Kita-Kanto Business Office● KAGA FEI Co., Ltd., Omiya Office▲ KAGA MICRO SOLUTION CO., LTD., Tokyo OfficeTokyo● KAGA ELECTRONICS CO., LTD., Head Office, Chiyoda-ku, Tokyo● KAGA TECH CO., LTD., Head Office● KAGA DEVICES CO., LTD., Head Office● AD DEVICE CO., LTD., Head Office▲ KAGA MICRO SOLUTION CO., LTD., Head Office▲ KAGA SPORTS CO., LTD., Head Office● EXCEL CO., LTD., Head Office■ KAGA TECHNO SERVICE CO., LTD., Head Office (Sumida-ku)◆ DREAMS CORPORATION, Head Office (Sumida-ku), (Shinagawa-ku)● Kyokuto Electric Co., Ltd., Tokyo Sales Office (Chiyoda-ku)● KAGA ELECTRONICS CO., LTD., Head office annex, Chuo-ku, Tokyo■ KAGA SOLUTION NETWORK CO., LTD., Head Office◆ Digital Media Lab., Inc., Head Office▲ KAGA AMUSEMENT CO., LTD., Head Office◆ ACCESS GAMES INC., Head Office

Kanagawa● KAGA ELECTRONICS CO., LTD., Shin-Yokohama Business Office● KAGA FEI Co., Ltd., Headquarters● NV DEVICES Co., Ltd., Head Office- 21 -◆: Software▲: Others

Nagano● KAGA FEI Co., Ltd., Matsumoto Sales Office/Suzaka Sales Office● EXCEL CO., LTD., Matsumoto Sales Office

Ishikawa● KAGA ELECTRONICS CO., LTD., Hokuriku Business Office● KAGA FEI Co., Ltd., Kanazawa Sales Office● AD DEVICE CO., LTD., Hokuriku Sales Office▲ Digital Media Lab., Inc., Kanazawa Office

Shizuoka● KAGA ELECTRONICS CO., LTD., Hamamatsu Business Office● KAGA FEI Co., Ltd., Shizuoka Sales Office● EXCEL CO., LTD., Numazu Sales Office

Aichi● KAGA ELECTRONICS CO., LTD., Nagoya Business Office● KAGA FEI Co., Ltd., Nagoya Office/Mikawa Office● AD DEVICE CO., LTD., Chubu Sales Division▲ KAGA SPORTS CO., LTD., Central Japan Sales Division● EXCEL CO., LTD., Nagoya Sales OfficeOsaka● KAGA ELECTRONICS CO., LTD., Kansai Business Office● KAGA FEI Co., Ltd., Osaka Office● KAGA DEVICES CO., LTD., Osaka Office■ KAGA SOLUTION NETWORK CO., LTD., Osaka Office● AD DEVICE CO., LTD., Osaka Sales Division◆ Digital Media Lab., Inc., Osaka Office▲ KAGA SPORTS CO., LTD., Retail Sales Division◆ ACCESS GAMES INC., Development Division■ KAGA TECHNO SERVICE CO., LTD., Kansai Sales Office● EXCEL CO., LTD., Osaka Sales Office● Kyokuto Electric Co., Ltd., Head Office

Wakayama
Tottori
Hiroshima
Fukuoka● KAGA AEROSYSTEMS CO., LTD.
● Kyokuto Electric Co., Ltd., Yatsuhashi/Urayasu/Nakayama Plants● KAGA ELECTRONICS CO., LTD., Fukuyama Business Office● KAGA ELECTRONICS CO., LTD., Fukuoka Business Office● KAGA FEI Co., Ltd., Fukuoka Sales Office

Overseas Networks●: Electronic Components ■: Information Equipment

Europe◆: Software● KD TEC s.r.o.
● KD TEC TURKEY ELEKTRONIK SANAYI VE TICARET LIMITED SIRKETI● KAGA FEI EUROPE GmbH● Candera GmbH.

ASEAN/Asia● KAGA ELECTRONICS (THAILAND) COMPANY LIMITED● AD DEVICE (Thailand) CO., Ltd.
● EXCEL ELECTRONICS TRADING (THAILAND) CO., LTD.
● KAGA COMPONENTS (MALAYSIA) SDN.BHD.
▲ KAGA AMUSEMENT MALAYSIA SDN.BHD.
● PT. KAGA ELECTRONICS INDONESIA● KAGA ELECTRONICS (VIETNAM) CO., LTD.
● KAGA ELECTRONICS INDIA PRIVATE LIMITED● KAGA DEVICES INDIA PRIVATE LIMITED● KAGA (SINGAPORE) ELECTRONICS PTE LTD● KAGA FEI KOREA Ltd.

- 22 -▲: Others

Americas● KAGA FEI AMERICA, Inc.
● KAGA FEI AMERICA, Inc. Mid-West Office● TAXAN MEXICO S.A. DE C.V.
● TAXAN-SWE MEXICO MANUFACTURING, S. DE R.L. DE C.V.
▲ KAGA AMUSEMENT AMERICA, INC.

China/HongKong/Taiwan● KAGA (SHENZHEN) ELECTRONICS LTD.
● KAGA (SHENZHEN) TRADING LTD.
● EXCEL ELECTRONICS TRADING (SHEN ZHEN) LTD.
● KAGA (H.K.) ELECTRONICS LIMITED● KAGA DEVICES (H.K.) LIMITED● AD DEVICE (H.K.) LIMITED● KAGA FEI ELECTRONICS PACIFIC ASIA LIMITED● EXCEL ELECTRONICS (HONG KONG) LTD.
● KAGA (SHANGHAI) ELECTRONICS CO., LTD.
● KAGA TAXAN (SUZHOU) ELECTRONICS CO., LTD.
● SUZHOU TAXAN KAGA TRADING CO., LTD● KAGA TECHNOLOGY (SUZHOU) ELECTRONICS CO., LTD● AD DEVICE (SHANGHAI) CO., LTD.
● KAGA FEI ELECTRONICS (Shanghai) Co., Ltd.
● EXCEL INTERNATIONAL TRADING (SHANGHAI) CO., LTD.
● EXCEL INTERNATIONAL TRADING (SHANGHAI) CO., LTD. WUXI BRANCH● HUBEI KAGA ELECTRONICS LIMITED● KAGA FEI ELECTRONICS (Dalian) Software Limited● KAGA (TAIWAN) ELECTRONICS CO., LTD.
● EXCEL ASIAN TAIWAN CO., LTD.

- 23 -

Issues to be Addressed
1. Medium-Term Management Plan 2024
In November, 2021, the Company formulated Medium-Term Management Plan 2024 to present the Group’s
path toward growth over the next three years. Under this plan, the Company will thoroughly implement “profitoriented management” while carrying out measures in line with the following basic policies to achieve its
vision of “aiming to be Japan’s No. 1 corporate group in the industry” and “aiming to be a competitive WorldClass Company.”(i) Basic policy
1) Further Reinforcement of Profitability
We will predict the movements of the times and focus on markets with high potential for growth andprofitability.
2) Reinforcement of Management Base
Pursuing further efficiency and soundness, we will effect a shift to a Group management foundation
appropriate to “Japan’s No. 1 corporate group in the industry.”3) Creation of New Businesses
We will make active use of venture investments and M&A to create new businesses and strengthen our
resistance to changes in the external environment.
4) Promotion of SDGs Management
We will engage in management that seeks to achieve solutions to social issues and sustainable growth as acompany.
JPY 1 tn

Aim to become a competitive “World class company”“Aim to be “Japan’s No. 1 corporate groupin the industry”
Organic growth+
Further M＆A
Challenges

Increased
Sales

Quantitative
expansion of

Expansion of trading
company businesswill lead to growthof the EM S businesstrading company
business

