[Translation]
February 6 (as amended on Feb 7), 2024
To whom it may concern:

Company Name:
Name of Representative:
Contact:

KDDI Corporation
Makoto Takahashi
President, Representative Director, CEO(Securities Code: 9433 TSE Prime Market)
Yasuo Nakazato, General Manager ofGeneral Administration Division,
Corporate Sector(TEL．03-3347-0077)

Notice Regarding Planned Commencement of Tender Offer for Shares of Lawson, Inc.
(Securities Code: 2651) and the Execution of the Capital and Business Alliance Agreement
KDDI Corporation (the “Offeror”) hereby announces that today, the Offeror has resolved to enter intowith Mitsubishi Corporation (“MC”; the Offeror and MC collectively referred to as the “Offeror Related
Parties”) a master agreement stipulating that the Offeror will acquire the share certificates, etc. of
Lawson, Inc. (Securities Code: 2651, a company listed on the Prime Market of Tokyo Stock Exchange,
Inc. (the “TSE”); the “Target”) through a tender offer under the Financial Instruments and Exchange Act(Act No. 25 of 1948, as amended; the “Act”) (the “Tender Offer”) (the “Master Agreement”), and toenter into a capital and business alliance agreement (the “Capital and Business Alliance Agreement”)
with MC and the Target (the “Capital and Business Alliance Agreement”).
With respect to the Tender Offer, based on the considerations to date, it is expected that a certain
period of time is necessary to complete the procedures and actions required under the competition laws
(the “Competition Law Procedures”) of Japan, China, South Korea, and the EU. Accordingly, theTender Offer is scheduled to be commenced promptly upon the satisfaction (or waiver by the Offeror
Related Parties) of the conditions precedent (Note 1) (the “Conditions Precedent”), including thecompletion of the procedures and actions and other conditions precedent stipulated in the Master
Agreement. As of today, based on discussions with local law firms regarding such procedures, etc.,
the Offeror aims to commence the Tender Offer in or around April 2024, but it is difficult to accurately
predict the length of time required for the procedures and actions with Japanese and foreign competition
authorities. If there is any change in the expected schedule of the Tender Offer, it will be promptly
announced.
(Note 1) Under the Master Agreement, the commencement of the Tender Offer by the Offeror is subject
to the satisfaction (I) the representations and warranties made by the Offeror Related Parties(for details of such representations and warranties, please refer to “(I) Master Agreement” under“(6) Material agreements relating to the Tender Offer” under “1. Purposes of Tender Offer”
below) are all true and accurate in all material respects; (II) all of the Definitive Agreements(as defined in “(1) Outline of the Tender Offer” under “1. Purposes of Tender Offer” below;
hereinafter the same) have been validly and lawfully executed and remain valid, and all
obligations to be fulfilled or complied with by each party under the Definitive Agreements prior
to the commencement of the Tender Offer have been fulfilled or complied with in all material
respects; (III) the Target’s board of directors has approved the Tender Offer and to the Target’s
shareholders to recommend that they tender their shares in the Tender Offer (the “Opinion in
Favor of Tender Offer”; hereinafter the same) with the unanimous consent of all disinterested
directors, and the Opinion in Favor of Tender Offer has been made is made public and it ismaintained; (IV) the Special Committee (as defined in “(i) Background of the proposal by the

Offeror Related Parties and establishment of a review system” under “(II) Decision-making
process leading to and grounds for the opinion in favor of the Tender Offer by the Target” under“(2) Background, purpose and decision-making process leading to the decision to conduct theTender Offer, and management policy following the Tender Offer” under “1. Purposes ofTender Offer” below; hereinafter the same), which was established in connection with theTender Offer, has made a report to the Target’s board of directors that it is appropriate to express
the Opinion in Favor of Tender Offer and such report has been made public, and the report ismaintained; (V) all Competition Law Procedures and other procedures with relevant authorities
necessary for the implementation of the Transactions (as defined in “(1) Outline of the Tender
Offer” under “1. Purposes of Tender Offer” below; hereinafter the same) have been completed;(VI) the implementation of any of the Transactions do not constitute a violation of laws andregulations, and there is no determination, etc. by any relevant authority that restricts or
prohibits the implementation of any of the Transactions; and (VII) as of the commencement
date of the Tender Offer, there are no material facts regarding the Target’s business, etc.
(Article 166, paragraph 2 of the Act) that have not been disclosed (Article 166, paragraph 4 of
the Act) and there are no facts regarding the implementation of the tender offer, etc.
(Article 167, paragraph 2 of the Act) with respect to the Target’s Share Certificates (as definedin “(1) Outline of the Tender Offer” under “1. Purposes of Tender Offer” below; hereinafter thesame) that have not been disclosed (Article 167, paragraph 4 of the Act); (VIII) from today
onward, any event that may have a material adverse effect on the business, financial condition,
operating results, or cash flows, or the prospects thereof of the Target Group (as defined in “(I)Background, purposes and decision-making process leading to the decision to conduct theTender Offer” under “(2) Background, purpose and decision-making process leading to thedecision to conduct the Tender Offer, and management policy following the Tender Offer”
under “1. Purposes of Tender Offer” below; hereinafter the same), or any other situation that
may make it difficult to achieve the purpose of the Transactions has not occurred or become
apparent or is not reasonably expected to occur or become apparent, and no significant changes
in domestic and international stock market conditions, other market environments, financial
environments, or economic environments have occurred or become apparent or are notreasonably expected to occur or become apparent.
1. Purposes of Tender Offer(1) Outline of the Tender Offer
As of today, of the shares of common stock of the Target listed on the TSE Prime Market (the“Target Shares”), the Offeror owns 2,110,000 shares (Shareholding Ratio (Note 1): 2.11%).
(Note 1) “Shareholding Ratio” refers to the ratio (rounded to the second decimal place; hereinafter
the same applies in the calculation of the Shareholding Ratio) of the number of Target Sharesto the number of shares (100,184,370 shares) (the “Total Number of Shares After Adjustment
for Diluted Shares”) calculated by deducting the number of treasury shares held by the Target
as of November 30, 2023, as stated in the “Consolidated Financial Results [IFRS] for theThird Quarter of the Fiscal Year Ending February 29, 2024” announced by the Target on
January 12, 2024 (the “Target’s Financial Results”) (221,630 shares) from the number ofshares calculated by adding the total number of the Target Shares to be issued upon exercise
of 1,060 units of Share Options (as defined in “(II) Share options” under “(3) Price of tender
offer” under “2. Summary of Tender Offer” below; hereinafter the same) (106,000 shares)
reported by the Target as remaining as of December 31, 2023 to the total number of issued
shares as of January 12, 2024, as stated in the “third Quarterly Report for the 49th fiscalyear” submitted by the Target on January 12, 2024 (the “Target Third Quarterly Report”)(100,300,000 shares). The Shareholding Ratio calculated based on the latest information
available before the commencement of the Tender Offer may differ from the above figure
due to changes after that date (hereinafter the same).
(Note 2) The breakdown of 1,060 units of the Share Options is as follows (The names of the respective
share options are defined in “(II) Share options” under “(3) Price of tender offer” under “2.
Summary of Tender Offer” below; hereinafter the same):- 2 -Name of Share Options

Number of Share Options as ofDecember 31, 2023 (units)

14th Series of Share Options
16th Series of Share Options
17th Series of Share Options
18th Series of Share Options
19th Series of Share Options
20th Series of Share Options
21st Series of Share Options
22nd Series of Share Options
23rd Series of Share Options
24th Series of Share Options

27
38
62
18
74
92
135
162
186
266

Number of the Target Shares tobe issued upon exercise of the
Share Options (shares)
2,700
3,800
6,200
1,800
7,400
9,200
13,50016,20018,60026,600Today, the Offeror has entered into the Master Agreement and the shareholders agreement (the“Shareholders Agreement”; the Master Agreement, the Shareholders Agreement, and the Capital andBusiness Alliance Agreement hereinafter collectively referred to as the “Definitive Agreements”) (Fordetails of the Master Agreement, the Shareholders Agreement, and the Capital and Business AllianceAgreement, please refer to “(I) Master Agreement”, “(II) Shareholders Agreement”, and “(III) Capitaland Business Alliance Agreement” under “(6) Material agreements relating to the Tender Offer”
below) with MC, the parent company of the Target (number of shares held: 50,150,100 shares,
Shareholding Ratio: 50.06%), and decided to execute a series of transactions (the “Transactions”) inorder to ensure that the Target’s shareholders are solely the Offeror Related Parties, by acquiring allof the Target Shares (including the Target Shares related to such American Depositary Shares (asdefined in “(III) Depositary receipts for share certificates” under “(3) Price of tender offer” under “2.
Summary of Tender Offer” below; hereinafter the same) represented by the American Depositary
Receipts (as defined in “(III) Depositary receipts for share certificates” under “(3) Price of tender
offer” under “2. Summary of Tender Offer” below; hereinafter the same); however, excluding Target
Shares owned by the Offeror Related Parties and the treasury shares owned by the Target) and Share
Options (the “Target’s Share Certificates”). In addition, the Capital and Business AllianceAgreement has been executed today between the Offeror, MC, and the Target. The Offeror willconduct the Tender Offer as part of the Transactions provided that the Conditions Precedent aresatisfied (or waived by the Offeror Related Parties). As of today, the Offeror is not aware of any
event of material impediment to the satisfaction of the Conditions Precedent. The Offeror, together
with MC, will implement the procedures and actions required under the competition laws of Japan,
China, South Korea, and the EU to satisfy the Conditions Precedent, based on the legal advice of local
law firms in Japan and in the relevant foreign jurisdictions. The Offeror Related Parties are alreadymaking the necessary advance preparations for such procedures and actions, and from today, willconsult with the relevant authorities concerning competition law to ensure that such procedures andactions can be implemented.
The Offeror has set the minimum number of tendered shares to be purchased in the Tender Offer at
14,458,800 shares (Shareholding Ratio: 14.43%); and if the total number of the Target’s Share
Certificates tendered in the Tender Offer (the “Tendered Shares”) is less than the minimum number oftendered shares to be purchased, the Offeror will purchase none of the Tendered Shares. Meanwhile,with the Offeror’s intention of having the Target Shares go private, the Offeror has not set the maximum
number of tendered shares to be purchased in the Tender Offer; and if the total number of the Tendered
Shares is not less than the minimum number of tendered shares to be purchased, the Offeror willpurchase all of the Tendered Shares. The minimum number of tendered shares to be purchased(14,458,800 shares) has been set so that upon the completion of the Tender Offer, the total number ofvoting rights of the Target held by the Offeror Related Parties should be two-thirds (2/3) or more of thetotal number of voting rights of the Target (the number of voting rights of the Target, 1,000,783, inrespect of the number of shares (100,078,370 shares) which is the number of shares calculated bydeducting the number of treasury shares held by the Target as of November 30, 2023, as stated in the- 3 -Target’s Financial Results (221,630 shares) from the total number of issued shares (100,300,000 shares)
as of January 12, 2024 as stated in the Target Third Quarterly Report). Due to changes in the numberof treasury shares held by the Target after relevant time of the information, the actual minimum numberof tendered shares to be purchased in the Tender Offer may differ from the above figure. Prior to thecommencement of the Tender Offer, we plan to determine the definitive minimum number of tenderedshares to be purchased based on the latest information available at the time of the commencement of
the Tender Offer.
With respect to the number of Target Shares (106,000 shares) to be issued upon exercise of the Share
Options, given that (i) the holder of the Share Options (the “Share Option Holders”) may exercise suchholder’s Share Options only in a lump sum, within the exercise period of the Share Options which islimited to the 10-day period (or the following business day if the 10th day falls on a holiday) from thedate following the date on which such Share Option Holder has lost his/her/their position as the Target’s
director and executive officer (the exercise conditions associated with the loss of status hereinaftercollectively referred to as the “Forfeiture of Status Exercise Conditions”), and according to the Target,
among the Target’s current 5 directors and the current 13 executive officers who are the Share Option
Holders, there is no person who plans to exercise the Share Options by fulfilling the Forfeiture of Status
Exercise Conditions and it is not assumed that the Share Options will be exercised and Target Shares
will be issued or transferred to the Share Option Holders during the period for a tender offer in theTender Offer (the “Tender Offer Period”); and (ii) as stated in “(4) Policies on organizational
restructuring, etc. after the Tender Offer (matters concerning “two-step acquisition”)” below, when theTender Offer is completed, the Offeror Related Parties plan to request the Target to carry out theprocedures reasonably necessary for the execution of the Transactions, such as encouraging the Share
Option Holders to forfeit their Share Options and according to the Target, if the Target receives such arequest, it intends to cooperate with it promptly after the settlement commencement date of the Tender
Offer, the Offeror does not take into account the number of Target Shares (106,000 shares) to be issued
upon exercise of the Share Options when setting the minimum number of tendered shares to bepurchased.
In addition, as the Offeror aims to make the Offeror Related Parties the sole shareholders of the Target
as set forth above, if, upon the completion of the Tender Offer, in the event the Offeror Related Parties
fails to acquire all of the Target’s Share Certificates in the Tender Offer, the Offeror Related Parties
plans, as described in “(4) Policies on organizational restructuring, etc. after the Tender Offer (mattersconcerning “two-step acquisition”)” below, to implement a series of procedures to make the Offeror
Related Parties the Target’s only shareholders (the “Squeeze-out Procedure”). The Offeror plans to use
cash on hand and/or borrowings from financial institutions, etc., to fund the Tender Offer.
We plan to conduct each of the transactions as substantially described below as the Transactions.
I. Prior to the implementation of the Tender Offer (current status)
As of today, MC owns 50,150,100 Target Shares (Shareholding Ratio: 50.06%), the Offeror owns
2,110,000 Target Shares (Shareholding Ratio: 2.11%), and other minority shareholders own
47,818,270 Target Shares (Shareholding Ratio: 47.73%) and 1,060 Share Options (106,000 Target
Shares to be issued upon exercise of the Share Options (Shareholding Ratio: 0.11%)).

- 4 -

MC

Other shareholders and theShare Option Holders

Offeror50.06%

2.11%

47.84%

TargetII. Tender Offer
The Offeror will conduct the Tender Offer with the aim of acquiring all of the Target’s Share
Certificates with the purpose of having the Target Shares go private.
Tender Offer
MCOther shareholders and the Share
Option Holders

Offeror50.06%

2.11%

47.84%

TargetIII. Squeeze-out Procedure through Share Consolidation (upon the completion of the Tender Offer)
In the event the Offeror fails to acquire all of the Target’s Share Certificates in the Tender Offer,
the Offeror, together with MC, shall request the Target to implement the procedures for the Share
Consolidation (as defined in “(4) Policies on organizational restructuring, etc. after the Tender Offer(matters concerning “two-step acquisition”)” below; hereinafter the same), subject to the completionof Tender Offer and the completion of the settlement thereof, and the Target shall implement theprocedures to make the Target’s shareholders solely the Offeror Related Parties. With respect to theratio of the Share Consolidation, the Offeror, together with MC, plans to request the Target to set theratio of the Share Consolidation to a ratio where the total number of issued shares of the Target is twoshares (however, if, as a result of discussions between the Offeror Related Parties, the Offeror Related
Parties agree to a different ratio, such different ratio) (the “Consolidation Ratio”) (if a different ratio
is set, such ratio will be promptly disclosed). In addition, if any fractional shares (including
fractional shares of the Target Shares owned by MC) result from the implementation of the Share
Consolidation, the Offeror plans to purchase the Target Shares equivalent to the total number of such
fractional shares (any fractional shares less than one share resulting from the aggregation of fractional- 5 -shares shall be discarded; hereinafter the same) in accordance with the procedures provided in Article
235 of the Companies Act (Act No. 86 of 2005, as amended; the “Companies Act”) and other relevantlaws and regulations.
Squeeze-out through the Share
Consolidation
MC

Other shareholders and theShare Option Holders

Offeror50.06%

100-(α+50.06)%

α%

TargetIV. After the implementation of the Transactions
After completion of the Squeeze-out Procedure, MC and the Offeror each plan to hold 50.00% of
the voting rights in the Target.
MC

Offeror50.00%

50.00%

TargetAs of today, the Target Shares are listed on the TSE Prime Market. However, as described in “(5)Possibility of delisting and reason therefor” below, depending on the outcome of the Tender Offer,
the Target Shares may become delisted through the prescribed procedures. If the Squeeze-out
Procedure is to be implemented after the Tender Offer is completed, the Target Shares will be delisted
through the prescribed procedures.
According to “Notice of Expression of Our Opinion in Favor of the Planned Commencement ofand Recommendation to Tender in the Tender Offer for Company’s Share Certificates by KDDI
Corporation and Notice of Capital and Business Alliance” published today by the Target (the “Target’s
Press Release”), the Target resolved at its board of directors meeting held today, as the Target’s
opinion as of today, to the effect that, if the Tender Offer is commenced, it shall express its opinion infavor of the Tender Offer as the Target’s opinion as of today and recommend that the Target’s
shareholders tender their shares in the Tender Offer, that it recommends that the holders of theAmerican Depositary Receipts tender in the Tender Offer by delivering their American Depositary- 6 -Receipts to the Depositary Bank (as defined in “(III) Depositary receipts for share certificates” under“(3) Price of tender offer” under “2. Summary of Tender Offer” below; hereinafter the same) inadvance and receiving delivery of the Target Shares related to such American Depositary Shares
represented on the American Depositary Receipts; and that it leaves the decision to the Share Option
Holders whether or not to tender in the Tender Offer.
According to the Target, it has resolved at the above-mentioned board of directors meeting to takethe following procedures for the expression of its opinion. Specifically, the Target has also resolved
to request, at the commencement of the Tender Offer, that the Special Committee established by theTarget regarding the Tender Offer review whether any change should be made to the opinion
expressed by the Special Committee to the Target’s board of directors as of February 5, 2024, andeither advise the Target’s board of directors accordingly if there is no change, or if any change should
be made, state the amended opinion, and to again express the Target’s opinion regarding the Tender
Offer upon the commencement of the Tender Offer based on such opinion of the Special Committee,
as described in “(ii) Establishment of an independent special committee at the Target and receipt of areport from the special committee” under “(Measures to ensure the fairness of the Tender Offer, suchas measures to ensure the fairness of the Tender Offer Price and measures to avoid conflicts ofinterest)” under “(II) Background of calculation” under “(4) Basis for calculation of the price of tender
offer” under “2. Summary of Tender Offer” below.
The Target states that the above-mentioned board resolution of the Target was passed on theassumption that, through the Tender Offer and the Squeeze-out Procedure by the Offeror, the Offeror
Related Parties will be the sole shareholders of the Target, and that the Target Shares are scheduled to
be delisted.
For details regarding the decision-making process of the Target’s board of directors, please refer tothe Target’s Press Release and “(II) Decision-making process leading to and grounds for the opinion
in favor of the Tender Offer by the Target” under “(2) Background, purpose and decision-making
process leading to the decision to conduct the Tender Offer, and management policy following theTender Offer” below.
(2) Background, purpose and decision-making process leading to the decision to conduct the Tender
Offer, and management policy following the Tender Offer
The background, purpose and decision-making process leading to the decision to conduct theTender Offer by the Offeror Related Parties and the Target, and management policy following theTender Offer are as follows. The below descriptions of the Target are based on the information madepublicly-available by the Target, the Target’s Press Release, and the explanations from the Target.
Furthermore, the below descriptions of MC are based on the information made publicly-available byMC, the “Notification Regarding Changing Status of MC Subsidiary (Lawson, Inc.) into that ofEquity-method Affiliate Company” announced today by MC, and the explanations received from MC.
(I) Background, purposes and decision-making process leading to the decision to conduct theTender Offer
The Offeror was established in 2000 as DDI Corporation as a result of the merger of threecompanies (Kokusai Denshin Denwa Co., Ltd. (KDD), which was established in 1953, DDI
Corporation (DDI), which was established in 1984 and changed its trade name in 1985, and IDO
Corporation (IDO), which was established in 1987,) with DDI as the surviving corporation, with the
purpose of further enriching customers’ lives, business, and communications through“communication”.
Subsequently, through the absorption-type mergers, etc., of mobile
communication service companies consisting of seven cellular group companies and three TU-KA
group companies, and POWEREDCOM, Inc., which is an electric power communication service
provider, the Offeror has provided various services to its customers as a comprehensive
communication service provider that can provide mobile and Fixed Broadband (FTTH/CATV)
Service (Note 1) by a single company. DDI listed its shares on the TSE in 1993 and changed its
trade name to KDDI Corporation in 2001.
(Note 1) “Fixed Broadband (FTTH/CATV) Service” means communication services that can send
and receive large-capacity data at a high speed. Those using optical fibers are referred
to as “FTTH” and those using cable TV lines are referred to as “CATV.”- 7 -Currently, the Offeror Group (which refers to a corporate group consisting of the Offeror, its 189
consolidated subsidiaries, and its 43 affiliated companies subject to equity method (as of
September 30, 2023)) is expanding its business into various fields, with the provision ofcommunication services to individuals and corporate customers in Japan and overseas as its corebusiness. In May 2022, the Offeror Group announced “KDDI VISION 2030: The creation of asociety in which anyone can make their dreams a reality, by enhancing the power to connect,” anddetermined that it would aim to become a presence that can add value to every industry and life
scene, and become a “Platformer Supporting Society”. In addition, the New Medium-TermBusiness Strategy (from the fiscal year ending March 2023 through the fiscal year ending March
2025) is built upon “Sustainability Management” that aims to achieve the sustainable growth ofsociety and the enhancement of corporate value together with its partners, and the Offeror Groupaims for an era in which new value is created, by evolving the “power to connect” through the useof 5G’s characteristics and blending telecommunications into every kind of scene. In particular,
the Offeror Group has set out a “Satellite Growth Strategy” as its business strategy and defined DX,
finance, energy, LX, and regional co-creation as its five focused areas, and is accelerating the
expansion of new business domains by evolving the Offeror Group’s 5G telecommunications
business and its businesses in focus areas centered on telecommunications.
On the other hand, according to the Target, the Target was incorporated in April 1975 as Daiei
Lawson Co., Ltd. and changed its trade name to Lawson, Inc. in June 1996. Subsequently,
according to the Target, the Target listed its shares on the First Section of the TSE Market in July
2000; and in April 2022, the Target moved to the Prime Market of the TSE Market in accordancewith the review of the market classification of the TSE. According to the Target, currently, theTarget Group (referring to a corporate group consisting of the Target, 30 consolidated subsidiaries,
and 9 equity method affiliates (as of November 30, 2023)) operates a franchising system for theconvenience stores “LAWSON” and directly managed stores as its main business.
According to the Target, since entering into a business alliance agreement (as amended) with MC
in February 2000, the Target has pursued mutual business synergies with MC and established its
position as one of Japan’s leading convenience store chains. In addition, according to the Target,
the Target has aimed to realize the group philosophy of “Creating Happiness and Harmony in Our
Communities” in the medium-term management vision “Challenge 2025” formulated in FY 2021 inpreparation for 2025, the 50th anniversary of the Target’s incorporation, focusing its efforts oncreating “new hubs of refreshment in every community” (Note 2), and carried out various initiatives
centered on “Superior taste”, “Human kindness”, and “Environmental (Machi) friendliness”.
(Note 2) “New hubs of refreshment in every community” refers to stores in which everyone canfind “Whew!” Surprises and that bring peace of mind, excitement, and convenience toeveryone’s daily life, which is the ideal store image targeted by the Target.
According to the Target, the details of the main business and the mid to long term management
strategies for each business of the Target Group are as below.
(A) Domestic convenience store businessAccording to the Target, in the domestic convenience store business, the Target operates afranchising system as the headquarters of franchise chains for “LAWSON,” “NATURALLAWSON,” and “LAWSON STORE 100” as well as directly managed stores. According to theTarget, Lawson Urban Works, Inc., a consolidated subsidiary of the Target, operates theconvenience store “LAWSON” mainly in Tokyo and Chiba prefecture; Lawson Store 100, Inc., aconsolidated subsidiary of the Target, operates, and provides management support for, the directly
managed stores of “LAWSON STORE 100”; and SCI, Inc., a consolidated subsidiary of the Target,
is a functional subsidiary that comprehensively manages the business process from procurement of
raw materials to sales, improving the efficiency of, and optimizing the entire process.
According to the Target, amid the outbreak of COVID-19, which has caused major changes in
consumer behavior, the Target has strengthened its lineup of daily-use products such as fresh andfrozen foods in order to respond to the customers’ stay-at-home demand, and in the current situation
where more people are going out as the flow of people recovers, the Target is responding to thischange in consumer behavior more than ever, and is continuing to innovate products and create sales- 8 -spaces that are easy to shop at. In addition, based on the use of digital technologies, including theuse of data within the Target Group, and the motivation and spirit of challenge of colleagues working
together, the Target is pursuing “Three Promises” (Note 3) and is accelerating changes to create“new hubs of refreshment in every community,” which can provide new convenience in the future.
In order to accelerate these initiatives under the strategic concept of “community based × individual
customer and individual store-focused” (Note 4), the area company system (Note 5), which waspartially introduced in FY 2022, has been expanded nationwide since FY 2023.
According to the Target, the Target has positioned the domestic convenience store business as itscore business in its business portfolio strategy and plans to continue to strengthen this businessthrough concentrated investment, and at the same time, intends to accelerate the evolution of its
convenience store business, including peripheral businesses, in order to implement “newconvenience” and create a sustainable business model. As its most recent major initiative, theTarget has been working to realize the world’s fastest quick commerce platform by linking delivery
platform companies with its systems and increasing the number of delivery products it handles.
(Note 3) “Three Promises” refers to “Superior taste,” “Human kindness,” and “Environmental(Machi) friendliness” promised to customers and society by the Target.
(Note 4) “Community based × individual customer and individual store-focused” refers to aiming
to optimize product offerings that meet the needs of customers in each area.
(Note 5) “Area company system” refers to a structure for rigorously pursuing the creation of value
for customers at locations closer to them, in which companies with great discretion are
established in eight areas nationwide to realize “community based × individual customer
and individual store-focused.”(B) Seijo Ishii businessAccording to the Target, Seijo Ishii Co., Ltd., a consolidated subsidiary of the Target, mainly
operates 181 directly managed “Seijo Ishii” supermarkets (as of the end of November 2023) and afranchising system. Seijo Ishii Co., Ltd. establishes its own unique business model of “vertical
integration of food,” in which all of its processes, from importing, logistics, and manufacturing towholesaling, retail sales, and restaurant operations, are carried out in-house. Against the backdropof its strong brand power, backed by high-quality products and services, which are its strengths,
Seijo Ishii Co., Ltd. has succeeded in capturing the stay-at-home demand and is achieving rapid
expansion in the scale of its business.
The new, integrated central kitchen, the “Yamato No. 3 central kitchen,” went into operation in
July 2022, significantly strengthening Seijo Ishii Co., Ltd.’s existing manufacturing capacity. Given
that, Seijo Ishii Co., Ltd. now plans to open a new distribution center in order to promote thedevelopment of new categories of products in the delicatessen division, further accelerate store
openings in the Kanto region, and build a distribution system in preparation for advancement andexpansion into western Japan. Furthermore, in the EC business, the Seijo Ishii Net Supermarket
has been jointly operating on Amazon.co.jp since March 2022, and Seijo Ishii Co., Ltd. is working
to strengthen its EC and to promote last-mile businesses.
(C) Entertainment-related businessAccording to the Target, Lawson Entertainment, Inc., a consolidated subsidiary of the Target,
operates ticketing businesses such as LAWSON Tickets and LAWSON Travel and a product sales
business that sells music/video software at HMV stores and via EC, etc. In addition, United
Cinemas Co., Ltd., a consolidated subsidiary of the Target, operates a cinema complex business that
operates 41 movie theater complexes (as of the end of December 2023).
In its business portfolio strategy, the Target has positioned this business as one of the main sourcesof earnings in 2025. In addition to vertically launching the travel business with a view todeveloping services which seamlessly provide both entertainment and travel tickets and utilizing
M&A transactions and alliances, as well as strengthening product lineups and developing new
products in the EC business, the Target is working to develop its entertainment complex business byproviding high added-value, such as premium seats and other theatrical facilities, in the cinema
business and expanding screening content other than movies. Through these initiatives, the Target
is aiming to become the one and only comprehensive entertainment distribution company.
- 9 -(D) Financial services businessAccording to the Target, Lawson Bank, Inc., a consolidated subsidiary of the Target, hasdeveloped its ATM business and retail businesses based on 13,509 ATMs installed at LAWSON
stores nationwide (as of the end of March 2023); in addition, it provides services which connect
ATM users with partner financial institutions (385 companies as of the end of March 2023) andcashless operating companies through its ATM network.
According to the Target, in its business portfolio strategy, the Target has positioned this businessas one of the main sources of earnings in 2025 and is working to increase the number of ATM users
by expanding the number of partner financial institutions and expanding Lawson Bank’s ATM
services. In addition, the Target aims to provide, as the “bank closest to customers,” new retailfinancial services to more than 3.6 billion store visitors annually.
(E) Overseas businessAccording to the Target, as an overseas business, the Target operates “LAWSON” stores in China,
Thailand, the Philippines, Indonesia, and Hawaii, U.S.A. with operating companies in the respective
regions (Note 6).
(Note 6) According to the Target, in China, Thailand, the Philippines, and Hawaii, U.S.A.,
business operations are primarily conducted through subsidiaries based on investments
by the Target, and in Indonesia, the Target is conducting franchising operations througharea-licensing to local companies rather than conducting business operations throughsubsidiaries.
According to the Target, among the Target’s overseas businesses, in China, which boasts thelargest scale of business and is the main source of overseas sales revenue, in addition to store
openings by the Target’s Chinese subsidiaries, the Target is proceeding with opening stores throughmega-franchise agreements with local retailers in cities such as Shanghai, Chongqing, Shenyang,and Beijing, opening stores based on area license agreements where local partner companies haveheadquarter functions and are responsible for overall operation and development in designated areas,
and is accelerating the expansion of store opening areas and number of stores. Specifically, thenumber of stores in China surpassed 6,000 in August 2023, reaching 6,251 as of the end of November
2023 (a net increase of 631 stores from the end of the previous fiscal year). The Target has set a
goal of operating 10,000 stores in China in FY 2025, and to achieve this goal, the Target is promoting
product strategies such as strengthening private brands, as well as strengthening delivery, OMO(Note 7), and EC, in addition to accelerating store openings in new areas and expanding the scale ofstores in areas where it has already opened stores. According to the Target, in the future, the Target
may consider various options relating to business strategies and capital policies to accelerate thegrowth of its Chinese subsidiaries, including alliances with business partners, acceptance of external
capital, public offerings, business restructuring, and organizational restructuring, taking into accountthe state of its business and geopolitical risks in China; however, no concrete decisions have been
made as of today. Furthermore, in regions other than China, the Target operates 964 stores inThailand, the Philippines, Indonesia, and Hawaii, U.S.A. as of the end of November 2023. In
Southeast Asia, where economic growth is remarkable, demand for convenience stores is steadily
growing, reflecting the expansion of the middle class, and the Target is striving to expand the scaleof its business with a target of 3,000 stores by FY 2025. In order to further accelerate store
openings, in addition to initiatives including alliances with leading local companies, in thePhilippines, the Target is promoting full-scale development of franchises, opening new stores indiverse forms and locations, and in Indonesia, the Target is promoting the expansion of the area ofstore openings in major cities other than Jakarta. In addition, the Target’s policy is to strengthen
the appeal of its products by expanding its lineup of private-brand products and over-the-counterfast food, and by strengthening vendor policies.
(Note 7) “OMO” is an abbreviation of “online merges with offline” and refers to measures toeliminate the distinction between sales through the Internet (electronic commerce) andsales at physical stores to encourage purchasing by customers.

