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

Securities Code: 8154
Date of sending by postal mail: June 8, 2023
Start date of measures for electronic provision: June 6, 2023
To all of our shareholders
Ryoichi Kado
Representative Director, President & COO
KAGA ELECTRONICS CO., LTD.
20 Kandamatsunagacho, Chiyoda-ku, Tokyo, Japan

Notice of the 55th Ordinary General Meeting of Shareholders
We hereby inform you of the 55th ordinary general meeting of shareholders of KAGA ELECTRONICS CO., LTD.
(the “Company”) to be held as follows.
When convening this general meeting of shareholders, the Company takes measures for providing information that
constitutes the content of reference documents for the general meeting of shareholders, etc. (matters for whichmeasures for providing information in electronic format are to be taken) in electronic format, and posts thisinformation on each of the following websites. Please access one of the websites by using the Internet address
shown below to review the information.
The Company’s website:
https://www.taxan.co.jp/jp/ir/event/event_03.html (in Japanese)
Website for posted informational materials for the general meeting of shareholders
https://d.sokai.jp/8154/teiji/ (in Japanese)
TSE website (Listed Company Search):https://www2.jpx.co.jp/tseHpFront/JJK010010Action.do?Show=Show (in Japanese)(Access the TSE website by using the Internet address shown above, enter “KAGA ELECTRONICS” in “Issue
name (company name)” or the Company’s securities code “8154” in “Code,” and click “Search.” Then, click“Basic information” and select “Documents for public inspection/PR information.” Under “Filed information
available for public inspection,” click “Click here for access” under “[Notice of General Shareholders Meeting/Informational Materials for a General Shareholders Meeting].”)If you are unable to attend the meeting in person, you may exercise your voting rights via the Internet or in writing.
Please review the Reference Documents for the General Meeting of Shareholders, and exercise your voting rights
by 5:30 p.m. on June 26, 2023 (Monday) (Japan Time).
1. Date and Time
2. Place

10:00 a.m. on June 27, 2023 (Tuesday) (Japan Time)
Akihabara Business Center 4F, AP Akihabara
1-1 Akihabara, Taito-ku, Tokyo
3. Agenda of the Meeting
Matters to be reported
1. The Business Report and Consolidated Financial Statements for the 55th fiscal year (from April 1, 2022 toMarch 31, 2023), and results of the Audit Reports by the Accounting Auditor and the Board of Auditors of
the Consolidated Financial Statements
2. Non-consolidated Financial Statements for the 55th fiscal year (from April 1, 2022 to March 31, 2023)
Matters to be resolved
Proposal No. 1:
Distribution of Surplus
Proposal No. 2:
Partial Amendments to the Articles of Incorporation
Proposal No. 3:
Election of Six (6) Directors
Proposal No. 4:
Election of Two (2) Auditors-1-4. Other Matters Concerning the Meeting (Instructions on Exercise of Voting Rights)(1) If you exercise your voting rights in writing (by post), but indicate neither approval nor disapproval for a
proposal on the Exercise Voting Rights Form, it will be treated as an indication of approval.
(2) If you exercise your voting rights more than once via the Internet, only the last vote shall be deemed
effective.
(3) If you exercise your voting rights both via the Internet and in writing (by post), regardless of the date ofarrival, the vote via the Internet shall be deemed effective.
If you attend the meeting in person, please present the enclosed Exercise Voting Rights Form at the reception on arrival at the meeting.
If revisions to the matters subject to measures for electronic provision arise, a notice of the revisions and the details of the matters
before and after the revisions will be posted on each website provided on the previous page.
For this general meeting of shareholders, we have delivered paper-based documents stating the matters subject to measures forelectronic provision to all shareholders regardless of whether they have made a request for delivery of such documents. Among thematters subject to measures for electronic provision, in accordance with the provisions of laws and regulations and Article 16 of the
Articles of Incorporation of the Company, the following matters are not provided in the paper-based documents delivered toshareholders.
(i) Principal lines of business, Operating results by business segment, Employees, Major Creditors, Other Significant Information
Concerning the Current State of the Corporate Group, Accounting Auditor, and Company Structure and Policies in the Business Report(ii) Consolidated Statement of Comprehensive Income, Consolidated Statement of Changes in Equity and Notes to the Consolidated
Financial Statements(iii) Statement of Changes in Equity and Notes to Non-consolidated Financial Statements
Accordingly, the Business Report, Consolidated Financial Statements, and Non-consolidated Financial Statements included in thepaper-based documents constitute a part of the documents audited by the Accounting Auditor in preparing the accounting audit reportand Auditors in preparing the audit report.

-2-

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

10:00 a.m. on June 27, 2023 (Tuesday) (Japan Time) (Reception desk will open at 9:00 a.m.)

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

To be received no later than 5:30 p.m. on June 26, 2023 (Monday) (Japan Time)

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

All data entry to be completed no later than 5:30 p.m. on June 26, 2023 (Monday) (Japan Time)How to Fill Out Your Exercise Voting Rights Form
Please indicate whether you approve or disapprove of each proposal.
Proposal Nos. 1 and 2・ To mark your approval
Circle “Approve (賛)”・ To mark your disapproval
Circle “Disapprove (否)”Proposal Nos. 3 and 4・ To mark your approval for all candidates Circle “Approve (賛)”・ To mark your disapproval for all candidates
Circle “Disapprove (否)”・ To mark your disapproval for certain candidates
Circle “Approve (賛)” and write thenumber of the candidate(s) you wish to disapprove
Please note that your online vote will prevail should you exercise your voting rights both in writing (by post) and via
the Internet. If you exercise your voting rights more than once via the Internet, only the last vote shall be deemed
effective.

-3-

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

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

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

-4-

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

Distribution of Surplus

The Company intends to distribute the surplus as follows.
Matters related to year-end dividends
With respect to the year-end dividend for the 55th fiscal year, taking into account the Company’s business results inthe fiscal year under review and business development, etc., going forward, the Company proposes an ordinary
dividend of 70 yen per share of common stock of the Company plus a 55th Anniversary commemorative dividendof 10 yen and an extraordinary dividend of 40 yen, for a total dividend payout of 120 yen per share. Note that the
total amount of the dividends in this case will be 3,151,600,920 yen.
As a result, combined with the interim dividend of 100 yen per share already paid, the annual dividend payout willbe 220 yen per share and the total amount of the annual dividends will be 5,777,960,720 yen.
1.
Type of dividend property
Cash2.
Allotment of dividend property to shareholders and the total amount
120 yen per share of common stock of the Company(Ordinary dividend: 70 yen)(Commemorative dividend: 10 yen)
(Extraordinary dividend: 40 yen)
Total amount: 3,151,600,920 yen
3.
Effective date of distribution of surplus
June 28, 2023

-5-

Proposal No. 2

Partial Amendments to the Articles of Incorporation

1. Reasons for the Proposal
1) Article 15 (Convenor and Chairperson) of the current Articles of Incorporation will be amended to enable
flexible and agile response regarding the administration of General Meeting of Shareholders.
2) The current Chapter 4 (Directors and Board of Directors), Article 21 (Term of Office), Article 22(Representative Directors and Directors with Titles), and Article 23 (Executive Officers) will be amended
for the purpose of speeding up management decision-making and enhancing supervisory functions of theBoard of Directors by separating management decision-making and supervisory functions and businessexecutive functions, clarifying directors’ managerial responsibilities and building a system that is able torespond swiftly to changes in management environment, and achieving flexible business execution.
3) Article 24 (Convenor and Chairperson of Board of Directors) of the current Articles of Incorporation willbe amended to enable flexible and agile response regarding the administration of the Board of Directors
meetings.
2. Details of the Amendments
The details of the amendments are as follows:

2. In the event that the President & COO is not able to attend
the Meeting due to an accident or any other unavoidable
circumstances, another director appointed in the orderprescribed by the Board of Directors shall call and presideover the General Meeting of Shareholders.

(Underlined text indicates changes)
Proposed Amendments(Convenor and Chairperson)
Article 15
1. Unless otherwise provided for in applicable laws andregulations, the director determined in advance by the
Board of Directors shall call and preside over the General
Meeting of Shareholders.
2. In the event that said director is not able to attend theMeeting due to an accident or any other unavoidable
circumstances, another director appointed in the orderprescribed by the Board of Directors shall call and presideover the General Meeting of Shareholders.

Chapter 4. Directors and Board of Directors

Chapter 4. Directors, Board of Directors, and Executive Officers(Term of Office)
Article 21
1. The term of office of directors shall continue until theconclusion of the Ordinary General Meeting of
Shareholders for the last fiscal year which ends within two(2) years from the time of their election.
2.
(Omitted)(Representative Directors and Directors with Titles)
Article 22
1.
(Omitted)
2. The Board of Directors may, by resolution, appoint one (1)President & COO, the chairperson of the board, vicechairperson of the board, vice president, senior managing
director, managing director, and a small number of otherdirectors with titles.

(Term of Office)
Article 21
1. The term of office of directors shall continue until theconclusion of the Ordinary General Meeting of
Shareholders for the last fiscal year which ends within one(1) year from the time of their election.
2.
(No change)(Representative Directors)
Article 22(No change)(Deletion)(Executive Officers)
Article 23(Executive Officers)
Article 23

Current Articles of Incorporation(Convenor and Chairperson)
Article 15
1. Unless otherwise provided for in applicable laws andregulations, the President & COO shall call and presideover the General Meeting of Shareholders.

(Omitted)(Establishment)(No change)
2. The Board of Directors may, by resolution, appoint theFounder & CEO, President & COO, senior managing
executive officers, managing executive officers, senior
executive officers, and a small number of other executive
officers with titles.

-6-

Current Articles of Incorporation(Convenor and Chairperson of Board of Directors)
Article 24
1. Unless otherwise provided for in applicable laws andregulations, the President & COO shall call and presideover the Board of Directors meetings.
2. In the event that the President & COO is not able to attend
the meeting due to an accident or any other unavoidable
circumstances, another director appointed in the orderprescribed by the Board of Directors shall call and presideover the meeting.

Proposed Amendments(Convenor and Chairperson)
Article 24
1. Unless otherwise provided for in applicable laws andregulations, the director determined in advance by the
Board of Directors shall call and preside over the Board of
Directors meetings.
2. In the event that said director is not able to attend themeeting due to an accident or any other unavoidable
circumstances, another director appointed in the orderprescribed by the Board of Directors shall call and presideover the meeting.

-7-

Proposal No. 3

Election of Six (6) Directors

The terms of office of all eleven (11) current directors will expire at the conclusion of this general meeting.
Accordingly, the Company proposes the election of six (6) Directors, a reduction by five (5) from the current
eleven (11) Directors. The objective is to strengthen the Board of Directors’ functions and business executionfunctions by clarifying the respective functions of management decision-making and supervision on one hand andbusiness execution on the other, including delegating authority to executive officers, so as to further enhance
corporate governance.
Candidates for director are as follows.

