[Delayed] Prior Disclosure Agreement Relating to Share Delivery(adval Corp.)(Disclosure items as stipulated in Article 816-2, Paragraph 1 of the Companies Act and Article 213-2 ofthe Regulation for Enforcement of the Companies Act)

October 25, 2021
Vision Inc.

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October 25, 2021

Information regarding the Share Delivery to be disclosed in Advance
6-5-1 Nishi-Shinjuku, Shinjuku-ku, Tokyo
Vision Inc.
Representative Director, President, and CEO Kenichi Sano
The share delivery plan (hereinafter referred to as the “share delivery plan”) created by the Company on October 18, 2021
will go into effect on December 1, 2021 (hereinafter referred to as the “effective date”). Therefore, the Company will
become the parent company and adval Corp. (hereinafter referred to as “adval”) will become a subsidiary through a sharedelivery (hereinafter referred to as the “share delivery”).
The matters regarding the share delivery to be disclosed in advance as stipulated in Article 816-2, Paragraph 1 of theCompanies Act and Article 213-2 of the Regulation for Enforcement of the Companies Act are as follows.
Record1.

Contents of the Share Delivery Plan (Article 816-2 Paragraph 1 of the Companies Act)
Refer to Attachment 1.

2.

Reasons why the share delivery parent company has determined that provisions for matters listed in Article 774-3,
Paragraph 1 Item 2 of the Companies Act meet the requirements stipulated in Paragraph 2 of the same article. (Article
213-2 Paragraph 1 of the Regulation for Enforcement of the Companies Act)The Company has set 94,809 to be the lower limit of common shares to be transferred during share delivery.
According to the adval registration information dated October 15, 2021, the total number of issued shares of common
stock of adval is 192,616 shares. Adval confirmed that it had not issued any class shares with voting rights as of October,and that the only stock acquisition rights that could be exercised by the effective date were the first stock acquisitionrights. This accurately reflects the status of issued shares and stock acquisition rights of adval as of the same day,
October 15, 2021. We have confirmed with adval that we have no plans to issue or grant convertible rights to corporate
bonds or other shares of adval between October 15 and the effective date.
In addition, the Company will make stock acquisitions with all stock acquisition rights holders of the initial stockacquisition rights until the shares of adval are listed on any financial exchange and trading begins. An allotment
agreement has been concluded that stock acquisition rights cannot be exercised until adval shares are listed on one of
the financial exchanges and it is confirmed that there are no plans to be traded until the effective date.
Because of these, the Company has determined that the lower limit of common shares of adval to be transferred at
the time of share delivery is 94,809 shares, which meets the requirements stipulated in Article 774-3, Paragraph 2 of
the Companies Act.

3.

The appropriateness of provisions regarding the matters listed in Article 774-3, Paragraph 1, Items 3 to 6 of theCompanies Act (Article 213-2 Paragraph 2 of the Regulation for Enforcement of the Companies Act)
Refer to Attachment 2.

4.

The appropriateness of provisions regarding the matters listed in Article 774-3, Paragraph 1, Items 8 and 9 of theCompanies Act (Article 213-2 Paragraph 3 of the Regulation for Enforcement of the Companies Act)Not applicable.

5.

Matters concerning subsidiaries (Article 213-2 Paragraph 4 of the Regulation for Enforcement of the Companies Act)

(1) Contents of financial statements for the final business year
Refer to Attachment 3.
(2) If there are temporary financial statements with the day after the last day of the final business year as the temporary
account closing day, the contents of the financial statements.
Not applicable.
(3) Details of major property disposals, significant debt burden, or other events that have a significant impact on the statusof company property that occurred after the last day of the final business year.

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6.

Details of major property disposals, significant debt burdens, and other events that have a significant impact on thestatus of company property that occurred after the last day of the final business year at the share delivery parent company.
(Article 213-2 Paragraph 5 of the Regulation for Enforcement of the Companies Act)Not applicable.

7.