- 10 -

According to the Target, in September 2020, the Target Group launched the “Lawson Group
Sweeping Transformation Executive Committee” to consider the implementation of a growthstrategy for the entire Target Group in light of the changing lifestyles and values of consumers dueto the impact of the global spread of COVID-19 in order to realize “Challenge 2025,” which is themedium-term management plan for FY 2021 to FY 2025 formulated in preparation for 2025, the50th anniversary of the Target’s incorporation. Under this committee, the Target Group is taking
on challenges such as providing new forms of conveniences and improving the job satisfaction of
employees and store crews. Furthermore, the Target Group also aims to achieve the performanceindicators of Challenge 2025 (an ROE of 15% or more and an EPS of 500 yen or more) through“enhancing corporate value,” “balancing growth investment and shareholder returns,” and “growthof individual group companies and growth of the LAWSON Group as a whole” through concentrated
investment in its core domestic convenience store business. The Target Group plans to achievethese challenges two years ahead of schedule starting in FY 2025.
Against this backdrop, the environment surrounding the retail industry in which the Target
operates is characterized by increasingly intense competition across business categories andincreasingly diverse consumer needs, as well as increases in various costs, including raw material,labor, and logistics costs. To achieve sustained growth in these difficult circumstances, the Target
believes that it should provide high-value-added products and services in the Target Group’s various
businesses, pursue further expansion of scale and efficiency improvements, and deepen DX toachieve these goals. In addition, as demand for a sustainable society increases, the Target has
introduced the Environmental Vision “Lawson Blue Challenge 2050!” (Note 8) in order to contributeto the creation of a decarbonized society through de-carbon activities and by reducing food waste
and plastic use and to SDGs in response to intensifying environmental changes, such as climatechange, which is a social issue, and the Target views such environmental changes as business issues
that must be addressed with priority.
(Note 8) “Lawson Blue Challenge 2050!” was introduced in 2019 as the Target’s environmental
vision that focuses on three areas: (i) reducing CО2 emissions, (ii) reducing food waste,and (iii) reducing plastic use (in containers and shopping bags).
The Offeror and the Target executed a capital and business alliance agreement in December 2019with the purpose of promoting data marketing that leverages the customer bases of both companies
and of creating new consumer experiences through the utilization of cutting-edge technologies.
Through measures such as collaborations of points, they have worked, among others, to expand theircustomer bases and enhance services for their members. In addition, in June 2022, the Offeror
executed a business alliance agreement with the Target, MC, and menu, Inc., an Offeror Group
company, and has been expanding the delivery business, that is one of the new consumer experiencesat convenience stores.
In promoting such alliances, in late May 2023, the Offeror received a proposal from MC, theparent company of the Target, to conduct a joint consideration on collaboration including theprivatization of the Target Shares by the three companies, i.e., the Offeror Related Parties and third
party that was initially considering participating in the Transactions (the “Initial Partner
Candidate”), with the Offeror and the Initial Partner Candidate as the new partner candidates of theTarget who can mutually utilize their own real store network and customer bases and support the
expansion and functional improvement of the Target’s network of real stores across Japan, andexpansion of functions in the digital area, including utilization for the Target’s digital marketing,(hereinafter the transaction toward the privatization of the Target Shares by the Offeror Related
Parties and the Initial Partner Candidate mentioned above is referred to as the “Transactions (Initial
Proposal)”). However, as described below, the Initial Partner Candidate declined the proposal to
the Transactions (Initial Proposal) during the Transactions (Initial Proposal) review process.
According to MC, MC was incorporated on April 1, 1950, and listed its shares on the TSE andOsaka Exchange, Inc. in 1954. According to MC, MC comprises a corporate group consisting of
1,367 consolidated subsidiaries and 410 equity method affiliates (as of September 30, 2023)
including MC and the Target (“MC Group”). MC has indicated that through its domestic and- 11 -

overseas network, MC operates in a wide range of industries in ten groups: natural gas, industrial
materials, chemicals solution, mineral resources, industrial infrastructure, automotive & mobility,
food industry, consumer industry, power solutions, and urban development, as well as the industry
digital transformation group and next-generation energy business group. According to MC, inaddition to trading, MC also plays a role in development, production, and manufacturing at sitesaround the world with various partners.
According to MC, MC has formulated the “Midterm Corporate Strategy 2024” for three years
starting from FY 2022 in May 2022, which aims for the continuous creation of MC Shared Valueby elevating the MC Group’s collective capabilities in order to address societal challenges, with
“fostering and leveraging connections” of diverse businesses, intelligence, human resources, andstakeholders as the keywords. In particular, according to MC, the Consumer Industry Group aims
to provide consumers with highly attractive consumption experiences and highly convenientservices by collaborating with other industries, streamlining the supply chain through DX, andproviding products, services, and information that meet consumer needs through digital marketingby leveraging MC’s far-reaching operations (contacts) with a wide range of consumers (customers)
across real world and digital technology fields, based on the mission of “Creating a rich life byconnecting consumers and producers as well as the real world and digital technology fields.”
According to MC, in this context, the real store network centered on the Target and far-reaching
operations of digital services centered on Ponta are sources of value creation within the Consumer
Industry Group; and since the execution of a business alliance agreement between the Target andMC in February 2000, the Target has been responsible for the most important business in thedownstream business area of the MC Group.
According to MC, with respect to capital relationships between MC and the Target, MC Retail
Investment Co., Ltd. (“MCRI”), a wholly-owned subsidiary of MC, acquired 9,109,300 Target
Shares (7.93% of the issued shares at that time) in February 2001, and a further 22,980,000 shares(21.36% of the issued shares at that time) in August 2001 (resulting in the aggregate holding of
32,089,300 shares, including the 9,109,300 shares acquired previously, accounting for 29.82% of
the issued shares at that time), becoming the Target’s largest shareholder. MC has indicated thatin December 2004, MC purchased all of these Target Shares from MCRI, and became the Target’s
largest shareholder. According to MC, through market purchase thereafter and though the Target
a consolidated subsidiary in February 2017, MC has been operating the Target’s business together
with the Target for nearly a quarter of a century. According to MC, as a result of the above, MCowns 50,150,100 Target Shares (Shareholding Ratio: 50.06%) as of today.
According to MC, MC recognizes that the Target, which continues to provide value toapproximately 10 million customers per day using a network of approximately 14,600 stores acrossJapan, is a rare entity that possesses critical infrastructure functions that are indispensable to local
customers. In addition, MC has expressed that it realizes that the Target’s business, which is a“hub of refreshment in every community,” has been established through the efforts of many people,
including franchisees and crews who support the Target’s business operations, employees of theTarget Group, and those who are engaged in logistics, vendor business, etc. According to MC,
MC believes that extensive contact with consumers and the customer base of the Target’s business,
which is essential to customers in this way, are valuable business resources that can serve as thefoundation for the MC Group to develop new business concepts in downstream fields. According
to MC, MC will continue to seek to provide services that are convenient and profitable for
consumers, create new customer experiences, and support prosperous local communities, including
the possibility of collaboration between the Target’s business and the financial, advertising, andhealthcare businesses operated by the MC Group and in the urban development, electric power,
mobility, and energy fields.
On the other hand, according to MC, as it internally has considered measures to contribute tofurther enhancing the Target’s corporate value, it had reached the conclusion by mid-May 2023 thatas the environment surrounding the retail business is expected to change, including advances indigital technology, diversification of consumer needs, future population decline, and intensifying
competition, including in other industries, based on the recognition that providing services that
integrate the real and digital more than ever will lead to consumer value, rather than stopping at theefforts made by the Target Group or the support system for the Target by the MC Group, MC has- 12 -

come to believe that collaborating with new partners with a customer base and rich digitalknowledge will contribute to further enhancing the Target’s corporate value. According to MC, inparallel with these ongoing in-house consultations, MC had an opportunity to conduct initialexchanges of views with the Offeror in order to consider a wide range of possibilities for further
collaboration aimed at enhancing the Target’s corporate value, taking advantage of the entry into thecapital and business alliance agreement between the Offeror and the Target in December 2019. In
addition, according to MC, MC had been conducting initial exchanges of views with the Initial
Partner Candidate in order to consider the possibility of a partnership between the Initial Partner
Candidate and the Target, since being approached by the Initial Partner Candidate in late December
2022 regarding joint consideration of the possibility of collaboration through a partnership with theTarget.
According to MC, MC began approaching the Initial Partner Candidate and the Offeror in midMay 2023 and in late May 2023, respectively, to jointly consider a collaboration, including theprivatization of the Target Shares, given that, through these initial exchanges of views with theOfferor and the Initial Partner Candidate, MC confirmed that both parties have a strong interest in
business collaboration with the Target, and MC has come to believe that it can aim to become afamiliar presence for all customers by combining the digital knowledge of the Offeror with the social
infrastructure centered on the “real world” sites owned by the Offeror and the Initial Partner
Candidate, and that these two companies could become new partner candidates for further enhancing
the Target’s corporate value. Thereafter, the Initial Partner Candidate indicated its willingness toconsider the Transactions (Initial Proposal) in mid-May 2023, and the Offeror indicated its intention
to agree to proceed with the concrete examination of the Transactions (Initial Proposal) in late June
2023, as described below. According to MC, MC intends to work together with the Offeror, withwhich MC has reached an agreement to implement the Transactions, to enhance the corporate valueof the Target, which will celebrate its 50th anniversary in 2025, and further to take on the challengeof realizing a “hub of refreshment in every community” with a view to the next 50 years.
In response to this, the Offeror has repeatedly had initial discussions with MC regarding thesignificance of the Transactions (Initial Proposal) and the potential synergies with the Target. The
Offeror believes that convenience stores, which is the Target’s mainstay business, are an
indispensable part of social infrastructures, and that their importance has been increasing in recent
years. On the other hand, the Offeror believes that the diversification of consumer values,
including lifestyle and consumer behaviors, triggered by the spread of COVID-19, will necessitate
the provision of new values beyond real stores in the future. Under such business conditions, theOfferor recognizes that the Target has developed distinctive stores, such as “LAWSON,” aconvenience store with approximately 14,600 stores across Japan, “LAWSON STORE 100,” and“NATURAL LAWSON,” by adopting “community based × individual customer and individualstore-focused” as a strategy and has established its position as one of the leading convenience store
chains in Japan through the provision of products and services closely tailored to local customers
and that it has a wide range of customer contact points, such as through Seijo Ishii, which is asupermarket with strong brand power due to its high-quality original products, and the entertainment
business, which sells tickets and operates movie theaters, etc.
The Offeror recognizes that in order to continue to be an enterprise selected by customers in the
future, while responding to a declining domestic population and changes in the environment
surrounding the communications industry, maintaining and strengthening contact points withcustomers will be matters of even more importance for management than ever before. The Offeror
believes that collaborating with the Target will enable the Offeror to build contact points with morecustomers and that by providing digital support for the Target through the utilization of various
assets, including communication systems owned by the Offeror Group, the Offeror will be able toimprove the convenience of the Target’s stores and provide new value to customers.
Based on this consideration, the Offeror has come to believe that meeting the needs of local
communities and customers by deepening alliances between the Target, which has close contacts
with “real” customers, and the Offeror, which has close contacts with “digital” customers, is also
consistent with the Offeror’s aim to become a “Platformer Supporting Society.” Accordingly, in- 13 -

late June 2023, the Offeror has agreed to the proposal from MC and has started to specificallyexamine the Transactions (Initial Proposal).
Since late June 2023, the Offeror has continued discussions with MC on the transaction structuresand management policies for the Transactions (Initial Proposal) by the three companies, including
the Initial Partner Candidate, through explanations regarding the Initial Partner Candidate from MC,
and has also considered specific collaborative measures with the Target in addition to deepening its
understanding of the Target through explanations regarding the Target from MC.
In late June 2023, the Offeror appointed Nishimura & Asahi (Gaikokuho Kyodo Jigyo) as a legal
advisor independent of the Offeror Related Parties and the Target, and in early September 2023, it
appointed UBS Securities Japan Co., Ltd. (“UBS Securities”) as a financial advisor independent of
the Offeror Related Parties and the Target. In addition, in mid-May 2023, MC appointed
Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. as a financial advisor independent of the Offeror
Related Parties and the Target, and appointed Nagashima Ohno & Tsunematsu as a legal advisor
independent of the Offeror Related Parties and the Target. After that, the three companies,
including the Initial Partner Candidate, have held consultations on multiple occasions since lateAugust 2023 on fundamental matters such as the transaction structure and schedule, as well as
specific measures to enhance the corporate value of the Target. As a result, in late August 2023,
the Offeror has come to share with MC and the Initial Partner Candidate the view that the Target’s
corporate value could be enhanced by utilizing the networking, management resources, andknowledge possessed by the Offeror Related Parties, the Initial Partner Candidate, and the Target intheir respective industries, and by promoting their business activities based on mutual collaboration.
Specifically, for the Target Group’s business activities that support customers nationwide throughthe provision of food and daily necessities, by utilizing the knowledge of the Offeror Group, an
infrastructure company with leading domestic shares in the field of communications; and the Initial
Partner Candidate, and by the Offeror Related Parties, the Initial Partner Candidate, and the Target
cooperating in each area of “real,” aiming to expand networks and enhance store functions throughthe mutual utilization of real stores; “digital,” aiming to expand the points economic zone anddevelop real and digital integrated services; and “green,” aiming to promote measures to reduce theenvironmental burden, the parties came to believe that they could contribute to enhancing theTarget’s corporate value by creating value for consumers through the realization of a new business
form that surpasses conventional convenience stores based on the concept of “real × digital × green.”
In addition, with regard to the means to realize the above, the parties decided that it would be best
to take private the Target Shares, based on the view that accelerating the mutual utilization ofmanagement resources, implementing various measures that lead to the growth of the Target overthe medium to long term even if not directly related to the short-term benefits of the Target, andbuilding stronger alliances will ultimately contribute to the enhancement of the Target’s corporate
value.
Based on the discussions as described above, the Offeror Related Parties and the Initial Partner
Candidate provided an initial proposal as of September 1, 2023, concerning the Transactions (Initial
Proposal), to the Target, and in early September 2023, the Target indicated its intention to establish
a review system for discussions regarding the Transactions (Initial Proposal). After that, since midSeptember 2023, the Offeror Related Parties and the Initial Partner Candidate have commenced
consultations on specific matters with the Target toward the implementation of the Transactions(Initial Proposal). In addition, since mid-October 2023, the Offeror Related Parties and the Initial
Partner Candidate have consecutively commenced due diligence on the Target to deepen theirunderstanding of the business environment, growth strategies, management issue, etc., with respect
to the Target and its business. At the same time, they confirmed matters with respect to the fieldsof business, accounting, tax affairs, legal affairs, etc. of the Target.
In such situation, in late December 2023, the Offeror Related Parties were consulted by the Initial
Partner Candidate regarding the impact on the Transactions (Initial Proposal) due to thecircumstances of the Initial Partner Candidate. After discussions between the Offeror Related
Parties and the Initial Partner Candidate, the parties came to the conclusion that it would be difficult
to continue with the Transactions (Initial Proposal), and the Offeror Related Parties received an offer
concerning the declining of the Transactions (Initial Proposal) from the Initial Partner Candidate.
- 14 -

Based on this, the Offeror Related Parties consulted again regarding the best way to enhance theTarget’s corporate value. As a result, the Offeror Related Parties reconfirmed their understandingthat in order to enhance the corporate value of the Offeror Related Parties and the Target, it isessential to mutually leverage their respective management resources, such as their respective
human resources and know-how, etc., and to promote swift decision-making. On the other hand,
the Offeror Related Parties also confirmed that they are mutually aware of the issue that it is
impossible to deny the risk of a short-term downturn in business results due to a temporary increasein costs incurred as a result of taking various measures and the possibility of the adverse effect on
stock prices resulting from them. As a result, based on the belief that taking private the Target
Shares without impairing benefits of the Target’s minority shareholders by providing the Target’s
minority shareholders with appropriate and reasonable opportunities to sell the Target Shares, taking
various measures that lead to the growth of the Target over the medium to long term, even if suchmeasures may not be directly related to the short-term benefits of the Target, and building stronger
alliances, will ultimately contribute to the enhancement of the Target’s corporate value, the Offeror
Related Parties have determined that taking private the Target Shares and putting the Target under ajoint management structure by the Offeror Related Parties is the best option for enhancing thecorporate value of the Target.
After that, the Initial Partner Candidate officially provided the Target with a notice as ofDecember 25, 2023 declining the proposal regarding the Transactions (Initial Proposal). In
addition, as a result of consultation, the Offeror Related Parties provided the Target with a written
proposal as of December 26, 2023 for a change in the initial proposal regarding the Transactions
that changed the Transactions (Initial Proposal) from a collaboration involving the privatization of
the Target Shares by three companies (i.e., the Offeror Related Parties and the Initial Partner
Candidate) to a collaboration involving the privatization of the Target Shares by two companies (i.e.,
the Offeror Related Parties).
In response to this, according to the Target, on January 4, 2024, the Target and the Special
Committee held an interview session with the Offeror Related Parties to review the impact of thechanges to the initial proposal. In the interview, according to the Target, the Target and the Special
Committee received an explanation from the Offeror that due to the Initial Partner Candidate’s
decline, the business alliance matters proposed by the Initial Partner Candidate will be excluded
from the scope of the proposal, but as the voting rights ratio of the Offeror after the Transactions
will be raised to 50.00%, with respect to the business alliance matters proposed by the Offeror, theOfferor will be able to give prompt and generous support based on a stronger commitment; therefore,
they believed that it would be worthwhile to deepen consideration and discussions on the details of
the proposed changes to the initial proposal, and decided to continue to consider the Transactions.
The Offeror Related Parties expect synergies in each of the “real × digital × green” fields throughthe creation of new consumer value that combines “real × digital × green” and by making the Offeror
Related Parties the Target’s only shareholders through the Transactions and conducting business
operations in an integrated manner with the Target, and they are considering the following mattersas measures to realize those synergies. Further, the Offeror Related Parties may consider entering
into an alliance with a new outside partner as a future option after the Transactions is completed inorder for the Target to continue to grow sustainably in the future as well. However, as of today, no
consideration has been given to entering into an alliance with a specific outside partner, nor is therea specific policy for inviting an outside partner.
(i)

Specific Measures and Synergies in Real Areas
The Offeror Related Parties believe it possible to build a leading domestic real store
network regarding the Offeror’s and the Target’s approximately 16,800 real stores, which are
the strengths of both the Target and the Offeror (Target stores: approximately 14,600; au
shops: approximately 2,200). On that basis, the Offeror Related Parties expect to improve
the Target’s competitive advantage by providing new services that utilize the functions andcommodities of the Offeror Related Parties and the Target.
Specifically, as measures to expand the networks and strengthen the functions of theTarget’s stores, the Offeror Related Parties are considering providing new services bycombining the Offeror’s assets, such as the handling of Target goods and services at au shops,- 15 -

the provision of commodities and services centered on communications of the Offeror atTarget stores (such as merchandise-based communication services), and the provision ofservices that are more in tune with customers’ lives through the introduction of online remotecustomer service.
(ii)

Specific Measures and Synergies in Digital Areas
The Offeror Related Parties expect that the Target will improve customer satisfaction andloyalty by utilizing the largest customer database in Japan resulting from the shared member
information (attributes, purchase information, etc.) held by the Offeror Related Parties andthe Target.
Specifically, the Offeror Related Parties are considering conducting new customer
referrals to Target stores from the Offeror’s membership base and developing and offering
new services for members aimed at expanding use of Target stores by existing members of
the Offeror and the Target. The Offeror Related Parties are also considering establishing adata-sharing and analytical system with the Offeror to expand the Target’s earnings, as well
as utilizing the Offeror’s DX knowledge and technologies for Target store management
issues, such as optimized operation of Target stores.

(iii)

Specific Measures and Synergies in Green Areas
By making maximum use of the business foundations of the Offeror Related Parties andthe Target and promoting initiatives to decarbonize the Target’s business, the Offeror Related
Parties expect to realize a green and sustainable society.
Specifically, the Offeror Related Parties are considering promoting the greening of Target
stores by installing solar panels at Target stores and having electricity be generated by theOfferor. In addition, the Offeror Related Parties will consider promoting a circular
economy business, such as manufacturing biodiesel whose raw material is waste oil made byTarget stores and contributing to achievement of “Lawson Blue Challenge 2050!” introducedby the Target by replacing plastic containers and plastic bottle materials with bio-materials
in Target’s business.

In parallel, the Offeror and MC have repeatedly and continuously held consultations with theTarget from mid-October 2023 until today on a specific business alliance, such as the management
structure and business policies following completion of the Transactions.
After several
consultations, as of today, the Offeror Related Parties and the Target executed the Capital andBusiness Alliance Agreement, and the Offeror Related Parties executed the Shareholders
Agreement. For summaries of the Capital and Business Alliance Agreement and the Shareholders
Agreement, please refer to “(II) Shareholders Agreement” and “(III) Capital and Business AllianceAgreement” under “(6) Material agreements relating to the Tender Offer” below. In connection
with the execution of the Capital and Business Alliance Agreement, it was agreed that the businessalliance agreement between MC and the Target on September 16, 2016, will be terminated subject
to the effectiveness of the Capital and Business Alliance Agreement.
In addition, based on the results of due diligence on the Target conducted from mid-October 2023
to late January 2024, with respect to the tender offer price in the Tender Offer (the “Tender Offer
Price”), the Offeror made an initial proposal (the “Initial Proposal”) in writing to the Target on
December 26, 2023, making the Tender Offer Price per Target Share be 8,650 yen (8,650 yen is theamount calculated by adding an 18.64% premium to 7,291 yen, which was the closing price of theTarget Shares on the Prime Market of the TSE on December 25, 2023 (such date being the business
day immediately preceding December 26, 2023, when the proposal was made) (rounded to thesecond decimal place; hereinafter the same applies in the calculation of the premium rate), an
18.98% premium to 7,270 yen, which was the simple average of the closing prices for the one monthending on December 25, 2023 (rounded to the nearest whole number; hereinafter the same applies
in the calculation of the simple average of closing prices), a 21.80% premium to 7,102 yen, which
was the simple average of the closing prices for the three months ending on December 25, 2023, anda 23.64% premium to 6,996 yen, which was the simple average of the closing prices for thesix months ending on December 25, 2023), making the tender offer price per Share Option (the- 16 -

