# EDGAR Filing Document

**Accession Number:** 0002072486
**File Stem:** 0000947871-25-001039
**Filing Date:** 2025-11
**Character Count:** 754595
**Document Hash:** a2b0b7d7bb1eac103ee48f729ff8ec19
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0000947871-25-001039.hdr.sgml**: 20251124

**ACCESSION NUMBER**: 0000947871-25-001039

**CONFORMED SUBMISSION TYPE**: CB

**PUBLIC DOCUMENT COUNT**: 31

**FILED AS OF DATE**: 20251124

**DATE AS OF CHANGE**: 20251124

**SUBJECT COMPANY**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** HAGIWARA ELECTRIC HOLDINGS CO., LTD.
- **CENTRAL INDEX KEY:** 0002072488

**ORGANIZATION NAME:**
- **EIN:** 000000000
- **STATE OF INCORPORATION:** M0
- **FISCAL YEAR END:** 0331

**FILING VALUES:**
- **FORM TYPE:** CB
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 005-95133
- **FILM NUMBER:** 251509524

**BUSINESS ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 2-2-1 HIGASHI SAKURA
- **STREET 2:** HIGASHI-KU
- **CITY:** NAGOYA-SHI
- **NON US STATE TERRITORY:** AICHI
- **PROVINCE COUNTRY:** M0
- **ZIP:** 461-0005
- **BUSINESS PHONE:** 81-52-931-3511

**MAIL ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 2-2-1 HIGASHI SAKURA
- **STREET 2:** HIGASHI-KU
- **CITY:** NAGOYA-SHI
- **NON US STATE TERRITORY:** AICHI
- **PROVINCE COUNTRY:** M0
- **ZIP:** 461-0005
**FILED BY**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** SATORI ELECTRIC CO., LTD.
- **CENTRAL INDEX KEY:** 0002072486

**ORGANIZATION NAME:**
- **EIN:** 000000000
- **STATE OF INCORPORATION:** M0
- **FISCAL YEAR END:** 0531

**FILING VALUES:**
- **FORM TYPE:** CB

**BUSINESS ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 1-14-10 SHIBA
- **CITY:** MINATO-KU
- **NON US STATE TERRITORY:** TOKYO
- **PROVINCE COUNTRY:** M0
- **ZIP:** 105-0014
- **BUSINESS PHONE:** 81-3-3452-7171

**MAIL ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 1-14-10 SHIBA
- **CITY:** MINATO-KU
- **NON US STATE TERRITORY:** TOKYO
- **PROVINCE COUNTRY:** M0
- **ZIP:** 105-0014

**UNITED STATES<br> SECURITIES AND EXCHANGE COMMISSION<br> Washington, D.C. 20549** 

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FORM CB<br> TENDER OFFER/RIGHTS OFFERING NOTIFICATION FORM

Please place an X in the box(es) to designate the appropriate rule provision(s) relied upon to file this Form:

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| | |
|:---|:---|
| Securities Act Rule 801 (Rights Offering) | ☐ |
| Securities Act Rule 802 (Exchange Offer) | ☒ |
| Exchange Act Rule 13e-4(h)(8) (Issuer Tender Offer) | ☐ |
| Exchange Act Rule 14d-1(c) (Third Party Tender Offer) | ☐ |
| Exchange Act Rule 14e-2(d) (Subject Company Response) | ☐ |
| Filed or submitted in paper if permitted by Regulation S-T Rule 101(b)(8) | ☐ |

---

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| |
|:---|
| <br> **HAGIWARA DENKI HOLDINGS KABUSHIKI KAISHA**<br> **SATORI DENKI KABUSHIKI KAISHA**<br>|
| (Name of Subject Company)<br>**HAGIWARA ELECTRIC HOLDINGS CO., LTD.** |
| **SATORI ELECTRIC CO., LTD.** |
| (Translation of Subject Company's Name into English (if applicable)) |
| **Japan** |
| (Jurisdiction of Subject Company's Incorporation or Organization) |
| **HAGIWARA ELECTRIC HOLDINGS CO., LTD.**<br> **SATORI ELECTRIC CO., LTD.**<br>|
| (Name of Person(s) Furnishing Form) |
| **Common Stock** |
| (Title of Class of Subject Securities) |
| **N/A** |
| (CUSIP Number of Class of Securities (if applicable)) |
| <br> **HAGIWARA ELECTRIC HOLDINGS CO., LTD.**<br> **2-2-1 Higashi Sakura**<br> **Higashi-ku, Nagoya-shi, Aichi 461-0005**<br> **Japan**<br> **+81-52-931-3553**<br> **Attn: Kyoko Kitagawa**<br>**SATORI ELECTRIC CO., LTD.**<br> **1-14-10, Shiba** <br> **Minato-ku, Tokyo 105-0014**<br> **Japan**<br> **+81-80-6116-1359**<br> **Attn: Remi Shiraki**<br>|
| (Name, Address (including zip code) and Telephone Number (including area code)<br> of Person(s) Authorized to Receive Notices and Communications on Behalf of Subject Company) |
| **N/A** |
| (Date Tender Offer/Rights Offering Commenced) |

---

**PART I – INFORMATION SENT TO SECURITY HOLDERS**

**Item 1. Home Jurisdiction Documents** 

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| | |
|:---|:---|
| &nbsp;&nbsp;**Exhibit**<br> **<u>Number</u>** |  |
| &nbsp;&nbsp;99.1\* | &nbsp;&nbsp;[Announcement Concerning Execution of Basic Agreement on Business Integration through the Establishment of a Joint Holding Company (Share Transfer) between Hagiwara Electric Holdings Co., Ltd. and SATORI ELECTRIC CO., LTD. (English translation)](https://www.sec.gov/Archives/edgar/data/2072486/000094787125000698/ss5134831_ex9901.htm) |
| &nbsp;&nbsp;99.2\*\* | &nbsp;&nbsp;[Announcement Concerning Execution of Business Integration Agreement on Business Integration through the Establishment of a Joint Holding Company (Share Transfer) between Hagiwara Electric Holdings Co., Ltd. and SATORI ELECTRIC CO., LTD. and Preparation of a Share Transfer Plan (English translation)](https://www.sec.gov/Archives/edgar/data/2072486/000094787125000902/ss5459348_ex9902.htm) |
| &nbsp;&nbsp;99.3 | &nbsp;&nbsp;[Hagiwara Electric Holdings Co., Ltd. Notice of the Extraordinary General Meeting of Shareholders (English translation)](ss5620204_ex9903.htm) |
| &nbsp;&nbsp;99.4 | &nbsp;&nbsp;[Hagiwara Electric Holdings Co., Ltd. Extraordinary General Meeting of Shareholders Reference Documents for Extraordinary General Meeting—Supplementary Volume (English translation)](ss5620204_ex9904.htm) |
| &nbsp;&nbsp;99.5 | &nbsp;&nbsp;[SATORI ELECTRIC CO., LTD. NOTICE OF AN EXTRAORDINARY SHAREHOLDERS MEETING (English translation)](ss5620204_ex9905.htm) |
| &nbsp;&nbsp;99.6 | &nbsp;&nbsp;[SATORI ELECTRIC CO., LTD. Extraordinary General Meeting of Shareholders Reference Documents for Extraordinary General Meeting—Supplementary Volume (English translation)](ss5620204_ex9906.htm) |

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\* Previously furnished to the Commission under cover of Form CB on July 29, 2025.

\*\* Previously furnished to the Commission under cover of Form CB on October 15, 2025.

**Item 2. Informational Legends**

The required legend is prominently included in the document(s) referred to in Item 1.

**PART II – INFORMATION NOT REQUIRED TO BE SENT TO SECURITY HOLDERS** 

N/A

**PART III – CONSENT TO SERVICE OF PROCESS**

HAGIWARA ELECTRIC HOLDINGS CO., LTD. and SATORI ELECTRIC CO., LTD. submitted to the Securities and Exchange Commission a written irrevocable consent and power of attorney on Form F-X dated July 29, 2025.

**SIGNATURES**

After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

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| |
|:---|
| HAGIWARA ELECTRIC HOLDINGS CO., LTD. |
| /s/ Masayuki Hasegawa |
| Name: Masayuki Hasegawa |
| Title: Managing Executive Officer |

---

Date: November 24, 2025

**SIGNATURES**

After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

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| |
|:---|
| SATORI ELECTRIC CO., LTD. |
| /s/ Hiroyuki Satori |
| Name: Hiroyuki Satori |
| Title: Representative Director, President |

---

Date: November 24, 2025

## Exhibit 99.3

&nbsp;&nbsp; The business combination described in this document involves securities of Japanese companies. The business combination is subject to disclosure requirements of Japan that are different from those of the United States. Financial information included in this document, if any, was excerpted from financial statements prepared in accordance with foreign accounting standards that may not be comparable to the financial statements of United States companies.<br>It may be difficult for you to enforce your rights and any claim you may have arising under the U.S. federal securities laws, since the issuers are located in Japan and some or all of their officers and directors reside outside of the United States. You may not be able to sue a Japanese company or its officers or directors in a Japanese court for violations of the U.S. securities laws.<br>It may be difficult to compel a Japanese company and its affiliates to subject themselves to a U.S. court's judgment. You should be aware that the issuer may purchase securities otherwise than under the business combination, such as in the open market or through privately negotiated purchases.<br>

Dear Shareholders:

We would like to express our appreciation to shareholders for their continued support.

