[Translation]
November 18, 2022
Kakuyasu Group Co.,Ltd.
Representative Director and President

Akihiko Tajima（Ticker Code：7686 Tokyo Stock Exchange Standard Market）
Inquiry toDirectorYoshiyuki
Maegaichi

Introduction of Employees Stock Ownership Plan with Capital Increase
This is to announce that the Company resolved to introduce a stock benefit trust (employee
stockholding association purchase-type; hereinafter referred to as the “Plan”) for the purpose ofpromoting welfare benefits for employees and giving incentives pertaining to the improvement of thecorporate value of the Company at the Board of Directors meeting convened today.
In addition, as a part of the introduction of the Plan, the Board of Directors also resolved issuanceof common stocks allocated to a Trust E account (hereinafter the “Trust E Account”) to be created at
the Custody Bank of Japan, Ltd. Details are described as follows.
【 Introduction of the Plan 】
1. Purposes of introduction
The Plan has two primary objectives: It aims toA)

Enhance employee benefits by providing a stable supply of Company shares to theEmployees’ Stock Ownership Association and by distributing profits to employees throughthe management and disposition of trust property.

B)

Enhance the Company’s corporate value mainly by boosting employees’ awareness of thestock price and their motivation for work.

2. Overview of the Plan
The Plan is an incentive plan under which the benefits of a rise in the Company’s stock priceare passed along to all the employees who are members of the “Kakuyasu Employee
Shareholding Association” (hereinafter referred to as the “Shareholding Association”).
To introduce the Plan, the Company will enter into a stock benefit trust (employee
stockholding association purchase-type) agreement (hereinafter the “Trust Agreement”) withMizuho Trust & Banking Co., Ltd., in which the Company will be the settlor and Mizuho Trust& Banking will be the trustee (hereinafter the “Trustee”). (The trust to be created under theTrust Agreement is hereinafter referred to as the “Trust.”) The Trustee will agree with theCustody Bank of Japan to entrust the Trust to the Custody Bank of Japan, which will manage
the trust property, including securities.
The Custody Bank of Japan will purchase Company shares in an amount equivalent to theshares that the Shareholding Association is expected to buy in the next three years. Thepurchased shares will be held in the Trust E Account. Subsequently, the Shareholding

Association will buy Company shares from the Trust E Account. If the amount equivalent to thegains on sales of Company shares to the Shareholding Association from the Trust E Account isaccumulated in the trust property of the Trust by the time of its termination, that amount will
be considered residual assets and will be distributed to the Shareholding Association members(employees) who meet the beneficiary requirements.
The Company will provide a guarantee for the repayment of loans that the Trustee will takeout for the Trust E Account to purchase Company shares. If there is any outstanding debt
equivalent to losses on sales of shares at the time of termination of the Trust due to a fall in thestock price, among other reasons, the Company will pay the debt as per the guarantee agreement.

3. Overview of the Trust(1)

Purpose of the TrustA stable supply of the Company stocks to the Shareholder
Association and the distribution of profits to thebeneficiaries through the management and disposition ofthe trust property.

(2)

TrustorThe Company(3)

TrusteeMizuho Trust & Banking Co., Ltd.
Mizuho Trust & Banking Co., Ltd. will conclude acomprehensive trust agreement with Custody Bank ofJapan, Ltd., and Custody Bank of Japan, Ltd. will become
the trustee of re-trust.

(4)

Beneficiaries

Members of the Shareholder Association who meet thebeneficiary requirements.

(5)

Trust Set-up date

December 22, 2022

(6)

Trust period

From December 22, 2022, to January 13, 2026.

【 Capital increase allocated to third-parties 】
4. Overview of the issuance(1)

Payment dateThursday, December 22, 2022

(2)

Class and number of stocks

244,200 common stocks

to be issued(3)

Issued price

JPY 1,351 per share(4)

Total amount issued

JPY 329,914,200(5)CustodianCustody Bank of Japan (account E in trust)(6)

Other information

It will be subject to the effectuation of securities
registration under the Financial Instruments andExchange Act.

5. Purposes of the issuance
The Company will issue certain common stocks to the Custody Bank of Japan (Trust EAccount), which will hold and dispose of the shares of the Company whose class and number
will be determined when the Trust is set up.
The number of shares to be issued will be equivalent to the number that the Shareholding
Association plans to purchase through the Trust in the next three years. This number ofshares is equivalent to 2.62% (rounded to the second decimal place) of the number of shares
outstanding as of September 30, 2022, which is 9,326,800 (2.62% (rounded to the seconddecimal place) of the number of voting rights as of September 30, 2022, which is 93,238).
6. Basis of issued price and other details
The Company has decided that the issue price shall be 1,351 yen, which is the closing price of
the Company's ordinary stock at Tokyo Stock Exchange on the business day immediately
preceding the date of the board resolution with respect to the issuance.
The Company has selected the closing price of its stock on the business day immediately
preceding the board resolution date, based on the judgment that this price accurately indicates
the Company’s corporate value and is reasonable.
Moreover, the issue price of 1,351 yen represents the following prices: a price calculated bymultiplying 1,370 yen (rounded to the nearest yen), which is the average closing share price forthe one-month period immediately preceding the board resolution date, by 98.61%, a pricecalculated by multiplying 1,364 yen (rounded to the nearest yen), which is the averaging closing
share price for the three-month period preceding the said date, by 99.05%, and a price calculated
by multiplying 1,354 yen (rounded to the nearest yen), which is the average closing share pricefor the six-month period preceding the said date, by 99.78%.
Taking the above into consideration, the Company has determined that the issue price related
to the issuance is not particularly advantageous to any party and therefore is reasonable. All
three auditors of the Company (all are outside auditors) say that the issue price above is in linewith the Japan Securities Dealers Association's guidelines for the issuance to a third party andis not particularly advantageous to the prospective allottees.
7. Matters regarding procedures pertaining to the Code of Corporate ConductWith i) the dilution rate being less than 25% and ii) no change taking place in controllingshareholders regarding the issuance, the Company is not required to implement procedures for
obtaining opinions from any independent third-party, or confirming shareholders' intention, asprovided by Rule 432 of the Tokyo Stock Exchange's Securities Listing Regulations.

Disclaimer: This is an English translation of the disclosure. This translation is prepared andprovided for the reader’s convenience.