“Share Option Price”) be 1 yen, and making the Tender Offer Price per Target Share relating toAmerican Depositary Shares represented by American Depositary Receipts be 8,650 yen. In
response to the Initial Proposal, the Offeror received a request from the Target on December 27,
2023 to consider revising the Tender Offer Price from the perspective of considering the interests of
the Target’s minority shareholders.
In response to that request from the Target, the Offeror made a second proposal (“Proposal No. 2”)
in writing to the Target on January 4, 2024 setting the Tender Offer Price per Target Share at
9,000 yen (9,000 yen is the amount calculated by adding a 23.58% premium to 7,283 yen, which
was the closing price of the Target Shares on the Prime Market of the TSE on December 29, 2023
(such date being the business day immediately preceding January 4, 2024, when the proposal wasmade), a 24.09% premium to 7,253 yen, which was the simple average of the closing prices for the
one-month period ending on December 29, 2023, a 26.32% premium to 7,125 yen, which was thesimple average of the closing prices for the three-month period ending on December 29, 2023, anda 28.13% premium to 7,024 yen, which was the simple average of the closing prices for the sixmonth period ending on December 29, 2023), setting the Share Option Price at 1 yen, and setting
the Tender Offer Price per Target Share relating to American Depositary Shares represented byAmerican Depositary Receipts at 9,000 yen. In response to Proposal No. 2, the Offeror received arequest from the Target on January 6, 2024 to once again consider revising the Tender Offer Pricefrom the perspective of considering the interests of the Target’s minority shareholders.
In response to that request from the Target, the Offeror made a third proposal (“Proposal No. 3”)
in writing to the Target on January 11, 2024 setting the Tender Offer Price per Target Share at
9,500 yen (9,500 yen is the amount calculated by adding a 29.85% premium to 7,316 yen, which
was the closing price of the Target Shares on the Prime Market of the TSE on January 10, 2024 (suchdate being the business day immediately preceding January 11, 2024, when the proposal was made),a 31.51% premium to 7,224 yen, which was the simple average of the closing prices for the onemonth period ending on January 10, 2024, a 32.50% premium to 7,170 yen, which was the simple
average of the closing prices for the three-month period ending on January 10, 2024, and a 34.35%
premium to 7,071 yen, which was the simple average of the closing prices for the six-month period
ending on January 10, 2024), setting the Share Option Price at 1 yen, and setting the Tender Offer
Price per Target Share relating to American Depositary Shares represented by American Depositary
Receipts at 9,500 yen. In response to Proposal No. 3, the Offeror received a request from the Target
on January 12, 2024 to once again consider revising the Tender Offer Price from the perspective ofconsidering the interests of the Target’s minority shareholders.
In response to that request from the Target, the Offeror made a fourth proposal (“Proposal No. 4”)
in writing to the Target on January 18, 2024 setting the Tender Offer Price per Target Share at
10,000 yen (10,000 yen is the amount calculated by adding a 20.63% premium to 8,290 yen, which
was the closing price of the Target Shares on the Prime Market of the TSE on January 17, 2024 (suchdate being the business day immediately preceding January 18, 2024, when the proposal was made),a 35.23% premium to 7,395 yen, which was the simple average of the closing prices for the onemonth period ending on January 17, 2024, a 37.76% premium to 7,259 yen, which was the simple
average of the closing prices for the three-month period ending on January 17, 2024, and a 40.61%
premium to 7,112 yen, which was the simple average of the closing prices for the six-month period
ending on January 17, 2024), setting the Share Option Price at 1 yen, and setting the Tender Offer
Price per Target Share relating to American Depositary Shares represented by American Depositary
Receipts at 10,000 yen. In response to Proposal No. 4, the Offeror received a request from theTarget on January 24, 2024 to consider further raising the Tender Offer Price in exchange for an
opinion in favor of and a recommendation to tender in the Transactions, from the perspective ofconsidering the interests of the Target’s minority shareholders and in light of the recent growth in
the Target’s business, including the details of the Target’s Financial Results, and the continued risein the current stock price.
In response to that request from the Target, the Offeror made a fifth proposal (“Proposal No. 5”)
in writing to the Target on January 26, 2024 setting the Tender Offer Price per Target Share at
10,200 yen (10,200 yen is the amount calculated by adding a 23.40% premium to 8,266 yen, which
was the closing price of the Target Shares on the Prime Market of the TSE on January 25, 2024 (suchdate being the business day immediately preceding January 26, 2024, when the proposal was made),- 17 -

a 31.61% premium to 7,750 yen, which was the simple average of the closing prices for the onemonth period ending on January 25, 2024, a 37.99% premium to 7,392 yen, which was the simple
average of the closing prices for the three-month period ending on January 25, 2024, and a 42.04%
premium to 7,181 yen, which was the simple average of the closing prices for the six-month period
ending on January 25, 2024), setting the Share Option Price at 1 yen, and setting the Tender Offer
Price per Target Share relating to American Depositary Shares represented by American Depositary
Receipts at 10,200 yen. In response to Proposal No. 5, the Offeror received a request from theTarget on January 28, 2024 to consider further raising the Tender Offer Price from the perspectiveof considering the interests of the Target’s minority shareholders, for the opinion in favor of, and arecommendation to tender in, the Transactions.
In response to that request from the Target, the Offeror made a sixth proposal (“Proposal No. 6”)
in writing to the Target on January 29, 2024, setting the Tender Offer Price per Target Share at
10,290 yen (10,290 yen is the amount calculated by adding a 24.20% premium to 8,285 yen, which
was the closing price of the Target Shares on the Prime Market of the TSE on January 26, 2024 (suchdate being the business day immediately preceding January 29, 2024, when the proposal was made),a 31.91% premium to 7,801 yen which was the simple average of the closing prices for the onemonth period ending on January 26, 2024, a 38.81% premium to 7,413 yen which was the simple
average of the closing prices for the three-month period ending on January 26, 2024, and a 43.08%
premium to 7,192 yen which was the simple average of the closing prices for the six-month period
ending on January 26, 2024, setting the Share Option Price at 1 yen, and setting the Tender Offer
Price per Target Share relating to American Depositary Shares represented by American Depositary
Receipts at 10,290 yen. In response to Proposal No. 6, the Offeror received a request from theTarget on January 29, 2024 to consider further raising the Tender Offer Price from the perspectiveof fully securing the interests of the Target’s minority shareholders for the opinion in favor of, anda recommendation to tender in, the Transactions.
In response to that request from the Target, the Offeror made a seventh proposal (“Proposal
No. 7”) in writing to the Target on January 30, 2024 setting the Tender Offer Price per Target Shareat 10,350 yen (10,350 yen is the amount calculated by adding a 23.01% premium to 8,414 yen,which was the closing price of the Target Shares on the Prime Market of the TSE on January 29,
2024 (such date being the business day immediately preceding January 30, 2024, when the proposal
was made), a 30.60% premium to 7,925 yen, which was the simple average of the closing prices forthe one-month period ending on January 29, 2024, a 39.19% premium to 7,436 yen, which was thesimple average of the closing prices for the three-month period ending on January 29, 2024, and a
43.67% premium to 7,204 yen, which was the simple average of the closing prices for the six-month
period ending on January 29, 2024), setting the Share Option Price at 1 yen, and setting the Tender
Offer Price per Target Share relating to American Depositary Shares represented by American
Depositary Receipts at 10,350 yen. In response to Proposal No. 7, on January 31, 2024, the Offeror
received a request from the Target that the Offeror will consider further raising the Tender Offer
Price for the opinion in favor of, and a recommendation to tender in, the Transactions from theperspective of fully securing the interests of the Target’s minority shareholders.
In response to that request from the Target, the Offeror made the final proposal (“Final Proposal”)
in writing to the Target on January 31, 2024 setting the Tender Offer Price per Target Share at
10,360 yen (10,360 yen is the amount calculated by adding a 23.00% premium to 8,423 yen, which
was the closing price of the Target Shares on the Prime Market of the TSE on January 30, 2024 (suchdate being the business day immediately preceding January 31, 2024, when the proposal was made),a 30.27% premium to 7,953 yen, which was the simple average of the closing prices for the onemonth period ending on January 30, 2024, a 38.89% premium to 7,459 yen, which was the simple
average of the closing prices for the three-month period ending on January 30, 2024, and a 43.61%
premium to 7,214 yen, which was the simple average of the closing prices for the six-month period
ending on January 30, 2024), setting the Share Option Price at 1 yen, and setting the Tender Offer
Price per Target Share relating to American Depositary Shares represented by American Depositary
Receipts at 10,360 yen. In response to the Final Proposal, on February 2, 2024, the Offeror
received a response from the Target stating that it views the Tender Offer Price in the Final Proposal
as the maximum price that the Offeror could offer and accepts the Tender Offer Price in the Final
Proposal.
- 18 -

As a consequence of the above, the Offeror and the Target agreed on February 2, 2024 to set theTender Offer Price per Target Share at 10,360 yen (10,360 yen is the amount calculated by adding a19.99% premium to 8,634 yen, which was the closing price of the Target Shares on the Prime Marketof the TSE on February 1, 2024 (such date being the business day immediately preceding February
2, 2024, when the agreement was made), a 29.32% premium to 8,011 yen, which was the simple
average of the closing prices for the one-month period ending on February 1, 2024, a 38.10%
premium to 7,502 yen, which was the simple average of the closing prices for the three-month period
ending on February 1, 2024, and a 43.17% premium to 7,236 yen, which was the simple average ofthe closing prices for the six-month period ending on February 1, 2024), the Share Option Price at
1 yen, and the Tender Offer Price per Target Share relating to American Depositary Shares
represented by American Depositary Receipts at 10,360 yen. The Offeror also agreed with MC
today to set the Tender Offer Price per Target Share at 10,360 yen, the Share Option Price at 1 yen,and the Tender Offer Price per Target Shares relating to American Depositary Shares represented byAmerican Depositary Receipts at 10,360 yen.
(II) Decision-making process leading to and grounds for the opinion in favor of the Tender Offer by
the Target
According to the Target’s Press Release, the decision-making process leading to and grounds forthe opinion in favor of the Tender Offer by the Target are as follows.
(i) Background of the proposal by the Offeror Related Parties and establishment of a review
system
According to the Target, as described in “(I) Background, purposes, and decision-making process
leading to the decision to conduct the Tender Offer” above, upon the receipt of a written initial
proposal regarding the Transactions (Initial Proposal) on September 1, 2023, the Target appointed
SMBC Nikko Securities Inc. (“SMBC Nikko Securities”) as its financial advisor and third-party
valuator independent of the Offeror Related Parties and the Target with respect to the Transactions(Initial Proposal), after examining the expertise and past performances of SMBC Nikko Securities,
to receive advice and assistance from a financial perspective, including advice on the calculation of
the value of the Target Shares and the policy for negotiation with the Offeror Related Parties, andappointed Anderson Mori & Tomotsune Gaikokuho-Kyodo-Jigyo (“Anderson Mori & Tomotsune”)
as its external legal advisor, after examining the expertise and past performances of Anderson Mori
& Tomotsune, to receive legal advice, including advice on the measures to be taken to ensure thefairness of the procedures for the Transactions (Initial Proposal), the procedures for the Transactions(Initial Proposal), and the method and process of decision-making by the Target concerning theTransactions (Initial Proposal). Because MC, which is one of the Offeror Related Parties, owns
50,150,100 Target Shares (Shareholding Ratio: 50.06%) and is the parent company of the Target,
and therefore, the Transactions (Initial Proposal) including the Tender Offer may fall underimportant transactions with controlling shareholders, and therefore the Transactions (Initial
Proposal) may fall under the type of transaction involving the issue of structural conflicts of interestand information asymmetry with minority shareholders, in order to address these issues and ensure
the fairness of the Transactions (Initial Proposal), the Target’s board of directors, based on the adviceof Anderson Mori & Tomotsune, immediately set about establishing a system to review, negotiate,
and make decisions regarding the Transactions (Initial Proposal) from the perspective of enhancing
the corporate value of the Target and securing the interests of the minority shareholders of the Target,from a stand point independent of the Offeror Related Parties.
Specifically, according to the Target, as described in “(ii) Establishment of independent special
committee at the Target and receipt of a written report from the special committee” under “(Measures
to ensure the fairness of the Tender Offer, such as measures to ensure the fairness of the Tender Offer
Price and measures to avoid conflicts of interest)” under “(II) Background of calculation” under “(4)Basis for calculation of the price of tender offer” under “2. Summary of Tender Offer” below, theTarget began preparations to establish the Special Committee comprised of the Target’s independent
outside directors and independent outside auditors from early September 2023. Then, according
to the Target, the Target, by resolution at its board of directors meeting held on September 13, 2023,
established a special committee comprised of three (3) members, Ms. Miki Iwamura (the Target’s
independent outside director), Ms. Satoko Suzuki (the Target’s independent outside director), and- 19 -

Ms. Yuko Gomi (the Target’s independent outside auditor) (the “Special Committee”; for details of
background of establishment, background of consideration, and details of decision of the Special
Committee, please refer to “(ii) Establishment of independent special committee at the Target andreceipt of a written report from the special committee” under “(Measures to ensure the fairness of
the Tender Offer, such as measures to ensure the fairness of the Tender Offer Price and measures toavoid conflicts of interest)” under “(II) Background of calculation” under “(4) Basis for calculationof the price of tender offer” under “2. Summary of Tender Offer” below). In addition, according
to the Target, the Target resolved to consult the Special Committee on (i) whether the purposes of
the Transactions are appropriate and reasonable (including whether the Transactions would
contribute to the Target’s corporate value); (ii) whether the fairness and appropriateness of the terms
and conditions of the Transactions (including the Tender Offer Price) are ensured; (iii) whether due
attention is paid in the Transactions to the interests of the Target’s shareholders through fair
procedures; (iv) whether it is deemed appropriate for the Target’s board of directors to express an
opinion in favor of the Tender Offer to recommend that the Target’s shareholders tender in the Tender
Offer and to recommend that the owners of American Depositary Receipts deliver the American
Depositary Receipts to the Depositary Banks in advance and receive delivery of the Target Shares
represented by those American Depositary Receipts to tender their shares in the Tender Offer andthat it would leave the decision as to whether to tender shares in the Tender Offer to the judgmentof the Share Option Holders; and (v) whether implementation of the Transactions would beconsidered disadvantageous to the Target’s minority shareholders from perspectives other than (i) to(iv) (collectively, the “Consultation Matters”) (for the method of resolution of the Target’s board of
directors, please refer to (viii) “Unanimous approval of all disinterested directors of the Target andthe opinion of all auditors of the Target that they have no objection” under “(Measures to ensure thefairness of the Tender Offer, such as measures to ensure the fairness of the Tender Offer Price andmeasures to avoid conflicts of interest)” under “(II) Background of calculation” under “(4) Basis forcalculation of the price of tender offer” under “2. Summary of Tender Offer” below). According
to the Target, as described in “(ii) Establishment of independent special committee at the Target andreceipt of a written report from the special committee” under “(Measures to ensure the fairness of
the Tender Offer, such as measures to ensure the fairness of the Tender Offer Price and measures toavoid conflicts of interest)” under “(II) Background of calculation” under “(4) Basis for calculationof the price of tender offer” under “2. Summary of Tender Offer” below, the Target has also received
approval from the Special Committee to appoint SMBC Nikko Securities as its financial advisor andthird-party valuator, and Anderson Mori & Tomotsune as its legal advisor. In addition, according
to the Target, as described in “(ii) Establishment of independent special committee at the Target andreceipt of a written report from the special committee” under “(Measures to ensure the fairness of
the Tender Offer, such as measures to ensure the fairness of the Tender Offer Price and measures toavoid conflicts of interest)” under “(II) Background of calculation” under “(4) Basis for calculationof the price of tender offer” under “2. Summary of Tender Offer” below, on September 13, 2023,
based on the above authority, the Special Committee appointed Nakamura, Tsunoda & Matsumoto
as its independent legal adviser, and appointed Daiwa Securities Co., Ltd. (“Daiwa Securities”) as
its independent financial adviser and third-party valuator.
Furthermore, according to the Target, the Target has established a system within the Target toreview, negotiate, and make decisions regarding the Transactions from a standpoint independent of
the Offeror Related Parties (including the scope and duties of the Target’s officers and employees tobe involved in the review, negotiation, and decisions regarding the Transactions) and has received
confirmation from the Special Committee that such review system has no problem from theperspectives of independence and fairness (for details on such review system, please refer to “(vii)
Establishment of independent review system at the Target” under “(Measures to ensure the fairnessof the Tender Offer, such as measures to ensure the fairness of the Tender Offer Price and measures
to avoid conflicts of interest)” under “(II) Background of calculation” under “(4) Basis forcalculation of the price of tender offer” under “2. Summary of Tender Offer” below).
(ii) Process of review and negotiation
According to the Target, the Target received from SMBC Nikko Securities a report on the resultsof valuation of the Target Shares and advice on the policy of the negotiation with the Offeror, as well
- 20 -

as legal advice from Anderson Mori & Tomotsune on measures to ensure the fairness of theprocedures for the Transactions, and based on these, the Target carefully considered whether toimplement the Transactions and whether the terms and conditions of the Transactions, including theTender Offer Price, were appropriate.
According to the Target, the Target held an interview session on October 12, 2023 to give an
explanation on the Target’s corporate profile to the Offeror Related Parties and the Initial Partner
Candidate, and since mid-October 2023, the Target has held discussions and negotiations with theOfferor Related Parties and the Initial Partner Candidate with respect to the significance and purposeof the Transactions (Initial Proposal) and the plans for management and business operation after theTransactions (Initial Proposal). Specifically, according to the Target, on October 6, 2023, theTarget sent a questionnaire concerning the Transactions (Initial Proposal) to the Offeror Related
Parties and the Initial Partner Candidate, and on October 27, 2023, the Target received a written
response to the questionnaire from the Offeror Related Parties and the Initial Partner Candidate, andverbally confirmed the intent of such response on October 30, 2023. According to the Target, basedon the response received from the Offeror Related Parties and the Initial Partner Candidate, theTarget sent an additional questionnaire concerning the Transactions (Initial Proposal) to the Offeror
Related Parties and the Initial Partner Candidate on November 28, 2023. According to the Target,
after receiving the written response to the questionnaire from the Offeror Related Parties and theInitial Partner Candidate on December 4, 2023, the Target verbally confirmed the intent of such
response on December 13, 2023.
In addition, according to the Target, on November 17, 2023, the Special Committee sent aquestionnaire concerning the Transactions (Initial Proposal) to the Offeror Related Parties and theInitial Partner Candidate, and on December 4, 2023, after receiving the written response to thequestionnaire from the Offeror Related Parties and the Initial Partner Candidate, the Special
Committee verbally confirmed the intent of such response on December 7, 2023.
Thereafter, according to the Target, the Target received an offer to decline the proposals on theTransactions (Initial Proposal) from the Initial Partner Candidate as of December 25, 2023, andreceived from the Offeror Related Parties a written proposal for partial changes to the initial proposal
regarding the Transactions (Initial Proposal) as of December 26, 2023. According to the Target,
on January 4, 2024, the Target and the Special Committee had an interview session with the Offeror
Related Parties to review the impact of the changes to the initial proposal. In the interview session,according to the Target, the Target and the Special Committee received an explanation from theOfferor that due to the Initial Partner Candidate’s decline, the business alliance matters proposed by
the Initial Partner Candidate will be excluded from the scope of the proposal, but as the voting rights
ratio of the Offeror after the Transactions will be raised to 50.00%, with respect to the businessalliance matters proposed by the Offeror, the Offeror will be able to give prompt and generous
support based on a stronger commitment; therefore, they believed that it would be worthwhile todeepen consideration and discussions on the details of the proposed changes to the initial proposal,and decided to continue to consider the Transactions.
At the same time, according to the Target, the Target has been discussing specific businessalliances with the Offeror Related Parties since October 2023, including the management systemand business policies after the Transactions. According to the Target, after several discussions, theTarget and the Offeror Related Parties executed the Capital and Business Alliance Agreement as oftoday. For an outline of the Capital and Business Alliance Agreement, please refer to “(iii) Capitaland Business Alliance Agreement” in “(6) Material agreements relating to the Tender Offer” below.
As a result of the execution of the Capital and Business Alliance Agreement, the business allianceagreement as of September 16, 2016, between MC and the Target was decided to be dissolved on
condition that the Capital and Business Alliance Agreement becomes effective.
According to the Target, on December 26, 2023, the Target received in writing the Initial Proposal
regarding the Tender Offer Price from the Offeror. According to the Target, on December 27, 2023,
in response to the Initial Proposal, the Target requested the Offeror to reconsider an increase of theTender Offer Price, because the Tender Offer Price in the Initial Proposal is insufficient torecommend that the Target’s minority shareholders tender their shares. According to the Target,
on January 4, 2024, the Target received Proposal No. 2 in writing from the Offeror in response tosuch request. According to the Target, on January 6, 2023, in response to Proposal No. 2, the Target- 21 -

requested that the Offeror consider an increase of the Tender Offer Price, because the Tender Offer
Price in Proposal No. 2 was insufficient to recommend that the Target’s minority shareholders tendertheir shares. According to the Target, on January 11, 2024, the Target received Proposal No. 3 inwriting from the Offeror in response to such request. According to the Target, on January 12, 2024,
in response to Proposal No. 3, the Target requested that the Offeror consider an increase of theTender Offer Price, because the Tender Offer Price in Proposal No. 3 was insufficient to recommendthat the Target’s minority shareholders tender their shares. According to the Target, on the January
18, 2024, the Target received Proposal No. 4 in writing from the Offeror in response to such request.
According to the Target, on January 24, 2023, in response to Proposal No. 4, the Target requested
that the Offeror consider an increase of the Tender Offer Price for the Opinion in favor of andPlanned Commencement of a Tender Offer in view of the current growth of the Target’s businessperformance, including Target’s Financial Results, and continuous increase in the price of Target’s
shares, because the Tender Offer Price in Proposal No. 4 was insufficient to recommend that theTarget’s minority shareholders tender their shares. According to the Target, on January 26, 2024,
the Target received Proposal No. 5 in writing from the Offeror in response to such request.
According to the Target, on January 28, 2024, in response to Proposal No. 5, the Target requested
that the Offeror consider an increase of the Tender Offer Price for the Opinion in favor of andPlanned Commencement of a Tender Offer, because the Tender Offer Price in Proposal No. 5 wasinsufficient to recommend that the Target’s minority shareholders tender their shares. According
to the Target, on January 29, 2024, the Target received Proposal No. 6 in writing from the Offeror in
response to such request. According to the Target, on January 29, 2024, in response to Proposal
No. 6, the Target requested that the Offeror consider a further increase of the Tender Offer Price for
the Opinion in favor of and Planned Commencement of a Tender Offer, because the Tender Offer
Price in the Proposal No. 6 was insufficient to recommend that the Target’s minority shareholders
tender their shares. According to the Target, on January 30, 2024, the Target received Proposal
No. 7 in writing from the Offeror in response to such request. According to the Target, on January
31, 2024, in response to Proposal No. 7, the Target requested that the Offeror consider a further
increase of the Tender Offer Price for the Opinion in favor of and Planned Commencement of aTender Offer, because the Tender Offer Price in the Proposal No. 7 was insufficient to recommendthat the Target’s minority shareholders tender their shares. According to the Target, on January
31, 2024, the Target received the Final Proposal from the Offeror in response to such request.
According to the Target, on February 2, 2024, in response to the Final Proposal, the Target
responded to the Offeror that the Target agrees to set the Tender Offer Price per Target Share at
10,360 yen, the Share Option Price at 1 yen, and the Tender Offer Price per Target Share relating toAmerican Depositary Shares represented by American Depositary Receipts at 10,360 yen.
According to the Target, in the course of the review and negotiation described above, the Special
Committee received reports from the Target, the Target’s financial advisor, SMBC Nikko Securities,
and the Special Committee’s financial advisor, Daiwa Securities, confirmed such reports, andexpressed its opinions as appropriate. Specifically, according to the Target, the Target received
confirmation and approval from the Special Committee on the reasonableness of the details, material
conditions precedent, and process of preparation of the business plan prepared by the Target for theperiod from the fiscal year ending February 2024 to the fiscal year ending February 2028 (the“Business Plan”). In addition, the Target’s financial advisor, SMBC Nikko Securities, conductednegotiations with the Offeror in accordance with the policy of negotiation deliberated anddetermined by the Special Committee, and immediately reported to the Special Committee each time
the Target received a proposal from the Offeror regarding the Tender Offer Price and responded inaccordance with the instructions of the Special Committee.
On February 5, 2024, the Target received a written report (the “Written Report”) from the Special
Committee which stated that, as of the date of the report, (a) the Transactions would contribute to
the Target’s corporate value and the purposes of the Transactions are appropriate and reasonable; (b)the fairness and appropriateness of the terms and conditions of the Transactions (including the tender
offer price in the Tender Offer) are ensured; (c) due consideration is given in the Transactions to theinterests of the Target’s shareholders through fair procedures; (d) it is appropriate for the Target’s
board of directors to express an opinion in favor of the Tender Offer, to recommend that the Target’s- 22 -

shareholders tender in the Tender Offer, and to recommend that the owners of American Depositary
Receipts deliver the American Depositary Receipts to the Depositary Banks in advance and receive
delivery of the Target Shares represented by those American Depositary Receipts in order to tendertheir shares in the Tender Offer, and that it would leave the decision as to whether to tender sharesin the Tender Offer to the judgment of the Share Option Holders; and (e) in addition to (a) to (d)above, the implementation of the Transactions would not be considered disadvantageous to theTarget’s minority shareholders in the event that the Tender Offer is commenced (for a summary of
the Written Report, please refer to “(ii) Establishment of independent special committee at the Target
and receipt of a written report from the special committee” under “(Measures to ensure the fairnessof the Tender Offer, such as measures to ensure the fairness of the Tender Offer Price and measures
to avoid conflicts of interest)” under “(II) Background of calculation” under “(4) Basis forcalculation of the price of tender offer” under “2. Summary of Tender Offer” below).
(iii) Details of the Target’s decision making
According to the Target, based on the above circumstances, the Target carefully considered anddiscussed at its board of directors meeting held today whether the Transactions, including the Tender
Offer, would contribute to the enhancement of the Target’s corporate value and whether the terms
and conditions of the Transactions, including the Tender Offer Price, were appropriate, taking into
account the legal advice received from Anderson Mori & Tomotsune, the advice received fromSMBC Nikko Securities, and the details of a share valuation report concerning the results ofvaluation of the Target Shares submitted on February 5, 2024 (the “Share Valuation Report (Nikko
Securities)”) (please refer to “(iv) Receipt of a share valuation report from an independent financial
advisor and a third-party valuator of the Target” below under “(Measures to ensure the fairness of
the Tender Offer, such as measures to ensure the fairness of the Tender Offer Price and measures toavoid conflicts of interest)” under “(II) Background of calculation” under “(4) Basis for calculationof the price of tender offer” under “2. Summary of Tender Offer” below), with the utmost respect
for the details of the Special Committee’s judgment expressed in the Written Report.
As a result, according to the Target, the Target has concluded that the Transactions will contributeto the enhancement of the Target’s corporate value as described below.
According to the Target, as described in “(I) Background, purposes and decision-making process
leading to the decision to conduct the Tender Offer” above and the following synergies related to
the Transactions below, the retail industry in which the Target operates is facing a severe situation
characterized by increasingly intense competition across business categories and increasingly
diverse consumer needs, as well as expected increases in various costs, including raw material, labor,
and logistics costs. According to the Target, the Target believes that in order to achieve sustained
growth in such situation, it is necessary to provide high-value-added products and services in eachof the Target Group’s businesses, pursue further expansion of scale and efficiency improvements,
and deepen DX to achieve these goals, and as consumer values continue to diversify, includingchanges in lifestyles and consumer behavior and other diversifying consumer values triggered by
the recent expansion of the new coronavirus infections, the Target has begun to transform itself intoa “Real × Tech Convenience” that breaks away from a business model that relies solely on
conventional real stores. However, according to the Target, the Target believes that theimplementation of each of the initiatives to transform into “Real × Tech Convenience” willcontribute to enhancing the Target’s corporate value in the medium to long term, but in the shortterm, initial costs and investments will be required and they may have an impact on the Target’s
financial condition and business performance; therefore, there is a possibility that the Target will not
be able to obtain an adequate assessment from the capital markets in the short term, and it will bedifficult for the Target to implement each of the initiatives simultaneously and promptly while
maintaining the Target’s listing and pursuing the interests of minority shareholders, and this also has
limitations from the perspective of contributing to enhancing the Target’s corporate value.
Accordingly, according to the Target, today, the Target determined that the best way to enhance theTarget’s corporate value is to quickly and steadily maximize the following synergies in (A) to (G)and to accelerate the Target’s growth by the Offeror making the Offeror Related Parties the sole
shareholders of the Target, more promptly and boldly promoting the transformation into “Real ×
Tech Convenience,” and actively implementing each of the initiatives to drastically strengthen the- 23 -

Target’s businesses and management foundation in response to rapid changes in the businessenvironment.
According to the Target, the specific synergies that the Target considers to be achievable throughthe Transactions are as follows.
(A) Accelerate transformation into “Real × Tech Convenience” through the use of management
resources
According to the Target, as a company that responds to change, the Target has constantly capturedchanges in the environment around the world, created businesses from the perspective of“convenience,” and has grown through the appreciation of customers. In recent years, the Target
has taken advantage of the diversification of consumer values, including changes in lifestyles andconsumer behavior triggered by the spread of new coronavirus infectious diseases, and has revamped
its products and refurbished its stores. On the other hand, in pursuing further “convenience,” theTarget believes that by utilizing stores for “real” shopping venues as EC centers, the Target candevelop the quickest global delivery service in the world (Quickest E Commerce service: QEC).
By making the best of Tech, the Target seeks to take on the challenge of becoming “Real × Tech
Convenience” equipped with QEC from a “real” retailer through Tech.
In order to accelerate the expansion of the new service based on Tech, QEC, by establishing asystem by around spring 2024 so that consumers can check the product inventories of each of theTarget’s stores on their smartphones, the Target aims to enable approximately 14,600 inventory basesof the Target’s stores, which will be the base of QEC, and approximately 3,000 different items to be
directly linked to consumers, and products to be delivered in as little as 15 minutes. According to
the Target, the Target believes that by further utilizing the resources and assets held by the Offeror
Group, which has strengths in the digital field, QEC will become even more convenient and easy touse for customers, and it is highly likely to accelerate and stabilize the growth of business.
Specifically, the Target will promote QEC that enables provision of products to customers at thefastest speed in the convenience store industry to accelerate the transformation into “Real × Tech
Convenience” by strengthening the technological structure, including the development of systems
through the dispatch of engineers and other human resources from the Offeror, and enhancing theOfferor’s customer base of more than 13 million subscription service members and the digitalmarketing system that utilizes high-resolution location-based big data unique to atelecommunications company with approximately 31 million customers.
(B) Strengthen profitability by sharing customer baseAccording to the Target, in recent years, as marketing methods, in addition to conventional
advertising methods such as TV commercials, and new digital contact points such as SNS and acompany’s own applications, retail media that utilize data obtained at real stores as a result of thedevelopment of DX and distribute ads tailored to customer needs are attracting attention.
According to the Target, the Target also aims to expand its marketing business using consumer datacollected across stores and the Group businesses, as well as its owned media, through the “Unified
Use of Group Data Project” in the “Lawson Group Sweeping Transformation Executive
Committee.” The Target believes that for the growth of such business, the Target needs tostrengthen the Target Group’s membership base and expand loyal customers.
In order to achieve these goals, the Target intends to utilize the Offeror’s base of approximately
31 million customers and promote high-resolution marketing measures. Specifically, in addition
to reaching more customers and attracting more customers through new customer referrals from theOfferor Group’s economic area and referrals to individual stores by utilizing location information,
the Target intends to create new value in the application and membership domains throughdevelopment and provision of new services. By responding in a one-stop manner to collecting,gathering, analyzing, and visualizing a wealth of big data and by maximizing the value of data
through promotion of these measures, the Target will be able to consider promoting cross-sellingand developing new businesses and services, and expects to expand its marketing business.
(C) Coexistence with local communities by providing social infrastructure utilizing cutting-edge
technologies- 24 -

According to the Target, convenience store operators have established a position as social
infrastructure that is indispensable for everyday life, and the Target, which started as “handyman in
the community,” is determined to continue pursuing and advancing the “hub of refreshment in every
community” from the customer’s perspective, in order to ensure its position as an essential party of
the community that provides support for residents. As a provider of social infrastructure, the Target
believes that in the context of the need to resolve issues faced by local communities, to revitalize
local communities, and to further promote coexistence with local communities, it is necessary tocreate future convenience stores by utilizing cutting-edge technologies.
For example, with the social implementation of drones accelerating, it is expected that the Offeror
Group’s sophisticated drone technology can be used to resolve issues including the depopulation
and aging of communities, such as by improving convenience for consumers in regions without
stores. In addition, the 5G network and satellite communications technology of the Offeror, atelecommunications operator, can be used to develop stores and provide products in augmented
reality and virtual reality linked to its own apps through metaverse services, including provision of
medical services such as remote health checkups through vital sensing. Through the provision ofservices that support various aspects of life in this way, the Target hopes to encourage innovation
into lifestyle experiences and behaviors associated with the evolution of technology, aims to resolve
social issues, and hopes to build standards for future convenience stores.
(D) Strengthen the business foundation by utilizing management resources such as advanced
human resources and know-how
According to the Target, the Target believes that through the use of digital and technology, it isrequired to concentrate its management resources on the evolution of its core business, domestic
convenience stores, and the growth of its portfolio business, which has strong group synergies. On
the other hand, the Target believes that it needs to develop and secure digital human resources thatcan utilize AI and the like more effectively, and to accumulate know-how in various business areas.
Under these circumstances, the Target believes that by promoting human resource exchanges
between the Offeror Group, the MC Group, and the Target, and by mutually providing humanresource support, including the secondment and dispatch of employees, it will be able to takemeasures against the normalization of labor shortages and develop human resources. In addition,
the Target can expect to strengthen the Target Group’s portfolio and maximize the Group’s synergies
through the utilization of know-how of the financial business developed by the Offeror Group,
collaboration in the entertainment field, and the ongoing sharing of the MC Group’s global network.
(E) Strengthen cooperation in the environmental field to realize a decarbonized society
According to the Target, as the importance of sustainability, represented by climate-change, isrecognized as an urgent issue, the Target is taking steps to address this issue as a priority management
issue. In particular, in response to environmental changes, the Target has introduced its
environmental vision, “Lawson Blue Challenge 2050!,” aiming to realize a decarbonized society
through decarbonization activities and reduction of food loss and plastic consumption.
Specifically, by 2030, the Target has set goals for (i) a 50% reduction in CO2 emissions (per store
compared to 2013 levels), (ii) a 50% reduction in food loss (compared to 2018 levels), and (iii) a
30% reduction in plastic consumption (compared to 2017 levels), and it is currently seeing steadyprogress toward these goals (reduction by 30.6% for (i) above, reduction by 23.1% for (ii) above,and reduction by 25.1% for (iii) above (actual results in 2022) have been achieved).
By utilizing the functions of the Offeror Group and the MC Group to promote the use of renewableenergy generated by solar panels, the purchase of food products with reduced consumption prices
near their expiration dates using vast location data and purchasing data, and the replacement ofplastic containers and PET bottle materials with biomass materials, the Target believes that it will
be able to achieve the goal above by 2030, which is a milestone and to further strengthen andaccelerate its green and sustainable initiatives toward by 2050, achieving each KPI of (i) a reductionof CO2 emissions by 100% (per store; compared to 2013 levels), (ii) a reduction of food loss by
100% (compared to 2018 levels), and (iii) 100% use of eco-friendly materials for containers andpackaging of original products.