Matters concerning the obligation of fulfillments by the share delivery parent company after the date that the sharedelivery becomes effective (Article 213-2 Paragraph 6 of the Regulation for Enforcement of the Companies Act)
Article 816-8, Paragraph 1 of the Companies Act does not apply so this is not applicable to the share delivery.

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Attachment 1

Contents of the Share Delivery Plan

Share Delivery Plan
We have made the following share delivery plan (hereinafter referred to as the “share delivery plan”) for the execution ofa share delivery (hereinafter referred to as the “share delivery”) in which Vision Inc. (hereinafter referred to as “Party A”)
will become the parent company and adval Corp. (hereinafter referred to as “Party B”) will become a subsidiary.

Article 1 (Trade name and address of the share delivery subsidiary)
The trade name and address of Party B is as follows.
Trade name: adval Corp.
Address: 33-7 Udagawacho, Shibuya-ku, Tokyo
Article 2 (Minimum number of shares of the share delivery subsidiary to be transferred by the parent company at the timeof the share delivery)
The minimum number of shares of Party B that Party A is to transfer is 94,809 shares.
Article 3 (Allocation of shares and money to be delivered to the transferor of the subsidiary’s shares at the time of theshare delivery)
1. During the share delivery, Party A will deliver to the transferor of Party B's ordinary stock their own common stock inthe sum of Party B’s total common stock multiplied by 4.7.
2. During the share delivery, Party A will allocate 4.7 shares of Party A's common stock to the transferor of Party B’s
common stock for each share of transferred Party B common stock.
Article 4 (Amount of capital and reserves of the share delivery parent company)
Party A will not increase the amount of stated capital in the share delivery and will separately determine the amountof reserve and other matters in accordance with Article 39-2 of the Regulation on Corporate Accounting.
Article 5 (Deadline for applications of the transfer of shares by the subsidiary)
For Party B, November 12, 2021 is the deadline for applications of common stock.
Article 6 (Resolution to approve the share delivery plan)
Party A will approve the share delivery plan and make a decision on the matters necessary by the day before the plan
is to go into effect.
Article 7 (Date that the share delivery plan goes into effect)
The share delivery plan will go into effect (hereinafter referred to as the “effective date”) on December 1, 2021.
However, Party A may change this if necessary due to the necessity of proceeding with the share delivery or forother reasons.
Article 8 (Changes to the plan and cancellation of the share delivery)
If it becomes difficult to achieve the purpose of the share delivery due to an event that seriously hinders theexecution of the delivery during the time between the creation of the plan and the effective date, then changes to theplan or entire cancellation of the share delivery may be necessary.
Article 9 (Effect of share delivery plan)
The share delivery plan shall be invalid if the legal support of Party A as stipulated in Article 6 is not obtained.
Article 10 (Non-regulated matters)
In addition to the matters stipulated in the plan, details related to the share delivery will be decided by Party A in
accordance with the purpose of the share delivery.
October 18, 2021
6-5-1 Nishi-Shinjuku, Shinjuku-ku, Tokyo
Vision Inc.
Representative Director, President, and CEO Kenichi Sano

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Attachment 2

The appropriateness of provisions regarding the matters listed in Article 774-3, Paragraph 1, Items
3 to 6 of the Companies Act

Details of allocation related to the share delivery (share delivery ratio) and basis for calculating the share issuance ratio

1.