JPY 750 bn

Increased
ProfitRatio

Growth fields

Qualitative
improvement

Environment
Industrial equipment

through EM S
business

Health care

Mobility
Communications

MedicalReinforcement and expansion of overseas business, EM S businessNet sales

Medium-Term Management Plan 2024
Further reinforcementof profitability

Reinforcement ofmanagement base“Challenge 1.60”

Creation of new
businesses

Promotion of SDGs
management

Sales of ¥1 tn in yearof 60th anniversary offounding(ii) Progress of management targets
In the fiscal year ended March 2023, the first year of the plan, the Company achieved all KPI targets for net
sales, operating income, and ROE two years ahead of schedule for the final year of the plan (the fiscal year
ending March 2025), excluding new M&A targets, as a result of demonstrating the Group’s procurement
advantages to the fullest extent to respond to spot demand amid continuing global shortages of semiconductors
and other electronic components.
Based on these results from the first year of the plan, the Company updated the management targets for the
final year of the plan and released them as our “Latest Outlook” on May 11, 2023.
In the fiscal year ended March 2024, the second year of the plan, in the electronic components business, inaddition to the disappearance of spot demand and reduced transactions with major customers of our Group- 24 -

companies, customers began to make substantial inventory adjustments from the second half of the fiscal year.
Moreover, the forecast for the fiscal year ending March 2025 released on May 9, 2024 includes changes in thebusiness environment such as the impact of prolonged inventory adjustments and wage increases not included
in our Latest Outlook. The Company does not expect that our forecasts for net sales or operating income for the
final year of the plan will reach our Latest Outlook.
Given these conditions, we have positioned our forecast for the fiscal year ending March 2025 as ourcommitment to our stakeholders, and our Latest Outlook as “challenge targets.” The Group will come together
to close out the final year of our “Medium-Term Management Plan 2024.”(iii) Progress of management policies
Efforts to address priority issues based on the four basic policies of this plan have generally progressedsmoothly, and various results were achieved in the second year of the plan.
Regarding “Further reinforcement of profitability,” we started up a new plant in Mexico in April 2024 tostrengthen and expand our EMS business and overseas business. We aim to achieve net sales of 50.0 billion yen
in five years by responding to the production demand in the North American and Central and South American
markets, which are expected to continue growing in the future.
Regarding “Reinforcement of management base,” we have been proactively investing in human capital, and theestablishment of a new special leave system for male employees for childcare purposes has led to increase thenumber of employees who took such leave. We also decided to raise wages across the Group in March 2024.
Regarding “Creation of new businesses,” we have decided to invest in several venture companies through CVC(Corporate Venture Capital). However, we recognize that our efforts in new areas, including new M&A, remain
an issue to be addressed.
2. Basic policy for shareholders’ return
The Company views the return of profits to shareholders as one of its most important management policies, andour basic policy is to steadily and continuously increase dividends per share, with a target consolidated
dividend payout ratio of 25-35%, while comprehensively taking into account promotion of investments that
contribute to future growth, maintenance of a sound financial base over the medium to long term, and progressin consolidated business performance.

3. Medium- to Long-Term Sustainability Management Plan
Aiming for universal social contribution as a “company that benefits society”
Formulation of Medium-Term Sustainability Management Plan
The Company formulated its Medium- to Long-Term Sustainability Management Plan in November 2021
together with its Medium-Term Management Plan 2024. Based on its corporate philosophy of “Everything we
do is for our customers,” the Company promotes sustainability management with the aim of “achieving asustainable society” and “sustainable Group growth.” In doing so, we respect the dialogue with all of our
stakeholders, including customers, business partners, shareholders and investors, employees, and local
communities, and we aim to play an active role in achieving a sustainable society while improving ourcorporate value.
(i)Sustainability Policya. We will tackle environmental issues through our business activities
Through our business activities, we will take action to cut CO2 emissions, reduce waste, and promotereuse. At the same time, by providing environmentally considerate products and services, we willcontribute to bringing about a society that values the global environment.
b. We will respect human rights and develop human resources
We will respect the human rights of all stakeholders, regardless of gender, age, nationality, social status,
disabilities, or other personal attributes. We will develop work environments in which diverse employees
can work in safety and health, both physically and mentally, and will develop personnel systems andeducation and training systems that allow these employees to maximize their individual abilities. We willfurther work to develop human resources who will take on the challenge of innovation.

- 25 -

c. We will work to build mutual trust with society
We will work to be a company that earns the trust of society by observing laws and regulations, bystrengthening our governance structure, and by sincerely engaging in fair competition, the provision ofhigh-quality products and services, timely and appropriate information disclosure, and other corporate
activities.
(ii) Sustainability promotion structure
The Kaga Electronics Group has positioned CSR and sustainability as important management issues, and has
established the Sustainability Committee chaired by the Representative Director, President & COO of KAGAELECTRONICS CO., LTD. Directly under this committee are technical committees for environmental
management promotion, diversity promotion, governance, compliance, risk management, and information
disclosure. In this way, we have constructed a management system for promoting CSR and sustainability
throughout the group. Under commitment by top management and collaboration among business divisions, we
act through these committees to formulate policies, measures, and goals that address ESG issues, to manage
progress, and to otherwise promote sustainability within the Group as a whole.
Note: See the diagram of the Company’s governance system listed on page 14 of the convocation notice.

- 26 -

(iii) Identifying materiality (key issues)
The Kaga Electronics Group is committed to seriously addressing a variety of issues relevant not only to itself
but also communities around the world and thereby living up to the expectations of society. In line with thiscommitment, the Group has employed four perspectives— Environmental (E), Social (S), Governance (G) andBusiness (B)—to identify priority issues that are deemed to exert significant impact on its business operations,as listed below. Through its efforts to tackle the materiality of these issues, the Group will practice corporate
activities aimed at contributing to the realization of a sustainable society, with the aim of further improving its
corporate value.
Materiality

Related
SDGs

Changes in the socio-economic
environment

Our initiatives

E

Create a clean
global environment Provide products and services designed
 Growing seriousness of global warming
to help resolve environmental andand other environmental problems
energy issues
 Urgent call for carbon neutrality
 Continue initiatives to reduce theenvironmental burden

S

Create an inclusivecompany as well as
an affluent society

 Changes in social structure as we movetoward the popularization of the newnormal Human resource shortages attributable
to a low birthrate and an aging
population

 Promote workforce diversity andinnovative work styles to better adapt to
the new normal
 Develop human resources by passing
down and updating KAGAismG

Create asustainable
management base

 Public calls for more robust corporate
governance Growing need for business resilienceagainst changes in the operating
environment

 Further strengthening governance andcompliance Thoroughly practice a profit-focusedmanagement approach

Realize sustainablebusiness growth Provide products and services that
 Progress in digital transformation
contribute to the transition to a digital Coming of a “super-smart” society due
driven society
to the popularization of ICT, such as IoT
 Create new businesses aimed at helping
and AI
resolve social issues
 Intensification of global competition
 Further promotion of global expansion

B- 27 -

(iv) Medium- to long-term sustainability targets and major KPIs
Key themesE

Achievement ofshift to 100%
renewable energy

Shift to electricity
for companyowned vehicles
Diversity andhuman resource
management
S

G

Note:
Figures in parentheses () indicate current values.
Issues to address/examine
Medium-term targets
Long-term targets
 Adoption of renewable energy at
2024: 40% (1%)
2030: 100%
domestic sales offices
 Adoption of renewable energy at
By 2024: Information
2030: 50%
domestic manufacturing sites
gathering/analysis and2050: 100%
determination of policy In-house power
generation/external Adoption of renewable energy at
2030: 30%
procurement
overseas manufacturing sites
2050: 100%
 Solar panel/biomass power
generation/renewable energy
businesses
 Switch to electric vehicles fordomestic sales vehicles (EV, HV,
PHV, FCV)