- 25 -

(F) Growth in the businesses of group companies
According to the Target, in the retail finance business for the development of the “Real × Tech
Convenience,” collaboration of the financial know-how of MC and the Offeror Group, including
FinTech, is expected.
In addition, the entertainment business is one of the key businesses to realize Target’s corporate
philosophy of “Creating Happiness and Harmony in our Communities.” In this field, the Target
believes that contents and functions pertaining to digital technology possessed by MC and theOfferor Group will accelerate the Target’s growth in this business area. In addition, the Target
believes that in the Target’s supermarket business and overseas business, smart digital capabilities
and global expansion capabilities are essential; and that it can accelerate the growth of thesebusinesses by forming alliances with both companies.
(G) Reduction of listing maintenance costs and operational burden of the management divisionand reallocation of resources
In recent years, according to the Target, it has been pointed out that there has been an increase in
the human and economic costs required to maintain listing, and the Target recognizes that it cannot
deny the possibility that such an increase in costs will also be a further burden on its management.
The Target believes that taking the Target Shares private through the Transactions will allow it to
avoid the costs associated with maintaining listing and allocating resources to the various key
initiatives described above.
Generally, according to the Target, the disadvantages of taking shares private include becoming
unable to raise funds through equity financing from the capital markets and becoming unable toenjoy the benefits that have been enjoyed as a listed company, such as improvement of namerecognition and social credibility, thereafter. Nevertheless, the Target believes that it will be able
to utilize the necessary funding from financial institutions that are the Target’s business partners
even after the Transactions have been implemented. In addition, the Target’s name recognition,
branding, and social credibility, which are key to recruitment of human resources in the Target, arelargely acquired and maintained through its business activities; and it is able to acquire and maintainthem through implementation of businesses even after the Transactions are implemented.
Therefore, the Target believes that the impact of delisting will be limited. In addition, the Target
has granted the Share Options to the Target’s directors and executive officers as compensationequivalent to retirement benefits; however, in order not to harm the interests of the Share Option
Holders through implementation of the Transactions, since it is planned to introduce a newretirement bonus system to provide economic benefits to be enjoyed by the Share Option Holders,
it is determined that there is little likelihood that the Target’s corporate value will be impaired by theemployment separation of the Target’s directors and executive officers due to the implementation of
the Transactions.
Based on the above, the Target’s board of directors determined that the advantages of taking theTarget Shares private outweighed its disadvantages, and that taking the Target Shares private throughthe Transactions including the Tender Offer would contribute to enhancing the Target’s corporate
value.
Additionally, according to the Target, the Target has determined, based on the following points,
that 10,360 yen per share, the Tender Offer Price, is a reasonable price that secures the benefit to beenjoyed by the Target’s minority shareholders and that other conditions of the Tender Offer are fair;therefore, the Tender Offer provides the Target’s minority shareholders with a reasonable
opportunity to sell the Target Shares at a price with an appropriate premium.
(a)

The Tender Offer Price is the price agreed upon by the Target as a result of sufficientnegotiations with the Offeror through substantial involvement of the Special Committee,
after sufficient measures have been taken in the Target to secure the fairness of the tradeterms of the Transactions, including the Tender Offer Price described in “(Measures toensure the fairness of the Tender Offer, such as measures to ensure the fairness of the- 26 -

Tender Offer Price and measures to avoid conflicts of interest)” under “(II) Backgroundof calculation” under “(4) Basis for calculation of the price of tender offer” under “2.
Summary of Tender Offer” below.
(b)

The Tender Offer Price exceeds the upper limit of the range based on the Market priceanalysis and falls within the range based on the Discounted Cash Flow analysis (the“DCF analysis”) as a result of calculation of the value of the Target Shares calculated by
SMBC Nikko Securities in the Share Valuation Report (Nikko Securities) described in(iv) “Receipt of a share valuation report from an independent financial advisor and athird-party valuator of the Target” under “(Measures to ensure the fairness of the Tender
Offer, such as measures to ensure the fairness of the Tender Offer Price and measures toavoid conflicts of interest)” under “(II) Background of calculation” under “(4) Basis forcalculation of the price of tender offer” under “2. Summary of Tender Offer” below.

(c)

In the Transactions, although this Tender Offer Period is designated as 20 business days
(Note), which is the shortest period provided by laws and regulations, because the period
from the announcement of the tender offer plan to the commencement of the actual
tender offer is long, the opportunity to make an appropriate decision on tendering theirshares in the Tender Offer by minority shareholders and the opportunity for a tender offer
for Target Shares by a person other than the Offeror are secured.

(Note) The Tender Offer Period will be a period which covers 20 business days in the UnitedStates, which is the minimum number of days required as a tender offer period under
U.S. securities laws. The same applies hereinafter to the description of business days of
the Tender Offer Period.
(d)In the Transactions, the lower limit of the number of shares to be purchased in the Tender
Offer does not meet the “majority of minority” (Majority of Minority). However,
because other adequate fairness security measures have been taken in the Transactions,the fact that the lower limit of the number of shares to be purchased is not set at “majorityof minority” (Majority of Minority) is not considered to impair the fairness of the Tender
Offer.

(e)In the Transactions, the amount of money to be delivered to each shareholder as
consideration in the Share Consolidation will be calculated to be the same as the Tender
Offer Price multiplied by the number of Target Shares owned by each shareholder of theTarget (except for Offeror Related Parties and Target) which were not tendered in theTender Offer, and thus, consideration is given so that the minority shareholders will havethe opportunity to make an appropriate decision on whether or not to tender their sharesin the Tender Offer, and so as not to cause any coercion.

(f)

It has been determined that the fairness and appropriateness of the terms and conditionsof the Transactions (including the Tender Offer Price) is ensured in the Written Reportacquired from the Special Committee, as described in (ii) Establishment of independent
special committee at the Target and receipt of a written report from the special committee”
under “(Measures to ensure the fairness of the Tender Offer, such as measures to ensure
the fairness of the Tender Offer Price and measures to avoid conflicts of interest)” under“(II) Background of calculation” under “(4) Basis for calculation of the price of tender
offer” under “2. Summary of Tender Offer” below.”

According to the Target, based on the above, the Target has resolved that in the opinion of
the Target at the present time, if the Tender Offer is commenced, the Target will express its favor
for the Tender Offer and that it will recommend that the Target shareholders tender in the Tender
Offer, and recommend that the holders of the American Depositary Receipts tender in the Tender
Offer after delivering the American Depositary Receipts to the Depositary Bank in advance and- 27 -

receiving the delivery of the Target Shares pertaining to the American Depositary Shares
represented by the American Depositary Receipts, and resolved that it will leave the holders of
the Share Options to decide whether or not to tender in the Tender Offer.
According to the Target, in addition, the Target’s board of directors has also resolved that,when the Tender Offer is commenced, the Target’s board of directors will request that the Special
Committee established by the Target examine whether there is any change in the opinion
expressed by the Special Committee to the Target’s board of directors as of February 5, 2024,
and, if there is no change, shall state as such to the Target’s board of directors and, if there isany change, the Special Committee shall state its opinion after the change, and, based on theopinion of the Special Committee, the Target’s board of directors will express its opinion on theTender Offer again when the Tender Offer is commenced.
Further, for details of the Target’s board of directors’ decision-making process, please referto “(ⅷ) Unanimous approval of all disinterested directors of the Target and the opinion of all
disinterested auditors of the Target that they have no objection” under “(II) Background of
calculation” under “(4) Basis for calculation of the price of tender offer” under “2. Summary of
Tender Offer” below.”(III) Management policy after the Tender Offer
After the Tender Offer is successfully completed, the Offeror Related Parties are scheduled toappoint persons designated by them as officers of the Target with the aim of implementing measures
to realize each effect described in “(I) Background, purposes and decision-making process leading
to the decision to conduct the Tender Offer” above and establishing an appropriate management
structure for this purpose. However, the specific details of those measures, the specific time of
appointment of those officers, and the candidates themselves have not yet been determined. The
detailed management structure of the Target, including these points, will be determined inconsultation with the Target after the Tender Offer is successfully completed.
The Offeror entered into the Shareholders Agreement with MC as of today, where they agreed
that, as directors of the Target after completion of the Transactions, MC and the Offeror will eachappoint three directors, and MC and the Offeror will each appoint one representative director of theTarget. For a summary of the Shareholders Agreement, please refer to “(II) Shareholders
Agreement” in “(6) Material agreements relating to the Tender Offer” below.
In addition, with regard to the Share Options, since the Share Option Price is 1 yen and as statedin “(4) Policies on organizational restructuring, etc. after the Tender Offer (matters concerning “twostep acquisition”)” below, in the event that the Tender Offer has been successfully completed but theOfferor Related Parties are unable to acquire all of the Share Options in the Tender Offer and theShare Options are not exercised and remain outstanding, the Offeror Related Parties plan to requestthat the Target implement reasonably necessary procedures for carrying out the Transactions, suchas recommending that the Share Option Holders forfeit their Share Options. Therefore, in order
not to harm the interests of the Share Option Holders, the Offeror plans to make a determination
regarding the introduction of a new retirement benefit system that provides economic benefits to beenjoyed by the Share Option Holders in consultation with the Target and the Share Option Holders
promptly after the settlement commencement date of the Tender Offer after the Tender Offer has
been successfully completed. The determination regarding such retirement benefit system, whichtakes into account the fact that Share Options were granted as officers’ compensation equivalent toretirement benefits and is intended to not harm the interests of the Share Option Holders, is planned
to be made in consultation with the Target and the Share Option Holders after the Tender Offer has
been successfully completed, and is expected to be made independent of the Share Option Holders
tendering shares in the Tender Offer and without requiring that the Share Option Holders tender theirshares in the Tender Offer. Therefore, the Offeror believe that such retirement benefit system is
not contrary to the purport of the regulation on uniformity of the tender offer price.
(3) Measures to ensure the fairness of the Tender Offer, such as measures to ensure the fairness of theTender Offer Price and measures to avoid conflicts of interest
As of today, the Offeror Related Parties and the Target have implemented the measures set forth in(i) to (x) below in the Transactions, including the Tender Offer, with a view to ensuring the fairness- 28 -

of the Tender Offer from the time of the Tender Offer, eliminating arbitrariness in decision-making
concerning the Transactions, securing the fairness, transparency, and objectivity of the decisionmaking process, and avoiding any doubt of a conflict of interest given the fact that the Target is a
consolidated subsidiary of MC, which is one of the Offeror Related Parties, and that the Transactions,
including the Tender Offer, constitute transactions that typologically contain structural conflicts ofinterest issues and information asymmetry with minority shareholders. The measures implemented
by the Target described below are based on the explanation made by the Target.
In addition, as of today, the Offeror Related Parties hold 52,260,100 Target Shares (Shareholding
Ratio: 52.16%) in total. Therefore, the Offeror Related Parties believe that setting a “Majority of
Minority” minimum amount would destabilize the successful completion of the Tender Offer, which
in turn might not serve the interests of minority shareholders who wish to tender in the Tender Offer,and have not set a “Majority of Minority” minimum amount in the Tender Offer. However,considering that the Offeror Related Parties and the Target have taken the measures from (i) through(x) below, the Offeror Related Parties believe that due consideration was given to the interests of theTarget’s minority shareholders.
(i)
Receipt of a share valuation report from an independent third-party valuator by the Offeror;(ii)
Establishment of an independent special committee at the Target and receipt of a reportfrom the special committee;(iii)
Advice from an independent legal advisor by the Target;(iv)
Receipt of a share valuation report from an independent financial advisor and a third-party
valuator by the Target;(v)
Advice from an independent legal advisor by the Special Committee;(vi)
Receipt of a share valuation report and the Fairness Opinion (defined in “(iv) Receipt of ashare valuation report and the Fairness Opinion from an independent third-party valuatorretained by the Special Committee” under “(Measures to ensure the fairness of the Tender
Offer, such as measures to ensure the fairness of the Tender Offer Price and measures toavoid conflicts of interest)” under “(II) Background of calculation” under “(4) Basis forcalculation of the price of tender offer” under “2. Summary of Tender Offer” below;
hereinafter the same) from a third-party valuator by the Special Committee;(vii) Establishment of an independent review system at the Target;(viii) Receipt of the unanimous approval of all disinterested directors of the Target and theopinion of all auditors of the Target that they have no objection;(ix)
Establishment of measures to secure purchase opportunities from other purchasers; and(x)
Establishment of measures to ensure opportunities for the Target’s shareholders to make anappropriate decision on whether to tender their shares in the Tender Offer.
For details of the above, please refer to “(Measures to ensure the fairness of the Tender Offer, suchas measures to ensure the fairness of the Tender Offer Price and measures to avoid conflicts ofinterest)” in “(II) Background of calculation” under “(4) Basis for calculation of the price of tender
offer” under “2. Summary of Tender Offer” below.
(4) Policies on organizational restructuring, etc. after the Tender Offer (matters concerning “two-stepacquisition”)
If the Offeror is unable to acquire all of the Target’s Share Certificates in the Tender Offer, theOfferor jointly with MC plans to implement a series of procedures to make the Offeror Related Parties
the only shareholders of the Target through the method described below following the successful
completion of the Tender Offer.
Specifically, the Offeror jointly with MC plans to request that the Target convene an extraordinary
shareholders’ meeting (the “Extraordinary Shareholders’ Meeting”), at which the matters forresolution shall include consolidation of the Target Shares (the “Share Consolidation”), and on thecondition that the Share Consolidation takes effect, a partial amendment of the articles ofincorporation to abolish the provision concerning the share unit number. In addition, the Offeror
jointly with MC plans to request that the record date of the Extraordinary Shareholders’ Meeting be
a date close to the commencement of the settlement of the Tender Offer. Each of the Offeror Related
Parties intend to vote in favor of each of the above proposals at the Extraordinary Shareholders’Meeting. If the proposal for the Share Consolidation is approved at the Extraordinary Shareholders’- 29 -

Meeting, then on the date on which the Share Consolidation takes effect, the shareholders of the Target
will hold the Target Shares in the number corresponding to the Share Consolidation ratio approved at
the Extraordinary Shareholders’ Meeting. If any fraction of less than one share results from theimplementation of the Share Consolidation, an amount in cash equal to the purchase price to beobtained by selling to the Offeror the Target Shares equivalent to the total number of such fractional
shares will be delivered to the shareholders in accordance with the procedures provided in Article 235of the Companies Act and other relevant laws and regulations. With respect to the purchase price of
the Target Shares equivalent to such total number of fractional shares, it is scheduled to be set in sucha way so that, as a result of selling these shares, the amount of money to be delivered to the Target
shareholders who did not tender in the Tender Offer (however, excluding the Offeror Related Parties
and the Target) will be the same as the price obtained by multiplying the Tender Offer Price for theTarget Shares by the number of Target Shares held by each such shareholder. After the above
process, a court petition to obtain permission for a voluntary sale will be filed. The Offeror intends
to request together with MC that the Target use the Consolidation Ratio as the ratio of the Share
Consolidation. The Consolidation Ratio will be determined such that the number of Target Shares
held by Target shareholders who did not tender in the Tender Offer (excluding the Offeror Related
Parties) will be a fraction of less than one share so that the Offeror Related Parties will hold all of theTarget Shares.
The Target Shares subject to the Share Consolidation include the Target Shares represented byAmerican Depositary Receipts and held by the Depositary Bank. Therefore, if the above
determination is made, the number of Target Shares held by the Depositary Bank after the Share
Consolidation is also expected to be a fraction of less than one share. In this case, according to theAmerican Depositary Receipts Notifications (as defined in “(III) Depositary receipts for sharecertificates” under “(3) Price of tender offer” under “2. Summary of Tender Offer” below; hereinafter
the same), each of the Depositary Banks may cancel the American Depositary Receipts and deliver
to each holder of such American Depositary Receipts a portion of the cash received by the Depositary
Bank (converted into U.S. dollars) in accordance with the number of American Depositary Shares
represented by the American Depositary Receipts held by such holder after deducting Depositary
Bank’s fees and applicable taxes, in accordance with the provisions stated in the American Depositary
Receipts.
As for provisions of the Companies Act that aim to protect the rights of minority shareholders inconnection with the above, the Companies Act provides that if fractional shares of less than one share
are created as a result of the Share Consolidation, then the shareholders of the Target may request that
the Target purchase all of the fractional shares less than one share that they hold at a fair price inaccordance with Articles 182-4 and 182-5 of the Companies Act and other relevant laws andregulations and may file a court petition to determine the price of the Target Shares. The court will
eventually determine the purchase price per share via this method.
If a holder of American Depositary Receipts intends to make a share purchase demand and apetition for the determination of the price, such holder required to make a share purchase demand anda petition for determination of the price in accordance with Articles 182-4 and 182-5 of the Companies
Act and other relevant laws and regulations following the delivery of such holder’s American
Depositary Receipts to the Depositary Bank and receipt by such holder of the corresponding Target
Shares deposited with the Depositary Bank.
If the Tender Offer is successfully completed, but not all of the Share Options have been tenderedand purchased in the Tender Offer and such Share Options are not exercised and remain outstanding,
the Offeror Related Parties plan to request that the Target implement reasonably necessary proceduresfor the execution of the Transactions, such as recommending that the Share Option Holders forfeit
their Share Options. According to the Target, if the Target receives such a request, the Target intends
to cooperate with such request promptly after the settlement commencement date of the Tender Offer.
The procedures above may take time to implement, and the implementation method may change,depending on the situation, such as the amendment, effectuation, and interpretation by the authorities
of relevant laws and regulations. Even in such a case, if the Tender Offer is successfully completed,the method of eventually delivering money to the Target shareholders who did not tender in the Tender
Offer will be adopted, and in such case, the amount of money delivery to the Target’s shareholders
will be calculated to be equal to the Tender Offer Price multiplied by the number of Target Shares- 30 -

held by the shareholders of the Target. In such cases, the amount of money to be delivered to the
Depositary Banks in respect of the Target Shares represented by American Depositary Receipts andheld by the Depositary Banks will be the same. According to the American Depositary Receipts
Notifications, the Depositary Banks may cancel the American Depositary Receipts and deliver to eachholder of such American Depositary Receipts a portion of the cash received by the Depositary Bank
(converted into U.S. dollars in accordance with the number of Target Shares represented by theAmerican Depositary Receipts held by such holder after deducting Depositary Bank’s fees andapplicable taxes.
For the specific procedures and time of implementation of the above, the Offeror will consult with
the Target, and the Target will promptly announce the details once they have been determined.
(5) Possibility of delisting and reason therefor
The Target Shares are listed on the Prime Market of the TSE as of today. Because the Offeror has
not set a maximum number of shares to be purchased in the Tender Offer, the Target Shares may
become delisted through the prescribed procedures in accordance with the TSE’s delisting criteria
depending on the results of the Tender Offer. In addition, even if such delisting criteria are not met
as at the time of successful completion of the Tender Offer, in the case where the Tender Offer issuccessfully completed, a series of procedures is planned to be implemented so that the Offeror
Related Parties will be the only shareholders of the Target, as explained in “(4) Policies onorganizational restructuring, etc. after the Tender Offer (matters concerning “two-step acquisition”)”
above. Therefore, in such cases, the Target Shares will be delisted through the prescribed proceduresin accordance with the TSE’s delisting criteria. After the delisting of the Target Shares, the Target
Shares may no longer be traded on the Prime Market of the TSE.
(6) Material agreements relating to the Tender Offer(I) Master Agreement
As described in “(1) Outline of the Tender Offer” above, the Offeror executed the Master
Agreement with MC as of today, with respect to the Transactions. A summary of the Master
Agreement is as follows.
(i) Matters regarding the Transactions
The Offeror Related Parties will conduct the Transactions as follows:(A) The Offeror will conduct the Tender Offer for privatization of the Target. MC will nottender the Target Shares held by MC in the Tender Offer.
(B) If not all of the Target Share Certificates are acquired in the Tender Offer even if theTender Offer was successfully completed, the Squeeze-out Procedure will be conducted in orderto make the Offeror Related Parties the only Target shareholders and to privatize the Target
Shares.

The Offeror will conduct the Tender Offer subject to the satisfaction of all of the Conditions
Precedent or waiver by the Offeror Related Parties, in accordance with applicable laws,
regulations, etc. and the Master Agreement.

Until the Transactions have been completed, the Offeror Related Parties will not directly
or indirectly make any proposal, solicitation, provision of information, or consultation withany third party regarding transactions that virtually compete with, conflict with, or infringeon the Transactions, such as implementation of the tender offer subject to the Target Share
Certificates, or make it difficult to implement the Transactions, or which have a concrete
possibility of doing so (the “Competing Transactions”); and they will not conduct any act
that conflicts with or infringes on the Transactions such as an agreement related to theCompeting Transactions (including the exercise or non-exercise of voting rights at theTarget’s shareholders meeting that conflict with or infringe on the Transactions); if theyreceive a proposal for Competing Transactions from any third party or come to know that
there is such proposal, they will reasonably promptly notify the other party to that effectand of the details of the relevant proposal, and consult on responses to the Competing
Transactions in good faith.
In the Tender Offer, solicitation of the Target’s shareholders located in the United States
will be conducted, tenders for the Tender Offer from the United States will be accepted- 31 -

(however, the Offeror will not accept tenders for American Depositary Receipts, and will
accept only tenders for the Target Shares related to American Depositary Shares
represented by American Depositary Receipts), and the Offeror Related Parties will
provide mutual cooperation (including reasonably necessary cooperation by each party’s
subsidiaries and affiliates) to provide responses in compliance with the U.S. Securities Act.
(ii) Other mattersIn addition, under the Master Agreement, (A) MC shall be obliged to use its best effort tothe extent reasonably possible and commercially and reasonably necessary to ensure that
the Target will perform its business operations and manage and operate its assets
substantially the same as before the execution date of the Master Agreement and within thescope of ordinary business and the Target will not perform certain acts from the execution
date of the Master Agreement to the completion of settlement of the Tender Offer, except
for the case necessary for conducting the Transactions or agreed between the Parties inaccordance with the Master Agreement, (B) the Offeror Related Parties shall be obliged tomake the same efforts as above (A) from the completion of settlement of the Tender Offer
to the completion of the Transaction, (C) the Offeror Related Parties shall have an
obligation to consult in good faith on the business operations of the Target Group from thecompletion of settlement of the Tender Offer to the completion of the Transactions, (D) the
Offeror Related Parties shall be obliged not to transfer their Target Shares from theexecution date of the Master Agreement to the completion of the Transactions, unlessotherwise following the Definitive Agreements or with the prior written consent of anotherparty, (E) the Offeror Related Parties, as soon as practicable after the execution of the
Master Agreement, shall be obliged to legally complete the Competition Act Response
Procedure, to which they have obligations in relation to the implementation of theTransactions in accordance with laws and regulations, (F) the Offeror Related Parties shallrespectively make representations and warranties (Notes 1 and 2), and (G) the Offeror
Related Parties shall be obliged to compensate for damages, etc., in the event of breach of
the representations and warranties or the obligations under the Master Agreement.
(Note 1) Regarding MC, MC generally represents and warrants under the Master
Agreement as to (a) the validity of its survival and powers, (b) the validity of
its power to enter into and perform the Definitive Agreements and performanceof necessary procedures, (c) the enforceability of the Definitive Agreements, (d)no conflict of laws or regulations, (e) no legal insolvency procedures, and (f)the possession of the Target Shares. In addition, regarding the Target Group,
MC represents and warrants as to (a) the validity of the survival and powers of
the Target, (b) the total number of issued shares of the Target, the number ofshare options, etc., (c) no legal insolvency procedures, (d) non-applicability ofanti-social forces, and (e) accuracy of information disclosed by the Target
Group.
(Note 2) With respect to the Offeror, the Offeror generally represents and warrants under
the Master Agreement as to (a) the validity of its survival and powers, (b) thevalidity of its power to enter into and perform the Definitive Agreements andperformance of necessary procedures, (c) the enforceability of the Definitive
Agreements, (d) no conflict of laws or regulations, (e) no legal insolvency
procedures, and (f) the possession of the Target Shares.
(II) Shareholders Agreement
As described in “(1) Outline of the Tender Offer” above, the Offeror executed the Shareholders
Agreement with MC as of today, with respect to the joint operation of the Target Group. A summaryof the Shareholders Agreement is as follows. Except for certain general and other provisions, theShareholders Agreement shall be effective when the Squeeze-out Procedure is completed and thevoting rights ratio of MC and the Offeror in Target becomes 50.00%, respectively.
(i) Matters concerning the organization and operation of the Target, etc.
Organizational planning of the Target (board of directors, board of company auditors,- 32 -

companies with financial auditors)
Changes in the articles of incorporation, regulations of the board of directors, andregulations of the management meetingThe right to appoint the Target’s directors (the number of directors shall be six; MC andthe Offeror will appoint three each)The right to appoint the Target’s representative directors (the number of representative
directors shall be two; MC will appoint one representative director and president and theOfferor will appoint one representative director and vice president; to be agreed throughfaithful consultations as to which party will appoint the representative director andpresident and the representative director and vice president for fiscal years following the
fiscal year in which the five-year periods after the date of completion of the Transactions
has elapsed)Establishment of the management meeting of the TargetEstablishment of the steering committee between the Offeror Related Parties for five years
after the completion of the Transaction
The right to appoint auditors of the Target (the number of auditors shall be four, of which
one each shall be appointed by MC and the Offeror, and the remaining auditors shall beagreed upon after faithful consultations)
Sincere consultation about the business plan and the annual budget proposal of the Target
Matters related to the distribution policy of the Target (100% in principle, based on theInternational Financial Reporting Standards (IFRS))
Procedures in the case of deadlock(ii)
Matters concerning transfer of shares, etc.