(1) Details of allocation related to the share delivery (share delivery ratio)
The Company will allocate and deliver 4.7 shares of the Company’s common stock for one share of adval common
stock. In addition, we plan to allocate treasury stock 446,500 shares held by the Company to the common stock of theCompany to be delivered as an allotment for the shares of adval by the Company, and will not issue new shares.
The lower limit of the common stock of adval that the Company will transfer is 94,809 shares. If a fraction less than
one share is generated as a result of the share delivery, the fractions will be totaled in accordance with the provisions ofArticle 234 of the Companies Act (if the total number has a fraction less than one, it shall be rounded down). The
Company’s common stock equivalent will be sold and the price will be delivered to the adval shareholders according
to the fraction(2) Basis for calculating the share issuance ratio
a. Basis and reasons for the content of the allotment
In considering the share delivery ratio to be used, the Company selected Tokyo Kyodo Accounting Office, a third
party calculation agent independent of the Company and adval, to ensure the fairness and appropriateness of the sharedelivery ratio, and obtained the share delivery ratio calculation report for the share delivery on October 15, 2021.
After comprehensive consideration and deliberation of the results of the calculation of the share delivery ratio for theshares of adval submitted by Tokyo Kyodo Accounting, and factors such as the financial conditions, asset conditions,and prospects for future business activities of both companies, the Company finally decided that the share delivery
ratio described in “(1) Details of allocation related to the share delivery (share delivery ratio)” above is within therange of the share delivery ratio calculated by Tokyo Kyodo Accounting Office and is appropriate and not detrimental
to the interests of shareholders. This share delivery ratio is subject to change upon consultation between the Company
and adval’s shareholders in the event of a material change in the various conditions that form the basis of thecalculation.
b.

Matters relating to calculation① Relationship with the calculation institution
Tokyo Kyodo Accounting Office is not a related party of the Company or adval and has no significant interests tobe stated regarding the share delivery.
② Summary of calculation
The Company has common stock listed on the First Section of the Tokyo Stock Exchange, a stock price, and highliquidity in the trading market. Therefore, when valuing the stock value, the Tokyo Kyodo Accounting Office decided
that the market price method would provide a sufficiently appropriate result, so the market-based valuation method
was adopted for the calculation.
Valuation method
Market-based

Calculation result (per share of common stock)
1,183 yen - 1,463 yen

Regarding adval, since it is an unlisted company, there is no market stock price, and it is judged that the amount of
net assets as of the valuation record date does not indicate the stock value considering future cash flows since theprofit level will fluctuate significantly depending on the progress and implementation accuracy of future businessmeasures. Also considering that it is difficult to objectively and rationally determine which fiscal year’s profit leveland multiplier should be adopted for calculation, which are the calculation elements of the similarly listed companies,
the discounted cash flow method (listed below as “DCF”) was adopted for the calculation to reflect the status of
future business activities in the evaluation.
Valuation method
DCF

Calculation result (per share of common stock)
4,930 yen – 6,931 yen

As a result, the calculation result of share delivery ratio of one adval share to one common stock is as follows,
assuming that the value per share of the Company's common stock is one.