CandidateNo.

Name/Candidate attributes

1.

Isao Tsukamoto

Reelection

2.

Ryoichi Kado

Reelection

3.

Shintaro Kakei

Reelection

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

Reelection
OutsideOutside directors
Independent
Reelection
5.
Akira Tamura
OutsideOutside directors
Independent
Reelection
6.
Noritomo Hashimoto
OutsideOutside directors
Independent
Reelection: Candidate for Director to be reelected
Outside: Candidate for Outside Director
Independent: Independent officer as defined by Tokyo Stock Exchange, Inc.
4.

Susumu Miyoshi★: Chairperson○: Member-8-

Attendance atBoard ofDirectors
meetings

Committee the candidate is scheduled tojoin after the meeting
Nomination
CSR
SDGs
and
Promotion
Committee
Compensation
Committee
Committee

17/18(94.4%)○

18/18(100%)○

18/18(100%)
18/18(100%)○

17/18(94.4%)○

18/18(100%)

★

★

★

○

○

candidate
no.

1.

2.

Name
(Date of birth)

Career summary, position and responsibilities in the Company

Established Kaga Electronics Co., Ltd.
President & CEO
Apr. 2007
Founder & CEO
June 2021
Outside Director, ITbook Holdings Co., Ltd (topresent)
730,345
Apr. 2022
Representative Director, Founder & CEO (topresent)
Significant positions concurrently held
Outside Director, ITbook Holdings Co., Ltd.
Reasons for proposing the candidate for director
Isao Tsukamoto is the founder of the Company and served as President & CEO until 2007. Since then as Founder &CEO, he has used his extensive knowledge and human network, which goes beyond the industry, to give direction to
management group-wide. Based on our judgment that his wealth of knowledge and professional abilities related to
management will continue to be indispensable for the Group management and improvement of corporate value, wehave made him a candidate for director.
Mar. 1980
Joined Kaga Electronics Co., Ltd.
Apr. 1991
Division Manager of Sales Department No. 3,
Sales Headquarters
Apr. 1992
Division Manager of Amusement Products
Sales Department, Sales Headquarters
Apr. 1995
Division Manager of East Japan Sales
Department, High Tech Business Division
Ryoichi Kado
June
1995
Director(December 1, 1957)
Apr.
2002
Managing
DirectorReelection
Term of office
Apr. 2005
Senior Managing Director, General Manager of
66,45128 yearsSpecific Industry Business Headquarters
Attendance at Board ofApr. 2011
Senior Managing Director, Head of
Directors meetings
Entertainment Business Unit
18/18 (100%)
Apr. 2012
Vice President, Head of Components Business
Unit
Apr. 2014
President & COO
Apr. 2022
Representative Director, President & COO (topresent)
Significant positions concurrently held
Reasons for proposing the candidate for director
Since joining the Company, Ryoichi Kado has been involved in the major businesses of the Company and possesses
leadership based on his extensive knowledge and results. Since being elected President & COO in 2014, he has
contributed to improvement of corporate value by giving direction to Group management. Based on our judgment that
his broad-ranging experience and capabilities are indispensable to promotion of the Medium-Term Management Plan
and central to the Group’s management, we have made him a candidate for director.
Isao Tsukamoto(September 1, 1943)
Reelection
Term of office
55 years
Attendance at Board of
Directors meetings
17/18 (94.4%)

Sept. 1968

Number of theCompany’s shares
held

-9-

candidate
no.

Name
(Date of birth)

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

3.

Number of theCompany’s shares
held

Joined Kaga Electronics Co., Ltd.
Manager of Asia Project Office, Sales
Headquarters No. 2
Apr. 1997
Division Manager of Overseas Sales
Department, Sales Headquarters
May 2000
Division Manager of Overseas Business
Division, Electronics Business Headquarters
Shintaro Kakei
June 2000
Director(November 9, 1956)
Apr. 2005
Managing Director
Reelection
Term of office
Apr. 2011
Managing Director, Head of Manufacturing
33,33523 years
Business Unit
Attendance at Board ofApr. 2014
Senior Managing Director, Head of
Directors meetings
Manufacturing Business Unit
18/18 (100%)
Apr. 2015
Senior Managing Director, Head of Corporate
Planning Department
Oct. 2015
Senior Managing Director
Apr. 2022
Director and Senior Executive Officer (topresent)
Significant positions concurrently held
Reasons for proposing the candidate for director
Since joining the Company, Shintaro Kakei has been involved in the overseas and EMS businesses and possesses asolid track record and broad-ranging knowledge, having established a revenue base for those businesses. Based on our
judgment that his business development results overseas and rich experience are indispensable to improve the corporate
value, we have made him a candidate for director.

- 10 -

candidate
no.

Name
(Date of birth)

Career summary, position and responsibilities in the Company
Apr. 1963

4.

5.

Susumu Miyoshi(September 20, 1940)
Reelection
OutsideIndependent
Term of office
8 years
Attendance at Board of
Directors meetings
18/18 (100%)

Sept. 1994
June 2001
June 2002
June 2002
June 2005

June 2009

Joined Toyota Motor Co., Ltd. (currently
Toyota Motor Corporation)
Director
Executive Vice President and Representative
Director
Consultant
President & COO of Osaka Toyopet Co., Ltd.
(currently Osaka Toyota Motor Co., Ltd.)
Advisor to Toyota Motor Corporation
Chairman of Osaka Toyopet Co., Ltd. (currently
Osaka Toyota Motor Co., Ltd.)
Executive Advisor to Hitachi Maxell, Ltd.
(currently Maxell Holdings, Ltd.)

Number of theCompany’s shares
held

3,000

June 2015
Outside Director of the Company (to present)
Significant positions concurrently held
Reasons for proposing the candidate for outside director and overview of expected role
Susumu Miyoshi has served as Executive Vice President at Toyota Motor Corporation, and we believe that his richexperience and broad-ranging knowledge as a member of management at various companies, will be leveraged tosupervise and provide advice on the Company’s overall management, and will strengthen the function of our Board of
Directors, so we have made him a candidate for outside director. If he is elected, he will be involved in the election ofcandidates for directors and the determination of remuneration for directors (and other officers) of the Company,
objectively and from a neutral position as a Nomination and Compensation Committee member.
Apr. 1970
Joined the Bank of Japan
June 1978
Deputy Director of the International Finance
Bureau, Ministry of Finance (dispatched)
Jan. 1998
Director of Information Systems Department,
Bank of Japan
Akira Tamura
Apr. 1998
Director of Information System Services(July 23, 1946)
Department
Reelection
June 2001
Managing Director at Sohgo Security Services
OutsideCo., Ltd. (ALSOK)
Independent
Apr. 2008
Representative Director and Senior Executive
3,000
Term of office
Officer
8 years
Apr. 2012
Advisor to Niigata Sohgo Security Services
Attendance at Board ofCo., Ltd. (ALSOK) (to present)
Directors meetings
June 2015
Outside Director of the Company (to present)
17/18 (94.4%)
June 2019
Outside Board Director, Solekia Limited (topresent)
Significant positions concurrently held
Advisor to Niigata Sohgo Security Services Co., Ltd. (ALSOK)
Outside Board Director, Solekia Limited
Reasons for proposing the candidate for outside director and overview of expected role
Akira Tamura has served as Director and Senior Managing Executive Officer at Sohgo Security Services Co., Ltd., andwe believe that his rich experience as a member of corporate management and his deep knowledge cultivated at the
Bank of Japan and several other companies will be leveraged to supervise and provide advice on the Company’s overallmanagement, particularly in the areas of management strategy and business administration, and will strengthen thefunction of our Board of Directors, so we have made him a candidate for outside director. If he is elected, he will be
involved in the election of candidates for directors and the determination of remuneration for directors (and otherofficers) of the Company, objectively and from a neutral position as a Nomination and Compensation Committee
member.

- 11 -

candidate
no.

Name
(Date of birth)

Career summary, position and responsibilities in the Company

Number of theCompany’s shares
held

Apr. 1977
Apr. 20096.

(Notes)Joined Mitsubishi Electric Corporation
Executive Officer in charge of General Affairs,
Human Resources and Public Relations
June 2009
Director, Chairman of the Nomination
Committee, Chairman of the Compensation
Committee, Executive Officer, and in charge ofGeneral Affairs, Human Resources and Public
Noritomo Hashimoto
Relations(July 30, 1954)
Apr. 2012
Director, Chairman of the Nomination
Reelection
Committee, Chairman of the Compensation
OutsideCommittee, Senior Vice President, and in
Independent
charge of Corporate Strategic Planning and1,300
Term of office
Operations of Associated Companies
4 years
June 2012
Director, Member of the Nomination
Attendance at Board ofCommittee, Senior Vice President, and in
Directors meetings
charge of Corporate Strategic Planning and18/18 (100%)
Operations of Associated Companies
Apr. 2016
Director
July 2016
AdvisorJune 2019
Outside Director of the Company (to present)
Mar. 2021
Outside Director, Ibokin Corp. (to present)
Significant positions concurrently held
Outside Director, Ibokin Corp.
Reasons for proposing the candidate for outside director and overview of expected role
Noritomo Hashimoto has served as Director and Executive Officer at Mitsubishi Electric Corporation, and we believethat his rich experience and deep knowledge serving as the Chairman of the Nomination and Compensation Committees
as well as being in charge of departments such as General Affairs, Human Resources and Corporate Strategic Planning,
will be leveraged to supervise and provide advice on the Company’s overall management, particularly in the areas ofmanagement strategy and human resources, and will strengthen the function of our Board of Directors, so we havemade him a candidate for outside director. If he is elected, he will be involved in the election of candidates for directors
and the determination of remuneration for directors (and other officers) of the Company, objectively and from a neutral
position as a Nomination and Compensation Committee member.
1. No conflict of interest exists between any of the candidates and the Company.
2. Susumu Miyoshi, Akira Tamura, and Noritomo Hashimoto are candidates for outside directors.
3. Susumu Miyoshi, Akira Tamura, and Noritomo Hashimoto are currently outside directors of the Company, and theirtenure as outside directors will come to eight (8) years for Susumu Miyoshi and Akira Tamura and four (4) years for
Noritomo Hashimoto at the conclusion of this meeting.
4. The Company has entered into contracts with Susumu Miyoshi, Akira Tamura, and Noritomo Hashimoto based on theprovisions of the Companies Act, Article 427, paragraph (1) to limit their liability for damages under Article 423,
paragraph (1) of the said Act to within the minimum liability amount stipulated in Article 425, paragraph (1) of the said
Act. If the reelection of the three candidates is approved, the Company plans to renew the aforementioned contracts withthem.
5. The Company has entered into a directors and officers liability insurance policy with an insurance company for theofficers, etc., stipulated in Article 430-3, paragraph (1) of the Companies Act. This insurance policy will cover any
damages that may arise due to the insured officers, etc. assuming responsibility for the execution of their duties, or fromclaims received in relation to the pursuit of such responsibility. An overview, etc. of the content of the insurance
agreement is listed in “III Corporate Officers (5) Overview of Details of Directors and Officers Liability Insurance
Policy” on page 38 of the Business Report. If the election of the candidates for director is approved, all of them will be
included in the insured persons of this insurance agreement. Furthermore, in the next renewal period, the Company will
renew this insurance policy with the same contents.
6. Susumu Miyoshi, Akira Tamura, and Noritomo Hashimoto satisfy the requirements for independent officers based on theprovisions of the Tokyo Stock Exchange; so the Company has registered them as independent officers. If the reelectionof the three candidates is approved, the Company plans for their appointment as independent officers to continue.