Restrictions on transfer of the Target SharesPreferred negotiating rights and the tag along right of the Offeror Related Parties after
five years from the date of completion of the Transaction
Call options and put options, etc. in the breach of the Shareholders Agreement(iii)
Other matters
・ In addition, under the Shareholders Agreement, the Offeror Related Parties agree on (A)representations and warranties, (B) in the case where the nominated director concurrently
holds the post of officer or employee of a company, etc. carrying out a business that maycompete with the business of the Target, the obligation to have the director obtain approval
after submitting a report to the Target’s board of directors, (C) the prohibition ofheadhunting of the Target Group employees, etc., and (D) the obligation to provide
information on the Target Group, etc.
(III) Capital and Business Alliance Agreement
As described in “(1) Outline of the Tender Offer” above, the Offeror executed the Capital andBusiness Alliance Agreement with MC and the Target as of today with respect to the capital andbusiness alliance between the Offeror Related Parties and the Target Group after the Transactions.
A summary of the Capital and Business Alliance Agreement is as follows.
(i)
Purposes・ Maximize corporate value of the Target Group by strengthening each business of the Target
Group to realize a new-generation “hub of refreshment in every community” that creates
new consumer value by combining “real × digital × green” by leveraging leading contact
points with consumers in the country
・ Expand the business foundations of the MC Group and the Offeror Group and create newvalue through growth of the Target Group(ii)
Details of the capital alliance・ Establishment of the capital alliance between the Offeror Related Parties and the Target by
the Transactions (this provision shall be effective on the closing date (meaning the datewhen the voting rights ratio of MC and the Offeror in the Target becomes 50.00%,
respectively, after the Share Consolidation becomes effective; hereinafter the same)(iii)
Details of the business alliance- 33 -

・ In general, the implementation of a business alliance in the following alliance fields (the“Business Alliance”), the contribution and cooperation to the promotion of the following
various measures (this provision shall be effective as of the closing date), and establishmentof the collaboration committee as a forum for consultation on the policy and progress of
the Business Alliance(A) Real store-related: Creation of new store forms in real stores, the strengths of theTarget and the Offeror, and that can provide new services utilizing each company’sfunctions and products(B) Digital collaboration-related: Link member information held by each group of theOfferor Related Parties and the Target and expand the customers who use servicesof the Target Group by utilizing the customer database and make them loyal
customers(C) Green collaboration-related: Decarbonization of the Target Group and promotion of
the circular economy business utilizing the business foundations of the Offeror
Related Parties and their groups(D) Business alliances in other areas: Cooperation with measures in other areas that aim
to maximize the corporate value of the Target Group determined by the collaborationcommittee after consultation between the Offeror Related Parties and the Target
・ (A) Provision of sufficient management resources by the Offeror Related Parties and theirgroups to the Target Group within the scope of economic rationality, and (B) consultationand consideration of details of implementation of the Business Alliance and roles of eachparty based on the provision of sufficient management resources by the Target Group to theOfferor Related Parties and their groups within the scope of economic rationality (thisprovision shall be effective as of the closing date)・ Agreement by the collaboration committee on the details of implementation of the Business
Alliance and specific roles of each party based on the results of the above consultation andconsideration within 12 months from the execution date of the Capital and Business
Alliance Agreement (this provision shall be effective as of the closing date)・ Implementation of measures agreed upon by the collaboration committee (the relevantmeasures and the roles of each party shall be reviewed every three years from the time of
the above agreement) within three years from the closing date in principle (this provision
shall be effective as of the closing date)(iv)
Management of the Target, etc.
・ Confirmation by the Offeror Related Parties of the Target Group’ officers and employees
strengthening the Target’s existing businesses and developing new businesses to maximize
Target’s corporate value, and operating with the aim of “improving Life Time Value ofconsumers” and “a prosperous local community in Japan” through the Business Alliance(this provision will be effective as of the closing date)・ The Offeror Related Parties’ utmost respect for the Target Group’s contractual and business
relationships existing prior to the closing date (including contractual terms and conditions
agreed to with franchisee owners) to the extent that such relationships contribute toenhancing the Target Group’s corporate value, and in the commercially reasonable scopeof the Target’s transaction practices existing before the closing date (this provision will beeffective as of the closing date)・ The Offeror Related Parties’ obligation to maintain the employment of the Target Group
employees and to maintain the employment terms and conditions of the employees not tobe substantially less than the level as of the execution date of the Capital and Business
Alliance Agreement (the Offeror Related Parties’ obligation does not extend to retirement
or disciplinary actions in accordance with laws and regulations and internal rules, the casewhere the Target Group needs to change the terms and conditions of employment of theTarget Group’s employees in order to maintain substantially the same business operation
as before in line with changes in the market situation or the business environment, or any
other case that follows prior established practice of the Target Group) ( this provision will
be effective as of the closing date)- 34 -

・ Sincere consultation about the stock option system of the Target that exists as of theexecution date of the Capital and Business Alliance Agreement
・ Target’s obligation to make requests to each shareholding association to the extent
commercially reasonable to require all of the Target Shares owned by each shareholding
association of the Target Group to take measures to legally subscribe to the Tender Offer
and to take measures required to comply with laws and regulations applicable to Tender
Offer・ Dispatch or secondment of the officers and employees of Offeror Related Parties and theirgroups to the Target Group as required for the purpose of effectively and substantiallypromoting the Business Alliance (this provision shall be effective as of the closing date)
2.
(1)
(I)

Summary of Tender Offer
Summary of Target and MC
Summary of Target(I)
Name
Lawson, Inc.
(II)
Address
Osaki 1-11-2, Shinagawa-ku, Tokyo(III)
Title/name of President and CEO, Representative Director, Chairman of therepresentative Board Sadanobu Takemasu(IV)
Details ofDevelopment of franchise chains of “Lawson” convenience storesbusiness(V)
Stated capital 58,506 million yen (as of November 30, 2023)(VI)
Date ofApril 15, 1975
establishment(VII)
Mitsubishi Corporation
50.11%The Master Trust Bankof Japan, Ltd. (trust
8.15%
account)
Custody Bank of Japan,
2.74%
Ltd. (trust account)
SMBC Nikko Securities
2.31%
Inc.
Major
KDDI Corporation
2.11%
shareholders
NTT DOCOMO, INC.
2.09%
and
shareholding Japan Securities Finance
1.73%
ratio
Co., Ltd.
(as of
JPMorgan
Securities
1.20%
August 31,
Japan Co., Ltd.
2023) (NoteMitsubishi UFJ Morgan1)
Stanley Securities Co.,
1.20%
Ltd.
STATE STREET BANK
AND
TRUST
COMPANY
505103(standingproxy:
0.93%
Settlement & Clearing
Services Department,
Mizuho Bank, Ltd.)(VIII) Relationship between Offeror and Target
Capital
As of today, the Offeror holds 2,110,000 Target Shares
relationship(Shareholding Ratio: 2.11%).
Personnel
Not applicable.
relationship- 35 -

Businessrelationship

The Offeror has executed the Capital and Business AllianceAgreement with the Target. In addition, the Offeror has executed
the business alliance agreement with the Target, MC, and menu,
Inc.

Applicablestatus of
The Offeror does not fall under a related party.
relatedparties(IX) Target’s consolidated management performance and consolidated financial
position for the last three years (based on international accounting standards)
Accounting
Fiscal year ending
periodFebruary 2023
Total assets
2,242,421 million yen
Total sharehol
253,858 million yen
ders’ equity
Gross
operating
1,000,385 million yen
revenueCore operating
64,311 million yen
profitIncomeattributable to29,708 million yen
owners of theparentIncome per296.86 yen
share
Dividend per
150 yen
share
Target’s consolidated management performance and consolidated financial
position for the last three years (based on Japanese accounting standards)
Fiscal year ending
Fiscal year ending
Accounting period
February 2021
February 2022
278,473
Consolidated net assets
272,931 million yen
million yen
1,365,430
1,337,245
Consolidated total assets
million yen
million yen
Consolidated net assets per
2,674.53 yen
2,726.97 yen
shareConsolidated total operating
698,371
666,001 million yen
revenuemillion yen
Consolidated operating income
40,876 million yen 47,096 million yen
Consolidated ordinary income
37,610 million yen 47,571 million yen
Net income attributable to8,689 million yen 17,900 million yen
owners of the parent
Consolidated net income per86.84 yen
178.87 yen
share
Dividend per share
150 yen
150 yen(Note 1) “(VII) Major shareholders and shareholding ratio (as of August 31, 2023)” is quoted from“status of major shareholders” in the second Quarterly Report for the 49th fiscal year
submitted by the Target on October 13, 2023.
(Note 2) The Target has prepared its consolidated financial statements in accordance with theinternational financial reporting standards (IFRS) from the fiscal year ending February 2023.
(II)

Summary of MC- 36 -

(I)
(II)
(III)
(IV)

Name
Address
Title/name ofrepresentative

Details of business

(V)
(VI)
(VII)

Stated capital
Date ofestablishment

Mitsubishi Corporation
Marunouchi 2-3-1, Chiyoda-ku, Tokyo
Representative Director, President and Chief Executive Officer
Katsuya Nakanishi
MC is a company that is developing business jointly with bases
in approximately 90 countries and regions around the world andapproximately 1,700 consolidated business companies. Also, it
has a system with 10 groups (natural gas, industrial materials, oiland chemicals solution, mineral resources, industrial
infrastructure, automotive & mobility, food industry, consumer
industry, power solutions, and urban development) as well as theindustry DX department; and it has broad industries as its
business fields, and is promoting DX (digital transformation) andEX (energy transformation) to address digitalization and a low ordecarbonized society collectively as measures for important
issues for the future.
204,447 million yen (as of September 30, 2023)
April 1, 1950 (founded on July 1, 1954)
The Master Trust Bank of Japan, Ltd. (trust
account)
EUROCLEAR BANK S.A./N.V. (standing proxy:
Transaction Services Division, MUFG Bank, Ltd.)
Custody Bank of Japan, Ltd. (trust account)
Meiji Yasuda Life Insurance Company

14.84%
9.22%
5.46%
4.16%

Tokio Marine & Nichido Fire Insurance Co., Ltd.
2.88%
The Master Trust Bank of Japan, Ltd. (employee
Major shareholders
2.30%
pension trust account/voting trustee exercise type)and shareholding
STATE
STREET
BANK
WEST
ratio
CLIENT-TREATY
505234(standingproxy:(as of September 30,
1.60%
Settlement & Clearing Services Department,
2023) (Note 1)
Mizuho Bank, Ltd.)The Master Trust Bank of Japan, Ltd. (employee
pensiontrust
account/Mitsubishi
Electric
1.26%
Corporation account)
JP MORGAN CHASE BANK 385781 (standing
proxy: Settlement & Clearing Services
1.09%
Department, Mizuho Bank, Ltd.)
JPMorgan Securities Japan Co., Ltd.
1.07%
(VIII) Relationship between Offeror and MCCapital relationship Not applicable.
Personnel
Not applicable.
relationship
Business
The Offeror has executed the Business Alliance Agreement withrelationshipMC, the Target, and menu, Inc.
Applicable status of
The Offeror does not fall under a related party.
related parties(IX) MC’s consolidated management performance and consolidated financial position forthe last three years
Fiscal year ending
Fiscal year ending
Fiscal year ending
Accounting period
March 2021
March 2022
March 2023

- 37 -

Total assets
Total stated capital
Equity attributable toowners of the parent
per share
Revenue

18,634,971
million yen
6,538,390 million yen

21,912,012
million yen
7,857,172 million yen

22,152,882
million yen
9,124,417 million yen

3,803.01 yen

4,659.68 yen

5,648.84 yen

12,884,521
million yen
253,527 million yen
132,241 million yen

17,264,828
million yen
1,293,116 million yen
1,004,459 million yen

21,571,973
million yen
1,680,631 million yen
1,271,499 million yen

Income before tax
Net income
Net income
attributable to owners
172,550 million yen
937,529 million yen 1,180,694 million yenof the parent
Basic net income per116.86 yen
635.06 yen
809.29 yen
share
Diluted net income per116.57 yen
625.73 yen
805.69 yen
share
Dividend amount per
134 yen
150 yen180 yenshare(Note 1) “(VII) Major shareholders and shareholding ratio (as of September 30, 2023)” is quoted from“status of major shareholders” in the second Quarterly Report for the 2023 fiscal year
submitted by MC on November 13, 2023.
(2)
Schedule
The Offeror intends to promptly conduct the Tender Offer once the Conditions Precedent are satisfied(or waived by the Offeror Related Parties). As of today, the Offeror aims to commence the Tender
Offer in around April 2024. However, as it is difficult to accurately predict the period required for theprocedures to be taken by the competition authorities in and outside Japan, the details of the schedule
for the Tender Offer will be announced promptly after they are determined.
The Tender Offer Period is scheduled to be 20 business days (Note 1).
(Note 1) Since the Tender Offer Period will be a period which covers 20 business days in the UnitedStates, which is the minimum number of days required for the tender offer period under
U.S. securities laws, the Tender Offer Period may be greater than 20 business days.
The schedule of the capital and business alliance is as follows:(1)
Resolution date of the board of
February 6, 2024
directors(2)
Execution date of the Capital andFebruary 6, 2024
Business Alliance Agreement(3)
Commencement date of the Tender
April, 2024 (Plan)
Offer
(4)
Effective date of the Share
August, 2024 (Plan)
Consolidation(5)
Commencement date of business
September, 2024 (Plan)
alliance(3)

Price of tender offer(I) 10,360 yen per common share(II) Share options
1 yen per share option issued pursuant to the resolution of the Target’s board of directors
meeting held on March 25, 2015 (the “14th Series of Share Options”) (the exercise period isfrom April 10, 2015 to March 24, 2035)- 38 -

1 yen per share option issued pursuant to the resolution of the Target’s board of directors
meeting held on April 13, 2016 (the “16th Series of Share Options”) (the exercise period isfrom May 2, 2016 to April 13, 2036)
1 yen per share option issued pursuant to the resolution of the Target’s board of directors
meeting held on April 12, 2017 (the “17th Series of Share Options”) (the exercise period isfrom May 1, 2017 to April 11, 2037)
1 yen per share option issued pursuant to the resolution of the Target’s board of directors
meeting held on July 5, 2017 (the “18th Series of Share Options”) (the exercise period is from
July 21, 2017 to July 4, 2037)
1 yen per share option issued pursuant to the resolution of the Target’s board of directors
meeting held on May 22, 2018 (the “19th Series of Share Options”) (the exercise period isfrom June 8, 2018 to May 21, 2038)
1 yen per share option issued pursuant to the resolution of the Target’s board of directors
meeting held on May 21, 2019 (the “20th Series of Share Options”) (the exercise period isfrom June 7, 2019 to May 20, 2039)
1 yen per share option issued pursuant to the resolution of the Target’s board of directors
meeting held on May 27, 2020 (the “21st Series of Share Options”) (the exercise period isfrom June 12, 2020 to May 26, 2040)
1 yen per share option issued pursuant to the resolution of the Target’s board of directors
meeting held on May 25, 2021 (the “22nd Series of Share Options”) (the exercise period isfrom June 11, 2021 to May 24, 2041)
1 yen per share option issued pursuant to the resolution of the Target’s board of directors
meeting held on May 25, 2022 (the “23rd Series of Share Options”) (the exercise period isfrom June 10, 2022 to May 24, 2042)
1 yen per share option issued pursuant to the resolution of the Target’s board of directors
meeting held on May 24, 2023 (the “24th Series of Share Options”) (the exercise period isfrom June 9, 2023 to May 23, 2043)(The 14th Series of Share Options, 16th Series of Share Options, 17th Series of Share Options,18th Series of Share Options, 19th Series of Share Options, 20th Series of Share Options, 21stSeries of Share Options, 22nd Series of Share Options, 23rd Series of Share Options, and 24th
Series of Share Options, collectively, the “Share Options”.)(III) Depositary receipts for share certificates
10,360 yen per share of the Target Shares related the American depositary sharers (the“American Depositary Shares”) deposited with Citibank, N.A., and Deutsche Bank Trust
Company Americas (collectively, the “Depositary Banks”) and represented by the American
depositary receipts related to the Target Shares issued by the Depositary Banks in the UnitedStates (the “American Depositary Receipts”).
(Note) According to the notification for the American Depositary Receipts (Form F-6EF)
submitted by Citibank, N.A. as of February 13, 2018 to the U.S. Securities and Exchange
Commission (the “SEC”) and the one submitted by Deutsche Bank Trust Company
Americas as of April 2, 2018 to the SEC (collectively, the “American Depositary
Receipts Notifications”), the American Depositary Receipts for the Target Shares were
issued in the United States. However, according to the Target, the Target was not
involved in the issuance of these American Depositary Receipts. Since the Offeror
aims to acquire all of the Target Shares in the Tender Offer (excluding the Target Shares- 39 -

held by the Offeror Related Parties and treasury shares held by the Target), the Offeror,in accordance with Article 27-2, paragraph (5) of the Act and Article 8, paragraph (5),item (iii) of the Order for Enforcement of the Financial Instruments and Exchange Act(Cabinet Order No. 321 of 1965, as amended), includes the American Depositary
Receipts as the type of share certificates, etc., to be purchased, because it is necessary tosolicit applications for sales, etc., for all the share certificates, etc. issued by the Target.
On the other hand, while the American Depositary Receipts are securities issued in the
United States, it has been determined that it will be difficult for the Offeror, which is a
resident of Japan, to acquire the American Depositary Receipts themselves in the Tender
Offer conducted outside the United States because there are no financial instruments
business operators, etc., that can handle the acquisition as a tender offer agent in practice.
Accordingly, in the Tender Offer, the Offeror will accept tenders of the Target Sharesand the Share Options only, and instead of accepting tenders of the American Depositary
Receipts themselves, it will accept tenders of the Target Shares related to such American
Depositary Shares represented by the American Depositary Receipts. Therefore, theowners of the American Depositary Receipts who wish to tender in the Tender Offer
should deliver the American Depositary Receipts to the Depositary Banks and receive
the delivery of the Target Shares related to such American Depositary Shares represented
by the American Depositary Receipts, in advance.
(4)

Basis for calculation of the price of tender offer(I) Basis for calculation(i)
Common shares
To ensure the fairness of the Tender Offer Price, the Offeror, in determining the Tender Offer
Price for the Target Shares, requested UBS Securities, its financial adviser, to calculate the value of
the Target Shares as its third-party valuation institution independent of the Offeror Related Parties
and the Target. UBS Securities is not a related party of the Offeror Related Parties or the Target
and has no material interest in the Transactions including the Tender Offer.
After considering the valuation method that should be adopted among various share valuation
methods when assessing the share value of the Target, UBS Securities assess the share value of theTarget using each of (i) the average market price analysis because the Target Shares are listed on
the Prime Market of the Tokyo Stock Exchange, (ii) the comparable company analysis because there
is a listed company comparable to the Target and it is possible to infer by analogy the share valueof the Target by comparing the Target with such a comparable company, and (iii) the DCF analysis
so as to reflect future business activities in the valuation, subject to the condition precedent set forth
below (Note) and certain other conditions, based on the premise that the Target is a going concern
and from the perspective that it would be appropriate to assess the share value of the Target in
multiple ways. As of February 5, 2024, the Offeror received the share valuation report from UBS
Securities (the “Share Valuation Report (UBS Securities)”).
According to UBS Securities, the ranges of the per share value of the Target Shares calculatedusing each of the above methods are as follows. For the conditions precedent and considerations
related to the preparation of the Share Valuation Report (UBS Securities) and the valuation analysis
that serve as a basis therefor, please refer to the below (Note).
Average market price analysis: 7,264 yen to 8,721 yen
Comparable company analysis: 6,568 yen to 8,835 yen
DCF analysis:
9,711 yen to 13,038 yen
Under the average market price analysis, February 5, 2023 was used as the valuation base date,
and the per share value of the Target Shares was calculated to range from 7,264 yen to 8,721 yen,based on the closing price of the Target Shares listed on the Prime Market of the Tokyo Stock
Exchange on the valuation base date of 8,721 yen and the simple average of closing prices over theprior one month of 8,154 yen, over the prior three months of 7,545 yen, and the simple average ofclosing prices over the prior six months of 7,264 yen.

- 40 -

Under the comparable company analysis, the share value of the Target was calculated throughcomparison with trading prices and financial indices indicating profitability, etc. of listed companies
engaged in businesses considered to be relatively similar to those of the Target. The per sharevalue of the Target Shares was calculated to range from 6,568 yen to 8,835 yen.
Under the DCF analysis, the per share value of the Target Shares was calculated to range from
9,711 yen to 13,038 yen, as a result of analyzing the enterprise value and the equity value of theTarget by discounting the free cash flow that is expected to be generated by the Target in the futureusing a certain discount rate, based on the earnings forecast of the Target in and after the fiscal year
ending February 2024 which takes into consideration various factors including the Target’s businessplan confirmed by the Offeror for five years from the fiscal year ending February 2024 to the fiscal
year ending February 2028, the trend of the Target’s business performance, and publicly available
information. The Target’s business plan, which served as a basis for the DCF analysis, does notinclude any fiscal year in which a substantial increase/decrease in profit is expected. Further, thebusiness plan does not assume the implementation of the Transactions, and does not include thesynergies expected to be realized from the implementation of the Transactions being completed
because it is difficult to specifically estimate such synergies at this time.
(Note) The Share Valuation Report (UBS Securities) has been delivered solely for the Offeror
to examine the Tender Offer Price of the Target Shares from a financial point of view.
UBS did not conduct any valuation analysis of the Share Options. The Share Valuation
Report (UBS Securities) does not express any opinion or view on the following: (a) theterms of, or other aspects of, the Transaction (including, without limitation, the manneror structure of the Transaction or other elements) or (b) the relative advantage of theTransaction compared with other strategies or transactions that may be adopted or
implemented by the Offeror, or business decision-making related to promoting or
implementing the Transaction. Furthermore, the Share Valuation Report (UBS
Securities) does not make any recommendations to the Offeror and the Board of the
Directors of the Offeror on any particular purchase price or any recommendations thatany particular purchase price is the only appropriate purchase prices. UBS Securities
also does not express any opinion or view on the fairness (whether financial orotherwise), as compared with the Tender Offer Price, of the amount, nature, or otheraspects of any remuneration for officers, directors, or employees of any party to theTransaction. The Share Valuation Report (UBS Securities) does not express any
opinion on the price at which the Target Shares should be transacted at any time,
including after the Transaction is publicly announced or commences.
In preparing the Share Valuation Report (UBS Securities), UBS Securities has
assumed and relied upon the accuracy and completeness of the assumptions andinformation that were publicly available or were furnished to UBS Securities by theOfferor or the Target or their other advisors or were otherwise reviewed by UBS
Securities for the purposes of preparing the Share Valuation Report (UBS Securities).
The content of the assumptions and information has not been independently verified by
UBS Securities or any of its directors, officers, employees, agents, representatives
and/or, advisers, or any other person.
No representation, warranty, or undertaking, express or implied, is or will be given by
UBS Securities or its directors, officers, employees, agents, representatives, or advisors
in relation to the accuracy, completeness, reliability, or sufficiency of the information
contained in the Share Valuation Report (UBS Securities) or the reasonableness of any
assumption contained in the Share Valuation Report (UBS Securities).
The Share Valuation Report (UBS Securities) is provided solely for the benefit of theOfferor, and the Offeror’s shareholders and other persons should not rely upon the Share
Valuation Report (UBS Securities) and will not be conferred any interests, rights, orremedies by the Share Valuation Report (UBS Securities).
By receiving the Share Valuation Report (UBS Securities), the Offeror acknowledges
and agrees that to the maximum extent permitted by law, except in the case of fraud andsave as provided in the engagement letter, UBS Securities and its directors, officers,- 41 -

employees, agents, representatives and advisors expressly disclaim any liability which
may arise from the Share Valuation Report (UBS Securities), or any other written or oral
information provided in connection with the Share Valuation Report (UBS Securities),and any errors contained therein or omissions therefrom.
The Share Valuation Report (UBS Securities) may also contain forward-looking
statements, projections, estimates, forecasts, targets, and/or opinions (collectively, the“Forecasts”) provided to UBS Securities by the Offeror or the Target, and UBS Securities
has relied upon the opinion of the Offeror as to the reasonableness and achievability of
the Forecasts (and the assumptions and bases thereof). UBS Securities has assumed
that the Forecasts represent the best available assessments and judgments of the Offeror
and the Target as of the date of the Share Valuation Report (UBS Securities) and that theForecasts will be realized in the amounts and time periods contemplated by the Offeror
and the Target. All assumptions contained in the Share Valuation Report (UBS
Securities) have been discussed and agreed with the Offeror. The Forecasts involve
significant assumptions and subjective judgments which may or may not prove to becorrect, and there can be no assurance that any Forecasts are a reliable indicator of future
performance, nor that they are attainable or will be realized. No representation or
warranty is given as to the achievement or reasonableness of, and no reliance should beplaced on, any Forecasts contained in the Share Valuation Report (UBS Securities).
The Share Valuation Report (UBS Securities) was prepared based on the economic,
regulatory, market, and other conditions as in effect on the date thereof and theinformation made available to UBS Securities as of the same date. Subsequent changes
in these conditions may affect the information contained in the Share Valuation Report(UBS Securities). The Share Valuation Report (UBS Securities) speaks as at the datethereof (unless an earlier date is otherwise indicated therein), and in furnishing the Share
Valuation Report (UBS Securities), no obligation is undertaken, nor is any representationor undertaking given, by any person: (i) to provide the Offeror with any additional
information, (ii) to update, revise, or re-affirm any information in the Share Valuation
Report (UBS Securities), including any Forecasts, or (iii) to correct any inaccuracies
therein which may become apparent.
The analyses conducted by UBS Securities described in the Share Valuation Report(UBS Securities) are summaries of the material financial analyses presented by UBS
Securities to the Offeror in connection with the Share Valuation Report (UBS Securities)
and are not comprehensive descriptions of all analyses undertaken or informationreferred to by UBS Securities in connection with the Share Valuation Report (UBS
Securities). The preparation of the Share Valuation Report (UBS Securities) and its
underlying analysis are a complex analytical process involving various judgments about
the appropriateness and relevance of methods of financial analysis and the applicationof those methods to the particular circumstances; therefore, a part or summary of theanalysis results do not necessarily accurately present all aspects of the analyses. UBS
Securities’ analysis results must be considered holistically, and reference to a part orsummary thereof, without considering all of such analysis results as a whole, may giverise to failure to obtain a correct understanding of the processes underlying UBS
Securities’ analyses. None of the companies reviewed in UBS Securities’ analyses as
a comparable company is identical to any business units or subsidiaries of the Target,
and these companies were selected because they were publicly traded companies withbusinesses that, for purposes of UBS Securities’ analyses, could be considered similar to
those of the Target. The analyses made by UBS Securities necessarily involve complex
considerations and judgments concerning differences in financial and businesscharacteristics of the companies reviewed for comparison with the Target and otherfactors that could affect these companies.
In preparing the Share Valuation Report (UBS Securities), UBS Securities has: (i) notmade any independent valuation or appraisal of the physical assets and liabilities of theTarget or any other company referred to in the Share Valuation Report (UBS Securities),
nor been furnished with any such valuation or appraisal; (ii) not carried out any- 42 -

assessment as to the commercial merits of the Transaction; (iii) not conducted any legal,tax, accounting, or other analysis in respect of the Transaction, and where relevant, hasrelied solely upon the judgments of the relevant professional advisors in these areas; and(iv) assumed that in the course of obtaining any regulatory or third party approvals,consents, and releases for the Transaction, no delay, limitation, restriction, or condition
would be imposed that would have an adverse effect on the Target, any other company
referred to in the Share Valuation Report (UBS Securities), or the Transaction.
UBS Securities is acting as financial advisor of the Offeror in connection with theTransaction and receives remuneration for its services as financial advisor, and such
remuneration t becomes payable subject to the successful completion of the Transaction.
In addition, the Offeror has agreed to indemnify UBS Securities for all costs borne by
UBS Securities in relation to UBS Securities’ involvement and certain liabilities arisingout of UBS Securities’ engagement.
The Offeror comprehensively considered elements such as the valuation results of the Share
Valuation Report (UBS Securities) obtained on February 5, 2024 from UBS Securities, the resultsof due diligence conducted on the Target during the period from mid-October 2023 to late-January2024, the approval or disapproval of the Tender Offer by the Target’s board of directors, the trends
in market price of the Target Shares, and prospects for tendering in the Tender Offer, and took into
account the results of consultations and negotiations with the Target, and decided to set the Tender
Offer Price at 10,360 yen per share as of today.
The Tender Offer Price of 10,360 yen per share of the Target Shares represents a price obtainedby adding a premium of 18.79% to the closing price of 8,721 yen of the Target Shares in the Prime
Market of the TSE on February 5, 2024, the business day prior to the date of the announcement of
the scheduled commencement of the Tender Offer, premium of 27.05% to the simple average ofclosing prices for the last one month until the same date (8,154 yen), premium of 37.31% to thesimple average of closing prices for the last three months until the same date (7,545 yen), or
premium of 42.62% to the simple average of closing prices for the last six months until the samedate (7,264 yen), respectively.
In addition, the Tender Offer Price per Target Share, 10,360 yen, exceeds the upper limit of thevaluation result range, based on the average market price analysis and the comparable companies
analysis in the Share Valuation Report (UBS Securities), and is within the valuation result range
based on the DCF analysis.
(ii)
Share Options
The Share Options were granted to directors and executive officers of the Target as executive
compensation equivalent to retirement benefits. The holder of the Share Options may exercise
such holder’s Share Options only in a lump sum, within the exercise period of the Share Options,which is limited to the 10-day period (or the following business day, if the 10th day falls on a holiday)
from the date following the date on which such holder has lost his/her/their position as the Target’s
director or executive officer. Considering the fact that the Offeror may not exercise the Share
Options even if the Offeror acquires them, the Offeror set the Share Option Price at 1 yen. Since
the Offeror set the Share Option Price as described above, the Offeror has not obtained a valuation
report from a third-party valuator.
(iii)
American Depositary Receipts
Considering that the American Depositary Receipts represent the American Depositary Sharesdeposited with Depositary Banks, and one American Depositary Shares is equivalent to one Target
Share, the price of the tender offer of the American Depositary Receipts is set at 10,360 yen per
share of the American Depositary Shares, which is the same price as the Tender Offer Price pershare of the Target Shares.
(II) Background of calculation(Background leading to the decision of the Tender Offer Price)- 43 -