Hagiwara Electric Holdings Co., Ltd. on October 14, 2025, reached a final agreement on the business integration with SATORI ELECTRIC CO., LTD. through the establishment of a joint holding company. The electronics and IT markets in which the Group operates continues to expand while changing rapidly, and customer needs are also diversifying and growing more sophisticated than ever before. Against such a backdrop, we seek to provide even greater added value and to improve corporate value by concentrating the management resources of both companies in the newly established MIRAINI HOLDINGS CO., LTD. and leveraging each of our strengths.

We seek the understanding of shareholders for this business integration and ask for your continued support.

Moritaka Kimura

Representative Director,

President Executive Officer

November 2025

Securities code: 7467

Date of sending by postal mail: November 25, 2025

Start date of measures for electronic provision: November 19, 2025

To our shareholders:

Moritaka Kimura, Representative Director, President <br> Executive Officer

**HAGIWARA ELECTRIC HOLDINGS CO., LTD.**

2-2-1 Higashi Sakura, Higashi-ku, Nagoya-shi, Aichi, <br> Japan

**Notice of the Extraordinary General Meeting of Shareholders**

It is a pleasure to inform you that the Extraordinary General Meeting of Shareholders of HAGIWARA ELECTRIC HOLDINGS CO., LTD. (the "Company") will be held as indicated below.

When convening this general meeting of shareholders, the Company takes measures for electronic provision of materials for the General Meeting of Shareholders, and posts this information as "Notice of the Extraordinary General Meeting of Shareholders" on each website. Please access the following websites by using the Internet address shown below to review the information.

The Company's website:

https://www.hagiwara.co.jp/ir/stocks/meeting/ (in Japanese)

Website containing informational materials for the general meeting of shareholders:

https://d.sokai.jp/7467/25295857/ (in Japanese)

TSE website (Listed Company Search):

https://www2.jpx.co.jp/tseHpFront/JJK010010Action.do?Show=Show (in Japanese)

Please check this information by the following procedure: access the TSE website (Listed Company Search) above, enter the issue name "HAGIWARA ELECTRIC HOLDINGS" or securities code "7467," and click "Search," and then click "Basic information" and select "Documents for public inspection/PR information."

If you are unable to attend the meeting, you may exercise your voting rights via the Internet or in writing. Please review the Reference Documents for General Meeting of Shareholders, and exercise your voting rights by Wednesday, December 10, 2025 at 6:00 p.m. (JST).

**1.** **Date and Time:** Thursday, December 11, 2025, at 10:00 a.m. (JST) (Reception for attendees begins at 9:00 a.m.)

**2.** **Venue:** Meeting Room at the Company's Headquarters

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5th Floor, Takaoka Park Building, 2-2-1 Higashi Sakura, Higashi-ku, Nagoya-shi, Aichi

**3.** **Purpose of the Meeting** 

**Matters to be resolved:**

**Proposal No. 1** Approval of the Share Transfer Plan

**Proposal No. 2** Partial Amendment to Articles of Incorporation

**Proposal No. 3** Partial Revision of the Restricted Stock Compensation Plan for Directors (Excluding Directors Who Are Audit & Supervisory Committee Members, and Outside Directors)

**4.** **Matters Determined Concerning the Convocation** 

&nbsp;&nbsp;&nbsp;&nbsp;(1) For this general meeting of shareholders, we have delivered paper-based documents stating the items subject to measures for electronic
provision to all shareholders, regardless of whether or not they have requested them. Among the items subject to measures for electronic
provision, in accordance with the provisions of laws and regulations and Article 15 of the Articles of Incorporation of the Company, the
following item is not provided in the paper-based documents to be delivered.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The details of the financial statements, etc., of Satori Electric Co., Ltd. for the fiscal year ended May 31, 2025

&nbsp;&nbsp;&nbsp;&nbsp;(2) If you exercise your voting rights both via the Internet and in writing, your vote via the Internet will be treated as the valid one.

&nbsp;&nbsp;&nbsp;&nbsp;(3) If you exercise your voting rights via the Internet multiple times, the final vote will be treated as the valid one.

&nbsp;&nbsp;&nbsp;&nbsp;(4) If you do not indicate approval or disapproval for each proposal when exercising your voting rights in writing, it will be treated
as an indication of approval.

**Instructions for Exercising Voting Rights**

You may exercise your voting rights by the following three methods.

**When exercising voting rights via the Internet:**

Please access the Portal of Shareholders' Meeting (https://www.soukai-portal.net) (in Japanese) or the website for exercising voting rights (https://www.web54.net) (in Japanese), enter your voting rights code and password shown on the voting form, and enter your vote of approval or disapproval of each proposal. For details, please refer to the next page.

Deadline for exercising voting rights: No later than 6:00 p.m. on Wednesday, December 10, 2025 (JST)

**When exercising voting rights in writing (by postal mail):**

Please indicate your vote of approval or disapproval of each proposal on the voting form and send it by postal mail to us without putting a stamp on it.

Deadline for exercising voting rights: 6:00 p.m. on Wednesday, December 10, 2025 (JST)

**When attending the Meeting in person:**

Please submit the voting form at the reception desk.

\* Please note that persons other than shareholders who are entitled to exercise voting rights, such as proxies or persons accompanying shareholders, are not allowed to attend the meeting (except for persons accompanying shareholders with disabilities).

Date and Time: Thursday, December 11, 2025, at 10:00 a.m. (JST) (Reception for attendees begins at 9:00 a.m.)

Venue: Meeting Room at the Company's Headquarters

**-** If you are attending the Meeting in person, please submit the voting form at the reception desk. Reception for attendees is scheduled to begin at 9:00 a.m.

**-** If revisions to the items subject to measures for electronic provision arise, a notice of the revisions and the details of the items before and after the revisions will be posted on each of the aforementioned websites.

**Use of Electronic voting platform (information for institutional shareholders)**

Institutional investors may exercise their voting rights for this Extraordinary General Meeting of Shareholders via electromagnetic means through the "Electronic Voting System Platform" operated by ICJ, Inc.

**Instructions for Exercising Voting Rights via the Internet**

Deadline for exercise of voting rights via the Internet:

No later than 6:00 p.m. on Wednesday, December 10, 2025 (JST)

**Exercising voting rights via a smartphone, etc.**

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| | | |
|:---|:---|:---|
| 1. Scan the QR Code printed on the voting form. | 2. Tap the "Exercise your voting right (議決権行使へ)" button from the top screen of the Portal of Shareholders' Meeting.<br>| 3. The top screen of Smart Vote® is displayed. Enter your approval or disapproval by following the instructions shown on the screen. |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;![](image_002.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;![](image_003.jpg) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <br>\* "QR Code" is a registered trademark of<br> DENSO WAVE INCORPORATED. |  |  |

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**Exercising voting rights via a PC, etc.**

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Please access the portal by entering your login ID and password printed on the voting form from the following URL. Then, enter your approval or disapproval by following the instructions shown on the screen.<br> The Portal of Shareholders' Meeting URL<br> ▶https://www.soukai-portal.net (in Japanese)<br> You can also use the website for exercising voting rights as before.<br> ▶https://www.web54.net (in Japanese) | ![](image_005.jpg) | ![](image_004.jpg) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Please access the portal by entering your login ID and password printed on the voting form from the following URL. Then, enter your approval or disapproval by following the instructions shown on the screen.<br> The Portal of Shareholders' Meeting URL<br> ▶https://www.soukai-portal.net (in Japanese)<br> You can also use the website for exercising voting rights as before.<br> ▶https://www.web54.net (in Japanese) |  | Click "Exercise your voting right"! |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Please access the portal by entering your login ID and password printed on the voting form from the following URL. Then, enter your approval or disapproval by following the instructions shown on the screen.<br> The Portal of Shareholders' Meeting URL<br> ▶https://www.soukai-portal.net (in Japanese)<br> You can also use the website for exercising voting rights as before.<br> ▶https://www.web54.net (in Japanese) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Please access the portal by entering your login ID and password printed on the voting form from the following URL. Then, enter your approval or disapproval by following the instructions shown on the screen.<br> The Portal of Shareholders' Meeting URL<br> ▶https://www.soukai-portal.net (in Japanese)<br> You can also use the website for exercising voting rights as before.<br> ▶https://www.web54.net (in Japanese) |  |  |

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Notes:

● If you wish to change your vote after exercising your voting rights, it is necessary that you enter your voting rights code and password printed on the voting form.

● If you exercise your voting rights both via the Internet and in writing, your vote via the Internet will be treated as the valid one. Also, if you exercise your voting rights via the Internet multiple times, the final vote will be treated as the valid one.