- 12 -

Proposal No. 4

Election of Two (2) Auditors

The terms of office of auditors Kazunori Kameda and Takahiro Ishii will expire at the conclusion of this general
meeting. Therefore, the Company proposes that two (2) auditors be elected.
Furthermore, the Board of Auditors has given acknowledgment of this proposal.
A candidate for auditor is as follows.
candidateno.

Name(Date of birth)

Career summary and position in the Company
Mar. 1979
Dec. 1985
Apr. 1993

1.

Number of theCompany’s shares
held

Joined Kaga Electronics Co., Ltd.
President of Taxan (U.K.) Ltd.
Division Manager of Overseas Sales
Department, Sales Headquarters No. 2
May 2003
President of Kaga Solution Network Co., Ltd.
Apr. 2005
Executive Officer, Head of Accounting
Eiji Kawamura
Division and Head of Information Systems(August 14, 1955)
Department
New candidate
Apr. 2012
Executive Officer, Head of Administration
Term of office
Headquarters–
40,622
Attendance at Board ofJune 2012
Director, Head of Administration Headquarters
Directors meetingsand Head of Accounting Division
18/18 (100%)
Apr. 2015
Director, Head of Administration Headquarters
Attendance at Board of Auditors June 2015
Managing Director, Head of Administration
meetings
Headquarters-/- (-%)
Apr. 2022
Director, Managing Executive Officer and Headof Administration Headquarters
Apr. 2023
Director, Managing Executive Officer (topresent)
Significant positions concurrently held
Reasons for proposing the candidate for auditor
Eiji Kawamura possesses broad-ranging knowledge and insights concerning the Group’s operations, having been
involved in Sales and Administration since joining the Company and served as president of consolidated subsidiaries inJapan and overseas, and accordingly, the Company judges that he will be able to perform his duties appropriately as anauditor, and so we have made him a candidate for auditor.

- 13 -

candidate
no.

Name
(Date of birth)

Career summary and position in the Company

Number of theCompany’s shares
held

Apr. 2002
Jan. 2004

2.

(Notes)Joined Sanken Outsourcing K.K.
Joined Sugata Labor Management Office(currently Sakura Management Office)Nov. 2005
Registered as a labor and social security
attorney
Kyoko Oyanagi
Apr. 2006
Executive Director, Tokyo Labor Improvement(September 11, 1978)
Promotion Association (Labor insurance affairs
New candidate
association certified by the Minister of Health,OutsideLabour and Welfare)
Independent
Apr. 2016
Representative of Social Insurance and Labor
Term of office
Advisors Corporation, Sakura Management––
Office (to present)
Attendance at Board ofApr. 2020
Chairman, Tokyo Labor Improvement
Directors meetings
Promotion Association (Labor insurance affairs-/- (-%)
association certified by the Minister of Health,Attendance at Board of Auditors
Labour and Welfare) (to present)
meetings
Significant
positionsconcurrently held-/- (-%)
Representative of Social Insurance and Labor Advisors
Corporation, Sakura Management Office
Chairman, Tokyo Labor Improvement Promotion Association(Labor insurance affairs association certified by the Minister of
Health, Labour and Welfare)
Reasons for proposing the candidate for outside auditor
Kyoko Oyanagi possesses extensive knowledge and experience in corporate management and as a labor and social
security attorney, and to ensure the soundness of the Company in reforming the work style, investing in human capital,and promoting women’s activities, the Company has made her a candidate for outside auditor in the expectation that she
will conduct accurate audits from a professional and multifaceted perspective.
1. No conflict of interest exists between any of the candidates and the Company.
2. Kyoko Oyanagi is a candidate for an outside auditor.
3. If the election of Kyoko Oyanagi is approved, the Company will enter into a contract with her based on the provisions of
the Companies Act, Article 427, paragraph (1) to limit her liability for damages under Article 423, paragraph (1) of thesaid Act to within the minimum liability amount stipulated in Article 425, paragraph (1) of the said Act.
4. The Company has entered into a directors and officers liability insurance policy with an insurance company for theofficers, etc., stipulated in Article 430-3, paragraph (1) of the Companies Act. This insurance policy will cover any
damages that may arise due to the insured officers, etc. assuming responsibility for the execution of their duties, or fromclaims received in relation to the pursuit of such responsibility. An overview, etc. of the content of the insurance policy
is listed in “III Corporate Officers (5) Overview of Details of Directors and Officers Liability Insurance Policy” on page
38 of the Business Report. If the election of the candidates for auditor is approved, all of them will be included in theinsured persons of this insurance agreement. Furthermore, in the next renewal period, the Company will renew thisinsurance policy with the same contents.
5. Kyoko Oyanagi is the Representative of Social Insurance and Labor Advisors Corporation, Sakura Management Office,and although the Company concluded an advisory contract with the said office, the transaction amount is insignificant
and she satisfies the requirements for independence as defined by the Tokyo Stock Exchange; the Company plans toregister her as an independent officer based on the provisions of the Tokyo Stock Exchange.

- 14 -

<Reference> Table of Officer Structure After Approval of Proposal Nos. 3 and 4 and Area of Expertise of Each Director and Auditor
Area of Expertise
Corporate
Management

Name

〇
〇

Director

Isao Tsukamoto
Ryoichi Kado
Shintaro Kakei

〇
〇
〇

〇
〇
〇

Law and
Risk
Management

〇

〇

〇

Akira Tamura

OutsideIndependent

〇

〇

〇

Noritomo Hashimoto

OutsideIndependent〇

OutsideIndependent

Yoichi Sato

OutsideIndependent

Kyoko Oyanagi

OutsideIndependent〇

Technology and
Manufacture

IT andDigital

〇

〇

〇
〇

〇

〇

〇

〇

〇

〇

〇

Personneland
Human
Resources
Development〇

Susumu Miyoshi

Susumu Kitsunai

FinanceandAccounting〇

OutsideIndependent

Eiji Kawamura
AuditorGlobalSales andMarketing

〇

〇

〇

〇

〇

〇
〇

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

- 15 -

[Reference] Basic Policies and Structure of Corporate Governance (after the 55th Ordinary General Meeting of
Shareholders)
The Company recognizes that the fulfillment of corporate governance is an important management issue and has
established a corporate governance system with the basic policy and objective to ensure sound, efficient andtransparent management and to enhance corporate value while promoting thorough compliance with corporate
ethics and laws and regulations and strengthening internal control systems. In light of the importance of corporate
governance, in addition to the CSR Promotion Committee, the Company has established the SDGs Committee andthe Nomination and Compensation Committee to strengthen its structure.
We are a company with a Board of Directors and a Board of Auditors and have adopted a corporate governancesystem based on the collaboration of the Board of Directors, the Nomination and Compensation Committee, theauditors and the Board of Auditors, and the accounting auditors. In addition to regular monthly meetings, the Boardof Directors holds extraordinary meetings as needed to make decisions on issues stipulated by law and importantmanagement issues as well as to monitor the execution of duties of each director. The number of directors is six (6),including three (3) outside directors, and the Company has established a system that allows for sufficient discussion
and accurate and prompt decision-making. In addition, on April 1, 2005, the Company introduced an employmenttype executive officer system. However, on April 1, 2022, the Company introduced an engagement-type executive
officer system in order to further improve corporate governance. In doing so, the Company has built a systemcapable of providing swift response to external environmental change while strengthening the Board of Directors’
function and the business execution function through promoting separation of the decision making and supervisory
functions related to management from the business execution function and clarifying the respective roles. The
Board of Auditors consists of four (4) members, including three (3) outside auditors, and the auditors attend Boardof Directors meetings at all times and actively participate in important internal meetings to perform their duties.
The structure of corporate governance by the Company is described below.

Nomination and Compensation Committee
The Company has established the Nomination and Compensation Committee to ensure transparency and objectivity
in the evaluation and decision-making processes related to the nomination and remuneration of directors, auditorsand engagement-type executive officers, thereby strengthening the supervisory function of the Board of Directors
and enhancing the corporate governance system.

- 16 -

Audit Office
The Company has established the Audit Office, which conducts internal audits in cooperation with the auditors. In
addition to prior discussions between the auditors and the Audit Office regarding audit plans, the Audit Officereports audit results to the auditors on a regular basis, and the auditors collaborate with the Audit Office, requesting
reports from the Audit Office when necessary.
SDGs Committee
The Company has established the SDGs Committee, chaired by the Representative Director, President & COO, toenhance our efforts to address CSR and ESG issues and to promote sustainability management across the entire
group. In addition, the Company has established the Environment Working Group, Society Working Group andGovernance Working Group as subordinate organizations and is actively developing activities in each of theseareas.
CSR Promotion Committee
The Company has established the CSR Promotion Committee, chaired by the Representative Director, President &COO, to enhance corporate value and promote corporate social responsibility. In addition, the Company has
established the Compliance Committee, Risk Management Committee, Information Disclosure Committee andPersonal Information Management Committee as subordinate organizations and is actively developing activities ineach of these areas.

Outside Officers
The Company has elected three (3) outside directors and three (3) outside auditors. With respect to the election ofoutside directors, the Company refers to the independence standards of the Tokyo Stock Exchange and requires
candidates to have no special interest in the Company and to possess a wide range of experience and insight incorporate management. In addition, the Company requires auditors to have a high level of expertise as well as
independence from those who execute the business.
The Company has established the Board of Directors Administrative Office and distributed materials on issues tobe discussed by the Board of Directors to all officers, including outside officers, prior to the Board of Directors
meetings. The Company provides outside officers with sufficient advance information, including supplementary
explanations as necessary, to encourage lively discussions at Board of Directors meetings. The Company sets theschedule of regular meetings of the Board of Directors for the following fiscal year by the end of each fiscal year
and informs all officers, including outside officers, of the schedule in an effort to improve the attendance rate.