As described in “(I) Background, purposes and decision-making process leading to the decision
to conduct the Tender Offer” under “(2) Background, purpose and decision-making process leading
to the decision to conduct the Tender Offer, and management policy following the Tender Offer”
in “1. Purposes of Tender Offer,” the Offeror, in late June 2023, appointed Nishimura & Asahi(Gaikokuho Kyodo Jigyo) as its legal advisor independent of the Offeror Related Parties and theTarget, and in early September 2023, appointed UBS Securities as its financial adviser independentof the Offeror Related Parties and the Target, and it commenced specifically considering theTransactions (Initial Proposal). On September 1, 2023, the Offeror, together with MC and theInitial Partner Candidate, submitted a written initial proposal regarding the Transactions (Initial
Proposal) to the Target, and made a proposal to the Target to take the Target Shares private with
only the Offeror Related Parties and the Initial Partner Candidate as the Target’s shareholders.
Since mid-September 2023, the Offeror Related Parties and the Initial Partner Candidate havecommenced consultations on specific matters with the Target toward the implementation of theTransactions (Initial Proposal). In addition, since mid-October 2023, the Offeror Related Parties
and the Initial Partner Candidate have consecutively commenced due diligence on the Target.
After the Initial Partner Candidate provided the Target with official notice as of December 25,
2023, declining the proposal regarding the Transactions (Initial Proposal), as a result of theconsultations, the Offeror Related Parties provided the Target with a written proposal on
December 26, 2023, amending the initial proposal to change the Transactions (Initial Proposal)
from a collaboration involving the privatization of the Target Shares by three companies (i.e., theOfferor Related Parties and the Initial Partner Candidate) to a collaboration involving theprivatization of the Target Shares by two companies (i.e., the Offeror Related Parties). Thereafter,
the Offeror Related Parties and the Target continued to consider the Transactions.
In addition, based on the results of due diligence on the Target conducted from mid-October
2023 to late January 2024, with respect to the Tender Offer Price, the Offeror made the Initial
Proposal in writing to the Target on December 26, 2023, setting the Tender Offer Price per Target
Share at 8,650 yen, the Share Option Price at 1 yen, and the Tender Offer Price per Target Sharerelating to American Depositary Shares, represented by American Depositary Receipts, at
8,650 yen. In response to the Initial Proposal, the Offeror received a request from the Target on
December 27, 2023 to consider revising the Tender Offer Price, considering the interests of theTarget’s minority shareholders.
In response to that request, the Offeror made Proposal No. 2 in writing to the Target on January 4,2024, setting the Tender Offer Price per Target Share at 9,000 yen, the Share Option Price at 1 yen,and the Tender Offer Price per Target Share relating to American Depositary Shares, represented
by American Depositary Receipts, at 9,000 yen. In response to Proposal No. 2, the Offeror
received a request from the Target on January 6, 2024 to once again consider revising the Tender
Offer Price, considering the interests of the Target’s minority shareholders.
In response to that request, the Offeror made Proposal No. 3 in writing to the Target on
January 11, 2024, setting the Tender Offer Price per Target Share at 9,500 yen, the Share Option
Price at 1 yen, and the Tender Offer Price per Target Share relating to American Depositary Shares,
represented by American Depositary Receipts, at 9,500 yen. In response to Proposal No. 3, theOfferor received a request from the Target on January 12, 2024, to once again consider revising theTender Offer Price, considering the interests of the Target’s minority shareholders.
In response to that request from the Target, the Offeror made Proposal No. 4 in writing to theTarget on January 18, 2024, setting the Tender Offer Price per Target Share at 10,000 yen, the Share
Option Price at 1 yen, and the Tender Offer Price per Target Share relating to American Depositary
Shares, represented by American Depositary Receipts, at 10,000 yen. In response to Proposal
No. 4, the Offeror received a request from the Target on January 24, 2024 to consider further raising
the Tender Offer Price, considering the interests of the Target’s minority shareholders and in lightof the recent growth in the Target’s business results, including the details of the Target’s Financial
Results and the continued rise in the current stock price, for an opinion in favor of, andrecommendation to tender in, the Transactions.
In response to that request from the Target, the Offeror made Proposal No. 5 in writing to theTarget on January 26, 2024, setting the Tender Offer Price per Target Share at 10,200 yen, the Share
Option Price at 1 yen, and the Tender Offer Price per Target Share relating to American Depositary- 44 -

Shares, represented by American Depositary Receipts, at 10,200 yen. In response to Proposal
No. 5, the Offeror received a request from the Target on January 28, 2024, to consider further
raising the Tender Offer Price, considering the interests of the Target’s minority shareholders, for
an opinion in favor of, and recommendation to tender in, the Transactions.
In response to that request from the Target, the Offeror made Proposal No. 6 in writing to theTarget on January 29, 2024, setting the Tender Offer Price per Target Share at 10,290 yen, the Share
Option Price at 1 yen, and the Tender Offer Price per Target Share relating to American Depositary
Shares, represented by American Depositary Receipts, at 10,290 yen. In response to Proposal
No. 6, the Offeror received a request from the Target on January 29, 2024, to consider further
raising the Tender Offer Price, with the aim of fully securing the interests of the Target’s minority
shareholders, and for an opinion in favor of, and recommendation to tender in, the Transactions.
In response to that request from the Target, the Offeror made Proposal No. 7 in writing to theTarget on January 30, 2024 setting the Tender Offer Price per Target Share at 10,350 yen, setting theShare Option Price at 1 yen, and setting the Tender Offer Price per Target Share relating to American
Depositary Shares represented by American Depositary Receipts at 10,350 yen. In response to
Proposal No. 7, on January 31, 2024, the Offeror received a request from the Target that the Offeror
will consider further raising the Tender Offer Price for the opinion in favor of, and recommendation
to tender in, the Transactions from the perspective of fully securing the interests of the Target’s
minority shareholders.
In response to that request from the Target, the Offeror made the Final Proposal in writing to theTarget on January 31, 2024 setting the Tender Offer Price per Target Share at 10,360 yen, setting theShare Option Price at 1 yen, and setting the Tender Offer Price per Target Share relating to American
Depositary Shares represented by American Depositary Receipts at 10,360 yen. In response to the
Final Proposal, on February 2, 2024, the Offeror received a response from the Target stating that it
views the Tender Offer Price in the Final Proposal as the maximum price that the Offeror could offer
and accepts the Tender Offer Price in the Final Proposal.
As a consequence of the above, the Offeror and the Target agreed on February 2, 2024, to set theTender Offer Price per Target Share at 10.360 yen, the Share Option Price at 1 yen, and the Tender
Offer Price per Target Share relating to American Depositary Shares, represented by American
Depositary Receipts, at 10,360 yen. The Offeror also agreed with MC today, to set the Tender
Offer Price per Target Share at 10,360 yen, the Share Option Price at 1 yen, and the Tender Offer
Price per Target Shares relating to American Depositary Shares, represented by American
Depositary Receipts, at 10,360 yen.
(Measures to ensure the fairness of the Tender Offer, such as measures to ensure the fairness of theTender Offer Price and measures to avoid conflicts of interest)
As described in “(3) Measures to ensure the fairness of the Tender Offer, such as measures toensure the fairness of the Tender Offer Price and measures to avoid conflicts of interest” in “1.
Purposes of Tender Offer” above, considering the fact that the Target is a consolidated subsidiaryof MC, which is one of the Offeror Related Parties, and therefore the Transactions including theTender Offer and execution of the Capital and Business Alliance Agreement fall under the type oftransaction involving the issue of structural conflicts of interest and information asymmetry withminority shareholders, in the Transactions, including the Tender Offer, and execution of the Capitaland Business Alliance Agreement, the Offeror Related Parties and the Target implemented themeasures set forth in (i) to (x) below with a view to ensuring the fairness of the Tender Offer fromthe time of the Tender Offer, eliminating arbitrariness in decision-making concerning theTransactions and execution of the Capital and Business Alliance Agreement, securing the fairness,transparency, and objectivity of the decision-making process, and avoiding any doubt of a conflictof interest. The measures implemented by the Target described below are based on the
explanation made by the Target.
(i) Receipt of a share valuation report from an independent third-party valuator retained by theOfferor
To ensure the fairness of the Tender Offer Price, the Offeror, in determining the Tender Offer
Price, requested UBS Securities as its financial adviser to be its third-party valuator independent of- 45 -

the Offeror Related Parties and the Target to calculate the value of the Target Shares. UBS
Securities is not a related party of the Offeror Related Parties or a Target related party and has nomaterial interest in the Transactions including the Tender Offer. In addition, since the Offeror tookeach of the measures in (i) and (ii) to (x) below and determined the Tender Offer Price throughconsultation and negotiations with the Target, the Offeror has not obtained an opinion concerning
the fairness of the Tender Offer Price (fairness opinion) from UBS Securities. For details, pleaserefer to “(I) Basis for calculation.”(ii)
Establishment of independent special committee at the Target and receipt of a written reportfrom the special committee(A) Background of establishment
According to the Target, as described in “(II) Decision-making process leading to and grounds
for the opinion in favor of the Tender Offer by the Target” under “(2) Background, purpose anddecision-making process leading to the decision to conduct the Tender Offer, and management
policy following the Tender Offer” in “1. Purposes of Tender Offer” above, the Target establishedthe Special Committee by a resolution at the Target’s board of directors meeting held on
September 13, 2023. According to the Target, before the establishment of the Special Committee,
the Target, since early September 2023, with the advice from Anderson Mori & Tomotsune, for the
purpose of establishing a system to review, negotiate, and make decisions concerning theTransactions from the perspective of enhancing the Target’s corporate value and protecting theinterests of minority shareholders of the Target from a standpoint independent of the Offeror
Related Parties, explained to all of the independent outside directors and independent outside
auditors of the Target who have no material interest in relation to the Offeror Related Parties andthe Transactions, that the Target received the initial proposal regarding the Transactions (Initial
Proposal), and that, in reviewing and negotiating the Transactions, it is necessary to take sufficientmeasures to ensure the fairness of the terms and conditions of the Transactions, including theestablishment of a special committee, because the Transactions fall under the type of transaction
involving the issue of structural conflicts of interest and information asymmetry with minority
shareholders. According to the Target, at the same time, the Target considered candidates for themembers of the Special Committee with the advice from Anderson Mori & Tomotsune.
According to the Target, after confirming that the candidates for the members of the Special
Committee were independent of the Offeror Related Parties, and that they had no material interest
different from those of the minority shareholders regarding the success or failure of theTransactions, the Target held discussions with the Target’s independent outside directors andindependent outside audit & supervisory board members above, and with the advice from Anderson
Mori & Tomotsune, selected three persons, Ms. Miki Iwamura, Ms. Satoko Suzuki, and Ms. Yuko
Gomi, as the candidates for the members of the Special Committee for the purpose of the Special
Committee being at an appropriate scale while securing a balance of knowledge, experience, andskills of the Special Committee as a whole (The members of the Special Committee have notchanged since its establishment. As for the remuneration of the members of the Special
Committee, a fixed amount of remuneration is paid as consideration for their duties, regardless ofthe content of the report, and no contingency fee has been adopted.).
Accordingly, according to the Target, as described in “(II) Decision-making process leading toand grounds for the opinion in favor of the Tender Offer by the Target” under ““(2) Background,purpose and decision-making process leading to the decision to conduct the Tender Offer, andmanagement policy following the Tender Offer” in “1. Purposes of Tender Offer” above, the Target
established the Special Committee by a resolution at the Target’s board of directors meeting held
on September 13, 2023, and consulted the Special Committee on the Consultation Matters.
In establishing the Special Committee, according to the Target, the Target’s board of directors
resolved that (a) the Special Committee may obtain advice from the Target’s advisor concerning
the Transactions in considering the Consultation Matters and may entrust the Target’s sharevaluation, provision of the Fairness Opinion concerning the Transactions, and other matters deemednecessary by the Special Committee to a third-party organization and the like, and the reasonable
cost for such entrustment in such case will be borne by the Target; (b) the Target’s board of directors- 46 -

will conduct its decision making regarding the Transactions with the utmost respect for the detailsof the Special Committee’s judgment and if the Special Committee determines that the terms andconditions of the Transactions are not appropriate, the Target’s board of directors will support theTransactions; (c) in order to ensure that an appropriate decision will be made, the authority torequest the Target’s directors, employees, and other persons deemed necessary by the Special
Committee to attend the Special Committee meetings and give an explanation for necessary
information will be given to the Special Committee; and (d) the authority to be substantiallyinvolved in the negotiation process regarding the terms and conditions of the Transactions byconfirming the policy of negotiations by the Target regarding the terms and conditions of theTransactions in advance, receiving a timely report of its circumstances, expressing an opinion,
giving instructions, or making requests, as well as conduct direct negotiations by itself whennecessary, will be granted to the Special Committee.
According to the Target, at the Target’s board of directors meeting above, among the five
directors of the Target, the above resolution was unanimously passed after discussion by three
directors of the Target, excluding two directors, Mr. Masayuki Itonaga and Mr. Kiyotaka Kikuchi(that is, Mr. Sadanobu Takemasu, Ms. Miki Iwamura, and Ms. Satoko Suzuki). At the Target’s
board of directors meeting above, all of the five statutory auditors expressed their opinion that they
have no objection to the above resolution. In light of the fact that on and before April 1, 2022,
Mr. Masayuki Itonaga concurrently held the position of director at Mitsubishi Corporation
Financial & Management Services (Japan) Ltd., MC’s subsidiary, and Mr. Kiyotaka Kikuchi
concurrently holds the position of managing executive officer at MC, in order to eliminate, as muchas possible, possible impact of the issues of structural conflicts of interest and information
asymmetry with minority shareholders through the Transactions, they did not participate in theboard of directors meeting above and refrained from expressing their opinion. On the other hand,
although Mr. Sadanobu Takemasu previously worked at MC, more than nine years has passed since
he was transferred from MC to the Target and is not in a position to receive instructions from theOfferor Related Parties, and the side of the Offeror Related Parties has never been involved in theTransactions and is not in a position to be involved therein. Therefore, since it has been
determined that the Target’s decision-making in the Transactions has no risk of a conflict of interest,
he has participated in the discussions and resolutions at the Target’s board of directors meeting
above.
(B) Background of consideration
According to the Target, the Special Committee held a total of 22 meetings (total meeting timeof over approximately 22 hours) from September 13, 2023 until February 5, 2024, and performed
its duties regarding the Consultation Matters through such means as reporting, information sharing,consideration, and decision making.
According to the Target, the Special Committee confirmed that SMBC Nikko Securities, thefinancial advisor and third-party valuator of the Target, was independent and professionallyqualified, and approved the appointment thereof. The Special Committee also confirmed that
Anderson Mori & Tomotsune, the legal advisor of the Target, does not constitute an Offeror Related
Party or a Target related party and had no material interest in the Transactions, including the Tender
Offer, and approved the appointment thereof. In addition, the Special Committee confirmed that
Daiwa Securities, the financial advisor and third-party valuator of the Special Committee, wasindependent and professionally qualified, and appointed Daiwa Securities.
The Special
Committee also confirmed that Nakamura, Tsunoda & Matsumoto, the legal advisor of the Special
Committee, does not constitute an Offeror Related Party or a Target related party and had nomaterial interest in the Transactions, including the Tender Offer, and appointed Nakamura, Tsunoda& Matsumoto. Furthermore, as described in “(vii) Establishment of independent review systemat the Target” below, the Special Committee confirmed that the internal review system for theTransactions established by the Target (including the scope of officers and employees of the Target
who will be involved in the review, negotiation, and judgment for the Transactions and their duties)
is independent and fair.
According to the Target, based on the above, the Special Committee is considering the measures
to be taken to ensure the fairness of the procedures for the Transactions based on the opinions- 47 -

obtained from Nakamura, Tsunoda & Matsumoto. Further, while taking into account the advice
obtained from Daiwa Securities, the Special Committee received explanations from the Target on
the Business Plan prepared by the Target regarding the details, important preconditions, and thebackground of preparation, and confirmed the reasonableness of these matters and approved thesame.
According to the Target, the Special Committee received explanations from the Target on the
purpose and significance of the Transactions as well as the expected impact on the business of theTarget, and held a question-and-answer session on the foregoing. The Special Committee alsopresented questions to the Offeror Related Parties and held a question-and-answer session in theform of interviews with the Offeror Related Parties on the purpose and background of theTransactions and the management policy following the Transactions.
Furthermore, as described in “(iii) Receipt of a share valuation report and the Fairness Opinion
from an independent third-party valuator retained by the Special Committee” below, Daiwa
Securities calculated the value of the Target Shares based on the Business Plan. According to theTarget, the Special Committee received explanations regarding the method of calculation used by
Daiwa Securities for the calculation of the value of the Target Shares, the reasons for adopting suchmethod of calculation, the details of the calculations by each method of calculation, and importantconditions precedent, and confirmed the reasonableness of these matters after Q&A sessions,discussions and considerations.
Further, according to the Target, the Special Committee also received reports from the Target
and SMBC Nikko Securities on the Target’s negotiations with the Offeror from time to time anddiscussed and reviewed the same, and expressed necessary opinions on the Target’s negotiation
policies as appropriate. Specifically, the Special Committee received reports on the proposals of
the Tender Offer Price from the Offeror upon receipt and after obtaining analysis and opinions fromSMBC Nikko Securities and Daiwa Securities regarding the response policies and the policy forthe negotiation with the Offeror, considered these proposals based on the advice from Daiwa
Securities from a financial perspective. Then, the Special Committee expressed its opinions to
the Target on the matters to be discussed with the Offeror in order to achieve the significance andpurpose of the Transactions as the Target, and participated in the overall process of discussion andnegotiation between the Target and the Offeror regarding the terms and conditions of theTransactions, including the Tender Offer Price. As a result, on January 31, 2024, the Target
received a proposal from the Offeror that includes the Tender Offer Price of 10,360 yen per share,
and as a result, the Target received a total of eight proposals, resulting in a price increase of 19.77%
from the initial price proposal.
Furthermore, according to the Target, the Special Committee received explanations from
Anderson Mori & Tomotsune and Nakamura, Tsunoda & Matsumoto on the details of the draft of
the Target’s Press Release concerning the Tender Offer to be announced or submitted by the Target
on multiple occasions and confirmed that appropriate information disclosure will be conducted.
(C) Details of decision
According to the Target, under the circumstances above, while taking into account the details of
the legal advice received from Nakamura, Tsunoda & Matsumoto, the advice received from Daiwa
Securities, and the Share Valuation Report (Daiwa Securities) and the Fairness Opinion received
as of February 5, 2024, after careful consultations and consideration on the Consultation Matters,
the Special Committee, with the unanimous consent of all members, submitted the Written Reporton the Consultation Matters to the Target’s board of directors as of February 5, 2024, the content
of which is substantially as described below.
(a) Contents of the report by the Special Committee
1
2

The Transactions will contribute to the Target’s corporate value and the purposes of theTransactions are appropriate and reasonable.
The fairness and appropriateness of the terms and conditions of the Transactions (including
the tender offer price in the Tender Offer) are ensured.

- 48 -

3
4

5

Due consideration is given in the Transactions to the interests of the Target’s shareholders
through fair procedures.
It is appropriate for the Target’s board of directors to express an opinion in favor of the Tender
Offer to recommend that the Target’s shareholders tender in the Tender Offer and torecommend that the owners of American Depositary Receipts deliver the American
Depositary Receipts to the Depositary Banks in advance and receive delivery of the Target
Shares related to such American Depositary Shares represented by those American
Depositary Receipts to tender their shares in the Tender Offer and that it would leave thedecision as to whether to tender shares in the Tender Offer to the judgment of the Share Option
Holders.
In addition to No.1 to No.4 above, the implementation of the Transactions is not considereddisadvantageous to the Target’s minority shareholders.

(b) Reasons for the decisions
1 Report on the Items for Consultation Matter (i) (whether the purposes of the Transactions areappropriate and reasonable (including whether the Transactions would contribute to theTarget’s corporate value))
Based on the following aspects, regarding the Items for Consultation Matter (i), theTransactions would contribute to the Target’s corporate value and the purposes of theTransactions are appropriate and reasonable.
(i) Synergies forecast by the Target
As synergies from the Transactions, the Target explained that the following points are
expected to be achieved.
(I) Accelerate transformation into “Real × Tech Convenience” through the use ofmanagement resources
・ The Target is seeking to take on the challenge of becoming the fastest global delivery
service business in the world (Quickest E Commerce service: QEC) by making themost of Tech and utilizing stores “real” shopping venues as EC centers.
・ Through the Transactions, the Target is expected to promote QEC that enables
provision of products to customers at the fastest speed in the convenience store
industry and accelerate transformation into “Real × Tech Convenience”, bystrengthening its technological structure, including the development of systems
through the dispatch of engineers and other human resources from the Offeror, andenhancing the Offeror’s customer base and the digital marketing system that utilizes
high-resolution location-based data unique to the telecommunications company.
(II) Strengthen profitability by sharing customer base・ The Transactions will involve the utilization of the Offeror Group’s base of
approximately 31 million customers and promotion of the high-resolution
marketing measures.
・ Specifically, by reaching more consumers and attracting more customers throughnew customer referrals from the Offeror Group’s economic areas and referrals to
individual stores by utilizing location information, creating new value in theapplication and membership domains through development and provision of newservices, providing a one-stop response from the collection to the aggregation,
analysis, and visualization of a wealth of big data, and maximizing the value of data
through promotion of these measures, the Target will be able to consider promoting
cross-selling and developing new businesses and services, and Target’s marketingbusiness are expected to expand.
(III) Coexistence with local communities by providing social infrastructure utilizing
cutting-edge technologies
・ It can be expected that, by the Transactions, through the provision of services that
support various aspects of life, innovation into lifestyle experiences and behaviors
associated with the evolution of technology will be encouraged and social issues
will be resolved.
- 49 -

・ Specifically, for example, issues including the depopulation and aging ofcommunities are expected to be resolved by improving convenience for consumers
in regions without shops, through the use of the Offeror Group’s sophisticated drone
technology.
・ In addition, by the use of the 5G network and satellite communications technologyof the Offeror, development of stores and provision of products in augmented andvirtual reality linked to its own apps through metaverse services, including provisionof medical services such as remote diagnosis through health checks using vitalsensing, are expected to be enabled.
(IV) Strengthen the business foundation by utilizing management resources such asadvanced human resources and know-how
・ By promoting human resource exchanges between the Offeror Group, the MCGroup, and the Target, and by providing mutual human resource support, including
the secondment and dispatch of employees, measures to address the normalizationof labor shortages and development of human resources will also be enabled.
・ Strengthening the Target Group’s portfolio and maximizing the Group’s synergies
can be expected through the utilization of know-how of the financial businessdeveloped by the Offeror Group, collaboration in the entertainment field, and theongoing sharing of the MC Group’s global network.
(V) Strengthen cooperation in the environmental field to realize a decarbonized society
・ By implementing the Transactions, the Target’s green and sustainable initiatives
toward the achievement of the goal “Lawson Blue Challenge 2050!”, theenvironmental vision formulated by the Target, will be strengthened and accelerated.
・ Specifically, for example, by utilizing the functions of the Offeror Group and the
MC Group, the use of renewable energy generated by solar panels, the purchase offood products with reduced consumption prices near their expiration dates using
vast location data and purchasing data, and the replacement of plastic containers andPET bottle materials with biomass materials will be promoted from now on.
(VI) Growth in the businesses of group companies
・ In the retail finance business area, the financial know-how of MC and the Offeror
Group (including FinTech) will be combined.
・ In addition, functions related to MC and the Offeror Group’s content and digitaltechnology will accelerate the Target’s growth in the entertainment business area.
・ Furthermore, in the Target’s supermarket business and overseas business areas,
smart digital capabilities, and global expansion capabilities are essential, andforming alliances between both companies can accelerate the growth of thesebusinesses.
(VI) Growth in the businesses of group companies
・ In the retail finance business area, the financial know-how of MC and the Offeror
Group (including FinTech) will be combined.
・ In addition, functions related to MC and the Offeror Group’s content and digitaltechnology will accelerate the Target’s growth in the entertainment business area.
・ Furthermore, in the Target’s supermarket business and overseas business areas,
smart digital capabilities, and global expansion capabilities are essential, andforming alliances between both companies can accelerate the growth of thesebusinesses.
(VII) Reduction of listing maintenance costs and operational burden of the management
division and reallocation of resources
・ By taking the Target Shares private through the Transactions, Target will be able to
avoid the human and economic costs associated with maintaining listing, whichhave been pointed out in recent years, and to allocate resources to the various key
initiatives described above.
(ii) Availability of alternative transactions- 50 -

・

From the perspective of enhancing the Target’s corporate value, there are no specifictransactions that are viable alternatives to the Transactions.