For inquiries:

Dedicated phone line for Stock Transfer Agency Web Support, Sumitomo Mitsui Trust Bank, Limited 0120-652-031

(Operating hours: 9:00 a.m. to 9:00 p.m. (JST))

**Reference Documents for General Meeting of Shareholders**

**Proposal No. 1** Approval of Share Transfer Plan

Hagiwara Electric Holdings Co., Ltd. (the "Company") and SATORI ELECTRIC CO., LTD. ("Satori Electric") (the Company and Satori Electric shall hereinafter be collectively referred to as the "Companies") held discussions regarding the implementation of a business integration between the Companies (the "Business Integration") under the spirit of equality based on the memorandum of understanding executed by the Companies on July 28, 2025 (the "MOU"), following which they reached an agreement regarding the establishment of MIRAINI HOLDINGS Co., Ltd. (the "Joint Holding Company"), which will become the wholly-owning parent company of the Companies through a joint share transfer (the "Share Transfer") planned to be conducted on April 1, 2026, as well as regarding the terms and conditions of the Business Integration, and pursuant to a resolution of a Board of Directors meeting of each of the Companies held on October 14, 2025, the Companies executed a business integration agreement (the "Business Integration Agreement") on the same date and jointly prepared a share transfer plan (the "Share Transfer Plan").

Accordingly, the Company requests shareholder approval for the Share Transfer Plan.

The reasons for the Share Transfer, a summary of the Share Transfer Plan, and other matters relating to this proposal are as follows.

**1. Reasons for the Share Transfer**

The Companies, as comprehensive electronics trading companies handling semiconductors, electronic components, and electronic equipment, have been providing optimal solutions that meet the diverse needs of their customers and have expanded their businesses globally by leveraging a wide variety of products and advanced technologies. The electronics market is currently experiencing a surge in demand for the adoption and utilization of technologies such as the Internet of Things (IoT), artificial intelligence (AI), edge computing, generative AI, and digital transformation (DX), not only in next-generation automobiles, but also to resolve the challenges of smartification across a broad range of industries, including manufacturing. Amid this environmental change, there is an increasing need for solutions that are more closely aligned with customer challenges in the utilization and supply of semiconductors. Furthermore, the role of electronics trading companies is also evolving, as they are required to build more sophisticated supply chains in the face of the impact of overseas relocation of manufacturing bases in association with changes in semiconductor utilization needs, as well as growing uncertainties in the business environment caused by U.S.-China trade friction, export controls, and geopolitical tensions.

Under such a business environment, the Companies have reached a shared recognition that, in order to achieve continuous business growth and development going forward, it is essential to concentrate their respective management resources and leverage their strengths to expand the scale of their business, and thereby deliver even greater added value. Based on this recognition, the Companies have reached a final agreement to conduct the Business Integration through mutual cooperation based on the spirit of equality.

**2. Summary of the Share Transfer Plan**

A summary of the Share Transfer Plan is as stated in "Share Transfer Plan (Copy)" below.

**Share Transfer Plan (Copy)**

SATORI ELECTRIC CO., LTD. ("Satori Electric") and Hagiwara Electric Holdings Co., Ltd. ("Hagiwara Electric") have agreed to carry out a share transfer by means of a joint share transfer and have therefore jointly prepared the following share transfer plan (this "Plan").

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| | |
|:---|:---|
| **Article 1** | **Share Transfer** |

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In accordance with the provisions of this Plan, on the Establishment Date (defined in Article 6; hereinafter the same) of the wholly-owning parent company that is to be newly established by means of a joint share transfer (the "New Company"), Satori Electric and Hagiwara Electric shall carry out a share transfer (the "Share Transfer") causing the New Company to acquire all of the issued shares of Satori Electric and Hagiwara Electric, and as a result, Satori Electric and Hagiwara Electric will become wholly-owned subsidiaries of the New Company.

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| | |
|:---|:---|
| **Article 2** | **Purpose, Trade Name, Headquarters Location, Total Number of Authorized Shares, and Other Matters to Be Set Forth in the Articles of Incorporation of the New Company** |

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1. The New Company's purpose, trade name, headquarters location, and total number of authorized shares
shall be as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Purpose

The purpose of the New Company shall be as set forth in Article 2 of the Articles of Incorporation in Exhibit 1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Trade name

The trade name of the New Company shall be MIRAINI HOLDINGS Kabushiki Kaisha, rendered in English as MIRAINI HOLDINGS CO., LTD.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Headquarters location

The location of the headquarters of the New Company shall be Minato-ku, Tokyo, and the address of its headquarters shall be 1-14-10 Shiba, Minato-ku, Tokyo.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Main office addresses

The addresses of the main offices of the New Company shall be 2-2-1 Higashi Sakura, Higashi-ku, Nagoya-shi, Aichi and 1-14-10 Shiba, Minato-ku, Tokyo.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Total number of authorized shares

The total number of authorized shares of the New Company shall be 100,000,000 shares.

2. In addition to the matters listed in the preceding paragraph, the matters to be provided for in the articles
of incorporation of the New Company shall be as set forth in the Articles of Incorporation in Exhibit 1.

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| | |
|:---|:---|
| **Article 3** | **Names of the Directors and Financial Auditor Upon Establishment of the New Company** |

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1. The names of the Directors upon establishment of the New Company (excluding Directors upon establishment
concurrently serving as Audit & Supervisory Committee Members upon establishment) are as follows.

Director upon establishment (planned to be appointed as Representative Director and President): Moritaka Kimura

Director upon establishment (planned to be appointed as Representative Director and Vice President): Hiroyuki Satori

Director upon establishment: Naruhiko Mizukoshi

Director upon establishment: Takeshi Soejima

Director upon establishment: Takuma Oyama

Director upon establishment: Shunji Tsuchiya

Outside Director upon establishment: Akihiro Taguchi

Outside Director upon establishment: Shinichi Okamoto

Outside Director upon establishment: Kyoko Hayashi

2. The names of the Directors upon establishment of the New Company who are Audit & Supervisory Committee
Members upon establishment are as follows.

Director (Full-time Audit & Supervisory Committee Member) upon establishment: <br> Noriaki Inoue

Outside Director (Audit & Supervisory Committee Member) upon establishment: <br> Seiji Sakata

Outside Director (Audit & Supervisory Committee Member) upon establishment: <br> Sachiko Enomoto

Outside Director (Audit & Supervisory Committee Member) upon establishment: <br> Akiko Yukimaru

3. The name of the financial auditor upon establishment of the New Company is as follows.

KPMG AZSA LLC

**Article 4 Shares to Be Delivered at the Time of the Share Transfer and Their Allocation**

1. At the time of the Share Transfer, the New Company shall deliver to the shareholders of Satori Electric
and Hagiwara Electric as of the time immediately prior to the New Company acquiring all issued shares of Satori Electric and Hagiwara
Electric (the "Reference Time"), in exchange for the common shares of Satori Electric and Hagiwara Electric that each shareholder
owns, common shares of the New Company (the "Delivered Shares") in the same number as the total of (i) the number obtained
by multiplying the total number of common shares issued by Satori Electric as of the Reference Time by 1.02 and (ii) the number obtained
by multiplying the total number of common shares issued by Hagiwara Electric as of the Reference Time by 2.

2. The New Company shall allocate the Delivered Shares that are delivered pursuant to the provisions of the
preceding paragraph to the shareholders of Satori Electric and Hagiwara Electric as of the Reference Time in the following proportions
(the "Share Transfer Ratio").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) To shareholders of Satori Electric, 1.02 common shares of the New Company for each common share of Satori
Electric that the shareholder owns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) To shareholders of Hagiwara Electric, 2 common shares of the New Company for each common share of Hagiwara
Electric that the shareholder owns.

3. Any fraction of less than one share in the calculation set forth in the preceding two paragraphs shall
be handled in accordance with the provisions of Article 234 of the Companies Act (Act No. 86 of July 26, 2005, as amended) and other relevant
laws and regulations.

**Article 5 Amounts of the New Company's Stated Capital and Capital Reserves**

The amounts of stated capital and capital reserves on the Establishment Date of the New Company shall be as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Amount of stated capital: 10,000,000,000 yen

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Amount of capital reserves: 2,500,000,000 yen

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Amount of retained earnings reserves: 0 yen

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Amount of other capital surplus: The amount obtained by subtracting the total of the amounts set forth
in (1) and (2) above from the amount of changes in shareholder equity stipulated in Article 52, paragraph (1) of the Regulations for Corporate
Accounting (Ministry of Justice Order No. 12of 2006, as amended).

**Article 6 New Company Establishment Date**

The date on which the establishment of the New Company is to be registered (referred to as the "Establishment Date" in this Plan) shall be April 1, 2026. However, Satori Electric and Hagiwara Electric may change this by agreement upon consultation if necessary due to the progress of the procedures for the Share Transfer or for other reasons.

**Article 7 General Meetings of Shareholders to Approve the Share Transfer Plan**

1. Satori Electric shall convene an extraordinary general meeting of shareholders on December 11, 2025 and
seek resolutions regarding the approval of this Plan and matters required for the Share Transfer.

2. Hagiwara Electric shall convene an extraordinary general meeting of shareholders on December 11, 2025
and seek resolutions regarding the approval of this Plan and matters required for the Share Transfer.