- 17 -

[The Company’s Rationale Regarding Independence for Outside Officers]
・ As the Company elects outside officers in accordance with “Qualifications Required of Outside Officers”(Notes), which is based on requirements in the Companies Act in addition to the criteria for determining
independence as set forth by the Tokyo Stock Exchange, the Company has judged that the independence ofoutside officers is sufficiently maintained, and submitted notification to the Tokyo Stock Exchange
concerning the designation of all outside officers as independent officers.
・ The Board of Directors resolved that all outside officers will become independent officers as it was
confirmed that there are no issues with “Qualifications Required of Outside Officers” as a standard for
determining the independence of outside officers.
(Notes)
Qualifications Required of Outside Officers
・ The following qualification requirements have been established between new candidates for outside officer
and the companies and organizations to which they belong and the Company.
1. Has not been a representative officer or employee of the accounting auditor in the five years prior to being
nominated as a candidate for director or auditor
2. Is not a major shareholder of the Group (person who holds shares with 10% or more of total voting rights)
and, where a major shareholder of the Group is a corporation, not a director, auditor, officer, executive officer
or employee of such major shareholder
3. Is not a director, auditor, officer, executive officer or employee of a major business partner (*) of the Group(*) A major business partner is a company that has transactions with the Group where the amount paid or
received amounts to 3% or more of the consolidated net sales of the Group or the business partner
4. Has not received remuneration of 10 million yen or more from the Group other than remuneration as adirector or auditor
5. Does not have a familial relationship (within the second degree of kinship) with the any of the Group’s
directors, auditors or executive officers
6. Is not involved in the mutual dispatch of directors, auditors, officers or executive officers to and from theGroup
7. Has any other interest in the Group, and independence is not called into question when carrying out duties as
outside director or outside auditor- 18 -

(Attached documents)

Business Report(From April 1, 2022 to March 31, 2023)
I. Business Progress and Achievement of the Corporate Group(1) Overview of Business(i)

Business activities and results
During the fiscal year under review, the Japanese and overseas economic conditions surrounding theGroup showed a gradual recovery. The relaxation of COVID-19 restrictions on movement normalized
economic activity, and semiconductor shortages and supply chain disruptions eased. Meanwhile, amid
rising food and energy prices due to the prolonged Russia–Ukraine conflict, conditions remain uncertain
partly owing to sharp changes in exchange rates and financial system instability resulting from higher
policy rates as anti-inflation measures.
In the U.S. and Europe, personal spending generally remained strong, but high inflation and monetary
tightening have led to financial institution failures and other growing concerns about the future. In China,
although the country has been affected by its zero-COVID policy, there were signs of a pickup in personal
spending following the lifting of the policy. In Japan, despite concerns about the impact of risingcommodity prices due to the weak yen and price hikes in energy resources and grains, the economy
recovered gradually as economic activities began to return to normal.
In the electronics industry to which the Group belongs, supply shortages and extended lead times, which
had continued to affect some semiconductors and electronic components, were generally resolved, anddemand remains robust in a wide range of industries.
Under the management environment, in the electronic components business, which is the Group’s corebusiness, primarily in automotive and medical equipment applications, sales in both the component sales
business and the EMS(*) business grew significantly.
In the information equipment business, the Company saw growth in sales of high-end PC products andsecurity software, as well as in the LED installation business.
In the software business, orders for smartphone game development and computer graphics production
recovered.
In other businesses, the recycling business for PC products and other products remained solid.
As a result, sales increased in all business segments, and the Group’s net sales in the fiscal year underreview totaled 608,064 million yen, up 22.6% year on year.
Operating income increased by 54.2% year on year to 32,249 million yen due to a significant increase ingross profit resulting from higher net sales and improved gross profit margin. Ordinary income increasedby 52.6% year on year to 32,739 million yen and profit attributable to owners of parent increased by
49.8% to 23,070 million yen. The Company achieved record highs in net sales for the second consecutive
year, operating income and ordinary income for the fourth consecutive year, and profit attributable toowners of parent for the third consecutive year.
(Note)

Electronics Manufacturing Service: Provision of product development and manufacturing services on an
outsourcing basis.

- 19 -

(ii) Status of assets and profit/loss in the last three fiscal years preceding the fiscal year under review
Fiscal year ended
March 2020

Fiscal year ended
March 2021

Fiscal year ended
March 2022

Fiscal year ended
March 2023

Net sales (million yen)443,615422,365

495,827

608,064

Operating income (million yen)

10,014

11,467

20,91532,249Ordinary income (million yen)

10,137

11,241

21,45632,739Profit attributable to owners ofparent (million yen)

5,852

11,39915,401

23,070

7.6

13.5

15.7

19.6

Total assets (million yen)

207,638

237,004

272,139

286,217

Net assets (million yen)

86,25095,062

105,800

129,737

Earnings per share (yen)213.21415.07576.46878.65

Net assets per share (yen)2,850.99

3,311.24

4,026.22

4,935.36

37.7

38.4

38.8

45.3

Item

ROE (%)

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

Electronic Components
Description of business

Development, manufacture and sale of semiconductors, general electronic components
and other products, the electronics manufacturing service (EMS), and other activities
In this business, the component sales business attracted a high level of sales in a broad range of industries, in partdue to the improved supply/demand conditions for semiconductors and electronic components from the second halfof the fiscal year, which remained tight. Some products for automotive-related applications are facing supply
shortages, but the Company mobilized its abilities and secured sales volume by using its strength in procurement
capabilities as an independent trading company as well as proposing alternative products.
In the EMS business, sales in the automotive sector grew significantly and sales to key customers in applications
related to medical and office equipment remained strong. The yen has been weak since the start of the fiscal year,
and this pushed up revenue on a yen basis.
As a result, net sales increased 24.3% year on year to 539,342 million yen and segment income increased 56.4%
year on year to 28,314 million yen.
Information Equipment
Description of business

Sales of PCs, PC peripherals, home electric appliances, photograph and imaging
products, original brand products, and other products
In this business, sales of PCs for corporations and educational institutions were sluggish on a unit basis due to theprolonged replacement cycle but performed well on a value basis thanks to sales of high-end products. Sales of PC
peripheral products such as security software also remained solid. In the LED installation business, the installationof large-scale nationwide projects, which had been delayed due to material shortages, made steady progress andcontributed significantly to operating revenue.
As a result, net sales increased 10.3% year on year to 43,680 million yen and segment income increased 17.4%
year on year to 2,449 million yen.
SoftwareDescription of business

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

In this business, orders for large-scale and new projects in smartphone games development and computer graphics
production recovered, and the profitability of the business improved as a result of progress in cost reductions.
- 20 -

As a result, net sales increased 8.3% year on year to 2,998 million yen and segment income was 286 million yen(segment loss was 26 million yen in the same period of the previous year).
OthersDescription of business

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

In this business, the PC and PC peripheral recycling business was strong. In addition, sales of game equipment for
the amusement industry in Japan and overseas as well as golf products were robust, in part due to the relaxation of
restrictions on movement during the pandemic.
As a result, net sales increased 12.5% year on year to 22,044 million yen and segment income increased 76.0%
year on year to 1,101 million yen.
(iii) Capital investments
Capital investment made in the fiscal year under review was 3,691 million yen (based on acquisition costof property, plant and equipment), and this was mainly due to expansion of facilities at overseas
manufacturing bases.
(iv) Financing activities
In the fiscal year under review, unsecured bonds totaling 10 billion yen were issued to diversify funding
sources. In addition, the Company entered into a loan commitment line agreement with financial
institutions totaling 15 billion yen. Furthermore, there was no balance of borrowings executed under thisagreement as of the end of the fiscal year under review.
(v) Status of transfers of business, absorption-type company split or incorporation-type company split
Not applicable(vi) Status of acquisition of business of other companies
Not applicable(vii) Status of assumption of rights and duties relating to the business of other companies through absorptiontype merger or company split
Not applicable(viii) Status of acquisition or disposal of shares, other equity interests, or share acquisition rights and the like ofother companies


Status of acquisition of shares
Date

June 30, 2022

AcquireeAcquirer

KAGA EMS TOWADA KAGA ELECTRONICS
CO., LTD.
CO., LTD.

- 21 -

Percentage

Status100.0%

Wholly owned subsidiary(2) Significant Parent Companies and Subsidiaries(i)

Parent companies
Not applicable(ii) Significant subsidiaries
Directly owned subsidiaries

Name of Company

Percentage
of votingrights heldby theCompany

CapitalPrincipal lines of business

KAGA TECH CO., LTD.

60,000 thousandyen

100.0%

Sale of electronic components, electronicequipment, etc.

KAGA DEVICES CO., LTD

395,200 thousandyen

100.0%

Sale of electronic components, electronicequipment, etc.

Kaga Solution Network Co., Ltd.

310,000 thousandyen

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

AD DEVICE CO., LTD.

301,200 thousand
yen

96.7%

Sale of electronic components, electronicequipment, etc.

KAGA MICRO SOLUTION CO.,LTD.

300,050 thousandyen

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

Digital Media Lab., Inc.

106,000 thousandyen

100.0%

Planning, development, and sale of computer
graphics

KAGA SPORTS CO., LTD.

50,000 thousandyen

100.0%

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

KAGA AMUSEMENT CO., LTD.

50,000 thousandyen

100.0%

Sale of electronic components, electronicequipment, etc.

KAGA TECHNO SERVICE CO.,LTD.

42,000 thousandyen

100.0%

Electrical and telecommunications
equipment business, and interior
construction business

4,877,683 thousandyen

100.0%

Sale of electronic components, electronicequipment, etc.

KAGA EMS TOWADA CO., LTD.

30,000 thousandyen

100.0%

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

EXCEL CO., LTD.

400,000 thousandyen

100.0%

Sale of electronic components, electronicequipment, etc.

Kyokuto Electric Co., Ltd.

99,000 thousandyen

100.0%

Manufacture and sale of electronicequipment, electric equipment, etc.

KAGA AEROSYSTEMS CO., LTD.

99,000 thousandyen

100.0%

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

Kaga (H.K.) Electronics Limited

2,580 thousand
U.S. dollars

100.0%

Sale of electronic components, electronicequipment, etc.

943 thousand U.S.
dollars

100.0%

Sale of electronic components, electronicequipment, etc.

KAGA (TAIWAN) ELECTRONICS
CO., LTD.

50,000 thousand
TW dollars

100.0%

Sale of electronic components, electronicequipment, etc.

KAGA (SHANGHAI)
ELECTRONICS CO., LTD.

15,017 thousand
RMB

100.0%

Manufacture and sale of electronicequipment, electronic components, etc.

KAGA ELECTRONICS(THAILAND) COMPANY
LIMITED

102,000 thousand
Thai baht

100.0%

Manufacture and sale of electronicequipment, electronic components, etc.

600 thousand
British pounds

100.0%

Sale of electronic components, electronicequipment, etc.

12,000 thousand
Czech koruna

100.0%

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

KAGA FEI Co., Ltd.

KAGA (SINGAPORE)
ELECTRONICS PTE LTD

KAGA (EUROPE) ELECTRONICSLTD.
KD TEC s.r.o.