Common stock

Calculation result of share delivery ratio
3.37 - 5.86

When it comes to the market-based valuation method, the Company’s stock value is decided by using the Company’s
closing price on First Section of the Tokyo Stock Exchange on October 15, 2021, the designated calculation base date,to calculate the simple average of the closing price of the stock price for the previous month, three months and six-5-months.
For the DCF method, the corporate value of adval is discounted to their present value based on the free cash flowthat they are expected to generate between May 2022 and May 2026 according to their business plan. For thecontinuous value after the planning period, the permanent growth rate method is adopted and is calculated as -0.5%- 0.5% based on the level of business growth after the planned period that can be assumed at the time of evaluation.
When considering that adval’s business stage is in the growth phase, the discounted value is calculated to be 11.60%
to 12.82% based on 12.21% for the present value of free cash flow during and after the planning period. Regarding
the evaluation of stock acquisition rights, the corporate value is calculated by including the cash inflow amount (strikeprice) assuming that the first section stock acquisition rights have been exercised in non-business assets. As a result,the share value per share of adval is calculated using 201,616 shares, which is the sum of 192,616 issued shares and
9,000 additional shares when the first section stock acquisition rights are exercised.
Based on the results, the range of the share delivery ratio based on the comparison with the evaluation result using
the market price method of the Company is calculated as 3.37 - 5.86 for one share of common stock.
The Tokyo Kyodo Accounting Office certifies that they used information provided by the Company and adval aswell as information released to the public when calculating the share ratio, under the assumption that all thematerials and information used is accurate. It is assumed that it is complete and that there are no undisclosed facts
to the Tokyo Kyodo Accounting Office that may have a significant impact on the calculation of the share delivery
ratio. We have not verified the accuracy and completeness. In addition, in regards to the assets and liabilities of theCompany and adval (including contingent liabilities), we did not perform our own appraisals, including analysis
and appraisals of individual assets and liabilities, and we did not request appraisals from third parties. Lastly, it isassumed that the information regarding adval’s business plan referred to in the calculation has been prepared byadval’s management based on the best forecasts and judgments currently available. The analysis results of Tokyo
Kyodo Accounting Office are the result of the information and economic situation up to October 15, 2021.
Adval’s business plan, which is the basis for DCF method of calculation, includes fiscal years in which profits are
expected to increase significantly due to future business expansion. Specifically, we plan to increase the number ofstores in the space management business and expand business from the fiscal year ending May 2023 to the fiscal
year ending May 2026 which leads us to anticipate an increase in operating income. The financial forecasts foradval from the fiscal year ending May 2022 to the fiscal year ending May 2026, which is when profits are expected
to significantly increase, are as follows.
(Thousands of yen)
May 2022
May 2023
May 2024
May 2025
May 2026
Operating income or loss
-29,191
101,162
240,623
370,191
505,041
Change rate
137.8%
53.8%
36.4%
The current business plan does not presuppose the implementation of the share delivery. Additionally, thecalculation result of the share delivery ratio by the Tokyo Kyodo Accounting Office does not express an opinion on
the fairness of the ratio for the share delivery and the Company has not obtained a statement of opinion (fairness
opinion) that the share delivery ratio in the delivery is fair to the common shareholders of the Company from afinancial standpoint.
2.

Matters concerning the amount of stated capital and reserves of the Company that will increase due to the share issuance

The amounts of the Company's capital stock, capital reserve, and legal reserve that will increase as a result of the sharedelivery are as follows. We believe that such treatment is appropriate in view of the laws and regulations as well as ourcapital policy.
Amount of capital: 0 yen
Amount of capital reserve: Separately determined by the Company in accordance with Article 39-2 of theRegulation on Corporate Accounting③ Amount of revenue reserve: 0 yen

①
②

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Attachment 3

Contents of Financial Statements from the Final Fiscal Year of the Share Delivery Subsidiary

Refer to the next pages.

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Fifth TermBusiness Report and Financial Statements

From June 1, 2020
until May 31, 2021

adval Corp.