3. If necessary due to the progress of the procedures for the Share Transfer or for any other reason, Satori
Electric and Hagiwara Electric may, upon consultation and agreement, change the date of each general meeting of shareholders seeking resolutions
regarding the approval of this Plan and matters required for the Share Transfer stipulated in the preceding two paragraphs.

**Article 8 Share Listing and Shareholder Register Administrator**

1. On the Establishment Date, the New Company plans to list its common shares on the Tokyo Stock Exchange,
Inc. ("TSE") Prime Market and the Nagoya Stock Exchange, Inc. ("NSE") Premier Market, and Satori Electric and
Hagiwara Electric shall, upon consultation, mutually cooperate to the extent possible to carry out the procedures required for such listing.

2. Satori Electric and Hagiwara Electric shall mutually cooperate and carry out necessary procedures to ensure
that the listing of common shares issued by the New Company on the TSE Prime Market and on the NSE Premier Market is maintained.

3. The shareholder register administrator for the New Company upon establishment will be Sumitomo Mitsui
Trust Bank, Limited.

**Article 9 Dividends of Surplus**

1. Satori Electric may distribute dividends of surplus (i) up to a maximum of 44 yen per

common share to the common shareholders or registered pledgees of common shares of Satori Electric who are entered or recorded in the final shareholder register on November 30, 2025 and (ii) up to a maximum of 46 yen per common share to the common shareholders or registered pledgees of common shares of Satori Electric who are entered or recorded in the final shareholder register on March 31, 2026.

2. Hagiwara Electric may distribute dividends of surplus (i) up to a maximum of 90 yen per common share to
the common shareholders or registered pledgees of common shares of Hagiwara Electric who are entered or recorded in the final shareholder
register on September 30, 2025 and (ii) up to a maximum of 95 yen per common share to the common shareholders or registered pledgees of
common shares of Hagiwara Electric who are entered or recorded in the final shareholder register on March 31, 2026.

3. Except for the cases set forth in the preceding two paragraphs, during the period after the preparation
of this Plan and until the New Company's Establishment Date, Satori Electric and Hagiwara Electric shall not pass a resolution to
distribute dividends of surplus with a record date on or before the New Company's Establishment Date. However, this provision will
not apply if Satori Electric and Hagiwara Electric otherwise agree through consultation.

**Article 10 Handling of Treasury Shares**

After the preparation of this Plan, Satori Electric and Hagiwara Electric shall consult in good faith in regard to the timing, method, and other such matters relating to the disposal of the treasury shares held by each party.

**Article 11 Management of Company Assets, etc.**

1. During the period after the preparation of this Plan and until the New Company's Establishment Date,
Satori Electric and Hagiwara Electric shall each perform their own business and manage and operate their assets with the due care of a
prudent manager, shall each cause their respective subsidiaries to perform their own business and manage and operate their assets with
the due care of a prudent manager, and except where otherwise set out in this Plan, shall consult and agree in advance before carrying
out or causing to be carried out any act that could have a material impact on their respective assets or rights and obligations.

2. During the period after the preparation of this Plan and until the New Company's Establishment Date,
if Satori Electric or Hagiwara Electric discovers events or circumstances that could have a material adverse impact on the execution of
the Share Transfer or the reasonableness of the Share Transfer Ratio, it shall promptly give written notice thereof to the other party,
and the parties shall consult in good faith on the handling thereof.

**Article 12 Effect of this Plan**

This Plan shall lose effect if the general meeting of shareholders of either Satori Electric or Hagiwara Electric set forth in Article 7 does not approve this Plan and resolve the matters necessary for the Share Transfer, if permits, etc. by relevant authorities necessary upon conducting the Share Transfer are not obtained by the New Company's Establishment Date, or if the Share Transfer is suspended pursuant to the following article.

**Article 13 Changes to Share Transfer Conditions and Suspension of the Share Transfer**

During the period after the preparation of this Plan and until the New Company's Establishment Date, if a material change has occurred or if it is discovered that there is an event that has a material impact on the financial or management condition of Satori Electric or Hagiwara Electric, if a situation that would materially impede the execution of the Share Transfer occurs or becomes evident, or if it otherwise becomes significantly difficult to achieve the purpose of this Plan, Satori Electric and Hagiwara Electric may, upon consultation and agreement, change the terms and conditions of the Share Transfer, amend the content of this Plan, or suspend the Share Transfer.

**Article 14 Matters for Consultation**

In addition to the matters stipulated in this Plan, Satori Electric and Hagiwara Electric shall separately consult on and determine any matters not provided for in this Plan and other matters required for the Share Transfer in accordance with the intent of this Plan.

IN WITNESS WHEREOF, two counterparts of this Plan are prepared, and upon affixing their names and seals thereto, one counterpart will be held by each of Satori Electric and Hagiwara Electric.

October 14, 2025

Satori Electric

1-14-10 Shiba, Minato-ku, Tokyo

SATORI ELECTRIC CO., LTD.

Representative Director and President: Hiroyuki Satori [seal]

Hagiwara Electric

2-2-1 Higashi Sakura, Higashi-ku, Nagoya-shi, Aichi

Hagiwara Electric Holdings Co., Ltd.

Representative Director and President Executive Officer: Moritaka Kimura [seal]

Exhibit 1

**Articles of Incorporation**

**Chapter 1 General Provisions**

**Article 1 Trade Name**

The trade name of the Company shall be MIRAINI HOLDINGS Kabushiki Kaisha, rendered in English as MIRAINI HOLDINGS CO., LTD.

**Article 2 Purpose**

1. The purpose of the Company shall be to control and manage the business activities of companies (including
foreign companies), partnerships (including foreign organizations equivalent to partnerships), and other business entities engaged in
the following businesses by holding the shares or equity, etc. thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Manufacturing, selling, exporting, and importing electronic measurement devices and applied electronic
devices.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Manufacturing, selling, exporting, and importing medical equipment and devices.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Purchasing for sale, exporting, importing, planning, developing, designing, manufacturing, processing,
leasing, and maintaining electronic circuit components.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Developing, designing, manufacturing, processing, purchasing for sale, exporting, importing, leasing,
and maintaining telecommunications equipment, optical communication equipment and devices, applied electronic equipment and devices, electrical
equipment and devices, and devices and wires related to any of the foregoing (including semiconductor devices, integrated circuits, and
other parts and materials used in, and other articles related to, any of the foregoing).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Planning, developing, designing, producing for sale, purchasing for sale, exporting, importing, leasing,
and maintaining computer systems and software.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) Electrical work and telecommunications work.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) Labor dispatch.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(8) Selling and purchasing secondhand goods.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(9) Loaning money, guaranteeing and assuming obligations, selling and purchasing various claims, and other
financial services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(10) Services relating to the planning, design, development, establishment, maintenance, and operation of information
systems.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(11) Services relating to the development of application software using the internet and the sale of licenses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(12) Telecommunications services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(13) Information processing services and information provision services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(14) Consulting relating to the businesses stated in item (3), item (4), item (5), item (12), and item (13).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(15) Processing, selling, exporting, and importing synthetic resins, other chemical products, and metals.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(16) Any businesses incidental to any of the foregoing.

2. The Company may engage in any of the businesses set out in the items of the preceding paragraph and any
businesses incidental or related thereto.

**Article 3 Location of Headquarters, etc.**

1. The headquarters of the Company shall be located in Minato-ku, Tokyo.

2. In addition to the headquarters stated in the preceding paragraph, the Company shall have its main offices
in Nagoya-shi, Aichi and Minato-ku, Tokyo.

**Article 4 Establishment of Organs**

In addition to the general meetings of shareholders and Directors, the Company shall establish the following organs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Board of Directors

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Audit & Supervisory Committee

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Financial auditor

**Article 5 Method of Public Notices**

The Company shall provide its public notices electronically. However, if the Company is unable to provide electronic public notices due to an accident or other unavoidable circumstances, the Company shall publish its public notices in the Nihon Keizai Shimbun.

**Chapter 2 Shares** 

**Article 6 Total Number of Authorized Shares**

The total number of authorized shares of the Company shall be 100,000,000 shares.

**Article 7 Number of Shares in a Share Unit**

The number of shares in a share unit of the Company shall be 100 shares.

**Article 8 Rights Pertaining to Shares of Less than One Share Unit**

Shareholders of the Company shall not be entitled to exercise any rights other than those stated below in regard to any shares of less than one share unit held thereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The rights stated in each item of Article 189, paragraph (2) of the Companies Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) The right to make a demand pursuant to the provisions of Article 166, paragraph (1) of the Companies Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) The right to receive an allotment of shares for subscription or share options for subscription in proportion
to the number of shares owned by the shareholder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) The right to make a demand set out in Article 11.

**Article 9 Share Handling Regulations**

The handling of the shares of the Company shall be governed by the Share Handling Regulations established by the Board of Directors.

**Article 10 Shareholder Register Administrator**

The Company shall have a shareholder register administrator.

**Article 11 Demand for Sale of Additional Shares**

Shareholders who hold shares of less than one share unit may demand the Company to sell additional shares to them in the number that will equal one share unit when totaled with the shares of less than one share unit held by the shareholder.