(iii) Consistency between the Target’s explanation of the synergies and those of the Offeror
Related Parties.
・ In order to confirm whether there were any discrepancies in the understanding between
the parties to the Transactions, the Special Committee asked the Offeror Related Parties
almost the same questions about the Transactions as it did to the Target.
・ As a result, not only there were no answers made by the Offeror Related Parties that
contradicted those of the Target, but also, there are no discrepancies between the Target’s
understanding concerning the assumptions of synergies expected from the Transactions
and those of the Offeror stated in the Target’s Press Release.
2

Report on the Items for Consultation Matter (iii) (whether due consideration is given in theTransactions to the interests of the Target’s shareholders through fair procedures)
Due to the following matters, due consideration is considered to have been given in theTransactions to the interests of the Target’s shareholders through fair procedures.
(i) Establishment of a special committee
・ The Special Committee is considered to sufficiently ensure fairness, given the following
circumstances of its establishment and operation.
(I) The Special Committee was established before the transaction terms were decided
between the Offeror and the Target.
(II) The Special Committee is composed solely of outside directors, who are consideredhighly qualified under the “Fair M&A Guidelines - Enhancing Corporate Value andSecuring Shareholders’ Interests” issued by the Ministry of Economy, Trade andIndustry as of June 28, 2019 (the “M&A Guidelines”), and outside auditors, who are
considered to complement the outside directors.
(III) The Target requests confirmation from the special committee in advance of, or
promptly after, discussing the Tender Offer Price with the Offeror, thereby ensuringthat the Special Committee can substantially influence the negotiation process
regarding the transaction terms by receiving timely reports on the status ofnegotiations and giving its opinions, instructions, and requests at important stages.
(IV) On September 13, 2023, after considering the independence, expertise, and trackrecord of several candidates for legal advisor, financial advisor, and third-party
valuation institution, the Special Committee retained Nakamura, Tsunoda &Matsumoto as its own legal advisor independent of the Target and the Offeror Related
Parties, and on the same day, Daiwa Securities was appointed as an independent
financial advisor and third-party appraiser independent of the Offeror Related Parties
and the Target, and has reviewed and made decisions based on its expertise in thefairness of the procedures and the evaluation of corporate value.
(V) Due to the diversity of the agreements contemplated for the Transactions and thesynergies envisaged, it is difficult to publicly disclose all the details, but the Special
Committee, on behalf of the minority shareholders, obtained important information,
including the draft of the agreement to be executed by the Target regarding theTransactions, and examined and made decisions based on such information.
(VI) The Target’s board of directors, in making a resolution on the matters for consultation
with the Special Committee, resolved that the Target’s board of directors should
respect the decisions of the Special Committee to the maximum extent possible inmaking its decision on the Transactions, and in particular, if the Special Committee
determines that the terms of the Transactions are not appropriate, the Target’s boardof directors shall not approve the Transactions with such terms and conditions.
(ii) Decision-making process of the Target
・ Upon the Target making the decision pertaining to the Transactions, three directors of
the Target, excluding Mr. Masayuki Itonaga and Mr. Kiyotaka Kikuchi, who are
directors or employees of MC, which is one of the Offeror Related Parties, or its- 51 -

subsidiary (that is, Mr. Sadanobu Takemasu, Ms. Miki Iwamura, and Ms. Satoko Suzuki,
who are members of the Special Committee) are expected to deliberate and passresolutions.
・ Among the Target’s directors, Mr. Sadanobu Takemasu, President and CEO, previously
worked at MC. However, the M&A Guidelines set forth that if an independent special
committee is established and is functioning effectively, it is sufficient if the persons
concurrently holding positions as the Offeror’s director or employee are excluded.
Given that the period since Mr. Takemasu was transferred to the Target from MC issufficiently long, and that Mr. Takemasu, as the President and CEO of the Target, has
knowledge and experience that are indispensable and cannot be substituted inconsidering and negotiating the Transactions from the viewpoint of enhancing thecorporate value of the Target, and also based on the advice of Anderson Mori &Tomotsune, the Target’s legal advisor, and Nakamura, Tsunoda & Matsumoto, theSpecial Committee’s own legal advisor, it can be concluded that there are no concerns
from the perspective of independence and fairness with respect to Mr. Takemasu’s
participation in the consideration of the Transaction and negotiations with the Offeror.
・ Based on the information above, no circumstances were found that could raisesuspicions regarding the fairness of the decision-making process at the Target.
(iii) Receipt of advice from external advisors(I)
Receipt of advice from a legal advisor
・ The Target’s board of directors received advice from the attorneys of Anderson Mori
& Tomotsune, the Target’s legal advisor, regarding its decision-making, and it has
been determined that the Target has received independent legal advice fromattorneys.
(II)
Receipt of share valuation reports from a third-party valuator・ In order to ensure the fairness of the Tender Offer Price, the Target’s board of
directors obtained the Share Valuation Report (Nikko Securities) from SMBC Nikko
Securities, an independent third-party valuator, as materials concerning the value of
the Target Shares.
・ In addition, multiple calculation methods were used in the Share Price Valuation
Report (Nikko Securities) to avoid arbitrary calculation of the value of the Target
Shares. In addition, there is no evidence of arbitrary actions by the directors andemployees of the Offeror in the preparation of the Target’s business plan, which isthe basis for such calculations, and there are no circumstances that raise doubts
about the fairness of the calculations.
Further, the independence of SMBC Nikko Securities has been ensured.
・ In addition, the Special Committee appointed Daiwa Securities as its independent
financial advisor and third-party valuator when it considered the Transactions, andobtained the Share Valuation Report (Daiwa Securities) from Daiwa Securities asmaterials concerning the value of the Target Shares.
・ The Special Committee also has confirmed the independence of Daiwa Securities
as an advisor (including independence from the Offeror Related Parties and theTarget).
・ Based on the above, it has been determined that both the Share Valuation Report(Nikko Securities) and the Share Valuation Report (Daiwa Securities) are sharevaluation reports by independent third-party valuators.
(III)
Receipt of the Fairness Opinion
・ Furthermore, in order to ensure the fairness of the Tender Offer Price, the Special
Committee obtained the Fairness Opinion from Daiwa Securities, which states that
the Tender Offer Price is fair from a financial point of view with respect to theTarget’s general shareholders, excluding the Offeror Related Parties and theiraffiliates.
・ The Special Committee believes that the Fairness Opinion can be evaluated as ameasure to ensure fairness.

- 52 -

(IV)Market check・ The Offeror plans to set the Tender Offer Period at 20 business days, which is theshortest period provided by laws and regulations. However, the Tender Offer is atender offer with a prior announcement, and since a relatively long period of time
will be secured until the commencement of the Tender Offer, there will bereasonable opportunities for competing takeover offers by other potential acquirers.
・ In addition, there has been no agreement, nor has a transaction protection restriction
been imposed, between the Target and the Offeror to restrict contact with competing
takeover offerors (as defined in “(ix) Establishment of measures to ensure purchase
opportunities from other offerors” below).
Thus, in this case, an indirect market check is being conducted by conducting the
M&A after creating an environment in which other potential acquirers can makecompeting offers after the announcement.
(V)
Majority of minority
・ The majority-of-minority concept has not been adopted regarding the minimum
number of tendered shares to be purchased.
・ Many measures to ensure fairness other than the establishment of the majority-ofminority condition have been adopted in the implementation of the Tender Offer.
Therefore, the fact that the majority-of-minority concept has not been adopted in theTender Offer does not in itself constitute an obstacle to the fairness of the terms andconditions of the Transactions.
(VI)
Improved information provision to general shareholders and transparency ofthe process
・ The Target’s Press Release discloses certain factors regarding the Business Plan,
which is the premise for the DCF analysis in the Share Valuation Report (Nikko
Securities) and the Share Valuation Report (Daiwa Securities).
・ Finally, other information, such as the process leading to the implementation of the
M&A and the background of negotiations, has been described in the Target’s Press
Release in a substantial manner.
(VII)
Elimination of Coercion
・ The Squeeze-out Procedure in the Transactions are to be executed by means of aprocess using a share consolidation method. The shareholders have the right tofile a court petition to determine the price of the shares pursuant to Articles 182-4
and 182-5 of the Companies Act, and this fact is explicitly disclosed in the Target’s
Press Release.
・ Furthermore, the Target’s Press Release states that the Squeeze-out Procedure will
be conducted promptly after the completion of the Tender Offer, and that the amountof money delivered to minority shareholders in the Squeeze-out Procedure will becalculated to be equal to the Tender Offer Price multiplied by the number of Target
Shares held by each such shareholder (excluding the Offeror Related Parties and theTarget).
・ In light of the above, measures have been taken to prevent coercion with respect to
the Transactions.
3

Report on the Items for Consultation Matter (ii) (whether the fairness and appropriateness ofthe terms and conditions of the Transactions (including the Tender Offer Price) are ensured)(i) Ensuring the status of negotiations
・ The negotiations were conducted fairly, with the Target receiving advice from SMBC
Nikko Securities on the Tender Offer Price, which resulted in a final agreement. The
Special Committee also was proactively involved in the negotiations by giving its
opinion on the negotiations at each of the relevant periods.
・ Under this system, the Target referred to the valuation calculated by SMBC Nikko
Securities below and also took into account the deliberations of the Special Committee
and other factors, and reached a final agreement after several rounds of price- 53 -

negotiations. Further, the final Tender Offer Price (10,360 yen) was considerably
higher than the price originally offered by the Offeror (8,650 yen), and negotiations
were carried out by the Target with the aim of making the Transactions as favorable aspossible to the general shareholders.
・ In view of the information above, the decision regarding the Transactions was made asa result of significant discussions between the independent parties, and nocircumstances have been found that raise suspicions regarding the transparency orfairness of the decision-making process between the Target and the Offeror Related
Parties.
(ii) Relationship between the share valuation report and the Tender Offer Price・ Based on the following points, the Business Plan is considered to be reasonable fromthe perspective of the formulation process and the formulation method, as there is noevidence of any intervening pressure from the Offeror Related Parties.
(I)
Business Plan
・ Regarding the formulation of and updates to the Business Plan, it was based on abusiness plan which was confirmed by the Special Committee with the advice ofDaiwa Securities and Nakamura, Tsunoda & Matsumoto, the independent advisorof the Special Committee. As a result, no arbitrariness was found in this regard.
・ It is reasonable for the Business Plan (on a stand-alone basis) to also be used as thebasis for the calculation in this case.
・ In addition, in regard to the formulation of the Business Plan, “Challenge 2025”(which is the three-year plan from FY 2023 to FY 2025 that was reported in themeeting of the board of directors of the Target on April 13, 2023), and updates tothe Business Plan made in August 2023 thereafter, although the involvement of
seconded personnel from MC is acknowledged, these documents were preparedboth in the course of normal business operations unrelated to the Transactions andprior to the consideration of the Transactions. In addition, regarding the two-yearplan from FY 2026 to FY 2027, although it was prepared after the consideration of
the Transactions, it was drafted under a system without the involvement of theOfferor Related Parties, and the documents were prepared with the confirmation of
Sadanobu Takemasu, President and CEO, Representative Director of the Target.
In conclusion, the involvement of the seconded personnel from MC in the process
of formulating the Business Plan does not raise suspicions about the fairness of thecontents of the Business Plan.
・ In addition, Daiwa Securities, the Special Committee’s independent financial
advisor, also has asked the Target the necessary questions about the matters thatwere considered and taken into account in the process of formulating the Business
Plan and the feasibility of the forward-looking statements. In conclusion, theBusiness Plan was not deliberately suppressed in order to lower the Target’s sharevalue assessment, and there are no doubts by Daiwa Securities regarding theBusiness Plan.
(II)
Relationship between the share valuation report and the Tender Offer Price
・ The price of 10,360 yen per share, the Tender Offer Price, (i) exceeds the upper limitof the calculation result of the market price analysis and (ii) is in the range of thevalue of the shares calculated using the DCF analysis, which is considered toindicate the fundamental value of the shares of the Target.
・ The Special Committee also considers that the Tender Offer Price has reached alevel that is not detrimental to minority shareholders, even from the perspective ofcomparison with the valuation of the Target Shares calculated by Daiwa Securities
and SMBC Nikko Securities.
(III)
Consideration of the Premium・ In relation to the closing price of the Target Shares on the TSE on February 5, 2024
(the “Day before Last”; hereinafter the same in this section), the Tender Offer Priceis a price calculated by adding a premium of 18.79% on the closing price of the Day- 54 -

before Last, 27.05% on the average closing price over the past month on the Day
before Last, 37.31% on the average closing price over the past three months on the
Day before Last, and 42.62% on the average closing price over the past six months
on the Day before Last.
・ In conclusion, from the perspective of comparing the premium level of the Tender
Offer Price with other similar deals, the premium level of the Tender Offer Price isconsidered to be reasonable, taking into account that although the premium level of
the Tender Offer Price is below the average and median prices based on the closing
price of the Day before Last and the average closing price over the past month on
the Day before Last, it is above the average and median prices of 11 other deals
selected as those announced after July 2019, after the M&A Guidelines were
published, and concluded by December 31, 2023, with a market capitalization of
100 billion yen or more and the target shares exceeding 1x PBR before the deal wasannounced, based on the average closing price over the past three months on the
Day before Last and the average closing price over the past six months on the Day
before Last, and other factors.
(iii) Appropriateness of schemes
・ In implementing the Transactions, the structure of the Transactions is reasonable, inwhich the Offeror will acquire all of the Target’s Shares (including the American
Depositary Receipts, but excluding the Target Shares held by the Offeror Related Parties
and the Target) and the Stock Acquisition Rights, thereby acquiring all of Target’s Share
Certificates to provide the Target’s minority shareholders an opportunity to recover theirinvestment.
(iv) Appropriateness of the purchase price of the Share Options
・ The Tender Offer also includes the Share Options, but the purchase price for all of the
Share Options is 1 yen.
・ According to the Target’s Press Release, at the time of the announcement of the Tender
Offer, the Target intends to express its opinion to the Share Option Holders that it leaves
the decision of whether or not to tender in the Tender Offer to the Share Option Holders.
・ In view of the matters above, the Special Committee reserves its opinion on theappropriateness of the price of the Share Options in the Tender Offer.
4

Report on the Items for Consultation Matter (iv) (whether it is appropriate for the Target’s
board of directors to express an opinion in favor of the Tender Offer to recommend that theTarget’s shareholders tender in the Tender Offer and to recommend that the owners ofAmerican Depositary Receipts deliver the American Depositary Receipts to the Depositary
Banks in advance and receive delivery of the Target Shares related to such American
Depositary Shares represented by those American Depositary Receipts to tender their sharesin the Tender Offer and that it would leave the decision as to whether to tender shares in theTender Offer to the judgment of the Share Option Holders) and Consultation Matter (v) (inaddition to Consultation Matters (i) to (iv), whether the implementation of the Transactions
would be considered advantageous to the Target’s minority shareholders)・ As a result of the deliberations of the Special Committee, no issues have arisen in
regard to any of Consultation Matters (i) to (iii) above.
・ In view of the matters above, regarding Consultation Matters (iv) and (v), the Special
Committee shall express its opinion that (a) the board of directors of the Target is infavor of the Tender Offer and recommends that the shareholders of the Target tendertheir shares in the Tender Offer, (b) it recommends that the holders of the American
Depositary Receipts tender in the Tender Offer by delivering their American
Depositary Receipts to the Depositary Bank in advance and receiving delivery of theTarget Shares related to such American Depositary Shares represented on theAmerican Depositary Receipt, and (c) that it leaves the decision of whether or not totender in the Tender Offer to the Share Option Holders.
・ However, since the Tender Offer, which is the first phase of the Transactions, is- 55 -

expected to take a reasonable period of time between its announcement andcommencement, the Special Committee intends to reconsider these points before thecommencement of the Tender Offer.
(iii) Receipt of advice from an independent legal adviser by the Target
According to the Target, as described in “(ii) Establishment of independent special committee at
the Target and receipt of a written report from the special committee” above, the Target retainedAnderson Mori & Tomotsune as its outside legal advisor independent of the Offeror Related Parties
and the Target, and has received legal advice from Anderson Mori & Tomotsune including advice
on the measures to be taken to ensure the fairness of the procedures for the Transactions, theprocedures for the Transactions and the method and process of decision-making by the Target
concerning the Transactions.
Anderson Mori & Tomotsune does not constitute an Offeror Related Party or a Target related
party and has no material interest in the Transactions including the Tender Offer. According to
the Target, although the Target has executed a legal advisory agreement with Anderson Mori &Tomotsune, the firm is an external legal firm which provides legal services to a number of clients,
which is not limited to the Target, and the Target, as one of the firm’s clients, executed the legal
advisory agreement in order to request legal advice based on its areas of expertise and specialties,
and the fact of execution of such agreement will not violate the independence of the same legal
firm from the Target; in addition, since the firm is paid a fee calculated by multiplying the hours ofservice rendered by an hourly rate regardless of whether the Transactions are successfullycompleted and its fee does not include a performance fee conditioned on successful completion of
the Transactions, it was determined that Anderson Mori & Tomotsune was independent of theOfferor Related Parties and whether the Transactions are successfully completed. Furthermore,according to the Target, the Special Committee, at its first meeting, confirmed that Anderson Mori
& Tomotsune was independent and professionally qualified.
(iv) Receipt of a share valuation report from an independent financial adviser and third-party
valuator by the Target(A) Name of valuator and relationship with the Target and the Offeror Related Parties
According to the Target, the Target, in expressing its opinion concerning the Tender Offer, inorder to ensure the fairness of decision-making regarding the Tender Offer Price presented by theOfferor, requested its financial advisor SMBC Nikko Securities, as a third-party valuator
independent of the Offeror Related Parties and the Target, to calculate the share value of the Target
Shares, and obtained the Target Share Valuation Report (Nikko Securities) on February 5, 2024.
SMBC Nikko Securities does not constitute an Offeror Related Party or a Target related party andhas no material interest in the Transactions, including the Tender Offer. SMBC Nikko Securities
is one of the same group companies of Sumitomo Mitsui Financial Group, Inc. as Sumitomo Mitsui
Banking Corporation that conducts financing transactions as part of normal banking transactions
with the Target Group, the Offeror Group, and MC Group. However, according to the Target,
considering the past performance of SMBC Nikko Securities as a third-party valuator and based on
the fact that information blocking measures have been taken between the department whichcalculates the value of the Target Shares in SMBC Nikko Securities, other departments in SMBC
Nikko Securities, and Sumitomo Mitsui Banking Corporation as measures to prevent adverse
effects, that since the Target and SMBC Nikko Securities conduct transactions based on the sametransaction conditions as general customers, SMBC’s independence as a financial advisor and thirdparty valuator has been secured, and that SMBC Nikko Securities does not constitute a party related
to the Target or the Offeror Related Parties, and that the Target’s requests for SMBC Nikko
Securities to calculate the value of the Target Shares are considered to have no particular concerns,
the Target appointed SMBC Nikko Securities as its financial advisor and third-party valuator. The
Special Committee, at its first meeting, confirmed that SMBC Nikko Securities was independentand professionally qualified, and approved the appointment thereof as the financial advisor andthird-party valuator of the Target. The Target has not obtained from SMBC Nikko Securities anopinion concerning the fairness of the Tender Offer Price (fairness opinion) since the Target- 56 -

determined that the measures to ensure the fairness of the Tender Offer Price and to avoid conflictsof interest have been implemented and that fairness of the Transactions is sufficiently ensured.
According to the Target, with respect to the Transactions, SMBC Nikko Securities is paid aperformance fee payable on condition that the Transactions are successfully completed. The
Target appointed SMBC Nikko Securities as its financial advisor and third-party valuator based on
the above fee arrangement, taking into account general practices in the same kind of transactions
and the appropriateness of the fee arrangement in which the Target would incur a reasonablefinancial burden in the event that the Transactions are not successfully completed, and also basedon the determination that SMBC Nikko Securities’ independence would not be denied by the factthat a performance fee payable on condition that the Transactions are completed is included.
(Note) In preparing the Share Valuation Report (Nikko Securities), SMBC Nikko Securities has
assumed that all of the materials and information used as the basis therefor are accurate
and complete. SMBC Nikko Securities has not conducted any independent verificationof the accuracy and completeness of such materials and information, and assumes noobligation or responsibility for such verification. SMBC Nikko Securities assumed
that the Target has not recognized any facts or circumstances that render any of theinformation provided inaccurate or misleading. SMBC Nikko Securities has notindependently evaluated, appraised or assessed the assets or liabilities of the Target andits affiliates, nor has it requested any third-party organization to evaluate, appraise, orassess such assets or liabilities. If any problems are found in the accuracy andcompleteness of these materials and information, the results of the calculation may differ
significantly. Furthermore, SMBC Nikko Securities assumed that there are no claims
or obligations relating to undisclosed litigation, disputes, environment and taxation, etc.
regarding the Target and its affiliates, other contingent liabilities or off-the-bookliabilities, or any other fact that would have a material effect on the Share Valuation
Report (Nikko Securities). It was assumed that the business plan used by SMBC Nikko
Securities in the Share Valuation Report (Nikko Securities) was prepared by the Target
with reasonable and appropriate procedures based on the best estimate and judgment asof the reference date of making the calculation. In the Share Valuation Report (Nikko
Securities), when SMBC Nikko Securities conducted its analysis based on the materials,
information, and assumptions provided, it was assumed that the materials, information,
and assumptions provided are accurate and reasonable. SMBC Nikko Securities has
not independently verified the accuracy, appropriateness, and feasibility of theseassumptions, and assumes no obligation or responsibility therefor. The results of thecalculation by SMBC Nikko Securities have been submitted to the Target, at the requestof the Target, for the sole purpose of assisting the Target’s board of directors to consider
the Tender Offer Price. Such results of the calculation are not designed for expressing
SMBC Nikko Securities’ opinion as to the fairness of the Tender Offer Price.
(B) Overview of calculation
According to the Target, the Target, in expressing its opinion concerning the Tender Offer,
requested its financial advisor SMBC Nikko Securities, as a third-party valuator independent of theOfferor Related Parties and the Target, to calculate the share value of the Target Shares, andobtained the Share Valuation Report (Nikko Securities) on February 5, 2024.
In calculating the value of the Target Shares, SMBC Nikko Securities adopted the average market
price method since the Target Shares are listed on the TSE Prime Market and thus the market pricethereof is available; and the DCF analysis to reflect in the share valuation the status of futurebusiness activities of the Target.
The range of the value per share of the Target Shares calculated by SMBC Nikko Securities
based on each of the above methods is as follows.
Market price method:
DCF analysis:

From 7,248 yen to 8,039 yen
From 9,609 yen to 14,907 yen- 57 -

Under the average market price method, as of the reference date of February 2, 2024, which is
two business days immediately preceding the date of the announcement of the expected
commencement of the Tender Offer, the share value range per share of the Target Shares wascalculated to be 7,248 yen to 8,039 yen, based on the simple average of the closing prices for theprevious one month of the Target Shares on the TSE Prime Market (8,039 yen), the simple averageof the closing prices for the previous three months (7,526 yen), and the simple average of theclosing prices for the previous six months (7,248 yen). Under the DCF analysis, the share value
range per share of the Target Shares was calculated to be 9,609 yen to 14,907 yen by calculating
the Target’s corporate value and share value based on various elements such as the Business Plan
prepared by the Target, and information generally disclosed to the public, and discounting at a
certain rate to the present value the free cash flow projected to be generated by the Target in andafter the fourth quarter of its fiscal year ending February 2024. The Business Plan prepared by
the Target, which was used for the calculation under the DCF analysis by SMBC Nikko Securities,
does not include any fiscal year in which significant year-on-year increases or decreases in profits
are expected. The synergies expected to be realized through the implementation of theTransactions were not included in the financial forecast as it was difficult to estimate the same
specifically as of February 5, 2024.
(v) Receipt of advice from an independent legal adviser by the Special Committee
According to the Target, as described in “(ii) Establishment of independent special committee at
the Target and receipt of a written report from the special committee” above, the Target retained
Nakamura, Tsunoda & Matsumoto as its outside legal advisor independent of the Offeror Related
Parties and the Target, and has received legal advice from Nakamura, Tsunoda & Matsumoto,including advice on the measures to be taken to ensure the fairness of the procedures for theTransactions, the procedures for the Transactions, and the method and process of decision-making
by the Target concerning the Transactions.
Nakamura, Tsunoda & Matsumoto does not constitute an Offeror Related Party or a Target
related party and has no material interest in the Transactions, including the Tender Offer.
Nakamura, Tsunoda & Matsumoto is paid a fee calculated by multiplying the hours of service
rendered by an hourly rate regardless of whether the Transactions are successfully completed, andits fee does not include a performance fee conditioned on successful completion of theTransactions.
(vi) Receipt of a share valuation report and the Fairness Opinion from an independent third-party
valuator by the Special Committee(A) Name of valuator and relationship with the Offeror Related Parties and the Target
According to the Target, the Special Committee, in considering the Consultation Matters, inorder to ensure the fairness of the terms and conditions regarding the Transactions, including theTender Offer Price, requested its financial advisor Daiwa Securities, as a third-party valuator
independent of the Offeror Related Parties and the Target, to calculate the share value of the Target
Shares, and obtained a share valuation report regarding the share valuation result of the Target
Shares (the “Share Valuation Report (Daiwa Securities)”) on February 5, 2024. In addition, theSpecial Committee requested a third-party valuator independent of the Offeror Related Parties andthe Target, Daiwa Securities, to submit a fairness opinion to the effect that the terms and conditions
regarding the Transactions, including the Tender Offer Price, are fair (the “Fairness Opinion”), andreceived the Fairness Opinion on February 5, 2024. Daiwa Securities does not constitute an
Offeror Related Party or a Target related party and has no material interest in the Transactions,
including the Tender Offer. The Special Committee, at its first meeting, confirmed that Daiwa
Securities was independent and professionally qualified, and appointed Daiwa Securities as theSpecial Committee’s financial advisor and third-party valuator.
With respect to the Transactions, Daiwa Securities is paid only a fixed fee amount, which will
be paid regardless of whether the Transactions are successfully completed, and its fee does notinclude a performance fee conditioned on successful completion of the Transactions.
(B) Overview of calculation- 58 -

According to the Target, the Special Committee, in considering the Consultation Matters,
requested its financial advisor Daiwa Securities, as a third-party valuator independent of the Offeror
Related Parties and the Target, to calculate the share value of the Target Shares, and obtained theShare Valuation Report (Daiwa Securities) on February 5, 2024.
After considering the valuation method that should be adopted among various share valuation
methods when assessing the Target Shares, Daiwa Securities assessed the per share value of theTarget Shares using (i) market price analysis, because the Target Shares are listed on the Prime
Market of the TSE and thus the market price thereof is available and (ii) DCF analysis so as toreflect the details of the Target’s performance and forecasts in the valuation, based on the premisethat the Target is a going concern and from the perspective that it would be appropriate to assess thevalue of the Target Shares in multiple ways. On February 5, 2024, the Special Committee obtained
the Share Valuation Report (Daiwa Securities).
According to Daiwa Securities, the share value range per share of the Target Shares calculatedusing each of the above methods is as follows:
Market price analysis: 7,264 yen to 8,721 yen
DCF analysis:
7,037 yen to 14,514 yen
In the market price analysis, February 5, 2024 was used as the valuation base date, and the pershare value of the Target Shares was assessed to range from 7,264 yen to 8,721 yen, based on thefact that the closing price of the Target Shares listed on the Prime Market of the TSE on the valuationbase date was 8,721 yen and the simple averages of closing prices of the Target Shares listed on thePrime Market of the TSE over the last one month was 8,154 yen, over the last three months was
7,545 yen, and over the last six months was 7,264 yen.
In the DCF analysis, with various elements such as the Business Plan prepared by the Target
and publicly disclosed information, etc., as a basis, the Seijo Ishii business, the Chinese businessand all business with the Seijo Ishii Business and the Chinese Business excluded from theconsolidated business (the “Target’s Consolidated Business (Excluding the Seijo Ishii Business andthe Chinese Business)”) was analyzed, and the Target’s enterprise value and share value were
calculated by discounting the free cash flow that is expected to be generated by the Target from thefourth quarter of the fiscal year ending February 2024 onward to the present value with a certain
discount rate, and as a result, the per share value of the Target Shares was assessed to range from
7,037 yen to 14,514 yen. The Business Plan prepared by the Target that was used by Daiwa
Securities for the valuation through the DCF analysis includes fiscal years in which a substantial
increase/decrease in profit is expected. Specifically, in the Target’s Consolidated Business(Excluding the Seijo Ishii Business and the Chinese Business), a significant increase in free cash
flow (fiscal year ending February 2026: 44,551 million yen, year over year increase of 57.0%; fiscal
year ending February 2027: 60,948 million yen, year over year increase of 36.8%) due to improved
profitability through recovery of human flow, price increases, etc., is expected. In addition, thefinancial forecast does not reflect the synergy effects expected from the Transactions being
consummated because it is difficult to specifically estimate those synergy effects as of February 5,
2024.
(C) Overview of the Fairness Opinion
According to the Target, on February 5, 2024, the Special Committee obtained from Daiwa
Securities the Fairness Opinion to the effect that the purchase price per Target Share of 10,360 yen
is fair to the Target’s general shareholders, excluding the Offeror Related Parties and its affiliates,from a financial perspective.
The Fairness Opinion was prepared with the approval of the fairness opinion board at Daiwa
Securities, based on the valuation of shares of the Target conducted by Daiwa Securities throughthe analysis of financial information including business forecasts of the Target and Q&A sessions
with the Special Committee, as well as Q&A sessions with the Target and the Special Committee
conducted by Daiwa Securities regarding the background and circumstances leading to theapproval of the Tender Offer.