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Business Report
From June 1, 2020
until May 31, 2021
1.
Matters Concerning the Company’s Current State(1) Business progress and results
In the current fiscal year, the Company was greatly affected by the worldwide spread of COVID-19 as in order toprevent infection, stay at home measures were put into place in regards to all large, medium and small-scale gatherings
in Japan. Not only did the use of conference rooms and party spaces decline, but there were no events involving eating
and drinking (catering), resulting in a major profit loss in the space management business. Due to these circumstances,
the Company started the industry's first monthly flat-rate conference room service “Office Ticket” in October 2020.
With the increase of remote work and telework, initiatives such as office space reduction have become widespread, but
this is a service that responds to the demand to secure a certain meeting space so it is steady and makes it possible for
the Company to earn stock revenue that is not affected by seasonal fluctuations. The Company started sales activities
with the target of 100 “Office Ticket” contracts by the end of this fiscal year, and through steady performance haveachieved this amount. Also, the Company is developing space for telework booths to meet the demand for privaterooms.
In the accommodation business, the Company canceled unprofitable lodging properties due to a decline in inboundtravelers.
Also, the catering business “favorite”, which was transferred in the previous fiscal year, was transferred to anothercompany in the fourth quarter because it was greatly affected by events no longer occurring due to measures to stay athome. Instead, resources have been focused on rebuilding and growing the space business.
Due to COVID-19, there has been significant impact on the subleased space management business, which is normally
relatively unaffected by market conditions, and profits declined due to shortened business hours and closures to preventthe spread of infection in stores. With the cooperation of the leaseholders, we worked to maintain a certain level ofprofit by keeping costs down. In addition, in regards to Bukenavi, a restaurant space advisory business, there are many
restaurants that have been stopped from closing due to subsidies from the national and Tokyo governments, and thenumber of people who want to open a restaurant is decreasing with uncertainty about the future of the restaurant
business except by delivery. In response to this, the Company operated business more carefully than usual and wasable to make more contracts and Bukenavi has been profitable.
Because of the circumstances described above, the results for the current fiscal year were sales of 1,186,310 thousandyen (37.0% less compared to the same period of the previous year), operating loss of 354,273 thousand yen (operating
profit of 76,580 thousand yen in the same period of the previous year), ordinary loss of 211,931 thousand yen (ordinary
profit of 72,224 thousand yen in the same period of the previous year), and net loss of 391,083 thousand yen (22,401
thousand yen in the same period of the previous year).
(2) Status of capital investment
The amount of capital investment in the current fiscal year was 13 million yen. This was mainly for equipment andfixtures attached to buildings in operating spaces such as conference rooms for and accommodation facilities.
(3) Funding status
Not applicable.
(4) Business transfer, absorption-type split, or new establishment split
On March 1, 2021, the Company transferred over catering business “favorite” to MIG Holdings Co., Ltd.
(5) The transfer of other companies’ businesses
Not applicable.
(6) Succession of rights and obligations related to the business of other corporations, due to absorption-type merger orabsorption-type company split
Not applicable.
(7) Acquisition or disposal of shares or other equity in other companies or stock acquisition rights
Not applicable.
(8) Issues to be addressedWith the announcement of the fourth state of emergency and continued spread of the COVID-19 pandemic, therecovery of the Japanese economy has been significantly delayed and the flexible office market is under pressure to
majorly change. The Company will continue to grow “Office Ticket,” which we launched as a new form of flexible
office. In order to rebuild the business model and create a new flexible office market during the pandemic, we will
tackle the following issues.
① Implementation of store opening strategy to grow “Office Ticket”

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②

③

④

⑤

Property coverage is an important factor in expanding the market share of the Company’s main service, “Office
Ticket”. The Company is planning to open stores by bringing in our equipment to real estate owners' properties
and increasing the number of "semi-directly managed properties" that owners will open. In each space, we willthoroughly implement infection control measures, provide safe and secure use, acquire customers, and promoteuse.
Respond to the demand for remote work spaces with “Office Ticket”
As the demand for remote work and remote conference spaces grows due to the COVID-19 pandemic, we will
aggressively open locations of telework booths.
Enhancement of financial base
For our main service, “Office Ticket”, funds are required to make deposits and procure furniture whendeveloping spaces such as conference spaces and work booth spaces and a stable financial base is indispensable
for business expansion. The development of an excellent flagship space and the enhancement of semi-directly
managed store facilities will lead to an increase in paying members, secure the next development fund from profit
structure, create a virtuous cycle for further development, and stabilize the financial base.
Hiring and training employees
The Company believes that securing and continuous development of excellent human resources is an important
issue in aiming for future business expansion. We will continue to strive to secure excellent employees and workto establish an evaluation system, personnel training system, and compensation system that matches the growthphase.
Enhancement of management system
In order to continuously develop the Company, we will strive to improve the efficiency of operations andthoroughly comply with laws and regulations. We will enhance the compliance system and risk management
system to further establish an organizational system that balances company growth and business management.