2024: 85% (78.5%)

2030: 100%

Percentage of female new
Percentage of female new Ensuring diversity in core human
graduates in general
graduates in general positions
resources (Women, foreign nationals,
positions2023: 30% (5.8%)
mid-career hires)
2028: 40%
Percentage of women in Initiatives to employ elderly workers
Percentage of women in
management positions
and persons with disabilities
management positions
2024: 15% (13.3%)
2029: 17%
 Enhancement of programs such as2025: Certification bychildcare/family-care and telework
2022: Implementation ofoutside party Acquisition of certification as areview
2024 onward:
Health and Productivity Management 2023: Certification
Continuation ofOrganization
certification
 Independent Outside Directors: atleast 1/3
June 2021: Performed
 Establishment of Nomination andCompensation Committee Diversification of the Board of
By June 2022: Determination
Directorsof policy“Work-life
management” and“enhancement of
productivity”
Restructuring thegovernancestructure in
response to therevision of the
Corporate
Governance Codeand the Full compliance with Corporate
reorganization ofGovernance Code for Prime Market
Tokyo Stock
Exchange Adoption of delegation-based
Further
executive officer structure
strengthening thesupervisory andoversight functions  Transition to structure of companyof top managementwith committees
over businessexecution

November 2021: Performed

Setting of targets in linewith next Corporate
Governance Code revision

April 2022: Enactment

By March 2023:
Determination of policy(v) Changes in Medium- to Long-Term Sustainability Management Plan
Main activities in fiscal 2022/2023 and status of progress[Fiscal 2022]
1) Completed introduction of electric power from renewable sources for 1.2% of total electricity usage.
2) Discussed measures to achieve 40% in fiscal 2024.
[Fiscal 2023]
1) Completed introduction of electric power from renewable sources for 5.1% of total electricity usage.
2) In order to achieve the target of “40% renewable energy by 2024,” decided to purchase non-fossil
certificates. In addition, decided to quantify greenhouse gas emissions and set reduction targets forfiscal 2024.

- 28 -

[Fiscal 2022]
At locations in Aomori, Fukushima, and Tottori, calculated electricity generation amount with a view toinstalling solar panels. Started implementation plan.
[Fiscal 2023]
Introduced solar power generation facilities at Towada Plant (December 2023) and Sukagawa Plant(February 2024).
[Fiscal 2022]
Started introducing electric power from renewable sources through solar panels in China (Hubei),Vietnam and Malaysia.
[Fiscal 2023]
Installed solar panels at the new plant in Mexico (April 2024).
[Fiscal 2022]
Increased conversion rate to electric vehicles by 1.2 points from the previous fiscal year to 82.0% (as ofMarch 31, 2023).
[Fiscal 2023]
Increased conversion rate to electric vehicles by 3.0 points from the previous fiscal year to 85.0% (as ofMarch 31, 2024).
Implemented recruitment activities for new female graduates in career track positions inaccordance with our “Action Plan.”[Fiscal 2022]
Of the 22 new graduates hired for career-track positions, 4 were women. Increase of 12.3 points from theprevious fiscal year to 18.1%.
[Fiscal 2023]
Of the 23 new graduates hired for career-track positions, 5 were women. Increase of 3.6 points from theprevious fiscal year to 21.7%, but still fell short of the target of 30%.


We held discussions within the Group to increase the ratio of female managers, and each company
determined its own target number of female managers.
[Fiscal 2022]
We saw an increase of 3.2 points from the previous year to 16.5%.
[Fiscal 2023]
We saw an increase of 0.9 points from the previous year to 17.4%.
[Fiscal 2022]
Our employment of people with disabilities was at 100% of the legally mandated employment rate.
[Fiscal 2023]
Our employment of people with disabilities was at 100% of the legally mandated employment rate.
[Fiscal 2022]
We made telework a permanent system and reviewed options for revising regulations and rules.
[Fiscal 2023]
The new rules went into operation from April 2023.
[Fiscal 2022]
We obtained certification as a Health and Productivity Management Organization in March 2023.
[Fiscal 2023]
We obtained certification as a Health and Productivity Management Organization for the second
consecutive year in March 2024.
[Fiscal 2022]
From June 2023, there will be six (6) directors (including three (3) outside directors), and the majority
will be outside directors. We established a Nomination and Compensation Committee in June 2021.

- 29 -

[Fiscal 2023]
A resolution was passed at the June 2023 General Meeting of Shareholders to adopt a six-member Boardof Directors (including three outside directors).
[Fiscal 2022]
We decided to nominate a woman as a candidate for new outside auditor. We continue activities to electfemale directors.
[Fiscal 2023]
Election of a female outside auditor was approved at the June 2023 General Meeting of Shareholders.
Election of female directors will not be proposed at the June 2024 General Meeting of Shareholders.
[Fiscal 2022]
We implemented full-compliance with Corporate Governance Code for Prime Market in June 2022.
[Fiscal 2023]
No revision of Corporate Governance Code.
[Fiscal 2022]
We adopted delegation-based executive officer structure in April 2022.
[Fiscal 2023]
Decided to expand the membership of the Group Management Headquarters Meeting to includedelegation-based executive officers, and incorporated these changes effective from April 2024.
[Fiscal 2022]
We will reduce the term of office of directors from the current two (2) years to one (1) year while
continuing as a company with a Board of Auditors. (June 2023)[Fiscal 2023]
Continue to be a company with a Board of Auditors. Considering the expeditious management and theneed for the appointment of female directors, continuing to consider transitioning to a “company withaudit and supervisory committee.”- 30 -

II. Current Status of the Company
Status of Shares (as of March 31, 2024)(i)

Total number of authorized shares

80,000,000(ii) Total number of issued shares

28,702,118(iii) Number of shareholders

9,238(iv) Major shareholders (top 10 shareholders)Number of shares held(Thousands of shares)

Name of shareholder

Shareholding ratio(%)

The Master Trust Bank of Japan, Ltd. (Trust Account)

2,810

10.70

OKOZE CO., LTD

1,840

7.00

Custody Bank of Japan, Ltd. (Trust Account)

1,604

6.11

KAGA ELECTRONICS Employee Shareowners Association

1,557

5.93

MUFG Bank, Ltd.

1,137

4.33

Mizuho Bank, Ltd.

950

3.62

Isao Tsukamoto

728

2.77

THE BANK OF NEW YORK MELLON 140044

476

1.82

Nippon Life Insurance Company

459

1.75

BNYM AS AGT/CLTS 10 PERCENT

375

1.43

(Note)

1. The Company holds 2,432,338 shares of treasury stock, but the Company is not included in the major shareholders
listed above.
2. The shareholding ratio is calculated after deducting treasury shares.

(v) Status of shares granted to company officers as consideration of execution of duties during the fiscal year
under review
Persons eligible for the
granting

Number of shares
Director

2,861

2

Outside directors––

Auditor––(Note) The Company has introduced a restricted share-based remuneration plan based on a resolution of the 50th Ordinary
General Meeting of Shareholders held on June 28, 2018. In light of this, the meeting of the Board of Directors held on
June 27, 2023 resolved to dispose of treasury shares as restricted share remuneration, and disposal of 2,861 treasury
shares to 2 directors (not including Representative Director, Founder & CEO and outside directors) was carried out on
July 26 of that year. Details regarding share-based remuneration for directors can be found in “III. Corporate Officers,
Overview of Details of Remuneration to Directors and Auditors for the Fiscal Year Under Review” of the Business
Report.