- 22 -Name of Company

Percentage
of votingrights heldby theCompany

CapitalPrincipal lines of business

TAXAN MEXICO S.A. DE C.V.

477,796 thousand
Mexican pesos

100.0%

Manufacture and sale of electronicequipment, electronic components, etc.

KD TEC TURKEY ELECTRONIKSANAYI VE TICARET LIMITEDSIRKETI

48,847 thousand
Turkish lira100.0%

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

KAGA ELECTRONICS INDIA
PRIVATE LIMITED

185,000 thousand
Indian rupees

100.0%

Manufacture and sale of electronicequipment, electronic components, etc.

KAGA COMPONENTS(MALAYSIA)SDN.BHD.

7,000 thousand
Malaysian ringgit

100.0%

Manufacture and sale of electric equipment,
etc.

KAGA ELECTRONICS(VIETNAM) CO., LTD.

253,632 million
Vietnamese dongs

100.0%

Manufacture and sale of electronicequipment, electronic components, etc.

(Notes) 1. As of March 31, 2023, the Group has 57 subsidiaries subject to consolidation (20 domestic and 37 overseas); of
these, 28 are directly owned subsidiaries and 29 are indirectly owned subsidiaries.
2. KAGA FEI America, Inc. and KAGA ELECTRONICS (USA) INC. merged, with KAGA FEI America, Inc. as thesurviving company.
3. The Company acquired 5% of the shares of KAGA EMS TOWADA CO., LTD. on June 30, 2022, making it a wholly
owned subsidiary.
4. In addition to the above, 2 investment cooperatives are considered directly owned subsidiaries.

- 23 -

(3) Principal Business Locations (as of March 31, 2023)
Domestic Networks
Aomori
Miyagi●: Electronic Components ■: Information Equipment● KAGA EMS TOWADA CO., LTD., Headquarters/The Second Plant● KAGA ELECTRONICS CO., LTD., Sendai Business Office■ KAGA TECHNO SERVICE CO., LTD., Sendai Office

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

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

Kanagawa● KAGA ELECTRONICS CO., LTD., Shin-Yokohama Business Office● KAGA FEI Co., Ltd., Headquarters● NV DEVICES Co., Ltd., Head Office

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

Ishikawa● KAGA ELECTRONICS CO., LTD., Hokuriku Business Office● KAGA FEI Co., Ltd., Kanazawa Sales Office● AD DEVICE CO., LTD., Hokuriku Sales Office

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

Aichi● KAGA ELECTRONICS CO., LTD., Nagoya Business Office● KAGA FEI Co., Ltd., Nagoya Office/Mikawa Office● AD DEVICE CO., LTD., Chubu Sales Division● EXCEL CO., LTD., Nagoya Sales Office- 24 -: Software▲: Others

Osaka● KAGA ELECTRONICS CO., LTD., Kansai Business Office● KAGA FEI Co., Ltd., Osaka Office● KAGA DEVICES CO., LTD., Osaka Office■ Kaga Solution Network Co., Ltd., Osaka Office● AD DEVICE CO., LTD., Osaka Sales Division
Digital Media Lab., Inc., Osaka Office▲ KAGA SPORTS CO., LTD., Retail Sales Division
ACCESS GAMES INC., Development Division■ KAGA TECHNO SERVICE CO., LTD., Kansai Sales Office● EXCEL CO., LTD., Osaka Sales Office● Kyokuto Electric Co., Ltd., Head Office

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

Overseas Networks●: Electronic Components ■: Information Equipment

Europe: Software● KD TEC s.r.o.
● KD TEC TURKEY ELEKTRONIK SANAYI VE TICARET LIMITED SIRKETI● KAGA FEI EUROPE GmbHASEAN/Asia● KAGA ELECTRONICS (THAILAND) COMPANY LIMITED● AD DEVICE (Thailand) CO., Ltd.
● EXCEL ELECTRONICS TRADING (THAILAND) CO., LTD.
● KAGA COMPONENTS (MALAYSIA) SDN.BHD.
▲ KAGA AMUSEMENT MALAYSIA SDN.BHD.
● PT. KAGA ELECTRONICS INDONESIA● KAGA ELECTRONICS (VIETNAM) CO., LTD.
● KAGA ELECTRONICS INDIA PRIVATE LIMITED● KAGA DEVICES INDIA PRIVATE LIMITED● KAGA (SINGAPORE) ELECTRONICS PTE LTD● KAGA FEI KOREA Ltd.

Americas● KAGA FEI AMERICA, Inc.
● KAGA FEI AMERICA, Inc. Mid-West Office● TAXAN MEXICO S.A. DE C.V.

- 25 -▲: Others

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

- 26 -

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

(ii) Management targets
After the start of the plan, in the fiscal year ended March 2023, the first year of the plan, the Company achieved
all KPI targets for net sales, operating income, and ROE two years ahead of schedule for the final year of theplan, excluding new M&A targets, as a result of demonstrating the Group’s procurement advantages to thefullest extent amid the continuing global shortage of semiconductors and electronic components.
Looking at the future prospects, the Company is expecting a scenario in which the economy will be on arecovery track and return to a sound growth phase from the fiscal year ending March 2025, while factoring in
the impact of recession risk and temporary inventory adjustments by customers, and other effects in the fiscal
year ending March 2024.

- 27 -Given the circumstances in which rapid changes in the electronics industry to which the Group belongs, andcurrent fluctuations in business performance affected by these changes, which were not anticipated when theplan was formulated, the Company has updated the management targets for the final year of the plan.
The management targets to be achieved by the fiscal year ending March 2025, which will be the final year of
the medium-term management plan, are as follows.
1) Net sales: 750 billion yen
In addition to 600 billion yen in organic growth, the Company will aim to generate 150 billion yen throughmeasures such as new mergers and acquisitions.
2) Operating income: 30 billion yen or higher
The Company expects the economy to be on a recovery track and return to a sound growth phase from thefiscal year ending March 2025, while factoring in the impact of recession risk and temporary inventory
adjustments by customers, and other effects in the fiscal year ending March 2024.
3) ROE: 10% or higher
Keeping shareholders equity costs (approximately 7-8%) in mind, the Company will aim to maintain a stablelevel of 10% or higher.

2. Basic policy for shareholders’ return
The Company views the return of profits to shareholders as one of its most important management policies, andour basic policy is to steadily and continuously increase dividends per share, with a target consolidated
dividend payout ratio of 25-35%, while comprehensively taking into account promotion of investments that
contribute to future growth, maintenance of a sound financial base over the medium to long term, and progressin consolidated business performance.
3. Medium- to Long-Term Sustainability Management Plan
Aiming for universal social contribution as a “company that benefits society”
Formulation of Medium-Term Sustainability Management Plan
The Company formulated its Medium- to Long-Term Sustainability Management Plan in November 2021
together with its Medium-Term Management Plan 2024. Based on its corporate philosophy of “Everything we
do is for our customers,” the Company promotes sustainability management with the aim of “achieving asustainable society” and “sustainable Group growth.” In doing so, we respect the dialogue with all of our
stakeholders, including customers, business partners, shareholders and investors, employees, and local
communities, and we aim to play an active role in achieving a sustainable society while improving ourcorporate value.
(i)Sustainability Policya. We will tackle environmental issues through our business activities
Through our business activities, we will take action to cut CO2 emissions, reduce waste, and promotereuse. At the same time, by providing environmentally considerate products and services, we willcontribute to bringing about a society that values the global environment.
b. We will respect human rights and develop human resources
We will respect the human rights of all stakeholders, regardless of gender, age, nationality, social status,
disabilities, or other personal attributes. We will develop work environments in which diverse employees
can work in safety and health, both physically and mentally, and will develop personnel systems andeducation and training systems that allow these employees to maximize their individual abilities. We willfurther work to develop human resources who will take on the challenge of innovation.
c. We will work to build mutual trust with society
We will work to be a company that earns the trust of society by observing laws and regulations, bystrengthening our governance structure, and by sincerely engaging in fair competition, the provision ofhigh-quality products and services, timely and appropriate information disclosure, and other corporate
activities.

- 28 -

(ii) Sustainability promotion structure
The Kaga Electronics Group views the promotion of sustainability as a key management issue. We haveestablished an SDGs Committee chaired by the President and COO of Kaga Electronics Co., Ltd., and, under
this committee, have created working groups for “Environment,” “Society,” and “Governance.” In this way, we
have established a management structure that promotes sustainability across the Group.
Under commitment by top management and collaboration among business divisions, we act through theseworking groups to formulate policies, measures, and goals that address ESG issues, to manage progress, and tootherwise promote sustainability within the Group as a whole.
Note: See the diagram of the Company’s governance system listed on page 16 of the convocation notice.

- 29 -

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

E

Create a clean
global environment

Related
SDGs

Changes in the socio-economic
environment




S

Create an inclusivecompany as well as
an affluent societyG

Create asustainable
management base

B

Realize sustainablebusiness growth










Growing seriousness of global
warming and other environmental
problems
Urgent call for carbon neutrality

Our initiatives
Changes in social structure as wemove toward the popularization of the
new normal
Human resource shortages

attributable to a low birthrate and an
aging population
Public calls for more robust corporategovernance
Growing need for business resilienceagainst changes in the operating
environmentProgress in digital transformation
Coming of a “super-smart” society
due to the popularization of ICT, such 
as IoT and AI
Intensification of global competition - 30 -

Provide products and services
designed to help resolve
environmental and energy issues
Continue initiatives to reduce theenvironmental burden
Promote workforce diversity andinnovative work styles to better adapt
to the new normal
Develope human resources bypassing down and updating
KAGAism
Further strengthening governance andcompliance
Thoroughly practice a profit-focusedmanagement approach
Provide products and services that
contribute to the transition to adigital-driven society
Create new businesses aimed at
helping resolve social issues
Further promotion of global
expansion

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

Achievement ofshift to 100%
renewable energy
E

Shift to electricity
forcompany-owned
vehiclesDiversity andhuman resource
management
S

G

Issues to address/examine Adoption of renewable energy atdomestic sales offices
 Adoption of renewable energy atdomestic manufacturing sites

 Adoption of renewable energy atoverseas manufacturing sites

 Switch to electric vehicles fordomestic sales vehicles (EV, HV,
PHV, FCV)

Note: Figures in parentheses () indicate current values.
Medium-term targets
Long-term targets
2024: 40% (1%)

2030: 100%

By 2024: Information
gathering/analysis anddetermination of policy In-house power
generation/external
procurement
Solar panel/biomass
power
generation/renewableenergy businesses

2030: 50%
2050: 100%

2024: 85% (78.5%)

2030: 30%
2050: 100%

2030: 100%

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

November 2021: Performed

Setting of targets in linewith next Corporate
Governance Code revision

April 2022: Enactment

By March 2023:
Determination of policy(v) Changes in Medium- to Long-Term Sustainability Management Plan
Main activities in fiscal 2022 and status of progressCompleted introduction of electric power from renewable sources for 1.2% of total electricity
usage. Continuing discussion with a plan of achieving 40% in fiscal 2024.
At locations in Aomori, Fukushima, and Tottori, calculated electricity generation amount with aview to installing solar panels. Started implementation plan.
Started introducing electric power from renewable sources through solar panels at locations in
China (Hubei) and Vietnam. Expecting to cover 30 to 50% of annual electricity usage at eachlocation
Increased conversion rate to electric vehicles by 1.2 % from the previous fiscal year to 82.0% (asof March 31, 2023).