(9) Changes in Property and Profit or Loss Status
3rd term
May 2019

Segment

4th term
May 2020

5th term
May 2021(Current fiscal
year)

Sales

(Thousands of yen)

554,596

1,884,101

1,186,310

Operating profit (loss -)(Thousands of yen)-108,154

76,580-354,273

Ordinary profit (loss -)(Thousands of yen)

-127,551

72,224-211,931

Net income (loss -)(Thousands of yen)

-239,562

22,401-391,083(Yen)-1,290.17

116.91-2,030.38

Total assets(Thousands of yen)

1,069,644

1,304,958

953,436

Net assets(Thousands of yen)

26,60749,009-342,073(Yen)

138.14255.77-1,775.94

Earnings per share (loss -)Net asset per share(Note) Net income or loss per share is calculated based on the average number of shares during the period andnet assets per share is calculated based on the total number of issued shares.

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(10) Status of important parent companies or subsidiaries① Status of important parent companies
Not applicable.
② Status of important subsidiaries
Not applicable.
③ Matters concerning specified wholly owned subsidiaries
Not applicable.
(11) Business summary
Our main businesses are the development and operation of rental spaces, the sale and brokerage of real estate
properties used to operate restaurants, and catering sales.
(12) Offices
Headquarters
EBISU SHOW ROOM
(13) Employees
Number of employees
39 members

33-7 Udagawacho, Shibuya-ku, Tokyo
3-1-24 Ebisuminami, Shibuya-ku, Tokyo
Rate of decrease since endof previous fiscal year
-16 people *Average age
34.8 years old

Average employment
length
2.46 years(Note) The average number of temporary employees hired during the period was 31.
*On February 28, 2021, 13 employees from “favorite” (Plus part-time workers for a total of 22) were transferred.
(14) Important lenders
LenderBalance borrowed
Japan Finance Corporation

348 million yen

Juroku Bank, Ogaki Branch

178 million yen

Musashino Bank, Musashiurawa Branch

309 million yen

Ogaki Kyoritsu Bank, Tokyo Branch

50 million yen- 11 -

Balance Sheet(As of May 31, 2021)(Unit: Thousands of yen)
AssetsItem
Current Assets
Cash and Deposits
Accounts Receivable - Trade
Accounts Receivable - Other
Merchandise
Prepaid Expenses
OthersFixed Assets
Tangible Fixed Assets
Buildings and Accompanying
Facilities
Tools, Furniture, and Fixtures
Intangible Fixed Assets
Goodwill
SoftwareInvestments and Other Assets
Guarantee Deposit
OthersAllowance for Doubtful Accounts

Liabilities
AmountItem

441,622150,377
64,10482,36938,044
61,94044,785
511,814130,479
117,968
12,511
76,07866,4589,620
305,255
295,478
33,469-23,692

AmountCurrent Liabilities
Accounts Payable - Other
Short-term Loans
Current Portion of Longterm Debt
Advance Received
OthersFixed Liabilities
Long-term Debt
Guarantee Deposits
Received
Asset Retirement
Obligation
OthersTotal Liabilities

277,965
65,47725,00080,24433,80273,4401,017,545
792,484
165,762
35,93623,363
1,295,510

Net Assets

Total Assets

Shareholders’ Equity
CapitalCapital Surplus
Capital Reserve
Other Capital Surplus
Retained Earnings
Retained Earnings
Brought Forward

49,00910,000642,160
474,160
168,000-994,233-994,233

Total Net Assets-342,073

953,436

Total Liabilities and Net
Assets(Note) The figures are rounded down to the nearest thousand yen.

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953,436

Profit and Loss Statement(From June 1, 2020 until May 31, 2021)(Unit: Thousands of yen)
Item

AmountSales

1,186,310

Cost of Sales

1,196,367

Gross Loss

10,057

Selling, General, and Administrative Expenses

344,215

Operating Loss

354,273

Non-operating Income
Income of Insurance Money

2,535

Income of Subsidy Money

149,167

Others30

151,733

9,391

9,391

Non-operating Expenses
Interest Expense
Ordinary Loss

211,931

Extraordinary Profit
Negative Goodwill

3,981

3,981

Extraordinary Loss
Loss on Fixed Assets

10,765Extraordinary Loss due to COVID-19

171,434

Cancellation Fees
Net Loss Before Tax Adjustment

2,200

Corporate, Resident, and Business Taxes

2,936

Deferred Income Tax-4,203

Net Loss

184,399392,350-1,267
391,083(Note) The figures are rounded down to the nearest thousand yen.

