February 17, 2023
To AllCompany Name
Representative

Contact

Frontier Management Inc.
Shoichiro Onishi,
Co-President & Executive Officer(TSE Prime Market Code No. 7038)
Hiroaki Hamada,
Executive Officer, Head of Company
Planning and Administration Department(TEL．+81-3-6862-8335)

Notice of Capital Increase (Additional Capital Increase) by Consolidated Subsidiaries

Frontier Management Inc. (hereafter the “FMI”) and our consolidated subsidiary Frontier Capital Inc. (hereafter the"FCI") have concluded an agreement with The Joyo Bank, Ltd., Tokai Tokyo Financial Holdings, Inc. and JAPAN POSTBANK Co., Ltd. for a third-party allotment of shares to FCI, which is announced below.

Notation
1.Purpose of capital increase by our consolidated subsidiaries
FMI have provided a diverse range of solutions to domestic and overseas companies through teams of specialists tailoredto the business phases of our customers, including consulting, M&A, management staffing, and revitalization support.
Over the past few years, the global society has undergone major changes. Japanese companies are also required totransform their business models, such as responding to sustainability, responding to productivity improvements such asdigitization, responding to the revitalization of local economies, which are facing declining birthrates, aging populations, andbusiness succession problems, and responding to after-sales covid-19.
On April 1, 2023, FMI established an FCI with the aim of resolving such critical issues for companies and to resolve them.
On January 18, 2023, FMI received investments totaling approximately 2.7 billion from three Anchor Investors (THE BANKOF FUKUOKA, LTD., JAPAN POST BANK Co., Ltd., and The Bank of Yokohama,Ltd.) and four other banks (SaitamaResona Bank, Limited ,Daishi Hokuetsu Bank, Ltd., THE HOKURIKU BANK, LTD., and Sumitomo Mitsui BankingCorporation) (see the timely disclosure on December 27, 2022). FMI have newly obtained investments from The Joyo Bank,
Ltd. And Tokai Tokyo Financial Holdings, Inc., as well as additional investments from JAPAN POST BANK Co., Ltd.
FMI believe that FCI's investment business will enable us to grow by transforming the business model of our investee
companies and reorganizing our industry by making direct investments with the aim of enhancing the corporate value of ourinvestee companies over the medium to long term. At the same time, FMI will also contribute to enhancing our enterprisevalue by accelerating the expansion of the size of our group.
In promoting our investment business, in addition to dispatching management personnel from FCI to investee companies,
FMI also provide consulting services as needed.
In addition, as mentioned above, by obtaining investment from eight banks, including three anchor investors, and one
company, We will be able to combine the regional relationship and financial business know-how of each investor with theconsulting, M&A, management staffing, and restoration support know-how owned by FMI and FCI to further enhance thepromotion of this project. Through these initiatives, We will raise the corporate value of FMI and FCI by enhancing thecorporate value of the companies in which FCI invest.
FCI will raise capital in stages in accordance with the progress of the investment. FCI plan to ultimately raise funds totaling1

15 billion yen (The capital increase in January and February 2023 will be ¥3 billion of that amount.).
2.Consolidated Companies
(1)

Name

Frontier Capital Inc.

(2)Address

3-2-1, Roppongi, Minato-ku, Tokyo

Job Title/Name of

Shoichiro Onishi President, CEO and COO
Masahiro Matsuoka Representative Director

(3)
(4)
(5)

Representative
Description ofBusinesses
Capital before capitalincrease

Investment business involving the dispatch of management personnel
1.834 billion yen (1.834 billion yen in capital, 1.834 billion yen in capital reserve)(6)

Date of Incorporation

April 1, 2022

(7)

Fiscal year end

December 31

Major shareholders(8)prior to the capitalincrease and ratio of

FMI 91%

voting rights
CapitalrelationshipListed company and(9)the company
Relationship withPersonnelrelationship
Businessrelationship

Subsidiary of FMI
Shoichiro Onishi and Masahiro Matsuoka, representative directors ofFMI, serve concurrently as representative directors of the relevantcompany.
FMI have a business relationship with the company concerned.

3.Funding Profile(1)

Number of newly issued
shares3,333 shares of Class A shares(2)

Issue price

100,000 yen per share(3)

Total issue price

333 million yen (Note)

(4)
(5)
(6)

(7)

Amounts designated asstated capital
Payment date
Allottee(50-note order)

Capital after capitalincrease

166 million yen (50,000 yen per share)
February 28, 2023 (planned)[Class A stocks]
The Joyo Bank, Ltd., Tokai Tokyo Financial Holdings, Inc. and JAPAN POSTBANK Co., Ltd..
2 billion yen

Number of shares(8)

outstanding after the40,006 shares

capital increase[Class A shares]
・Dividends of surplus in cash shall be paid to Class A shareholders prior to the(9)Conditions of certain classof share

shareholders, etc. who hold shares of other classes.
・Distribution of residual assets to the allotment destination shall take place prior
to the shareholders, etc. holding the shares of other classes.
・Allotments may not exercise voting rights at FCI general meetings.
2

・Class A shareholders may demand that FCI acquire some or all of the Class A
shares in exchange for the payment of monies ten years from the date of the firstissue of the Class A shares.
(NOTE)Assuming that the payment after the above payment due date is conditionally arranged, the issuance of 104,991
shares of Class A shares and 5,000 shares of Class C shares (FMI plan to subscribe for all of the shares of Class C stock)is scheduled, and the total issue price is expected to be 15 billion yen.
4.Schedule
February 17, 2023

Conclusion of a share subscription agreement, a shareholder agreement, etc. concerning the ClassShares

February 28, 2023

Payment of capital by each investor (planned)

5.Future outlook
The impact of FCI funding, including this issue, on our consolidated business results for the year ended December 2023
has already been incorporated into the "Forecast of results for the year ending December 3.2023 (January 1, 2023 toDecember 31, 2023)" summary of "Summary of results for the year ending December 2022 [Japanese Standards](Consolidation)" released on February 10, 2023.

3