- 31 -












We increased the new female graduates in career track positions by 12.3 points from the previous
year to 18.1% by implementing recruitment activities in accordance with our “Action Plan.”
We held discussions within the Group to increase the ratio of female managers, and each company
determined its own target number of female managers. We saw an increase of 3.2 points from theprevious year to 16.5% as of April 2023.
We employ people with disabilities at 100% of the legally mandated employment rate (as ofMarch 31, 2023).
We made telework a permanent system and revised regulations and rules.
We obtained certification in March 2023.
From June 2023, there will be six (6) directors (including three (3) outside directors), and the
majority will be outside directors. We established a Nomination and Compensation Committee.
We decided to nominate a woman as a candidate for new outside auditor. We continue activities toelect female directors.
We implemented this in June 2022.
We implemented this in April 2022.
We will reduce the term of office of directors from the current two (2) years to one (1) year while
continuing as a company with a Board of Auditors. (Scheduled for June 2023)- 32 -

II. Current Status of the Company(1) Status of Shares (as of March 31, 2023)(i)

Total number of authorized shares

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

28,702,118(iii) Number of shareholders

9,657(iv) Major shareholders (top 10 shareholders)Number of shares held(Thousands of shares)

Shareholding ratio (%)

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

2,819

10.73

OKOZE CO., LTD

1,840

7.01

Custody Bank of Japan, Ltd. (Trust Account)

1,815

6.91

KAGA ELECTRONICS Employee Shareowners Association

1,503

5.73

MUFG Bank, Ltd.

1,137

4.33

Mizuho Bank, Ltd.

950

3.62

Isao Tsukamoto

730

2.78

THE BANK OF NEW YORK MELLON 140044

516

1.97

Mitsubishi Electric Corporation

500

1.90

Nippon Life Insurance Company

459

1.75

Name of shareholder(Notes) 1. The Company holds 2,438,777 shares of treasury stock, but the Company is not included in the major shareholders
listed above.
2. The shareholding ratio is calculated after deducting treasury shares.

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

Number of shares
Directors

13,944

6

Outside directors––

Auditor––(Note) The Company has introduced a restricted share-based remuneration plan based on a resolution of the 50th Ordinary
General Meeting of Shareholders held on June 28, 2018. In light of this, the meeting of the Board of Directors held on
June 29, 2022 resolved to dispose of treasury shares as restricted share remuneration, and disposal of 13,944 treasury
shares to 6 directors (not including Founder & CEO and outside directors) was carried out on July 28 of that year. Details
regarding share-based remuneration for directors can be found in “III Corporate Officers (2) Overview of Details ofRemuneration to Directors and Auditors for the Fiscal Year Under Review” on pages 34 to 37 of the Business Report.

(2) Share Acquisition Rights
Not applicable- 33 -

III. Corporate Officers(1) Directors and Auditors (as of March 31, 2023)
Position in the Company

Name

Responsibilities and significant positions concurrently held

Representative Director,
Founder & CEO

Isao Tsukamoto

Outside Director, ITbook Holdings Co., Ltd.

Representative Director,
President & COO

Ryoichi Kado

Director, Senior Managing
Executive Officer

Shinsuke Takahashi

Director, Senior Managing
Executive Officer

Shintaro Kakei

Director, Managing Executive
Officer

Eiji Kawamura

Head of Administration Headquarters

Director, Senior Executive
OfficerMotonori Toshinari

Manager of EMS Business Division

Director, Senior Executive
Officer

Mitsuhiro Nohara

Director

Susumu Miyoshi

Director

Akira Tamura

Advisor to Niigata Sohgo Security Services Co., Ltd. (ALSOK)
Outside Board Director, Solekia Limited

Director

Noritomo Hashimoto

Outside Director, Ibokin Corp.

Director

Hirokazu Nishiyama

Inside Auditor

Kazunori Kameda

Inside Auditor

Takahiro Ishii

AuditorSusumu Kitsunai

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

AuditorYoichi Sato

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

(Notes) 1. Directors Susumu Miyoshi, Akira Tamura, Noritomo Hashimoto, and Hirokazu Nishiyama are outside directors.
2. Auditors Susumu Kitsunai and Yoichi Sato are outside auditors.
3. Inside auditors Kazunori Kameda and Takahiro Ishii have abundant industry experience within financial institutions andsubstantial knowledge of finance and accounting.
4. Auditor Susumu Kitsunai is a credentialed certified public accountant and has substantial knowledge of finance andaccounting.
5. Auditor Yoichi Sato is a credentialed attorney and has substantial knowledge of corporate legal affairs.
6. The Company has submitted notification to the Tokyo Stock Exchange that Directors Susumu Miyoshi, Akira Tamura,
Noritomo Hashimoto and Hirokazu Nishiyama, and Auditors Susumu Kitsunai and Yoichi Sato have been designated as
independent officers.
7. The Company has entered into a directors and officers liability insurance policy as provided for in Article 430-3,
paragraph (1) of the Companies Act with an insurance company. An overview, etc. of the content of the insurance policy
is listed in “III Corporate Officers (5) Overview of Details of Directors and Officers Liability Insurance Policy” on page
38 of the Business Report.

(2) Overview of Details of Remuneration to Directors and Auditors for the Fiscal Year Under Review
Remuneration for directors and auditors
a. Policy for determining the details of remuneration for officers
At its Board of Directors meeting held on May 27, 2021, the Company has resolved its policy for
determining details of remuneration for individual directors.
The Board of Directors has determined with regards to the amount of fixed remuneration for eachdirector for the fiscal year under review that the method for decision of the details of remuneration and- 34 -

the details of remuneration decided on are consistent with the policy for determination approved by the
Board of Directors and has judged that it is in keeping with that policy for determination.
The policy for determining the details of remuneration for individual directors is as follows: Basic policy
The Company’s basic policy is to set the remuneration of directors at an appropriate level based on theirrespective responsibilities in determining the remuneration of individual directors as a remuneration
system that is linked to shareholders’ profits so that it can fully function as an incentive to secure andretain excellent human resources who will implement the realization of the Company’s management
philosophy and continuously improve corporate value. Specifically, remuneration for executive directors
consists of fixed remuneration, which is paid at a fixed amount, performance-linked remuneration andshare-based remuneration, while remuneration for outside directors, who are responsible for supervisory
functions, consists of fixed remuneration only in consideration of their responsibilities. Furthermore, thecontent of remuneration for directors is designed to be reasonable, objective and transparent in terms ofboth the content of remuneration and decision-making procedures.
 Policy regarding the determination of the amount of remuneration, etc. for each individual in fixed
remuneration
The fixed remuneration for directors of the Company shall be fixed monthly remuneration in cash, whichshall be determined in accordance with the position and responsibilities, etc., while taking into
consideration the levels of other companies, the business performance of the Company, and the level of
employee salaries, and reviewing the remuneration as appropriate in a comprehensive manner.
 Policy for determining the details of performance-linked remuneration, etc. and non-monetary
remuneration, etc. and the method for calculating the amount or number of such remuneration
Performance-linked remuneration, etc. is monetary remuneration reflecting performance indicators inorder to raise awareness of the need to improve performance for each fiscal year, and an amountcalculated in accordance with the degree of achievement of the target values for operating income,ordinary income and net income attributable to owners of parent for each fiscal year is paid as a bonus ata specified time. The target performance indicators and their values are based on the profit-oriented
management set forth in the Medium Term Management Plan, and will be reviewed in accordance withchanges in the business environment, respecting the report of the Nomination and Compensation
Committee. The amount of performance-linked remuneration is based on the consolidated businessresults. Non-monetary remuneration, etc. is granted at a set time after the end of the fiscal year as
restricted share remuneration with a transfer restriction period of up to 20 years, which is designed toprovide incentives for the sustainable enhancement of the Company’s corporate value and to promotefurther value-sharing with shareholders through the holding of the Company’s shares. The number ofshares to be granted is determined in consideration of the position, responsibilities, share price, etc., andwith respect to the report of the Nomination and Compensation Committee.
 Policy on determination of the ratio of the amount of monetary remuneration, the amount of
performance-linked remuneration, etc., or the amount of non-monetary remuneration, etc., to the amountof individual remuneration, etc., of directors
The ratio of type of remuneration for directors (excluding outside directors) is determined based on thereport of the Nomination and Compensation Committee, taking into consideration the position,
responsibilities, and trends in the remuneration levels of other companies with similar business scale as
the Company.
 Matters related to the decision policy concerning the details of remuneration, etc. for individual directors
Based on the delegated resolution of the Board of Directors, the Founder & CEO and President & COO
are delegated the authority to determine the amount of fixed remuneration for each director, theallocation of performance-linked remuneration (bonuses, etc.) based on the performance of the businessfor which each director is in charge, and the number of shares to be allotted to each individual in the formof restricted share remuneration. The Board of Directors consults the Nomination and Compensation- 35 -

Committee on the draft and obtains its report to ensure that such authority is properly exercised by theFounder & CEO and President & COO, and the Founder & CEO and President & COO, who havereceived the above delegation, make decisions with respect to the content of this report.
 Matters concerning the method of decision when the decision on the details of remuneration, etc. isdelegated to a director or other third party
The Founder & CEO and President & COO determine the specific details of the amount of remuneration,etc. and the number of shares to be allotted to each individual based on the delegated resolution of theBoard of Directors. The Board of Directors shall take measures to make decisions after consultation andreporting by the Nomination and Compensation Committee to ensure that such authority is properly
exercised by the Founder & CEO and President & COO. The Founder & CEO and President & COO
determine the details of individual remuneration for each director by fully respecting the advice andreport of the Nomination and Compensation Committee, while taking into consideration the Company’s
overall performance, share price, the role of each director, the impact of each director on the Company’s
performance and other circumstances.
b. Amount of remuneration for directors and auditors
Classification

Total amount of
remuneration(Million yen)

Total amount of remuneration by type (Million yen)Basicremuneration

Performancelinked
remuneration

Non-monetary
remuneration

Number of
eligible officers

Directors(Of which outside
directors)

1,039
(40)

332
(40)

666
(-)

40
(-)

11
(4)

Auditors(Of which outside
auditors)

46
(10)

46
(10)

(-)

(-)

4
(2)

Total
(Of which outside
officers)

1,085
(51)

378
(51)