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Statement of Changes in Shareholders’ Equity(From June 1, 2020 to May 31, 2021)(Units: Thousands of yen)
Shareholders’ Equity
Capital Surplus

Balance at the Beginning of
the Period
Changes of Items During the
PeriodCapital Reduction

CapitalCapitalReserve

Other
CapitalSurplus

Total
CapitalSurplus10,000474,160

168,000

642,160

Net Income
Total Changes of Items During
the Period
Balance at the End of the
10,000 474,160
168,000
Period(Note) The figures are rounded down to the nearest thousand yen.

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642,160

Retained
Earnings
Retained
Earnings
Brought
Forward-603,150

Total
Shareholders’EquityTotal
Net Assets

49,00949,009---391,083-391,083-391,083-391,083-391,083-391,083-994,233-342,073-342,073

Notes to Financial Statements (Non-Consolidated)
1.

Important Accounting Policies(1) Valuation Criteria and Valuation Methods for Securities
Investment Securities …………. Cost depends on Average Moving Method(2) Depreciation Method for Fixed Assets
Tangible Fixed Assets …………… Straight-line Method
Intangible Fixed Assets ………….. Straight-line Method(3) Accounting for Consumption Tax, etc.
Accounting for consumption tax and local consumption tax is based on the tax exclusion method.

2.

Notes on Changes in Accounting Policy
Not applicable3.

Notes on Changing the Display Method
Not applicable4.

Notes on the Statement of Changes in Shareholders’ Equity

Stock type

Ordinary stock

Number of sharesat the beginningof the fiscal year
(stock)Increased numberof shares for the
fiscal year
(stock)Decreased numberof shares forthe fiscal year
(stock)Number of sharesat the end of the
fiscal year
(stock)192,616－－

192,616--------------------------------------------------------------------------------------------------------------------------------------------(Note) The amount stated and the number of shares in this business report are rounded down to the nearest unit. In
addition, the rate of increase, etc. are displayed by rounding down fractions to less than the displayed digits.

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Audit Report

After deliberation by the Audit & Supervisory board based on the audit reports prepared by Board Members
regarding the execution of duties by directors during the fifth fiscal year from June 1, 2020 to May 31st, 2021,
this audit report has been prepared and reported as follows.
1. Audit method and description of the Audit & Supervisory Board and its members
After the Audit & Supervisory Board established the audit policies and plan, each Board Member shared thenecessary investigations, discussed the results at the Board, and conducted the audit. During the audit, employees
from the Corporate Planning department are used to assist with communications with the management department,
attend meetings of the Board of Directors and other important meetings, and read important approval documents
and reports. The Company received a report on the status of execution of duties from the company, requested
explanations from time to time, and investigated the status of operations and property at the head office.
Based on the above method, we examined the business report and annexed detail statements for the relevantbusiness year. In addition, we investigated the accounting books or materials related to them, and examined thefinancial statements (balance sheet, income statement, statement of changes in shareholders' equity, and individual
notes) and their annexed detail statements for the relevant fiscal year.

2. Results of the Audit(1) Audit results from business reports and annexed detail statements①

We acknowledge that the business report and annexed detail statements correct reflect the status of thecompany in accordance with the Articles of Incorporation.

②

The Company does not allow misconduct related to the execution of duties by directors or material facts
that violate the Articles of Incorporation.

(2) Audit results from financial statements and annexed detail statements
We acknowledge that the financial statements and annexed detail statements properly represent the statusof the company’s property and profit and loss in all important respects.

August 13, 2021
adval Corp. Audit & Supervisory Board
Auditor (Full-time) Hisetaka Odera
Auditor Yoshiyasu Iwase
Auditor Toru Ueno

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