Share Acquisition Rights
Not applicable- 31 -

III. Corporate Officers
Directors and Auditors (as of March 31, 2024)
Position in the Company

Name

Representative Director,
Founder & CEO

Isao Tsukamoto

Representative Director,
President & COO

Ryoichi Kado

Director, Senior Managing
Executive Officer

Shintaro Kakei

Director

Susumu Miyoshi

Director

Noritomo Hashimoto

Inside Auditor

Eiji Kawamura

AuditorSusumu Kitsunai

Responsibilities and significant positions concurrently held
Outside Director, ITbook Holdings Co., Ltd.

Outside Director, Ibokin Corp.
Representative, Kitsunai Certified Public Accountant Office
Representative Director, Asia Alliance Partner Co., Ltd.
Outside Director, Agent Insurance Group, Inc.

AuditorYoichi Sato

Lawyer (of counsel), Alpha Partners Law Offices
Auditor, Bouygues Asia K.K.

AuditorKyoko Oyanagi

Representative of Social Insurance and Labor Advisors
Corporation, Sakura Management Office
Chairman, Tokyo Labor Improvement Promotion Association(Labor insurance affairs association certified by the Minister of
Health, Labour and Welfare)(Notes) 1. Directors Susumu Miyoshi and Noritomo Hashimoto are outside directors.
2. Outside Director Akira Tamura was deemed to have retired from the office on March 15, 2024, following his passing.
3. Auditors Susumu Kitsunai, Yoichi Sato, and Kyoko Oyanagi are outside auditors.
4. Inside Auditor Eiji Kawamura has many years of experience as an employee and director of the Company in sales andadministration departments, and has a broad range of knowledge in areas such as corporate management, finance, andaccounting.
5. Auditor Susumu Kitsunai is a credentialed certified public accountant and has substantial knowledge of finance andaccounting.
6. Auditor Yoichi Sato is a credentialed attorney and has substantial knowledge of corporate legal affairs.
7. The Company has submitted notification to the Tokyo Stock Exchange that Directors Susumu Miyoshi and Noritomo
Hashimoto, and Auditors Susumu Kitsunai, Yoichi Sato, and Kyoko Oyanagi have been designated as independent
officers.
8. The Company has entered into a directors and officers liability insurance policy as provided for in Article 430-3,
paragraph (1) of the Companies Act with an insurance company.

Overview of Details of Remuneration to Directors and Auditors for the Fiscal Year Under Review
Remuneration for directors and auditors
a. Policy for determining the details of remuneration for officers
At its Board of Directors meeting held on May 27, 2021, the Company has resolved its policy for
determining details of remuneration for individual directors.
The Board of Directors has determined with regards to the amount of fixed remuneration for eachdirector for the fiscal year under review that the method for decision of the details of remuneration andthe details of remuneration decided on are consistent with the policy for determination approved by the
Board of Directors and has judged that it is in keeping with that policy for determination.
The policy for determining the details of remuneration for individual directors is as follows: Basic policy
The Company’s basic policy is to set the remuneration of directors at an appropriate level based on theirrespective responsibilities in determining the remuneration of individual directors as a remuneration
system that is linked to shareholders’ profits so that it can fully function as an incentive to secure and- 32 -

retain excellent human resources who will implement the realization of the Company’s management
philosophy and continuously improve corporate value. Specifically, remuneration for executive directors
consists of fixed remuneration, which is paid at a fixed amount, performance-linked remuneration, andshare-based remuneration, while remuneration for outside directors, who are responsible for supervisory
functions, consists of fixed remuneration only in consideration of their responsibilities. Furthermore, thecontent of remuneration for directors is designed to be reasonable, objective, and transparent in terms ofboth the content of remuneration and decision-making procedures.
 Policy regarding the determination of the amount of remuneration, etc. for each individual in fixed
remuneration
The fixed remuneration for directors of the Company shall be fixed monthly remuneration in cash, whichshall be determined in accordance with the position and responsibilities, etc., while taking into
consideration the levels of other companies, the business performance of the Company, and the level of
employee salaries, and reviewing the remuneration as appropriate in a comprehensive manner.
 Policy for determining the details of performance-linked remuneration, etc. and non-monetary
remuneration, etc. and the method for calculating the amount or number of such remuneration
Performance-linked remuneration, etc. is monetary remuneration reflecting performance indicators inorder to raise awareness of the need to improve performance for each fiscal year, and an amountcalculated in accordance with the degree of achievement of the target values for operating income,ordinary income, and profit attributable to owners of parent for each fiscal year is paid as a bonus at a
specified time. The target performance indicators and their values are based on the profit-oriented
management set forth in the Medium-Term Management Plan, and will be reviewed in accordance withchanges in the business environment, respecting the report of the Nomination and Compensation
Committee. The amount of performance-linked remuneration is based on the consolidated businessresults. Non-monetary remuneration, etc. is granted at a set time after the end of the fiscal year as
restricted share remuneration with a transfer restriction period of up to 20 years, which is designed toprovide incentives for the sustainable enhancement of the Company’s corporate value and to promotefurther value-sharing with shareholders through the holding of the Company’s shares. The number ofshares to be granted is determined in consideration of the position, responsibilities, share price, etc., andwith respect to the report of the Nomination and Compensation Committee.
 Policy on determination of the ratio of the amount of monetary remuneration, the amount of
performance-linked remuneration, etc., or the amount of non-monetary remuneration, etc., to the amountof individual remuneration, etc., of directors
The ratio of type of remuneration for directors (excluding outside directors) is determined based on thereport of the Nomination and Compensation Committee, taking into consideration the position,
responsibilities, and trends in the remuneration levels of other companies with similar business scale as
the Company.
 Matters related to the decision policy concerning the details of remuneration, etc. for individual directors
Based on the delegated resolution of the Board of Directors, the Representative Director, Founder &CEO and Representative Director, President & COO are delegated the authority to determine the amountof fixed remuneration for each director, the allocation of performance-linked remuneration (bonuses, etc.)
based on the performance of the business for which each director is in charge, and the number of shares
to be allotted to each individual in the form of restricted share remuneration. The Board of Directors
consults the Nomination and Compensation Committee on the draft and obtains its report to ensure thatsuch authority is properly exercised by the Representative Director, Founder & CEO and Representative
Director, President & COO, and the Representative Director, Founder & CEO and Representative
Director, President & COO, who have received the above delegation, make decisions with respect to thecontent of this report.

- 33 -

 Matters concerning the method of decision when the decision on the details of remuneration, etc. isdelegated to a director or other third party
The Representative Director, Founder & CEO and Representative Director, President & COO determine
the specific details of the amount of remuneration, etc. and the number of shares to be allotted to eachindividual based on the delegated resolution of the Board of Directors. The Board of Directors shall takemeasures to make decisions after consultation and reporting by the Nomination and Compensation
Committee to ensure that such authority is properly exercised by the Representative Director, Founder &CEO and Representative Director, President & COO. The Representative Director, Founder & CEO and
Representative Director, President & COO determine the details of individual remuneration for eachdirector by fully respecting the advice and report of the Nomination and Compensation Committee, while
taking into consideration the Company’s overall performance, share price, the role of each director, theimpact of each director on the Company’s performance, and other circumstances.
b. Amount of remuneration for directors and auditors
Classification

Total amount of
remuneration(Million yen)

Total amount of remuneration by type (Million yen)Fixed
remuneration

Performancelinked
remuneration

Non-monetary
remuneration

Number of
eligible officers

Directors(Of which outside
directors)

769
(32)

271
(32)

474
(-)

23
(-)

11
(4)

Auditors(Of which outside
auditors)

38
(14)

38
(14)

(-)

(-)

6
(3)

Total
(Of which outside
officers)

808
(46)

310
(46)

474
(-)

23
(-)

17
(7)

