August 23, 2024
To Whom It May Concern
Company:

TOCALO Co., Ltd.

Representative:

Kazuya KOBAYASHI, President andExecutive Officer(Stock Code: 3433 (Prime Market of Tokyo
Stock Exchange))

Contact:

Hiroshi GOTO, Director, Managing
Executive Officer; General Manager,
Administrative Headquarters

Phone:+81-78-303-3433

Notice Regarding the Subsidiarization of TERADA KOSAKUSHO Co., Ltd. Through theAcquisition of Its Shares

TOCALO Co., Ltd. (the Company) hereby announces that at the Board of Directors meeting today, it was decided
to acquire all the shares in TERADA KOSAKUSHO Co., Ltd. (hereinafter, “TERADA KOSAKUSHO”) to makeit a subsidiary, as stated below.

1. Reason for share acquisition
The Company provides surface modification solutions in a variety of fields, from key industries such as power,
steel, automobiles and industrial machinery through to the semiconductors, space development and advanced
medicine spheres, as a result of utilizing its surface modification technology, which centers on thermal spraying ,to grant new qualities and functions such as corrosion resistance, abrasion resistance and electrical insulation
properties to its customers’ products and production equipment components.

TERADA KOSAKUSHO possesses superior machine processing technology capable of manufacturing
precision components using a diverse range of materials. As a result of combining that technology with theCompany’s surface modification technology, we will expect to further improve the value that we provide to ourcustomers. It is on this basis that the Board decided to acquire the shares.

2. Overview of the subsidiary (TERADA KOSAKUSHO) to be transferred(1) Name

TERADA KOSAKUSHO Co., Ltd.

(2) Location

406-1, Oaza Kamisokoino, Nakama, Fukuoka(3) Representative (nameJunji TERADA, Representative Directorand designation)(4) Business

Manufacture of components for machine tools and precision machinery(5) Capital

10 million yen(6) Date of establishment

August 19861

(7) Major shareholders andFive individuals
shareholding ratio
Capital relationship

No notable matters.

Personal relationship

No notable matters.

Business relationship

No notable matters.

(8) Relationship with theCompany(9) Financial position and business performance for the past three years
Fiscal year

FY7/2021

FY7/2022

FY7/2023

Net assets

340 million yen

395 million yen

469 million yen

Total assets

715 million yen

830 million yen

806 million yen

Net assets per share

1,704,142 yen

1,978,614 yen

2,347,765 yen

Net sales

346 million yen

414 million yen

408 million yen

Operating profit

58 million yen

88 million yen

92 million yen

Ordinary profit

75 million yen

108 million yen

107 million yen

Net income

52 million yen

57 million yen

78 million yen

Net income per share

260,640 yen

289,472 yen

394,150 yen

Dividend per share

10,000 yen

15,000 yen

25,000 yen

3. Overview of the parties from whom shares will be acquired(1) Name

Five individuals(2) Location

Not disclosed based on the wishes of the shareholders.
There are no noteworthy capital, personal and business relationships(3) Relationship with thebetween the Company and the individuals concerned, and neither do they
Company
correspond to people connected to the Company.

4. Number of shares to be acquired, acquisition price, and shareholding status before and after the acquisition(1) Number of shares held
0 shares (Share of voting rights: 0%)
before the transfer(2) Number of shares to be200 shares (100.0%)
acquired(3) Acquisition price

800 million yen(4) Number of shares held
200 shares (Share of voting rights: 100.0%)
after the transfer

5. Schedule(1) Date of resolution byAugust 23, 2024
the Board of Directors(2) Contract dateAugust 23, 2024

(3) Date of execution ofAugust 26, 2024 (provisional)
share transfer2

6. Status after stock acquisition, and future outlook
The impact this acquisition will have on the Company’s consolidated and non-consolidated financial results forthe fiscal year ending March 2025 will be slight, and at the present point in time there are no amendments to theCompany’s full-year consolidated financial results forecast and dividend forecast (announced on May 9, 2024).

3