666
(-)

40
(-)

15
(6)

(Notes) 1. The amount paid to directors does not include the employee’s salary for directors who concurrently serve as
employees.
2. The performance indicators for performance-linked remuneration, etc. are operating income, ordinary income andprofit attributable to owners of parent, and are calculated in accordance with the degree of achievement of thetarget values. These indicators are selected based on profit-oriented management. The performance indicators forthe fiscal year under review can be found in “I Business Progress and Achievement of the Corporate Group (1)Overview of Business (i) Business activities and results” on page 19.
3. Non-monetary remuneration is provided as share-based remuneration, and the conditions for its provision can befound in “III Corporate Officers (2) Overview of Details of Remuneration to Directors and Auditors for the Fiscal
Year Under Review” on pages 34 to 37. The status of granting during the fiscal year under review can be found in“II Current Status of the Company (1) Status of Shares (v) Status of shares granted to company officers as
consideration of execution of duties during the fiscal year under review” on page 33.
4. The maximum amount of remuneration for directors was resolved at the 54th Ordinary General Meeting of
Shareholders held on June 29, 2022 to be no more than 1,000 million yen per year (of this amount, up to 100
million yen is for outside directors; salaries for services as employees are not included). The number of directors
as of the close of this General Meeting of Shareholders was 11 (including four outside directors). In addition, atthe 50th Ordinary General Meeting of Shareholders held on June 28, 2018, it was resolved that the annual amountof monetary remuneration claims to be paid to directors (excluding outside directors) for the granting of restricted
shares shall be 100 million yen or less, separately from the above maximum amount of remuneration. The numberof directors (excluding outside directors) as of the close of this General Meeting of Shareholders was three.
5. At the 27th Ordinary General Meeting of Shareholders held on June 29, 1995, it was resolved that the maximum
amount of remuneration to be paid to Supervisory Board members shall be 60 million yen per year. The numberof auditors as of the close of this General Meeting of Shareholders was four.

- 36 -

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

(3) Outside Officers(i)Status of concurrent positions at other organizations (for executives at other organizations) andrelationships between the Company and such other organizations
 Auditor Susumu Kitsunai is a representative of Kitsunai Certified Public Accountant Office and a
representative director of Asia Alliance Partner Co., Ltd. There is no particular relationship between eitherof these concurrent employers and the Company.
 Auditor Yoichi Sato serves as a lawyer (of counsel) at Alpha Partners Law Offices and as an auditor at
Bouygues Asia K.K. The Company has signed a legal advisor agreement with Alpha Partners Law
Offices. However, as he is not a partner at Alpha Partners Law Offices, he does not contribute to their
management. There is no particular relationship between Bouygues Asia K.K. and the Company.

(ii) Concurrent positions as outside officers at other organizations and relationships between the Company
and such other organizations
 The director Akira Tamura is an advisor to Niigata Sohgo Security Services Co., Ltd. (ALSOK), and an
outside board director of Solekia Limited. There is no particular relationship between any of these
concurrent employers and the Company.
 Director Noritomo Hashimoto is an outside director of Ibokin Corp. There is no particular relationshipbetween this concurrent employer and the Company.
 Auditor Susumu Kitsunai serves concurrently as an outside director of Agent Insurance Group, Inc. Thereis no particular relationship between this concurrent employer and the Company.
(iii) Major activities during the fiscal year under review
Name

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

Outside Director Susumu
Miyoshi

Participated in all 18 meetings of the Board of Directors during the fiscal year under review.
He provides his opinions on the Company’s overall management as a director from an objective
viewpoint and independent perspective, based on his abundant experience as a member ofcorporate management and his wide-ranging knowledge, and successfully discharges the roles
and responsibilities required of an outside director.

Outside Director Akira
TamuraParticipated in 17 of 18 meetings of the Board of Directors during the fiscal year under review.
He provides his opinions as a director from an objective viewpoint and independent
perspective, particularly concerning matters such as management strategy and corporate
management, based on his abundant experience as a member of corporate management and his
wide-ranging knowledge, and successfully discharges the roles and responsibilities required ofan outside director.

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

Outside Director Hirokazu
Nishiyama

Participated in all 18 meetings of the Board of Directors during the fiscal year under review.
He provides his opinions on the Company’s overall business as a director from an objective
viewpoint and independent perspective, based on his abundant experience as a member ofcorporate management and his wide-ranging knowledge, and successfully discharges the roles
and responsibilities required of an outside director.

- 37 -

Name

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

Outside Auditor Susumu
KitsunaiParticipated in all 18 meetings of the Board of Directors and in all 19 meetings of the Board ofAuditors during the fiscal year under review.
He provides opinions from the professional point of view of a certified public accountant andotherwise provides assistance and advice in ensuring that decisions by the Board of Directors
and the Board of Auditors are made adequately and appropriately.

Outside Auditor Yoichi Sato

Participated in all 18 meetings of the Board of Directors and in all 19 meetings of the Board ofAuditors during the fiscal year under review.
He provides opinions from the professional point of view of a lawyer and otherwise provides
assistance and advice in ensuring that decisions by the Board of Directors and the Board ofAuditors are made adequately and appropriately.

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

- 38 -

Consolidated Financial Statements
Consolidated Balance Sheet(As of March 31, 2023)(Million yen)Account title

AmountAccount title

ASSETS
Current assets
Cash and deposits

AmountLIABILITIES
245,572

Current liabilities

127,547

52,600Notes and accounts payable - trade

Notes receivable – trade

1,534

Short-term loans payable

19,585

Electronically recorded monetary claims– operating

9,683

Accrued expenses

8,400

Income taxes payable

6,011

Accounts receivable – trade
Securities
Merchandise and finished goods
Work in process

117,881

Provision for directors’ bonuses

195

Other

41,375

79,232465
13,852

2,277

Non-current liabilities

Raw materials and supplies

12,552

Bonds payable

10,000

Other

7,624

Long-term loans payable

10,600Allowance for doubtful accounts(153)

Deferred tax liabilities

2,634

28,93240,645

Provision for directors’ retirement benefits

Property, plant and equipment

20,158Net defined benefit liability

2,148

Buildings and structures

6,690

Asset retirement obligations

627

6,466

Other

Non-current assets

Machinery, equipment and vehicles
Tools, furniture and fixtures
Land
Construction in progress

2,778

Total liabilities

1,103

143

156,479

NET ASSETS

5,859
39

Shareholders’ equity

117,285

Intangible assets

2,702

Capital stock

12,133

Goodwill48

Capital surplus

14,820Software2,617

Retained earnings

95,945

Other

36

Treasury shares(5,614)

Investments and other assets

17,784

Accumulated other comprehensive income

12,322

Investment securities

12,144

Valuation difference on available-for-salesecurities

2,534

Deferred tax assets

2,162

Deferred gains or losses on hedges

Guarantee deposits

1,280

Foreign currency translation adjustment

9,568

Insurance funds

920

Remeasurements of defined benefit plans

239

(18)

Claims provable in bankruptcy, claims
provable in rehabilitation and other

4,842

Other

1,298

Allowance for doubtful accounts(4,864)

Total net assets

129,737

286,217

Total liabilities and net assets

286,217

Total assets

Non-controlling interests(Note) Figures are rounded down to the nearest million yen.

- 39 -

129

Consolidated Statement of Income(From April 1, 2022 to March 31, 2023)(Million yen)Account title

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

- 40 -

608,064
529,550
78,51446,26532,249
211
279
97
227
107
126
412
748
223

20
626
126
1
644
37
12
348
11
9,197
167

1,461

971
32,739774

1,054
32,4609,365
23,09423
23,070Non-consolidated Financial Statements
Balance Sheet(As of March 31, 2023)(Million yen)Account title

AmountAccount title

Amount

71,390
10,320249

LIABILITIESCurrent liabilities
Notes payable - trade
Accounts payable - trade54,316
1,445
17,538

4,057

Short-term loans payable

9,146

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

195
6,006
9
1
392
324

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

17,630

Deposits received

30,5763,051
180(1,606)55,817
5,528
1,922
14
70
52
138
3,292
37
2,036
4
2,026
5
48,252
10,472
34,695
10

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

12,455
5,040
66
1,737
2,450
2,065
1,079
273
400
617
22,46010,00010,600
99
126
108
1,525
76,77748,057
12,133
13,965
13,91252
27,568618
26,9497,000

15Open innovation promotion reserve

25

920

Retained earnings brought forward

19,924

4,421
368
147
1,720
(4,417)(99)
127,208

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

- 41 -(5,609)
2,373
2,380
(6)
50,431
127,208

Statement of Income(From April 1, 2022 to March 31, 2023)(Million yen)Account title

AmountNet sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Other
Non-operating expenses
Interest expenses
Depreciation of assets for rent
Foreign exchange losses
Other
Ordinary income
Extraordinary income
Gain on sales of investment securities
Gain on transfer of business
Reversal of allowance for doubtful accounts
Other
Extraordinary loss
Loss on sales of investment securities
Loss on valuation of investment securities
Loss on valuation of shares of subsidiaries and associates
Provision of allowance for investment loss
Other
Profit before income taxes
Income taxes - current
Income taxes - deferred
Profit137,522
119,859
17,663
11,656
6,007
233
5,559
450
507
14
116
145

600
750
3,156
0
12
341
491
98
1
2,757
(332)

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

- 42 -

6,243

784
11,466

4,507

944
15,0292,424
12,604

Audit Report

Independent Auditor’s Audit Report on the Consolidated Financial Statements
Independent Auditor’s Report
May 24, 2023
To the Board of Directors
KAGA ELECTRONICS CO., LTD.
PricewaterhouseCoopers Aarata LLC
Tokyo officeKensuke Koda, CPA
Engagement Partner
Masaki Nitta, CPA
Engagement Partner

Auditors’ Opinion
We have audited, pursuant to Article 444, paragraph (4) of the Companies Act, the consolidated financial
statements, which consist of the consolidated balance sheet, the consolidated statement of income, the consolidated
statement of changes in equity and the notes to the consolidated financial statements of KAGA ELECTRONICS
CO., LTD. (hereinafter referred to as the “Company”) for the fiscal year from April 1, 2022 to March 31, 2023.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, theconsolidated financial position of the Company and its consolidated subsidiaries as of March 31, 2023 and theconsolidated result of their operations for the year then ended in conformity with accounting principles generally
accepted in Japan.
Grounds for Auditor’s Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our responsibility isstated in “Auditor’s Responsibility in Auditing of Consolidated Financial Statements.” We are independent fromthe Company and its consolidated subsidiaries in accordance with the regulations relating to professional ethics inJapan, and have fulfilled other ethical responsibilities as auditor. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion.
Other Information
The other information refers to the business report and its supplementary schedules. Management is responsible forpreparing and disclosing the other information. In addition, auditors and the board of auditors are responsible foroverseeing the directors’ performance of duties within the maintenance and operation of the reporting process forthe other information.
The scope of our audit opinion on the consolidated financial statements does not include the content of the otherinformation, and we do not express an opinion regarding the other information.
Our responsibility in auditing the consolidated financial statements is to read through the other information, and in
the process of reading it, we examine whether there are material differences between the other information and theconsolidated financial statements or the knowledge we have gained in the auditing process, and we also pay
attention as to whether there are any indications in the other information of material errors besides such material
differences.
If we determine there to be material errors in the other information based on the work we have performed, we are
required to report those facts.
There are no matters to report regarding the other information.
Responsibilities of Management, Auditors and the Board of Auditors for Consolidated Financial Statements- 43 -