(Notes) 1. This includes five directors (including one outside director), two Audit & Supervisory Board Members, and one
director who died on March 15, 2024, all of whom left their positions at the conclusion of the 55th Ordinary
General Meeting of Shareholders held on June 27, 2023.
2. The amount paid to directors does not include the employee’s salary for directors who concurrently serve as
employees.
3. The performance indicators for performance-linked remuneration, etc. are operating income, ordinary income,and profit attributable to owners of parent, and are calculated in accordance with the degree of achievement of thetarget values. These indicators are selected based on profit-oriented management. The performance indicators forthe fiscal year under review can be found in “I. Business Progress and Achievement of the Corporate Group,
Overview of Business (i) Business activities and results.”
4. Non-monetary remuneration is provided as share-based remuneration, and the conditions for its provision can befound in “III. Corporate Officers, Overview of Details of Remuneration to Directors and Auditors for the Fiscal
Year Under Review.” The status of granting during the fiscal year under review can be found in “II. Current
Status of the Company, Status of Shares (v) Status of shares granted to company officers as consideration of
execution of duties during the fiscal year under review.”
5. The maximum amount of remuneration for directors was resolved at the 54th Ordinary General Meeting of
Shareholders held on June 29, 2022 to be no more than 1,000 million yen per year (of this amount, up to 100
million yen is for outside directors; salaries for services as employees are not included). The number of directors
as of the close of this General Meeting of Shareholders was 11 (including four outside directors). In addition, atthe 50th Ordinary General Meeting of Shareholders held on June 28, 2018, it was resolved that the annual amountof monetary remuneration claims to be paid to directors (excluding outside directors) for the granting of restricted
shares shall be 100 million yen or less, separately from the above maximum amount of remuneration. The numberof directors (excluding outside directors) as of the close of this General Meeting of Shareholders was three.
6. At the 27th Ordinary General Meeting of Shareholders held on June 29, 1995, it was resolved that the maximum
amount of remuneration to be paid to auditors shall be 60 million yen per year. The number of auditors as of theclose of this General Meeting of Shareholders was four.

- 34 -

7. The Board of Directors has delegated to the Representative Director, Founder & CEO Isao Tsukamoto and theRepresentative Director, President & COO Ryoichi Kado the authority to determine the amount of fixed
remuneration for each director, the performance-linked remuneration (bonuses, etc.) based on the performance ofthe business for which each director other than outside directors is in charge, and the number of shares to be
allotted to each individual in the form of restricted shares. This authority is delegated because it has been judged
appropriate for the Representative Director to evaluate the business segments that individual directors are
responsible for while taking into account the Company’s overall performance. Please note that the Nomination
and Compensation Committee has confirmed in advance that the details of this delegation are appropriate.

Outside Officers(i)Status of concurrent positions at other organizations (for executives at other organizations) andrelationships between the Company and such other organizations
 Auditor Susumu Kitsunai is a representative of Kitsunai Certified Public Accountant Office and a
representative director of Asia Alliance Partner Co., Ltd. There is no particular relationship between eitherof these concurrent employers and the Company.
 Auditor Yoichi Sato serves as a lawyer (of counsel) at Alpha Partners Law Offices and as an auditor at
Bouygues Asia K.K. The Company has signed a legal advisor agreement with Alpha Partners Law
Offices. However, as he is not a partner at Alpha Partners Law Offices, he does not contribute to their
management. There is no particular relationship between Bouygues Asia K.K. and the Company.
 Auditor Kyoko Oyanagi concurrently serves as Representative of Social Insurance and Labor Advisors
Corporation, Sakura Management Office, and as Chairperson of the Tokyo Labor Improvement
Promotion Association (Labor insurance affairs association certified by the Minister of Health, Labourand Welfare). The Company has concluded an advisor agreement with Social Insurance and Labor
Advisors Corporation, Sakura Management Office, however the amount of the transaction is negligible.
There is no particular relationship between the Company and the Tokyo Labor Improvement Promotion
Association (Labor insurance affairs association certified by the Minister of Health, Labour and Welfare).

(ii) Concurrent positions as outside officers at other organizations and relationships between the Company
and such other organizations
 Director Akira Tamura was an advisor at Niigata Sohgo Security Services Co., Ltd. and an Outside Board
Director at Solekia Limited, however there is no particular relationship between the Company and eitherof the companies where he concurrently served.
 Director Noritomo Hashimoto is an outside director of Ibokin Corp. There is no particular relationshipbetween this concurrent employer and the Company.
 Auditor Susumu Kitsunai serves concurrently as an outside director of Agent Insurance Group, Inc. Thereis no particular relationship between this concurrent employer and the Company.
(iii) Major activities during the fiscal year under review
Name

Status of attendance, status of remarks, and the outline of duties performed relating to the roles
expected of outside officers

Outside Director Susumu
Miyoshi

Participated in all 19 meetings of the Board of Directors during the fiscal year under review.
He provides his opinions on the Company’s overall management as a director from an objective
viewpoint and independent perspective, based on his abundant experience as a member ofcorporate management and his wide-ranging knowledge, and successfully discharges the roles
and responsibilities required of an outside director.

Outside Director Akira
TamuraParticipated in 16 of 18 meetings of the Board of Directors during this fiscal year under review
before his death on March 15, 2024.
He provided his opinions as a director from an objective viewpoint and independent
perspective, particularly concerning matters such as management strategy and human resources,
based on his abundant experience as a member of corporate management and his wide-ranging
knowledge, and successfully discharged the roles and responsibilities required of an outside
director.

- 35 -

Name

Status of attendance, status of remarks, and the outline of duties performed relating to the roles
expected of outside officers

Outside Director Noritomo
HashimotoParticipated in 18 of 19 meetings of the Board of Directors during the fiscal year under review.
He provides his opinions as a director from an objective viewpoint and independent
perspective, particularly concerning matters such as management strategy and human resources,
based on his abundant experience as a member of corporate management and his wide-ranging
knowledge, and successfully discharges the roles and responsibilities required of an outside
director.

Outside Auditor Susumu
KitsunaiParticipated in all 19 meetings of the Board of Directors and in all 17 meetings of the Board ofAuditors during the fiscal year under review.
He provides opinions from the professional point of view of a certified public accountant andotherwise provides assistance and advice in ensuring that decisions by the Board of Directors
and the Board of Auditors are made adequately and appropriately.

Outside Auditor Yoichi Sato

Participated in all 19 meetings of the Board of Directors and in all 17 meetings of the Board ofAuditors during the fiscal year under review.
He provides opinions from the professional point of view of a lawyer and otherwise provides
assistance and advice in ensuring that decisions by the Board of Directors and the Board ofAuditors are made adequately and appropriately.

Outside Auditor Kyoko
Oyanagi

Participated in all 15 meetings of the Board of Directors and in all 12 meetings of the Board ofAuditors during the fiscal year under review and which occurred after she took office on June27, 2023.
She provides opinions from the professional point of view of a labor and social security
attorney and otherwise provides assistance and advice in ensuring that decisions by the Boardof Directors and the Board of Auditors are made adequately and appropriately.

Overview of Limited Liability Agreement
The Company has entered into agreements with outside directors and outside auditors based on theprovisions of the Companies Act, Article 427, paragraph (1) to limit their liability for damages under Article
423, paragraph (1) of the said Act.
The maximum amount of liability for damages under the agreement is the minimum liability amount as set
out in Article 425, paragraph (1) of the Companies Act.
The same agreement was concluded with Director Akira Tamura, who passed away on March 15, 2024.
Overview of Details of Directors and Officers Liability Insurance Policy
The Company has concluded with an insurance company a directors and officers liability insurance policy asprovided for in Article 430-3, paragraph (1) of the Companies Act that insures the directors and auditors of
the Company and its subsidiaries (including persons in office during the fiscal year under review), and theCompany is responsible for the entire amount of the premiums.
In summary, this insurance policy states that as a result of the conclusion of the policy, the insurancecompany will cover any damages that may arise due to the insured persons assuming responsibility for the
execution of their duties, or from claims received in relation to the pursuit of such responsibility, and it will
be renewed annually. Please note that this insurance policy establishes a limit on the amount of coverage inorder to ensure that these officers do not fail to execute their duties in an appropriate manner.
In the next renewal period, the Company will renew this insurance agreement with the same contents.