**Chapter 3 General Meetings of Shareholders**

**Article 12 Record Date**

The shareholders recorded in the shareholder register on March 31 of each year shall be entitled to exercise rights at the Ordinary General Meeting of Shareholders of that year.

**Article 13 Timing of Convocation**

An Ordinary General Meeting of Shareholders of the Company shall be convened in June of each year. Extraordinary general meetings of shareholders shall be convened whenever necessary.

**Article 14 Convener and Chairperson**

General meetings of shareholders of the Company shall be convened and chaired by the Director who is President and Executive Officer. If that Director is unable to do so, another Director in the order determined in advance by the Board of Directors shall convene and chair the meeting.

**Article 15 Resolution Requirements**

1. Unless otherwise provided for in laws and regulations or these Articles of Incorporation, the passage
of a resolution of a general meeting of shareholders shall require approval by a majority of the voting rights of the attending shareholders.

2. The passage of a resolution of a general meeting of shareholders pursuant to Article 309, paragraph (2)
of the Companies Act shall require (i) the attendance of shareholders holding one third or more of the voting rights of all shareholders
entitled to vote and (ii) approval by a majority of two thirds or more of the voting rights of the attending shareholders.

**Article 16 Measures for Electronic Provision, etc.**

1. When convening a general meeting of shareholders, the Company shall take measures to electronically provide
information contained in the general meeting of shareholders reference documents and other such documents.

2. In regard to the matters for which electronic provisions measures will be taken that are set out in a
Ministry of Justice order, the Company may choose not to state all or some of those matters in the documents to be delivered to shareholders
who requested the delivery of documents by the record date for voting rights.

**Article 17 Proxy Exercise of Voting Rights**

Shareholders may exercise their voting rights through a proxy who is another shareholder with voting rights in the Company. In this case, the shareholder or the proxy must submit a document certifying the right of proxy to the Company for each general meeting of shareholders.

**Chapter 4 Directors and the Board of Directors** 

**Article 18 Number of Directors**

1. The Company shall have 15 or fewer Directors.

2. Of the Directors set out in the preceding paragraph, five or fewer shall be Directors concurrently serving
as Audit & Supervisory Committee Members.

**Article 19 Election**

1. The election of a Director shall require (i) the attendance at a general meeting of shareholders of shareholders
holding one third or more of the voting rights of all shareholders entitled to vote and (ii) approval by a majority of the voting rights
of the attending shareholders. However, Directors concurrently serving as Audit & Supervisory Committee Members shall be elected separately
from other Directors.

2. Cumulative voting shall not be used when electing Directors.

3. The election of reserve Directors concurrently serving as Audit & Supervisory Committee Members shall
be effective until the start of the Ordinary General Meeting of Shareholders pertaining to the final business year to end within two years
following their election.

**Article 20 Term of Office**

1. The term of office of Directors (excluding Directors concurrently serving as Audit & Supervisory Committee
Members) shall be until the close of the Ordinary General Meeting of Shareholders pertaining to the final business year to end within
one year following their election.

2. The term of office of Directors concurrently serving as Audit & Supervisory Committee Members shall
be until the close of the Ordinary General Meeting of Shareholders pertaining to the final business year to end within two years following
their election.

3. The term of office of a Director concurrently serving as an Audit & Supervisory Committee Member and
who was elected as a reserve to fill a vacancy left by a Director concurrently serving as an Audit & Supervisory Committee Member
leaving office before the completion of his or her term shall be until the completion of the term of the Director concurrently serving
as an Audit & Supervisory Committee Member who left office.

**Article 21 Representative Directors**

The Board of Directors shall appoint several Representative Directors from among the Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members).

**Article 22 Board of Directors**

1. Unless otherwise provided for in laws and regulations, Board of Directors meetings shall be convened and
chaired by the Director determined in advance by the Board of Directors. If that Director is unable to do so, another Director in the
order determined in advance by the Board of Directors shall convene and chair the meeting.

2. Notice of the convocation of a Board of Directors meeting shall be sent to each Director at least three
days before the date of the meeting. However, this period may be shortened in urgent cases.

3. If all of the Directors so consent, a Board of Directors meeting may be held without following the convocation
procedures.

4. If a Director proposes a matter to be resolved on by the Board of Directors, and all of the Directors
entitled to participate in the vote regarding that resolution express their consent in writing or by electronic or magnetic means, a Board
of Directors resolution approving that proposal shall be deemed to have been passed.

5. Matters relating to the operation of the Board of Directors and other such matters shall be governed by
the Board of Directors Regulations established by the Board of Directors.

6. Pursuant to the provisions of Article 399-13, paragraph (6) of the Companies Act, the Company may delegate
all or part of the decisions regarding the execution of important operations (excluding the matters stated in the items of paragraph (5)
of that article) to the Directors by a Board of Directors resolution.

**Article 23 Executive Officers**

1. By a Board of Directors resolution, the Company may appoint executive officers and cause them to execute
the operations of the Company assigned to them.

2. By a Board of Directors resolution, the Board of Directors may appoint a President and Executive Officer
and other executive officers with titles from among the executive officers.

**Chapter 5 Audit & Supervisory Committee** 

**Article 24 Audit & Supervisory Committee**

1. Notice of the convocation of an Audit & Supervisory Committee meeting shall be sent to each Audit
& Supervisory Committee Member at least three days before the date of the meeting. However, this period may be shortened in urgent
cases.

2. If all of the Audit & Supervisory Committee Members so consent, an Audit & Supervisory Committee
meeting may be held without following the convocation procedures.

3. Matters relating to the operation of the Audit & Supervisory Committee and other such matters shall
be governed by the Audit & Supervisory Committee Regulations established by the Audit & Supervisory Committee.

4. By an Audit & Supervisory Committee resolution, the Audit & Supervisory Committee may appoint
full-time Audit & Supervisory Committee Members.

**Chapter 6 Director Liability Exemption**

**Article 25 Director Liability Exemption**

1. Pursuant to the provisions of Article 426, paragraph (1) of the Companies Act, the Company may, by a Board
of Directors resolution, exempt Directors (including former Directors) from liability for damages up to the maximum exemption amount set
out in laws and regulations.

2. Pursuant to the provisions of Article 427, paragraph (1) of the Companies Act, the Company may enter into
agreements with Directors (excluding Directors who are executive Directors, etc.) limiting their liability for damages. However, the maximum
amount of liability under such agreements shall be the amount set out in laws and regulations.

**Chapter 7 Accounting**

**Article 26 Business Year**

The business year of the Company shall be from April 1 of each year until March 31 of the following year.

**Article 27 Dividends of Surplus, etc.**

1. The Company may pay year-end dividends to the shareholders or registered pledgees of shares recorded in
the shareholder register on the last day of each business year.

2. In addition to the preceding paragraph, the Company may pay interim dividends to the shareholders or registered
pledgees of shares recorded in the shareholder register on September 30 of each year.

3. In addition to the preceding two paragraphs, the Company may pay other dividends of surplus after establishing
a reference date.

4. Unless otherwise provided for in laws and regulations, the Company shall determine the payment of dividends
of surplus and other matters set out in the items of Article 459, paragraph (1) of the Companies Act by a Board of Directors resolution.

**Article 28 Limitation of Dividend Payment Period**

If dividends of surplus are not collected after three years have passed from the date on which payment commenced, the Company shall be released from its obligation to pay those dividends.

**Supplementary Provisions**

**Article 1 Representative Directors Upon Establishment**

The Company's Representative Directors upon establishment shall be as follows.

Representative Director upon establishment: Moritaka Kimura

Representative Director upon establishment: Hiroyuki Satori

**Article 2 Initial Compensation, etc. for Directors**

The amount of compensation, etc. for the Company's Directors for the period from the establishment date of the Company until the close of its first Ordinary General Meeting of Shareholders shall be as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Monetary compensation, etc. for Directors (excluding Directors concurrently serving as Audit & Supervisory
Committee Members)

The total amount of compensation, etc. shall be 800,000,000 yen or less annually (however, excluding the employee salaries of employees who are also Directors).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Compensation, etc. for Directors concurrently serving as Audit & Supervisory Committee Members

The total amount of compensation, etc. shall be 280,000,000 yen or less annually.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Monetary compensation claims issued in order to grant restricted stock

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. Allotment of and payment for restricted stock

The Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors; the "Eligible Directors") shall, as an in-kind investment, pay all of the monetary compensation claims issued pursuant to a resolution of the Company's Board of Directors and receive an allotment of the Company's common shares ("Restricted Stock").