Management is responsible for the preparation and fair presentation of consolidated financial statements inaccordance with accounting standards generally accepted in Japan. This responsibility includes designing andoperating internal controls, which management considers necessary for the preparation and fair presentation of
consolidated financial statements that are free from material misstatements, whether due to fraud or error.
In preparation of consolidated financial statements, management is responsible for reviewing whether it is properfor consolidated financial statements to be prepared based on the going concern assumption, and if it is necessary todisclose the relevant matters in accordance with accounting standards generally accepted in Japan, management is
responsible for disclosure thereof.
Auditors and the board of auditors are responsible for monitoring execution of duties by directors in preparationand operation of the financial reporting process.
Auditor’s Responsibility in Auditing of Consolidated Financial Statements
Our responsibility is to obtain reasonable assurance as to whether the consolidated financial statements as a whole
are free from material misstatement due to fraud or error based on the audit we performed, and to express an
opinion on the consolidated financial statements from an independent standpoint in the audit report. A misstatement
may occur due to fraud or error, and if, individually or in the aggregate, it is reasonably expected to affect thedecision-making of users of consolidated financial statements, it is judged to be material.
We make a professional judgment in the course of the audit in accordance with the auditing standards generally
accepted in Japan, and carry out the following maintaining professional skepticism.

Identify and evaluate the risk of material misstatement due to fraud or error. In addition, plan and implement
auditing procedures that address the risk of material misstatement. The selection and application of audit
procedures is at our discretion. Moreover, obtain sufficient and appropriate audit evidence to form the basis of
the opinion.

Although the purpose of auditing the consolidated financial statements is not to express an opinion on theeffectiveness of internal controls, in making those risk assessments, we consider internal controls in relation toaudits in order to design audit procedures that are appropriate for the circumstances.

Evaluate the adequacy of the accounting policy adopted by management and its application method, as well as
the reasonableness of accounting estimates made by management and the adequacy of related notes.

Reach conclusions on whether it is appropriate for management to prepare consolidated financial statementson the premise of going concern, and whether there is material uncertainty about events or situations thatcreate significant doubts about the premise of going concern based on the audit evidence obtained. If material
uncertainties regarding the going concern assumption are observed, it is expected to alert on the notes to theconsolidated financial statements in the audit report, or if the notes to the consolidated financial statements
regarding material uncertainties are not appropriate, it is required to express a qualified opinion with exceptive
items on the consolidated financial statements. Our conclusions are based on the audit evidence obtained up to
the date of the audit report, but future events and circumstances may prevent a company from continuing as agoing concern.

Assess whether the presentation of and notes to the consolidated financial statements comply with corporate
accounting standards generally accepted in Japan, as well as assess the presentation, composition and contentsof the consolidated financial statements including related notes, and whether the consolidated financial
statements properly represent the underlying transactions or accounting events.
Obtain sufficient and appropriate audit evidence regarding the financial information of the Company and its
consolidated subsidiaries to express opinions on the consolidated financial statements. We are responsible fordirecting, supervising and implementing audits of consolidated financial statements. We are solely responsible
for the audit opinion.
We give reports to auditors and the board of auditors on the scope and timing of planned audits, important audit
findings including important deficiencies in internal controls identified during the audit process, and on othermatters required by the auditing standard.
We give reports to auditors and the board of auditors that we are in compliance with the regulations relating toprofessional ethics in Japan regarding independence, as well as matters that are reasonably considered to affect our
independence as the Auditor, and if safeguards are in place to eliminate or reduce obstructive factors, the specificsof the safeguards.
Relationship of Interest- 44 -

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

- 45 -

Independent Auditor’s Audit Report on the Non-consolidated Financial Statements
Independent Auditor’s Report
May 24, 2023
To the Board of Directors
KAGA ELECTRONICS CO., LTD.
PricewaterhouseCoopers Aarata LLC
Tokyo officeKensuke Koda, CPA
Engagement Partner
Masaki Nitta, CPA
Engagement Partner

Auditors’ Opinion
We have audited, pursuant to Article 436, paragraph (2), item (i) of the Companies Act, the non-consolidated
financial statements, which consist of the balance sheet, the statement of income, the statement of changes inequity, the notes to the non-consolidated financial statements and the related supplementary schedules (collectively,“non-consolidated financial statements, etc.”) of KAGA ELECTRONICS CO., LTD. (hereinafter referred to as the“Company”) for the 55th fiscal year from April 1, 2022 to March 31, 2023.
In our opinion, the non-consolidated financial statements, etc. referred to above present fairly, in all material
respects, the financial position of the Company as of March 31, 2023 and the result of their operations for the year
then ended in conformity with accounting principles generally accepted in Japan.
Grounds for Auditor’s Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our responsibility isstated in “Auditor’s Responsibility in Auditing of the Non-consolidated Financial Statements, Etc.” We are
independent from the Company in accordance with the regulations relating to professional ethics in Japan, and havefulfilled other ethical responsibilities as auditor. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion.
Other Information
The other information refers to the business report and its supplementary schedules. Management is responsible forpreparing and disclosing the other information. In addition, auditors and the board of auditors are responsible foroverseeing the directors’ performance of duties within the maintenance and operation of the reporting process forthe other information.
The scope of our audit opinion on the non-consolidated financial statements, etc. does not include the content of theother information, and we do not express an opinion regarding the other information.
Our responsibility in auditing the non-consolidated financial statements, etc. is to read through the otherinformation, and in the process of reading it, we examine whether there are material differences between the otherinformation and the non-consolidated financial statements, etc. or the knowledge we have gained in the auditing
process, and we also pay attention as to whether there are any indications in the other information of material errors
besides such material differences.
If we determine there to be material errors in the other information based on the work we have performed, we are
required to report those facts.
There are no matters to report regarding the other information.
Responsibilities of Management, Auditors and the Board of Auditors for Non-consolidated Financial Statements,
Etc.
- 46 -

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

- 47 -

Audit Report of the Board of Auditors
Audit Report
With respect to the Directors’ performance of their duties during the 55th fiscal year (from April 1, 2022 to March
31, 2023), the Board of Auditors has prepared this audit report after deliberations based on the audit reports
prepared by each Auditor, and hereby reports as follows:
1. Method and Contents of Audit by Auditors and the Board of Auditors(1) The Board of Auditors has established the audit policies, audit plans, etc. and received a report from each
Auditor regarding the status of implementation of their audit and results thereof. In addition, we have received
reports from the Directors, Executive Officers and the Accounting Auditor regarding the status of execution of
their duties, and requested their explanations as necessary.
(2) In conformity with Auditor Auditing Standards established by the Audit & Supervisory Board, in accordancewith the audit policies, audit plans, etc., and each Auditor endeavored to facilitate a mutual understanding with
the Directors, the Audit Office and other employees, etc. of the Company, endeavored to collect informationand maintain and improve the audit environment, and conducted an audit by following the methods described
below:(i) Each Auditor has attended the meetings of the Board of Directors and other important meetings, received
reports on the status of execution of duties, including duties related to group companies, from the
Directors, Executive Officers, Division Managers and other employees and requested explanations asnecessary, examined important approval/decision documents, and investigated the status of operations
and assets of the headquarters and other major offices. Furthermore, we worked to communicate andshare information with the directors and auditors of subsidiaries, obtain business information fromsubsidiaries, and visit subsidiaries as necessary to investigate their operations and assets.
(ii) We received periodic reports from directors, employees, and others regarding the structure and operationof the contents of resolutions of the Board of Directors regarding the maintenance of systems necessary toensure that the duties of the directors described in the Business Report are executed in a mannerconsistent with laws, regulations, and the Articles of Incorporation and systems necessary to ensure theproper operations of the corporate group comprising the corporation and its subsidiaries as provided forin Article 100, paragraphs (1) and (3) of the Regulations for Enforcement of the Companies Act, as well
as systems maintained based on such resolutions (internal control systems), requested explanations asnecessary, and expressed opinions.
(iii) While coordinating with the independent auditor, we monitored and examined whether the independent
auditor maintained an independent position and performed auditing appropriately, and we also received
reports from the independent auditor on the execution of its duties and requested explanations whennecessary. We received reports from the Independent Auditor on its operations and requested explanations
when necessary. The Independent Auditor notified us, and we requested explanations when necessary,concerning its establishment of a “System for Ensuring the Appropriate Execution of Duties” (theRegulations on Corporate Accounting Article 131) in accordance with the “Quality Control Standard for
Auditing” (issued by the Business Accounting Council on October 28, 2005).
Through these methods, we reviewed the business report and its accompanying supplementary schedules, thenon-consolidated financial statements (balance sheet, statement of income, statement of changes in equity andnotes to the non-consolidated financial statements) and related supplementary schedules, and the consolidated
financial statements (consolidated balance sheet, consolidated statement of income, consolidated statement ofchanges in equity and notes to the consolidated financial statements) for the fiscal year under review.
2. Results of the Audit(1) Results of the audit for the business report(i) We have found that the business report and the accompanying supplementary schedules present fairly thecurrent financial position of KAGA ELECTRONICS CO., LTD. in conformity with applicable laws andregulations and the Articles of Incorporation.
(ii) With respect to the execution of duties of the Directors, we have found neither improper conduct nor any
material breach of applicable laws and regulations and the Articles of Incorporation.
- 48 -

(iii) We have found that the resolutions of the Board of Directors regarding the internal control system areproper and correct. We have found nothing that needs to be pointed out concerning the operation
regarding the internal control system.
(2) Results of the audit of the non-consolidated financial statements and the accompanying supplementaryschedules
We have found that the auditing methods employed by PricewaterhouseCoopers Aarata LLC, Accounting
Auditor, and the results thereof are appropriate and sufficient.
(3) Results of the audit of the consolidated financial statements
We have found that the auditing methods employed by PricewaterhouseCoopers Aarata LLC, Accounting
Auditor, and the results thereof are appropriate and sufficient.
May 24, 2023
The Board of Auditors, KAGA ELECTRONICS CO., LTD.
Inside Auditor
Inside Auditor
Outside Auditor
Outside Auditor

Takahiro Ishii
Kazunori Kameda
Susumu Kitsunai
Yoichi Sato

- 49 -(Seal)(Seal)(Seal)(Seal)