- 36 -

Consolidated Financial Statements
Consolidated Balance Sheet(As of March 31, 2024)(Million yen)Account title

AmountAccount title

ASSETS
Current assets
Cash and deposits
Notes receivable - trade

AmountLIABILITIES
244,629

Current liabilities

66,596
900

104,803

Notes and accounts payable - trade71,392

Short-term loans payable

10,604

Electronically recorded monetary claims- operating

10,146

Accrued expenses

8,419

Accounts receivable - trade

101,528

Income taxes payable

2,238

Securities
Merchandise and finished goods
Work in process

Provision for directors’ bonuses

171

Other

37,999437
11,7091,878

Non-current liabilities

Raw materials and supplies

14,861

Bonds payable

10,000Other

10,770Long-term loans payable

10,500(223)

Deferred tax liabilities

3,241

Allowance for doubtful accounts

30,75742,162

Provision for directors’ retirement benefits

Property, plant and equipment

25,135Net defined benefit liability

2,342

Buildings and structures

7,266

Asset retirement obligations

660

7,647

Other

Non-current assets

Machinery, equipment and vehicles
Tools, furniture and fixtures

3,918

Total liabilities

1,362

94

135,560

Land

6,036

Construction in progress

2,824

Shareholders’ equity

131,629

Intangible assets

2,092

Capital stock

12,133

Goodwill

16

Capital surplus

14,849Software

2,021

Retained earnings

110,250

Other

54

Treasury shares(5,603)

Investments and other assets

NET ASSETS

14,934

Accumulated other comprehensive income

19,204

Investment securities

10,472

Valuation difference on available-for-salesecurities

3,075

Deferred tax assets

1,179

Deferred gains or losses on hedges

Claims provable in bankruptcy, claims
provable in rehabilitation and other

5,015

Foreign currency translation adjustment

15,803

Other

3,340

Remeasurements of defined benefit plans

303

Allowance for doubtful accounts
Total assets(5,073)

Non-controlling interests

286,792(Note) Figures are rounded down to the nearest million yen.

- 37 -

21

396

Total net assets

151,231

Total liabilities and net assets

286,792

Consolidated Statement of Income(From April 1, 2023 to March 31, 2024)(Million yen)Account title

AmountNet sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Commission fee
House rent income
Other
Non-operating expenses
Interest expenses
Share of loss of entities accounted for using equity method
Foreign exchange losses
Other
Ordinary income
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Gain on bargain purchase
Gain on liquidation of subsidiaries and associates
Other
Extraordinary loss
Impairment loss
Loss on retirement of non-current assets
Loss on sales of investment securities
Loss on valuation of investment securities
Other
Profit before income taxes
Income taxes - current
Income taxes - deferred
ProfitLoss attributable to non-controlling interests
Profit attributable to owners of parent(Note) Figures are rounded down to the nearest million yen.

- 38 -

542,697472,244
70,45244,607
25,845
891
253
136
135
992
890
80
741
565

18
1,420
481
480
8
16
14
0
238
13
6,292
1,483

2,409

2,278
25,9762,408

284
28,0997,776
20,323(21)
20,345

Non-consolidated Financial Statements
Balance Sheet(As of March 31, 2024)(Million yen)Account title

AmountAccount title

Amount

71,426
9,902
197

LIABILITIESCurrent liabilities
Notes payable - trade
Accounts payable - trade

44,028540
17,822

2,992

Short-term loans payable

7,464

ASSETS
Current assets
Cash and deposits
Notes receivable - trade
Electronically recorded monetary claims operating
Accounts receivable - trade
Securities
MerchandiseWork in process
Supplies
Advance payments - trade
Prepaid expenses
Short-term loans receivable fromsubsidiaries and associates
Accounts receivable - other
Other
Allowance for doubtful accounts
Non-current assets
Property, plant and equipment
Buildings
Structures
Machinery and equipment
VehiclesTools, furniture and fixtures
Land
Lease assets
Intangible assets
Trademark right
Software
Other
Investments and other assets
Investment securities
Shares of subsidiaries and associates
Investments in capital
Investments in capital of subsidiaries andassociates
Long-term loans receivable fromsubsidiaries and associates
Claims provable in bankruptcy, claims
provable in rehabilitation and other
Long-term prepaid expenses
Other

171
6,462
30
0
14
337

Short-term loans payable to subsidiaries
and associates
Current portion of long-term loans payable
Lease obligations
Accounts payable - otherAccrued expenses
Income taxes payable
Advances received

22,319Deposits received

24,364

5,945
320(1,633)55,270
5,428
1,866
12
48
26
151
3,292
30
1,491
4
1,480
5
48,3508,724
37,281
10

100
62
1,036
2,638
193
1,095
68
400
248
22,36910,00010,500
249
45
83
110
1,378
66,39757,51912,133
13,993
13,912
81
36,990618
36,371

15

General reserve

930

Open innovation promotion reserve

25

4,383

Retained earnings brought forward

29,346281
1,439

Allowance for doubtful accounts(4,416)

Allowance for investment loss

(299)

Total assets

Provision for directors’ bonuses
Other
Non-current liabilities
Bonds payable
Long-term loans payable
Deferred tax liabilities
Lease obligations
Provision for retirement benefits
Asset retirement obligations
Other
Total liabilities
NET ASSETS
Shareholders’ equity
Capital stock
Capital surplus
Legal capital surplus
Other capital surplus
Retained earnings
Legal retained earnings
Other retained earnings

12,356

126,697

Treasury shares
Valuation and translation adjustments
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Total net assets
Total liabilities and net assets(Note) Figures are rounded down to the nearest million yen.

- 39 -

7,000(5,598)
2,780
2,760
19
60,300126,697

Statement of Income(From April 1, 2023 to March 31, 2024)(Million yen)Account title

AmountNet sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Other
Non-operating expenses
Interest expenses
Depreciation of assets for rent
Foreign exchange losses
Other
Ordinary income
Extraordinary income
Gain on sales of investment securities
Other
Extraordinary loss
Loss on sales of investment securities
Loss on valuation of investment securities
Provision of allowance for doubtful accounts
Provision of allowance for investment loss
Other
Profit before income taxes
Income taxes - current
Income taxes - deferred
Profit116,889
101,834
15,055
9,063
5,991
367
10,482
748
650
12
200
178

1,420
3
0
225
26
199
6
1,828
221

(Note) Figures are rounded down to the nearest million yen.