The paid-in amount for Restricted Stock shall be determined by the Company's Board of Directors within an extent that is not particularly favorable to the Eligible Directors based on the closing price of the Company's common shares on the Tokyo Stock Exchange on the business day preceding the date of the resolution of the Company's Board of Directors regarding the issuance or disposal of the Restricted Stock (if no shares were traded on that day, then the closing price of the nearest preceding day on which shares were traded). In addition, the monetary compensation claims shall be issued on the condition that the Eligible Directors consent to making that in-kind investment and enter into the restricted stock allotment agreement set out in D below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. Amount of monetary compensation claims to be issued to the Eligible Directors

The amount of monetary compensation claims to be issued to the Eligible Directors in order to grant Restricted Stock shall be within the annual amount of compensation stated in "(1) Monetary compensation, etc. for Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members)" and shall be 200,000,000 yen or less annually.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. Total number of shares of Restricted Stock

The total number of shares of Restricted Stock to be allotted to the Eligible Directors in each business year shall be limited to a maximum of 200,000 shares. However, if a share split (including a gratis allotment of shares) or share consolidation is performed in regard to the Company's common shares or if it is otherwise necessary to adjust the total number of shares of Restricted Stock to be allotted to the Eligible Directors, the Company may make reasonable adjustments thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. Details of the restricted stock allotment agreement

When allotting Restricted Stock, the Company shall, pursuant to a resolution of its Board of Directors, enter into a restricted stock allotment agreement with the Eligible Directors who will receive allotments of Restricted Stock containing the content summarized below (shares of Restricted Stock allotted to those Eligible Directors are hereinafter referred to as "Allotted Shares").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Details of transfer restriction

Eligible Directors who receive an allotment of Restricted Stock shall not be entitled to transfer to a third party, establish a pledge on, establish a right of security by assignment (*joto tanpo*) on, make an *inter vivos* gift of, bequeath, or otherwise dispose of the Allotted Shares for 30 years following the day on which the allotment was received (the "Transfer Restriction Period"; this restriction is hereinafter referred to as the "Transfer Restriction").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Acquisition of Restricted Stock without charge

If an Eligible Director who has been allotted the restricted stock resigns or retires from their office as a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer thereof, a Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer of its subsidiaries, or any other position designated by the Board of Directors of the Company from the commencement date of the Transfer Restriction Period until the day immediately before the date of the Company's first Ordinary General Meeting of Shareholders to be held after such commencement date, the Company shall naturally acquire all of the Allotted Shares without charge, unless there are reasons that the Board of Directors of the Company deems to be justifiable. Furthermore, if, at the time of the expiration of the Transfer Restriction Period, there are any Allotted Shares for which the Transfer Restriction has not been lifted pursuant to the provisions of (c) below, the Company shall naturally acquire all the Allotted Shares without charge. However, if, during the Transfer Restriction Period, a merger agreement under which the Company is to become a disappearing company, a share exchange agreement or a share transfer plan under which the Company is to become a wholly owned subsidiary, or any other proposal relating to organizational restructuring, etc. is approved at a general meeting of shareholders of the Company (however, if such organizational restructuring, etc. does not require approval at a general meeting of shareholders of the Company, the Board of Directors of the Company) and if, in such organizational restructuring, etc., a corporation other than the Company subject to such organizational restructuring, etc. delivers shares of such corporation (limited to shares that are equivalent to shares with restriction on transfer) to Eligible Directors, the Company shall not acquire the Allotted Shares without charge.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Lifting of Transfer Restriction

The Company shall lift the Transfer Restriction of all the Allotted Shares upon the expiration of the Transfer Restriction Period on the condition that an Eligible Director who has been allotted the restricted

stock has continuously held the position of a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer thereof, a Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer of its subsidiaries, or any other position designated by the Board of Directors of the Company from the commencement date of the Transfer Restriction Period until the date of the Company's first Ordinary General Meeting of Shareholders to be held after such commencement date. However, if such Eligible Director resigns or retires from their office as a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer thereof, a Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer of its subsidiaries, or any other position designated by the Board of Directors of the Company prior to the expiration of the Transfer Restriction Period for reasons that the Board of Directors of the Company deems to be justifiable, the number of the Allotted Shares for which the Transfer Restriction will be lifted and the timing of such lifting shall be reasonably adjusted as necessary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Handling of organizational restructuring, etc.

If, during the Transfer Restriction Period, a merger agreement under which the Company is to become a disappearing company, a share exchange agreement or a share transfer plan under which the Company is to become a wholly owned subsidiary, or any other proposal relating to organizational restructuring, etc. is approved at a general meeting of shareholders of the Company (however, if such organizational restructuring, etc. does not require approval at a general meeting of shareholders of the Company, the Board of Directors of the Company), the Company shall, by a resolution of the Board of Directors of the Company, lift the Transfer Restriction of the Allotted Shares in a number reasonably determined based on the period from the commencement date of the Transfer Restriction Period to the date of approval of such organizational restructuring, etc., prior to the effective date of such organizational restructuring, etc.

In such a case, the Company shall naturally acquire the Allotted Shares for which the Transfer Restriction has not been lifted at the time immediately following the lifting of the Transfer Restriction in accordance with the above provisions. Provided, however, if, in such organizational restructuring, etc., a corporation other than the Company subject to such organizational restructuring, etc. delivers shares of such corporation (limited to shares that are equivalent to restricted stock) to the Eligible Directors, the Company will not lift the Transfer Restriction of the Allotted Shares nor acquire the Allotted Shares without charge.

**Article 3 Assumption of Contractual Status Relating to Restricted Stock**

On April 1, 2026, the Company shall assume the contractual status and rights and obligations of Hagiwara Electric Holdings Co., Ltd. under the allotment agreement pertaining to the

restricted stock delivered pursuant to the restricted stock compensation plan approved at the 61st Ordinary General Meeting of Shareholders of Hagiwara Electric Holdings Co., Ltd. held on June 28, 2018.

**Article 4 Deletion of Supplementary Provisions**

Article 1 through Article 3 of these supplementary provisions shall be deleted upon the close of the Company's first Ordinary General Meeting of Shareholders.

**3.** **Matters Relating to the Appropriateness of Provisions Regarding the Matters Stated in Article 773, Paragraph (1), Items (v) and (vi) of the Companies Act** 

(1) Matters Relating to the Allotment of Shares of the Joint Holding Company to Be Delivered to the Shareholders
of the Companies by the Joint Holding Company Upon the Share Transfer

(i) Content of Allotment Pertaining to the Share Transfer (Share Transfer Ratio)

The Companies have determined that the allotment ratio of common shares of the Joint Holding Company to be allotted and delivered to the shareholders of each of the Companies upon the establishment of the Joint Holding Company through the Share Transfer (the "Share Transfer Ratio") shall be as follows.

Company name <u>The Company</u> <u>Satori Electric</u> <br> <u>Share Transfer Ratio</u> <u>2</u> <u>1.02</u>

(Note 1) Details of the Share Allotment pertaining to the Share Transfer

For each common share of the Company, two common shares of the Joint Holding Company shall be allotted and delivered; and for each common share of Satori Electric, 1.02 common shares of the Joint Holding Company shall be allotted and delivered. In the event that any fractional shares of the Joint Holding Company arise as a result of the Share Transfer, the amount of money corresponding to such fractional shares will be paid to the relevant shareholders, in accordance with Article 234 of the Companies Act and other applicable laws and regulations; provided, however, that the above Share Transfer Ratio may be subject to change upon mutual consultation between the Companies, if there is any material change in the conditions that form the basis of the valuation thereof or if any material discrepancy is found.

(Note 2) The share unit of the Joint Holding Company shall be 100 shares.

(Note 3) Number of new shares to be delivered by the Joint Holding Company (scheduled)

Common shares: 35,481,762 shares

The above number is based on the total number of issued shares of the Company as of September 30, 2025 (10,118,000 shares), and the total number of issued shares of Satori Electric as of August 31, 2025 (14,946,826 shares).

(Note 4) Handling of Shares Less Than One Unit

Shareholders of the Companies who receive an allotment of shares of the Joint Holding Company constituting less than one unit (100 shares) ("Shares Less Than One Unit") in the Share Transfer will not be able to sell the Shares Less Than One Unit that they hold on the Tokyo Stock Exchange or other financial instruments exchanges. However, such shareholders may demand that the Joint Holding Company purchase the Shares Less Than One Unit that they hold in accordance with the provision of Article 192, paragraph (1) of the Companies Act.

Additionally, it is planned that provisions will be set forth in the articles of incorporation of the Joint Holding Company to the effect that the shareholders may demand that the Joint Holding Company sell them a sufficient number

of shares to constitute one share unit when combined with the Shares Less Than One Unit that they hold. Therefore, pursuant to such provision of the articles of incorporation and the provision of Article 194, paragraph (1) of the Companies Act, the shareholders will be able to demand that the Joint Holding Company sell them a sufficient number of shares to constitute one share unit when combined with the Shares Less Than One Unit that they hold.

(ii) Grounds and Reasons for the Content of the Allotment Pertaining to the Share Transfer

To ensure the fairness of the Share Transfer Ratio in the Share Transfer and to otherwise ensure the fairness of the Share Transfer, the Company appointed SMBC Nikko Securities Inc. ("SMBC Nikko") as a third-party appraiser and Mori Hamada & Matsumoto LPC ("Mori Hamada") as its legal advisor. Meanwhile, Satori Electric appointed Daiwa Securities Co. Ltd. ("Daiwa Securities") as a third-party appraiser and TMI Associates as its legal advisor.