- 59 -

(Note) Daiwa Securities has assumed and relied on the accuracy and completeness of all
information that Daiwa Securities has analyzed or reviewed, and has not independently
verified, or assumed any obligation to independently verify, the accuracy orcompleteness of such information. In stating its opinion contained in the Fairness
Opinion, Daiwa Securities has assumed that as of the date on which the opinion
contained in the Fairness Opinion is stated, there has occurred no event relating to theTarget that is undisclosed to Daiwa Securities that would affect the corporate value of
the Target. Daiwa Securities has not undertaken an independent evaluation, appraisal orassessment of any of the assets or liabilities (including, but not limited to, financial
derivative products, off-balance-sheet assets and liabilities and other contingent
liabilities), on an aggregate or individual basis, of the Target or any of their respective
affiliates , nor has Daiwa Securities made any request to a third party for any suchvaluation, appraisal or assessment. Daiwa Securities has not evaluated the solvency or
creditworthiness of the Target or any of their respective affiliates under any applicablelaws relating to bankruptcy, insolvency or similar matters. Daiwa Securities has notconducted any physical inspection of the properties or facilities of the Target or any of
their respective affiliates, nor has Daiwa Securities assumed any obligation to do so.
In preparing the Fairness Opinion, Daiwa Securities has assumed that the businessplans, financial forecasts and other information regarding the future furnished to Daiwa
Securities have been prepared according to reasonable and appropriate procedures, andreflect the best currently available estimates and judgment of the management of theTarget, and with the consent of the Target, Daiwa Securities has relied on suchinformation without conducting any independent verifications of the accuracy, validity
or feasibility of the business plans of both companies. Daiwa Securities has assumed
that all assumptions for the preparation of the business plans and financial forecasts areaccurate and feasible. Daiwa Securities has assumed that the business plans, financial
forecasts and other information regarding the future furnished to Daiwa Securities havenot changed since the date they were prepared or provided in any way that would
materially affect the Target’s assets, financial condition, business or future projections.
In stating its opinion contained in the Fairness Opinion and making analyses as the basisof such opinion, Daiwa Securities set a number of assumptions regarding the industry
situations, the state of general business and economy and other matters, many of which
are not within the control of the Target. The estimates contained in such analyses of
Daiwa Securities are not necessarily indicative of future results or actual values, which
may be significantly more or less favorable than those suggested by such estimates.
In expressing the opinions contained in the Fairness Opinion, Daiwa Securities
assumed that all consents and approvals from the government and supervisory
authorities that are necessary for the successful completion of the Transactions wereobtained by the Target or the Offeror without affecting in any manner the anticipatedbenefits of the Transactions. Daiwa Securities has not evaluated the decision of theTarget with respect to its execution of the Tender Offer or the relative merits of theTender Offer as compared to any strategic alternatives that may be available to theTarget, nor has Daiwa Securities been requested the Target to do so. Daiwa Securities
is not a legal, accounting or tax expert and has neither independently analyzed orreviewed nor assumed any obligation to independently analyze or review the legality or
validity of any matter regarding the Tender Offer or the appropriateness of theaccounting and tax treatment of any matter regarding the Tender Offer.
Daiwa Securities is expected to receive a fixed compensation for its services related
to the Transactions, irrespective of whether the Transactions are successfully completed.
Also, Daiwa Securities is expected to receive reimbursement from the Target of any
expenses incurred in the course of the provision of its services. The Target understands
that Daiwa Securities and its affiliates have provided, or may provide in the future,services for transactions to Offeror, MC and their affiliates, for which Daiwa Securities
and its affiliates have received, or may receive, compensation, and has given priorconsent to the provision of such services without any objection. In addition, Daiwa- 60 -

Securities and its affiliates may actively trade or hold financial products, including
securities and derivatives products, of the Target or any of their respective affiliates, forthe accounts of Daiwa Securities or its affiliates or for the accounts of customers.
The Fairness Opinion was prepared solely in order that Daiwa Securities may provide
the Special Committee with reference information to review the Tender Offer Price.
Daiwa Securities does not recommend to the Special Committee any particular purchaseprice, nor does it recommend that any particular purchase price is the only appropriate
purchase price. In addition, neither the Target nor the Special Committee may disclose
the Fairness Opinion to any third party without the prior written consent of Daiwa
Securities. The Fairness Opinion is not addressed to any third party other than theTarget and no third party may trust or rely on the opinion for any purpose. Moreover,the Fairness Opinion does not constitute a recommendation or solicitation to any generalshareholders of the Target as to how such shareholders should vote on the Tender Offer,
the transfer or receipt of shares of the Target or any other related matters.
The Fairness Opinion addresses only the fairness of Tender Offer Price from afinancial point of view to the holders of the general shareholders of the Target other thanthe Offeror, MC and their affiliates, and the Target has not asked Daiwa Securities toaddress, and the Fairness Opinion does not address, the fairness to, or any otherconsideration of, any third party excluding the general shareholders of the Target otherthan the Offeror, MC and their affiliates. Daiwa Securities does not provide any
opinion on any premise or assumption upon which the determination of Tender Offer
Price was based or the underlying business decision of the Target to proceed with theTender Offer. Daiwa Securities is also not expressing any opinion as to the prices atwhich the shares of common stock of the Target will be traded at any time after the dateof this opinion. In addition, Daiwa Securities expresses no opinion with respect to thefairness of the amount or nature of any compensation to be received in relation to theTender Offer Price by any officer, director, employee or any similar such person involvedin the Tender Offer. Daiwa Securities is not authorized by the Target or the Targets
board of directors or Special Committee to solicit a decision of a third party concerning
the Transactions, and has not solicited such in the past.
The Fairness Opinion is also based upon financial, economic, market and otherconditions as they exist as of the date of the Fairness Opinion, and relies on information
made available to Daiwa Securities by the date of the Fairness Opinion. Additionally,
although the Fairness Opinion may be affected by future changes in conditions, Daiwa
Securities does not assume any obligation to revise, change, renew, supplement or
reaffirm the Fairness Opinion.
(vii) Establishment of independent review system at the Target
According to the Target, as described in “(II) Decision-making process leading to and grounds
for the opinion in favor of the Tender Offer by the Target” under “(2) Background, purpose anddecision-making process leading to the decision to conduct the Tender Offer, and management
policy following the Tender Offer” in “1. Purposes of Tender Offer” above, considering the factthat the Transactions, including the Tender Offer, fall under the type of transaction involving theissue of structural conflicts of interest and information asymmetry with minority shareholders, theTarget has established a system within the Target to review, negotiate, and make decisions regarding
the Transactions from a standpoint independent of the Offeror Related Parties. Specifically,
according to the Target, on September 1, 2023, after the Target received the Transactions (Initial
Proposal) from the Offeror Related Parties, a project team with the purpose to conduct a review
regarding the Transactions (including preparation of the business plan which serves as a basis forthe valuation of the Target’s share value) and consultation and negotiations with the Offeror Related
Parties was established, and its members are comprised of the Target’s officers and employees who
do not concurrently hold the position of officer or employee of any company in the Offeror Related
Parties group (excluding the Target Group other than MC), and such team continues to date.
In addition, according to the Target, an approval by the Special Committee was obtained that thereview system by the Target (including the scope of officers and employees of the Target who will
- 61 -

be involved in the review, negotiation, and judgment for the Transactions and their duties) has noconcerns from the viewpoint of independence and fairness.
(viii) Unanimous approval of all disinterested directors of the Target and the opinion of all
auditors of the Target that they have no objection
According to the Target, as described in “(II) Decision-making process leading to and grounds
for the opinion in favor of the Tender Offer by the Target” under “(2) Background, purpose anddecision-making process leading to the decision to conduct the Tender Offer, and management
policy following the Tender Offer” in “1. Purposes of Tender Offer” above, the Target’s board of
directors carefully considered and discussed whether the Transactions, including the Tender Offer,would contribute to the enhancement of the corporate value of the Target and whether the terms
and conditions of the Transactions, including the Tender Offer Price, are appropriate, based on legal
advice received from Anderson Mori & Tomotsune, advice received from SMBC Nikko Securities,
and the details of the Share Valuation Report (Nikko Securities), with the utmost respect for thedetails of the Special Committee’s judgment expressed in the Written Report.
As a result, according to the Target, as described in “(II) Decision-making process leading to andgrounds for the opinion in favor of the Tender Offer by the Target” under “(2) Background, purposeand decision-making process leading to the decision to conduct the Tender Offer, and management
policy following the Tender Offer” in “1. Purposes of Tender Offer” above, the Target determinedthat 10,360 yen per share, the Tender Offer Price, is a reasonable price that ensures that thebenefits to be enjoyed by the Target’s minority shareholders and that other conditions of the Tender
Offer are fair; therefore, the Tender Offer provides the Target’s minority shareholders with areasonable opportunity to sell the Target Shares at a price with an appropriate premium, andresolved, at the Target’s board of directors meeting held today, (i) to express the Target’s current
opinion as of the same date in favor of the Tender Offer if the Tender Offer commences; (ii) torecommend that the shareholders of the Target tender their shares in the Tender Offer; (iii) torecommend that the owners of the American Depositary Receipts deliver the American Depositary
Receipts to the Depositary Banks in advance and receive the delivery of the Target Shares
represented by the relevant American Depositary Receipts to tender their shares in the Tender Offer;and (iv) that the Target would leave the decision as to whether or not to tender their shares in theTender Offer to the judgement of the Share Option Holders.
According to the Target, at the Target’s board of directors meeting above, of the five directors of
the Target, the above resolution was unanimously passed after discussion by three directors of theTarget, excluding two directors, Mr. Masayuki Itonaga and Mr. Kiyotaka Kikuchi (that is, Mr.
Sadanobu Takemasu, Ms. Miki Iwamura, and Ms. Satoko Suzuki). At the Target’s board of
directors meeting above, all of the five auditors expressed their opinion that they have no objection
to the above resolution.
In light of the fact that on and before April 1, 2022, Mr. Masayuki Itonaga concurrently held theposition of officer at Mitsubishi Corporation Financial & Management Services (Japan) Ltd., MC’s
subsidiary, and Mr. Kiyotaka Kikuchi concurrently holds the position of managing executive officer
at MC, in order to eliminate, as much as possible, possible impact of the issues of structural
conflicts of interest and information asymmetry with minority shareholders through theTransactions, they did not participate in the meeting and refrained from expressing their opinion.
On the other hand, although Mr. Sadanobu Takemasu previously worked at MC, more than nine
years has passed since he was transferred from MC to the Target and is not in a position to receive
instructions from the Offeror Related Parties, and the side of the Offeror Related Parties has neverbeen involved in the Transactions and is not in a position to be involved therein. Therefore, since
it has been determined that the Target’s decision-making in the Transactions has no risk of a conflictof interest, he has participated in the discussions and resolutions at the Target’s board of directors
meeting above.
As described above, the Offeror intends to promptly conduct the Tender Offer once theConditions Precedent are satisfied (or waived by the Offeror Related Parties). As of today, theOfferor aims to commence the Tender Offer in around April 2024; however, it is difficult toaccurately predict the period required for the procedures to be taken by the competition authorities
in and outside Japan. According to the Target, at the Target’s board of directors meeting held
- 62 -

today, the Target resolved to (i) request, at the commencement of the Tender Offer, that the Special
Committee review whether any change should be made to the opinion expressed by the Special
Committee to the Target’s board of directors as of February 5, 2024, and either advise the Target’s
board of directors accordingly if there is no change, or if any change should be made, state theamended opinion, and to (ii) again express the Target’s opinion regarding the Tender Offer upon
the commencement of the Tender Offer based on such opinion of the Special Committee.
(ix) Establishment of measures to ensure purchase opportunities from other offerors
Since the Offeror aims to commence the Tender Offer in around April 2024 and there is a
substantial period until the commencement of the Tender Offer, the Offeror believes that an
opportunity for the Target’s minority shareholders to make an appropriate decision regarding thetender of the Tender Offer and an opportunity for persons other than the Offeror to purchase theTarget Shares are secured. In addition, the Offeror Related Parties, in the Master Agreement,
agree not to directly or indirectly make any proposal, solicitation, provision of information, or
consultation on competing transactions with any third party until completion of the Transactions,and not to conduct any act that conflicts with or infringes on the Transactions such as an agreement
related to competing transactions (including the exercise or non-exercise of voting rights at theTarget’s shareholders’ meeting that conflict with or infringe on the Transactions), but the Offeror
Related Parties have not made any agreement that contains a transaction protection clause thatprohibits the Target from contacting persons other than the Offeror Related Parties (the“Competitive Purchasers”), or any other agreement that restricts contacts between the Competitive
Purchasers and the Target. Since there is a substantial period until the commencement of theTender Offer as stated above and an opportunity for competitive purchases has been secured, dueconsideration is given to ensure the fairness of the Tender Offer.
(x) Establishment of measures to ensure opportunity for the Target’s shareholders to make anappropriate decision on whether to tender their shares in the Tender Offer
As described in “(4) Policies on organizational restructuring, etc. after the Tender Offer (mattersconcerning ‘two-step acquisition’)” in “1. Purposes of Tender Offer” above, (A) promptly after
completion of the settlement of the Tender Offer, the Offeror plans to request that the Target
convene the Extraordinary Shareholders’ Meeting, at which the matters for resolution shall include
a partial amendment of the articles of incorporation to abolish the provision concerning the shareunit number on the condition that the Share Consolidation takes effect, and a method that does notsecure the right to demand purchase of shares or the right to demand price determination of theowners of the American Depositary Receipts will not be adopted; and (B) the Offeror clarified thatthe amount of money to be delivered to the Target’s shareholders as consideration in the Share
Consolidation will be calculated to be the same as the Tender Offer Price multiplied by the numberof the Target Shares owned by each of the relevant shareholders of the Target; thus, the Offeror
gave consideration so that the Target’s shareholders and owners of the American Depositary
Receipts will have the opportunity to make an appropriate decision on whether or not to tendertheir shares in the Tender Offer, and so as not to cause any coercion.
Furthermore, since the Offeror Related Parties hold 52,260,100 shares of the Target Shares intotal (ownership ratio: 52.16%) as of today, the Offeror believes that because setting a minimum
number of the “Majority of Minority” in the Tender Offer would destabilize the successful
completion of the Tender Offer, which in turn might not serve the interests of minority shareholders
who wish to tender in the Tender Offer, it has not set a minimum number of the “Majority of
Minority” in the Tender Offer. However, since the Offeror Related Parties and the Target has
taken the measures in (i) through (ix) above and (x), they believe that due consideration was given
to the interests of the Target’s minority shareholders.
(III) Relationship with valuator
The Offeror’s financial advisor and third-party valuator, UBS Securities, does not constitutean Offeror Related Party or the Target’s related party and has no material interest in theTransactions including the Tender Offer.

- 63 -

(5)Number of share certificates to be purchased
Number of shares to be
Minimum number of shares topurchased
be purchased
47,924,270 shares

14,458,800 shares

Maximum number of shares tobe purchased- shares(Note 1) If the total number of the Tendered Shares is less than the minimum number of shares to bepurchased in the Tender Offer (14,458,800 shares), the Offeror will purchase none of theTendered Shares. If the total number of the Tendered Shares is not less than the minimum
number of shares to be purchased in the Tender Offer (14,458,800 shares), the Offeror willpurchase all of the Tendered Shares.
(Note 2) As the Tender Offer does not set the maximum number of shares to be purchased,
47,924,270 shares, which is the largest number of the Target Shares that the Offeror may
acquire through the Tender Offer, is stated as the number of shares to be purchased. The
largest number is the number obtained by adding the total number of issued shares as ofJanuary 12, 2024 (100,300,000 shares) as stated in the Target’s third Quarterly Report to thenumber of the Target Shares underlying the Share Options (106,000 shares), less the number oftreasury shares owned by the Target as of November 30, 2023 (221,630 shares) as stated in theTarget’s Financial Results and the number of the Target Shares owned by the Offeror Related
Parties (52,260,100) as of today (47,924,270 shares).
(Note 3) Shares constituting less than one unit (tangen-miman kabu) are also subject to the Tender Offer.
If a shareholder exercises the right to demand purchase of shares constituting less than one unit
pursuant to the Companies Act, the Target may purchase these shares during the Tender Offer
Period in accordance with statutory procedures.
(Note 4) The treasury shares held by the Target are not scheduled to be acquired through the Tender
Offer.
(Note 5) “Number of Shares to be Purchased” and “Minimum Number of Shares to be Purchased” areprovisional figures based on the information available as of today. The actual figures in theTender Offer may differ from the figures above due to changes such as changes in the numberof treasury shares held by the Target after said date. The final “number of shares to bepurchased” and “minimum number of shares to be purchased” will be determined prior to thecommencement of the Tender Offer, based on the latest information available as of thecommencement of the Tender Offer.
(6) Changes in ownership ratio of share certificates due to tender offer
Number of voting rights(Ownership ratio of share certificates before
pertaining to the share
21,100 the tender offer
certificates held by the Offeror
2.11%)
before the tender offer
Number of voting rights
pertaining to the share(Ownership ratio of share certificates before
certificates held by special
undetermined the tender offer
related parties before the tender
undetermined)
offer
Number of voting rights(Ownership ratio of share certificates after thepertaining to the share
500,342 tender offer
certificates held by the Offeror
49.94%)
after the tender offer
Number of voting rights
pertaining to the share(Ownership ratio of share certificates after thecertificates held by special
501,501 tender offer
related parties after the tender50.06%)
offer
Total number of voting rights of
999,718
all shareholders- 64 -

(Note 1) “Number of voting rights pertaining to the share certificates held by special related parties
before the tender offer” and its “Ownership ratio of share certificates before the tender offer”
has been undetermined as of today, but it will be disclosed after investigation before thecommencement of the Tender Offer. Since the share certificates held by each special related
party excluding the Target Shares held by MC (50,150,100 shares) are subject to the Tender
Offer, “Number of voting rights pertaining to the share certificates held by special relatedparties after the tender offer” is 501,501.
(Note 2) “Number of voting rights pertaining to the share certificates held by the Offeror after the tender
offer” is the number obtained by adding the total number of issued shares as of January 12,2024 (100,300,000 shares) as stated in the Target’s third Quarterly Report to the number of theTarget Shares underlying the Share Options (106,000 shares), less the number of treasury shares
owned by the Target as of November 30, 2023 (221,630 shares) as stated in the Target’s
Financial Results and the number of the Target Shares owned by MC (50,150,100) as of today(50,034,270 shares).
(Note 3) “Total number of voting rights of all shareholders” is the number of voting rights of allshareholders (the number of shares per unit is listed as 100 shares) as of August 31, 2023 asstated in the Target’s third Quarterly Report. However, because shares less than one unit andthe Share Options are also subject to tender offers, “Ownership ratio before the tender offer”
and “Ownership ratio after the tender offer” are calculated based on the denominator of the
Total Number of Shares After Adjustment for Diluted Shares (1,001,843).
(Note 4) “Ownership ratio of share certificates before the tender offer” and “Ownership ratio of sharecertificates after the tender offer” are rounded to the nearest second decimal place.
(7) Purchase price (scheduled) 496,495,437,200 yen(Note) The purchase price indicated is the amount obtained by multiplying the number of shares tobe purchased stated in “(5) Number of share certificates to be purchased” above by the Tender
Offer Price (10,360 yen) per share of the Target Shares. If the actual number of shares to bepurchased in the Tender Offer differs due to changes in the number of the Target Shares
excluding the treasury shares held by the Target, the purchase price may be subject to change.
(8) Other conditions and method of tender offer(I) Whether there are conditions listed in each item of Article 27-13, paragraph (4) of the Act, andthe details thereof
If the total number of the Tendered Shares is less than the minimum number of shares to bepurchased in the Tender Offer (14,458,800 shares), the Offeror will purchase none of theTendered Shares. If the total number of the Tendered Shares is not less than the minimum
number of shares to be purchased in the Tender Offer (14,458,800 shares), the Offeror willpurchase all of the Tendered Shares.
(II) Other conditions and method of tender offer
The “method of settlement”, the “date of public notice of commencement of the tender
offer,” and “other conditions and method of tender offer” will be announced as soon as they
are determined. Nomura Securities Co., Ltd. will be appointed as the tender offer agent.
(III) Others
This press release is intended to announce the Tender Offer and provide information relating
to the Tender Offer to the public and has not been prepared for the purpose of soliciting anoffer to sell securities or to make an offer to purchase securities pertaining to the Tender Offer.
If shareholders and the Share Option Holders wish to make an offer to sell their securities, theyshould first read the Tender Offer Explanatory Statement concerning the Tender Offer andmake an offer to sell their securities at their own discretion. This press release shall neitherbe, nor constitute a part of, an offer to sell or purchase, or solicitation to sell or purchase, any
securities, and neither this press release (or part of this press release) nor its distribution shallbe interpreted to constitute the basis of any agreement in relation to the Tender Offer, and- 65 -

neither this press release (or any part of this press release) nor the distribution thereof may berelied upon at the time of entering into any such agreement.
The Tender Offer is for shares of the Target, a company incorporated in Japan. The Tender
Offer shall be implemented in compliance with the procedures and information disclosure
standards prescribed by Japanese law, and these procedures and standards are not necessarily
the same as the procedures and information disclosure standards in the United States. In
particular, Section 13(e) or 14(d) of the U.S. Securities Exchange Act of 1934, as amended (the“Securities Exchange Act”) and the rules and regulations thereunder do not apply to the Tender
Offer, and the Tender Offer is not necessarily conducted consistent with these procedures andstandards. The financial information contained in this press release and the documents
referenced in this press release is based on Japanese accounting standards or international
accounting standards, which may differ materially from generally accepted accounting
principles in the United States and other countries. Since the Offeror Related Parties and theTarget are corporations incorporated outside the United States and all or some of their directors
and officers are not residents of the United States, it may be difficult to exercise, make orenforce any right or claim arising under the U.S. federal securities laws. It may not be
possible to commence legal proceedings against a non-U.S. corporation and its directors andofficers in a non-U.S. court for violations of U.S. securities laws. In addition, U.S. courts are
not necessarily granted jurisdiction over non-U.S. corporations and their subsidiaries andaffiliates and there is no guarantee that shareholders will be able to compel a company outside
the United States or its subsidiaries and affiliates to subject themselves to the jurisdiction of aU.S. court.
Unless otherwise stated, all procedures relating to the Tender Offer shall be conducted inJapanese. Although all or part of the documents relating to the Tender Offer may be preparedin English, if there is any discrepancy between the Japanese documents and the corresponding
English documents, the Japanese documents shall prevail.
Statements in this press release and the documents referenced in this press release contain“forward-looking statements” within the meaning of Section 27A of the U.S. Securities Act of
1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act.
Known and unknown risks, uncertainties, and other factors could cause actual results to differ
materially from the results implied or expressly stated as “forward-looking statements”.
None of the Offeror Related Parties, the Target nor their respective affiliates gives any
assurance or guarantee that the results implied or expressly stated by these forward-looking
statements will be achieved. The “forward-looking statements” contained in this press
release and the documents referenced in this press release have been prepared based upon theinformation available to the Offeror Related Parties as of the date of this press release, andunless otherwise requires by applicable laws and regulations, none of the Offeror Related
Parties nor any of their respective affiliates assumes any obligation to change or revise the“forward-looking statements” to reflect future events and circumstances.
The Offeror Related Parties, the Target, each of the financial advisors to the Offeror Related
Parties and the Target, and the tender offer agent (including the related parties thereof) may
purchase or take actions to purchase the Target Shares outside the Tender Offer prior to thecommencement of the Tender Offer or during the Tender Offer Period to the extent permitted
under the Financial Instruments and Exchange Related Laws and Regulations of Japan andother applicable laws and regulations and subject to the requirements of Rule 14e-5(b) under
the Securities Exchange Act. Such purchase may be conducted at a market price through amarket transaction or a price determined in off-market negotiations. If the relevant
information concerning such purchases is disclosed in Japan, it shall also be disclosed in the
United States by an equivalent method of disclosure.]- 66 -

If a shareholder exercises the right to demand purchase of shares less than one unit pursuant
to the Companies Act, the Target may purchase its treasury shares during the Tender Offer
Period in accordance with statutory procedures.
3.

Policies after the tender offer and future prospects
For the policies after the Tender Offer and future prospects, please refer to “(2) Background, purposeand decision-making process leading to the decision to conduct the Tender Offer, and management
policy following the Tender Offer,” “(4) Policies on organizational restructuring, etc. after the Tender
Offer (matters concerning “two-step acquisition”),” and “(5) Possibility of delisting and reason therefor”
under “1. Purposes of Tender Offer” above.
4.
Others(1)
Whether there are agreements between the Offeror Parties and the Target or its officers, and thedetails thereof(I) Expression of favor for the Tender Offer
According to the Target’s Press Release, the Target resolved at the board of directors’ meeting
held today, as the current opinion of the Target as of today, (i) to express the Target’s opinion in favorof the Tender Offer if the Tender Offer commences; (ii) to recommend that the shareholders of theTarget tender their shares in the Tender Offer; (iii) to recommend that the owners of the American
Depositary Receipts deliver the American Depositary Receipts to the Depositary Banks in advanceand receive the delivery of the Target Shares related to the American Depositary Shares represented
by the relevant American Depositary Receipts to tender their shares in the Tender Offer; and (iv) that
the Target would leave the decision as to whether or not to tender their shares in the Tender Offer tothe judgement of the Share Option Holders.
For details of the process of the decision-making by the Target’s board of directors, please referto “(viii) Unanimous approval of all disinterested directors of the Target and the opinion of all
disinterested auditors of the Target that they have no objection” under “(Measures to ensure thefairness of the Tender Offer, such as measures to ensure the fairness of the Tender Offer Price andmeasures to avoid conflicts of interest)” in “(II) Background leading to calculation” under “(4) Basisfor calculation of the price of tender offer” above.
(II) Capital and Business Alliance Agreement
The Offeror has entered into the Capital and Business Alliance Agreement between MC and theTarget as of today. For details of the Capital and Business Alliance Agreement, please refer to “(III)Capital and Business Alliance Agreement” under “(6) Material agreements relating to the Tender
Offer” in “1. Purposes of Tender Offer.”(2)
Other information considered to be necessary for investors to determine whether to tender theirshares in the Tender Offer(I)
Announcement of “Notice of Revision of Year-End Dividend Forecast (NoDistribution)”
According to the Target, the Target resolved at the board of directors’ meeting held today that it
would revise the year-end dividend forecast for the fiscal year ending February 2024 and would
not pay dividends for the fiscal year ending February 2024. For details, please refer to “Noticeof Revision of Year-End Dividend Forecast (No Dividend)” announced today by the Target.
End- 67 -

[Regulation on solicitation]
This press release is intended to announce the Tender Offer and provide information relating to theTender Offer to the public and has not been prepared for the purpose of soliciting an offer to sell
securities or to make an offer to purchase securities pertaining to the Tender Offer. If shareholders
and the Share Option Holders wish to make an offer to sell their securities, they should first read theTender Offer Explanatory Statement concerning the Tender Offer and make an offer to sell theirsecurities at their own discretion. This press release shall neither be, nor constitute a part of, an offer
to sell or purchase, or a solicitation of an offer to sell or purchase, any securities, and neither this press
release (or part of this press release) nor its distribution shall be interpreted to constitute the basis of
any agreement in relation to the Tender Offer, and neither this press release (or any part of this press
release) nor its distribution may be relied upon at the time of entering into any such agreement.
[Forward-Looking Statements]
This press release and the documents referenced in this press release may contain expressions
concerning future prospects, including “expect,” “forecast,” “anticipate,” “intend,” “plan,” “beconvinced,” “project” and “estimate.” These expressions are based on the current businessprospects of the Offeror Related Parties or the Target, as applicable, and they are subject to change
depending on future circumstances and developments. None of the Offeror Related Parties, theTarget nor any of their respective affiliates assumes any obligation to update these expressions
concerning future prospects to reflect actual performance and other circumstances and developments,
and changes to the conditions, or other related factors.
[U.S. regulations]
The Tender Offer is for shares of the Target, a company incorporated in Japan. The Tender Offer
shall be implemented in compliance with the procedures and information disclosure standards
prescribed by Japanese law, and these procedures and standards are not necessarily the same as theprocedures and information disclosure standards in the United States. In particular, Section 13(e) or
14(d) of the U.S. Securities Exchange Act of 1934, as amended (the “Securities Exchange Act”) andthe rules and regulations thereunder do not apply to the Tender Offer, and the Tender Offer is notnecessarily conducted consistent with these procedures and standards. The financial information
contained in this press release and the documents referenced in this press release is based on Japanese
accounting standards and international accounting standards, which may differ materially fromgenerally accepted accounting principles in the United States and other countries. Since the Offeror
Related Parties and the Target are corporations incorporated outside the United States and all or someof their directors and officers are not residents of the United States, it may be difficult to exercise,make or enforce any right or claim arising under the U.S. federal securities laws. It may not be
possible to commence legal proceedings against a non-U.S. corporation and its directors and officers
in a non-U.S. court for violations of U.S. securities laws. In addition, U.S. courts are not necessarily
granted jurisdiction over non-U.S. corporations and their subsidiaries and affiliates and there is no
guarantee that shareholders will be able to compel a company outside the United States or its
subsidiaries and affiliates to subject themselves to the jurisdiction of a U.S. court.
Unless otherwise stated, all procedures relating to the Tender Offer shall be conducted in Japanese.
Although all or part of the documents relating to the Tender Offer may be prepared in English, if there
is any discrepancy between the Japanese documents and the corresponding English documents, theJapanese documents shall prevail.

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Statements in this press release and the documents referenced in this press release contain “forwardlooking statements” within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended(the “Securities Act”) and Section 21E of the Securities Exchange Act. Known and unknown risks,
uncertainties, and other factors could cause actual results to differ materially from the results impliedor expressly stated as “forward-looking statements.” None of the Offeror Related Parties, the Target
nor their respective affiliates gives any assurance or guarantee that the results implied or expressly
stated by these forward-looking statements will be achieved. The “forward-looking statements”
contained in this press release and the documents referenced in this press release have been preparedbased upon the information in the possession of the Offeror Related Parties as of the date of this press
release, and unless otherwise required by applicable laws and regulations, none of the Offeror Related
Parties, the Target nor any of their respective affiliates assumes any obligation to change or revise the“forward-looking statements” to reflect future events and circumstances.
The Offeror Related Parties, the Target, each of the financial advisors to the Offeror Related Parties
and the Target, and the tender offer agent (including the related parties thereof) may purchase or takeactions to purchase the Target Shares outside the Tender Offer prior to the commencement of theTender Offer or during the Tender Offer Period to the extent permitted under the Financial Instruments
and Exchange Related Laws and Regulations of Japan and other applicable laws and regulations andsubject to the requirements of Rule 14e-5(b) under the Securities Exchange Act. Such purchase may
be conducted at a market price through a market transaction or a price determined in off-market
negotiations. If the relevant information concerning such purchases is disclosed in Japan, it shallalso be disclosed in the United States by an equivalent method of disclosure.
[Other countries]
The announcement, issuance, or distribution of this press release may be legally restricted in somecountries or territories. In such case, shareholders should be aware of and comply with such
restriction. The announcement, issue or distribution of this press release shall not be interpreted as
an offer to purchase or solicitation of an offer to sell share certificates concerning the Tender Offer,
but simply as a distribution of information.

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