- 40 -

11,598

1,042
16,5461,424

458
17,5132,049
15,463

Audit Report

Independent Auditor’s Audit Report on the Consolidated Financial Statements
Independent Auditor’s Report
May 21, 2024
To the Board of Directors
KAGA ELECTRONICS CO., LTD.
PricewaterhouseCoopers Japan LLC
Tokyo office
Takayoshi Yano, CPA
Engagement Partner
Masaki Nitta, CPA
Engagement Partner

Auditors’ Opinion
We have audited, pursuant to Article 444, paragraph (4) of the Companies Act, the consolidated financial
statements, which consist of the consolidated balance sheet, the consolidated statement of income, the consolidated
statement of changes in equity and the notes to the consolidated financial statements of KAGA ELECTRONICS
CO., LTD. (hereinafter referred to as the “Company”) for the fiscal year from April 1, 2023 to March 31, 2024.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, theconsolidated financial position of the Company and its consolidated subsidiaries as of March 31, 2024 and theconsolidated result of their operations for the year then ended in conformity with accounting principles generally
accepted in Japan.
Grounds for Auditor’s Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our responsibility isstated in “Auditor’s Responsibility in Auditing of Consolidated Financial Statements.” We are independent fromthe Company and its consolidated subsidiaries in accordance with the regulations relating to professional ethics inJapan, and have fulfilled other ethical responsibilities as auditor. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion.
Other Information
The other information refers to the business report and its supplementary schedules. Management is responsible forpreparing and disclosing the other information. In addition, auditors and the board of auditors are responsible foroverseeing the directors’ performance of duties within the maintenance and operation of the reporting process forthe other information.
The scope of our audit opinion on the consolidated financial statements does not include the content of the otherinformation, and we do not express an opinion regarding the other information.
Our responsibility in auditing the consolidated financial statements is to read through the other information, and in
the process of reading it, we examine whether there are material differences between the other information and theconsolidated financial statements or the knowledge we have gained in the auditing process, and we also pay
attention as to whether there are any indications in the other information of material errors besides such material
differences.
If we determine there to be material errors in the other information based on the work we have performed, we are
required to report those facts.
There are no matters to report regarding the other information.

- 41 -

Responsibilities of Management, Auditors and the Board of Auditors for Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of consolidated financial statements inaccordance with accounting standards generally accepted in Japan. This responsibility includes designing andoperating internal controls, which management considers necessary for the preparation and fair presentation of
consolidated financial statements that are free from material misstatements, whether due to fraud or error.
In preparation of consolidated financial statements, management is responsible for reviewing whether it is properfor consolidated financial statements to be prepared based on the going concern assumption, and if it is necessary todisclose the relevant matters in accordance with accounting standards generally accepted in Japan, management is
responsible for disclosure thereof.
Auditors and the board of auditors are responsible for monitoring execution of duties by directors in preparationand operation of the financial reporting process.
Auditor’s Responsibility in Auditing of Consolidated Financial Statements
Our responsibility is to obtain reasonable assurance as to whether the consolidated financial statements as a whole
are free from material misstatement due to fraud or error based on the audit we performed, and to express an
opinion on the consolidated financial statements from an independent standpoint in the audit report. A misstatement
may occur due to fraud or error, and if, individually or in the aggregate, it is reasonably expected to affect thedecision-making of users of consolidated financial statements, it is judged to be material.
We make a professional judgment in the course of the audit in accordance with the auditing standards generally
accepted in Japan, and carry out the following maintaining professional skepticism.

Identify and evaluate the risk of material misstatement due to fraud or error. In addition, plan and implement
auditing procedures that address the risk of material misstatement. The selection and application of audit
procedures is at our discretion. Moreover, obtain sufficient and appropriate audit evidence to form the basis of
the opinion.

Although the purpose of auditing the consolidated financial statements is not to express an opinion on theeffectiveness of internal controls, in making those risk assessments, we consider internal controls in relation toaudits in order to design audit procedures that are appropriate for the circumstances.

Evaluate the adequacy of the accounting policy adopted by management and its application method, as well as
the reasonableness of accounting estimates made by management and the adequacy of related notes.

Reach conclusions on whether it is appropriate for management to prepare consolidated financial statementson the premise of going concern, and whether there is material uncertainty about events or situations thatcreate significant doubts about the premise of going concern based on the audit evidence obtained. If material
uncertainties regarding the going concern assumption are observed, it is expected to alert on the notes to theconsolidated financial statements in the audit report, or if the notes to the consolidated financial statements
regarding material uncertainties are not appropriate, it is required to express a qualified opinion with exceptive
items on the consolidated financial statements. Our conclusions are based on the audit evidence obtained up to
the date of the audit report, but future events and circumstances may prevent a company from continuing as agoing concern.

Assess whether the presentation of and notes to the consolidated financial statements comply with corporate
accounting standards generally accepted in Japan, as well as assess the presentation, composition and contentsof the consolidated financial statements including related notes, and whether the consolidated financial
statements properly represent the underlying transactions or accounting events.
Obtain sufficient and appropriate audit evidence regarding the financial information of the Company and its
consolidated subsidiaries to express opinions on the consolidated financial statements. We are responsible fordirecting, supervising, and implementing audits of consolidated financial statements. We are solely
responsible for the audit opinion.
We give reports to auditors and the board of auditors on the scope and timing of planned audits, important audit
findings including important deficiencies in internal controls identified during the audit process, and on othermatters required by the auditing standard.
We give reports to auditors and the board of auditors that we are in compliance with the regulations relating toprofessional ethics in Japan regarding independence, as well as matters that are reasonably considered to affect our
independence as the Auditor, and where applicable, any measures taken to remove hindrances to independence or
any safeguards applied to mitigate hindrances to a tolerable level.

- 42 -

Relationship of Interest
We have no interests in or relationships with the Company and its consolidated subsidiaries which are required tobe disclosed pursuant to the provisions of the Certified Public Accountants Act of Japan.

- 43 -

Independent Auditor’s Audit Report on the Non-consolidated Financial Statements
Independent Auditor’s Report
May 21, 2024
To the Board of Directors
KAGA ELECTRONICS CO., LTD.
PricewaterhouseCoopers Japan LLC
Tokyo office
Takayoshi Yano, CPA
Engagement Partner
Masaki Nitta, CPA
Engagement Partner

Auditors’ Opinion
We have audited, pursuant to Article 436, paragraph (2), item (i) of the Companies Act, the non-consolidated
financial statements, which consist of the balance sheet, the statement of income, the statement of changes inequity, the notes to the non-consolidated financial statements and the related supplementary schedules (collectively,“non-consolidated financial statements, etc.”) of KAGA ELECTRONICS CO., LTD. (hereinafter referred to as the“Company”) for the 56th fiscal year from April 1, 2023 to March 31, 2024.
In our opinion, the non-consolidated financial statements, etc. referred to above present fairly, in all material
respects, the financial position of the Company as of March 31, 2024 and the result of their operations for the year
then ended in conformity with accounting principles generally accepted in Japan.
Grounds for Auditor’s Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our responsibility isstated in “Auditor’s Responsibility in Auditing of the Non-consolidated Financial Statements, Etc.” We are
independent from the Company in accordance with the regulations relating to professional ethics in Japan, and havefulfilled other ethical responsibilities as auditor. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion.
Other Information
The other information refers to the business report and its supplementary schedules. Management is responsible forpreparing and disclosing the other information. In addition, auditors and the board of auditors are responsible foroverseeing the directors’ performance of duties within the maintenance and operation of the reporting process forthe other information.
The scope of our audit opinion on the non-consolidated financial statements, etc. does not include the content of theother information, and we do not express an opinion regarding the other information.
Our responsibility in auditing the non-consolidated financial statements, etc. is to read through the otherinformation, and in the process of reading it, we examine whether there are material differences between the otherinformation and the non-consolidated financial statements, etc. or the knowledge we have gained in the auditing
process, and we also pay attention as to whether there are any indications in the other information of material errors
besides such material differences.
If we determine there to be material errors in the other information based on the work we have performed, we are
required to report those facts.
There are no matters to report regarding the other information.