The Companies have requested their respective third-party appraisers to perform a valuation on the Share Transfer Ratio to be used in the Share Transfer. Based on the valuation results provided by the respective third-party appraisers and advice from their respective legal advisors, and after comprehensively considering their respective financial conditions, asset status, future outlook, and other factors, the Companies engaged in multiple rounds of careful negotiations and consultations concerning the Share Transfer Ratio. As a result, the Companies determined that the Share Transfer Ratio set forth in "(i) Content of Allotment Pertaining to the Share Transfer (Share Transfer Ratio)" above is appropriate. Accordingly, at the respective Board of Directors meetings held on July 28, 2025, the Companies resolved to approve the Share Transfer Ratio and execute the MOU, and the MOU was duly executed.

The Companies have confirmed that, with respect to the basis for calculating the Share Transfer Ratio stated above, no material change that affects the Share Transfer Ratio stated above occurred after the execution of the MOU and agreed on the Share Transfer Ratio stated above in the Business Integration Agreement dated October 14, 2025 and the Share Transfer Plan.

(iii) Matters Related to the Valuation

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Names of appraisers and their relationship with the Companies

Neither SMBC Nikko, as the third-party appraiser for the Company, nor Daiwa Securities, as the third-party appraiser for Satori Electric, is a related party of the Companies, and neither SMBC Nikko nor Daiwa Securities has any material interest in connection with the Share Transfer which needs to be stated. The fees to be paid to SMBC Nikko and Daiwa Securities in relation to the Share Transfer include fixed fees to be paid irrespective of whether the Share Transfer is successful or unsuccessful and contingency fees to be paid subject to the completion of the Share Transfer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Summary of valuation

In order to ensure the fairness of the valuation of the Share Transfer Ratio to be used in the Share Transfer, the Company appointed SMBC Nikko as its third-party appraiser, and Satori Electric appointed Daiwa Securities as its third-party appraiser, following which each of the Companies requested its appraiser to conduct a valuation and analysis of the Share Transfer Ratio.

SMBC Nikko conducted the valuation employing the market share price method, since the shares of the Company are listed on the Prime Market of the Tokyo Stock Exchange

and the Premier Market of the Nagoya Stock Exchange, and the shares of Satori Electric are listed on the Prime Market of the Tokyo Stock Exchange, and each of their market share prices is available. Additionally, SMBC Nikko employed the comparable listed company method, since there are multiple listed companies that are engaged in businesses relatively comparable to the Company and Satori Electric, and it is therefore possible to infer the share value by comparing similar listed companies. Furthermore, the discounted cash flow (DCF) method was employed to evaluate the intrinsic value based on the status of the Company's and Satori Electric's future business activities.

The valuation results under each of the above methods are as follows. The valuation range of the Share Transfer Ratio below represents the valuation results of the number of common shares of the Joint Holding Company to be allotted per common share of Satori Electric when allotting two common shares of the Joint Holding Company for one common share of the Company.

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| | |
|:---|:---|
| &nbsp;&nbsp;Methods employed | &nbsp;&nbsp;Valuation range of the Share Transfer Ratio |
| &nbsp;&nbsp;Market share price method | &nbsp;&nbsp;1.01 - 1.03 |
| &nbsp;&nbsp;Comparable listed company method | &nbsp;&nbsp;0.87 - 1.75 |
| &nbsp;&nbsp;DCF method | &nbsp;&nbsp;0.53 - 1.16 |

---

The market share price method was conducted for the Company and Satori Electric with the valuation reference date set as July 25, 2025, by employing the simple average of the closing prices (rounded to the nearest yen) on the Prime Market of the Tokyo Stock Exchange for the period of one month, three months, and six months immediately preceding the valuation reference date, respectively, and the range of the Share Transfer Ratio was calculated as specified above based on the results of each such evaluation.

In calculating the Share Transfer Ratio, SMBC Nikko, in principle, used the information provided by the Company and Satori Electric and information, etc. available to the general public. SMBC Nikko relied on the assumption that all such materials and information, etc. were accurate and complete and did not independently verify their accuracy and completeness. In addition, SMBC Nikko did not conduct any independent valuation, appraisal, or assessment of the assets and liabilities of the Company and Satori Electric and their associated companies (including off-balance sheet assets and liabilities and other contingent liabilities), nor did it request a third-party appraiser to conduct any valuation, appraisal, or assessment. Furthermore, SMBC Nikko assumed that the information concerning the financial forecasts of the Company and Satori Electric (including the profit plans and other information) was reasonably prepared by the respective managements of the Company and Satori Electric based on the best forecasts and judgments as at the time such information was provided.

In addition, the business plans of the Company and Satori Electric, which SMBC Nikko used as a basis for its valuation under the DCF method, do not incorporate any synergy effects to be achieved as a result of the Business Integration. Moreover, the business plan of the Company for the fiscal years ending March 31, 2026 through March 31, 2028, which SMBC Nikko used as a basis for its valuation under the DCF method, includes fiscal years in which substantial fluctuations in profit are anticipated compared to the previous fiscal year. Specifically, for the fiscal year ending March 31, 2027, a substantial increase in operating income is anticipated compared to the previous fiscal year, driven by revenue growth in the electronic devices business due to the acquisition of new

projects and, in the technology solutions business, by steady demand for DX investment as well as an acceleration in the transition to a high value-added business model centered on data utilization.

Meanwhile, Daiwa Securities conducted the valuation employing the market share price method, since the Companies have listed their shares on financial instruments exchanges and their market share prices are available. Additionally, Daiwa Securities employed the comparable company method, since there are multiple listed companies comparable to the Companies and it is therefore possible to estimate the share value by comparing similar companies. Furthermore, Daiwa Securities employed the DCF method in order to reflect the status of future business activities in the valuation.

The results of the valuation under each of the above methods are as follows. The figures below represent the results of the valuation of the number of common shares of the Joint Holding Company to be allotted per common share of Satori Electric when allotting two common shares of the Joint Holding Company for one common share of the Company.

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| | |
|:---|:---|
| &nbsp;&nbsp;Methods employed | &nbsp;&nbsp;Valuation range of the Share Transfer Ratio |
| &nbsp;&nbsp;Market share price method | &nbsp;&nbsp;1.01 - 1.04 |
| &nbsp;&nbsp;Comparable company method | &nbsp;&nbsp;0.65 - 1.54 |
| &nbsp;&nbsp;DCF method | &nbsp;&nbsp;0.72 - 1.37 |

---

The market share price method was conducted with the valuation reference date set as July 25, 2025, by employing the closing price on the Tokyo Stock Exchange on the valuation reference date and the simple average of the closing prices on the Tokyo Stock Exchange for each period of the past one month, three months, and six months immediately preceding the valuation reference date, respectively.

Under the DCF method, the corporate value is calculated by discounting future cash flows, etc. (which are expected to be generated based on the financial forecasts prepared by the Companies) to present value at a certain discount rate. The financial forecast of Satori Electric which the calculation was based on does not include a fiscal year in which a substantial increase or decrease in profit is expected; however, the financial forecast of the Company does include such a fiscal year in which a substantial increase or decrease in the profit from the previous fiscal year is expected. Specifically, during the fiscal year ending March 31, 2027, a substantial increase in the operating profits from the previous fiscal year is expected due to an increase in net sales resulting from expanded sales in the engineering business that supports the utilization of software for mobility systems and in high value added devices, as well as due to a recovery of the gross profit margin resulting from a rebound from worsened profits caused by currency exchange fluctuations and certain low-profit projects.

In calculating the Share Transfer Ratio, Daiwa Securities, in principle, used the information provided by the Companies as well as information, etc. available to the general public. Daiwa Securities relied on the assumption that all such materials and information, etc. were accurate and complete and did not independently verify their accuracy and completeness. In addition, Daiwa Securities did not conduct any independent valuation, appraisal, or assessment of the assets and liabilities of the Companies and their associated companies (including off-balance sheet assets and

liabilities and other contingent liabilities), nor did it request a third-party appraiser to conduct any valuation, appraisal, or assessment. Furthermore, Daiwa Securities assumed that the information concerning the financial forecasts of the Companies (including the profit plans and other information) was reasonably prepared by the respective managements of the Companies based on the best forecasts and judgments as at the time such information was provided.

(iv) Measures to Ensure Fairness

The Company has taken the following measures to ensure the fairness of the Share Transfer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Procurement of a share transfer ratio valuation report from an independent third-party appraiser

As stated in "(ii) Grounds and Reasons for the Content of the Allotment Pertaining to the Share Transfer" above, in order to ensure the fairness and appropriateness of the Share Transfer, the Company has appointed SMBC Nikko as an independent third-party appraiser and has obtained a share transfer ratio valuation report to serve as the basis for the agreement on the Share Transfer Ratio in the Share Transfer. In addition, the Company has engaged in negotiations and consultations with Satori Electric, with reference to the analysis and advice of SMBC Nikko as a financial advisor and third-party appraiser, and the Company resolved at its Board of Directors meeting held on July 28, 2025 to carry out the Share Transfer based on the Share Transfer Ratio stated in "(i) Content of Allotment Pertaining to the Share Transfer (Share Transfer Ratio)" above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Advice from independent law firm

In order to ensure the fairness and appropriateness of decision making by its Board of Directors, the Company has obtained legal advice from Mori Hamada, a legal advisor independent from the Companies, regarding matters such as procedures for the Share Transfer and decision-making methods and processes to be undertaken by the Company. Mori Hamada is not a related party of the Companies and does not have any material interest in connection with the Business Integration which needs to be stated.