- 44 -

Responsibilities of Management, Auditors and the Board of Auditors for Non-consolidated Financial Statements,
Etc.
Management is responsible for the preparation and fair presentation of non-consolidated financial statements, etc.
in accordance with accounting standards generally accepted in Japan. This responsibility includes designing andoperating internal controls, which management considers necessary for the preparation and fair presentation of nonconsolidated financial statements, etc. that are free from material misstatements, whether due to fraud or error.
In preparation of non-consolidated financial statements, etc., management is responsible for reviewing whether it isproper for non-consolidated financial statements, etc. to be prepared based on the going concern assumption, and if
it is necessary to disclose the relevant matters in accordance with accounting standards generally accepted in Japan,
management is responsible for disclosure thereof.
Auditors and the board of auditors are responsible for monitoring execution of duties by directors in preparationand operation of the financial reporting process.
Auditor’s Responsibility in Auditing of the Non-consolidated Financial Statements, Etc.
Our responsibility is to obtain reasonable assurance as to whether the non-consolidated financial statements, etc. asa whole are free from material misstatement due to fraud or error based on the audit we performed, and to express
an opinion on the non-consolidated financial statements, etc. from an independent standpoint in the audit report. A
misstatement may occur due to fraud or error, and if, individually or in the aggregate, it is reasonably expected toaffect the decision-making of users of the non-consolidated financial statements, etc., it is judged to be material.
We make a professional judgment in the course of the audit in accordance with the auditing standards generally
accepted in Japan, and carry out the following maintaining professional skepticism.

Identify and evaluate the risk of material misstatement due to fraud or error. In addition, plan and implement
auditing procedures that address the risk of material misstatement. The selection and application of audit
procedures is at our discretion. Moreover, obtain sufficient and appropriate audit evidence to form the basis of
the opinion.

Although the purpose of auditing the non-consolidated financial statements, etc. is not to express an opinion
on the effectiveness of internal controls, in making those risk assessments, we consider internal controls in
relation to audits in order to design audit procedures that are appropriate for the circumstances.

Evaluate the adequacy of the accounting policy adopted by management and its application method, as well as
the reasonableness of accounting estimates made by management and the adequacy of related notes.

Reach conclusions on whether it is appropriate for management to prepare non-consolidated financial
statements, etc. on the premise of going concern, and whether there is material uncertainty about events orsituations that create significant doubts about the premise of going concern based on the audit evidence
obtained. If material uncertainties regarding the going concern assumption are observed, it is expected to alert
on the notes to the non-consolidated financial statements, etc. in the audit report, or if the notes to the nonconsolidated financial statements, etc. regarding material uncertainties are not appropriate, it is required toexpress a qualified opinion with exceptive items on the non-consolidated financial statements, etc. Our
conclusions are based on the audit evidence obtained up to the date of the audit report, but future events andcircumstances may prevent a company from continuing as a going concern.

Assess whether the presentation of and notes to the non-consolidated financial statements, etc. comply withcorporate accounting standards generally accepted in Japan, as well as assess the presentation, composition,and contents of the non-consolidated financial statements, etc. including related notes, and whether the nonconsolidated financial statements, etc. properly represent the underlying transactions or accounting events.
We give reports to auditors and the board of auditors on the scope and timing of planned audits, important audit
findings including important deficiencies in internal controls identified during the audit process, and on othermatters required by the auditing standard.
We give reports to auditors and the board of auditors that we are in compliance with the regulations relating toprofessional ethics in Japan regarding independence, as well as matters that are reasonably considered to affect our
independence as the Auditor, and where applicable, any measures taken to remove hindrances to independence or
any safeguards applied to mitigate hindrances to a tolerable level.
Relationship of Interest
We have no interests in or relationships with the Company which is required to be disclosed pursuant to theprovisions of the Certified Public Accountants Act of Japan.
- 45 -

Audit Report of the Board of Auditors
Audit Report
With respect to the Directors’ performance of their duties during the 56th fiscal year (from April 1, 2023 to March
31, 2024), the Board of Auditors has prepared this audit report after deliberations based on the audit reports
prepared by each Auditor, and hereby reports as follows:
1. Method and Contents of Audit by Auditors and the Board of Auditors(1) The Board of Auditors has established the audit policies, audit plans, etc. and received a report from each
Auditor regarding the status of implementation of their audit and results thereof. In addition, we have received
reports from the Directors, Executive Officers and the Accounting Auditor regarding the status of execution of
their duties, and requested their explanations as necessary.
(2) In conformity with Auditor Auditing Standards established by the Board of Auditors, in accordance with theaudit policies, audit plans, etc., and each Auditor endeavored to facilitate a mutual understanding with the
Directors, the Audit Office and other employees, etc. of the Company, endeavored to collect information andmaintain and improve the audit environment, and conducted an audit by following the methods described
below:(i) Each Auditor has attended the meetings of the Board of Directors and other important meetings, received
reports on the status of execution of duties, including duties related to group companies, from the
Directors, Executive Officers, Division Managers and other employees and requested explanations asnecessary, examined important approval/decision documents, and investigated the status of operations
and assets of the headquarters and other major offices. Furthermore, we worked to communicate andshare information with the directors and auditors of subsidiaries, obtain business information fromsubsidiaries, and visit subsidiaries as necessary to investigate their operations and assets.
(ii) We received periodic reports from directors, employees, and others regarding the structure and operationof the contents of resolutions of the Board of Directors regarding the maintenance of systems necessary toensure that the duties of the directors described in the Business Report are executed in a mannerconsistent with laws, regulations, and the Articles of Incorporation and systems necessary to ensure theproper operations of the corporate group comprising the corporation and its subsidiaries as provided forin Article 100, paragraphs (1) and (3) of the Regulations for Enforcement of the Companies Act, as well
as systems maintained based on such resolutions (internal control systems), requested explanations asnecessary, and expressed opinions.
(iii) While coordinating with the independent auditor, we monitored and examined whether the independent
auditor maintained an independent position and performed auditing appropriately, and we also received
reports from the independent auditor on the execution of its duties and requested explanations whennecessary. The Independent Auditor notified us, and we requested explanations when necessary,concerning its establishment of a “System for Ensuring the Appropriate Execution of Duties” (theRegulations on Corporate Accounting Article 131) in accordance with the “Quality Control Standard for
Auditing” (issued by the Business Accounting Council).
Through these methods, we reviewed the business report and its accompanying supplementary schedules, thenon-consolidated financial statements (balance sheet, statement of income, statement of changes in equity, andnotes to the non-consolidated financial statements) and related supplementary schedules, and the consolidated
financial statements (consolidated balance sheet, consolidated statement of income, consolidated statement ofchanges in equity, and notes to the consolidated financial statements) for the fiscal year under review.
2. Results of the Audit(1) Results of the audit for the business report(i) We have found that the business report and the accompanying supplementary schedules present fairly thecurrent financial position of KAGA ELECTRONICS CO., LTD. in conformity with applicable laws andregulations and the Articles of Incorporation.
(ii) With respect to the execution of duties of the Directors, we have found neither improper conduct nor any
material breach of applicable laws and regulations and the Articles of Incorporation.

- 46 -

(iii) We have found that the resolutions of the Board of Directors regarding the internal control system areproper and correct. We have found nothing that needs to be pointed out concerning the operation
regarding the internal control system.
(2) Results of the audit of the non-consolidated financial statements and the accompanying supplementaryschedules
We have found that the auditing methods employed by PricewaterhouseCoopers Japan LLC, Accounting
Auditor, and the results thereof are appropriate and sufficient.
(3) Results of the audit of the consolidated financial statements
We have found that the auditing methods employed by PricewaterhouseCoopers Japan LLC, Accounting
Auditor, and the results thereof are appropriate and sufficient.
May 22, 2024
The Board of Auditors, KAGA ELECTRONICS CO., LTD.
Inside Auditor
Outside Auditor
Outside Auditor
Outside Auditor

Eiji Kawamura
Susumu Kitsunai
Yoichi Sato
Kyoko Oyanagi- 47 -(Seal)(Seal)(Seal)(Seal)