Meanwhile, Satori Electric has taken the following measures to ensure the fairness of the Share Transfer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Procurement of a share transfer ratio valuation report, etc. from an independent third-party appraiser

As stated in "(ii) Grounds and Reasons for the Content of the Allotment Pertaining to the Share Transfer" above, in order to ensure the fairness and appropriateness of the Share Transfer, Satori Electric has appointed Daiwa Securities as an independent third-party appraiser and has obtained a share transfer ratio valuation report to serve as the basis for the agreement on the Share Transfer Ratio in the Share Transfer. In addition, Satori Electric has engaged in negotiations and consultations with the Company, with reference to the analysis and advice of Daiwa Securities as a financial advisor and third-party appraiser, and Satori Electric resolved at its Board of Directors meeting held on July 28, 2025 to carry out the Share Transfer based on the Share Transfer Ratio stated in "(i) Content of Allotment Pertaining to the Share Transfer (Share Transfer Ratio)" above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Advice from independent law firm

In order to ensure the fairness and appropriateness of decision making by its Board of Directors, Satori Electric has obtained legal advice from TMI Associates, a legal advisor independent from the Companies, regarding matters such as procedures for the Share

Transfer and decision-making methods and processes to be undertaken by Satori Electric. TMI Associates is not a related party of the Companies and does not have any material interest in connection with the Business Integration which needs to be stated.

(v) Matters relating to application for listing of Joint Holding Company, etc.

The Companies plan to apply for a technical listing of the common shares of the Joint Holding Company to be newly established on the Tokyo Stock Exchange and Nagoya Stock Exchange. The scheduled listing date is April 1, 2026. As the Companies will become wholly-owned subsidiaries of the Joint Holding Company as a result of the Share Transfer, the shares of Satori Electric are scheduled to be delisted from the Tokyo Stock Exchange, and the shares of the Company are scheduled to be delisted from the Tokyo Stock Exchange and the Nagoya Stock Exchange, respectively, on March 30, 2026, prior to the listing of the shares of the Joint Holding Company. The date of the delisting will be determined pursuant to the respective rules of the Tokyo Stock Exchange and the Nagoya Stock Exchange.

(vi) Measures to Avoid Conflicts of Interest

No special measures have been taken in connection with the Share Transfer as there are no particular conflicts of interest between the Companies.

(2) Matters Relating to the Amounts of Stated Capital and Capital Reserves of the Joint Holding Company

The Companies have determined that the amounts of the stated capital and capital reserves of the Joint Holding Company upon its establishment through the Share Transfer shall be as follows.

(i) Amount of stated capital: 10,000,000,000 yen

(ii) Amount of capital reserves: 2,500,000,000 yen

(iii) Amount of retained earnings reserves: 0 yen

(iv) Amount of other capital surplus: The amount obtained by subtracting the total of the amounts set forth
in (i) and (ii) above from the amount of changes in shareholder equity stipulated in Article 52, paragraph (1) of the Regulations for
Corporate Accounting.

The Companies held discussions and determined the above amounts of stated capital and capital reserves within the scope of the provisions of Article 52 of the Regulations for Corporate Accounting after comprehensively taking into account and considering the size of the Joint Holding Company and other various factors.

**4.** **Matters Relating to the Appropriateness of Provisions Regarding the Matters Stated in Article 773, Paragraph (1), Items (ix) and (x) of the Companies Act** 

There are no applicable matters.

**5.** **Matters Relating to Satori Electric** 

(1) Details of Financial Statements, etc. for Most Recent Business Year (Fiscal Year Ended May 31, 2025)

The details of the financial statements, etc. of Satori Electric for the fiscal year ended May 31, 2025 are not stated in these reference documents pursuant to the provisions of laws and regulations and Article 15, paragraph 2 of the Company's Articles of Incorporation as they are available on the Company's website (https://www.hagiwara.co.jp/ir/stocks/meeting/), the

website for publishing shareholders meeting reference documents (https://d.sokai.jp/7467/25295857/), and the website of the Tokyo Stock Exchange (https://www2.jpx.co.jp/tseHpFront/JJK010010Action.do?Show=Show).

(2) Details of Events Having a Material Impact on the Status of Company Assets That Occurred After the Last
Day of the Most Recent Business Year

There are no applicable matters.

**6.** **Details of Events Pertaining to the Company Having a Material Impact on the Status of Company Assets That Occurred After the Last Day of the Most Recent Business Year** 

There are no applicable matters.

**7.** **Matters Set Out in Article 74 of the Regulations for Enforcement of the Companies Act Regarding Persons Who Will Be Directors (Excluding Persons Who Will Be Directors Concurrently Serving as Audit & Supervisory Committee Members) of the Wholly-Owning Parent Company Established Through the Share Transfer** 

The persons who will be Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members) of the Joint Holding Company are as follows.

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Satori Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Jan. 2007 | &nbsp;&nbsp;Joined Oracle Corporation Japan |  |
|  | &nbsp;&nbsp;Jan. 2011 | &nbsp;&nbsp;Joined Hagiwara Electric Co., Ltd., Department Manager of Overseas Department |  |
|  | &nbsp;&nbsp;Apr. 2011 | &nbsp;&nbsp;President and CEO of Hagiwara America, Inc. |  |
|  | &nbsp;&nbsp;Oct. 2012 | &nbsp;&nbsp;Managing Director of Hagiwara Electric Europe GmbH |  |
|  | &nbsp;&nbsp;July 2014 | &nbsp;&nbsp;General Manager of 1st Electron Devices Division of Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;June 2015 | &nbsp;&nbsp;Executive Officer of Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2018 | &nbsp;&nbsp;Director of Hagiwara Electronics Co., Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2020 | &nbsp;&nbsp; Managing Executive Officer of Hagiwara Electric Holdings Co., Ltd.<br> Director of Hagiwara Techno Solutions Co., Ltd. |  |
| &nbsp;&nbsp; Moritaka Kimura<br> (January 30, 1967) | &nbsp;&nbsp;June 2020 | &nbsp;&nbsp; Director of Hagiwara Electric Holdings Co., Ltd.<br> Supervising Corporate Planning Division of Hagiwara Electric Holdings Co., Ltd. | &nbsp;&nbsp; (1) 11,128 shares<br> (2) - shares<br> (3) 22,256 shares |
|  | &nbsp;&nbsp;June 2021 | &nbsp;&nbsp;President and Representative Director of Hagiwara Electric Holdings Co., Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2022 | &nbsp;&nbsp;Supervising Corporate Strategy Division of Hagiwara Electric Holdings Co., Ltd. (current position) |  |
|  | &nbsp;&nbsp;June 2023 | &nbsp;&nbsp;Supervising Internal Audit Office of Hagiwara Electric Holdings Co., Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2024 | &nbsp;&nbsp;Supervising Internal Auditing Department of Hagiwara Electric Holdings Co., Ltd. (current position) |  |
|  | &nbsp;&nbsp;Apr. 2025 | &nbsp;&nbsp; Representative Director, President Executive Officer of Hagiwara Electric Holdings Co., Ltd. (current position)<br> Supervising Accounting & Finance Division of Hagiwara Electric Holdings Co., Ltd. (current position) |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Moritaka Kimura has many years of work experience in the device business and has been promoting initiatives related to new business as Director of business companies. He has been demonstrating his excellent leadership in promoting the new medium-term management plan since assuming the office of President and Representative Director of the Company. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Moritaka Kimura has many years of work experience in the device business and has been promoting initiatives related to new business as Director of business companies. He has been demonstrating his excellent leadership in promoting the new medium-term management plan since assuming the office of President and Representative Director of the Company. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Moritaka Kimura has many years of work experience in the device business and has been promoting initiatives related to new business as Director of business companies. He has been demonstrating his excellent leadership in promoting the new medium-term management plan since assuming the office of President and Representative Director of the Company. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Moritaka Kimura has many years of work experience in the device business and has been promoting initiatives related to new business as Director of business companies. He has been demonstrating his excellent leadership in promoting the new medium-term management plan since assuming the office of President and Representative Director of the Company. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Satori Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Sep. 1995 | &nbsp;&nbsp;Joined SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2002 | &nbsp;&nbsp;Director in charge of Overseas Business of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2005 | &nbsp;&nbsp;Director in charge of Greater China Business of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2007 | &nbsp;&nbsp;Managing Director, Head of Asia Business of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2008 | &nbsp;&nbsp;Director and Managing Executive Officer, Head of Overseas Business of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;June 2009 | &nbsp;&nbsp;Director and Managing Executive Officer, Head of Sales Promotion Business Unit in charge of Sales Promotion of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;June 2011 | &nbsp;&nbsp;Director and Senior Managing Executive Officer, Head of Sales in charge of Corporate Planning of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2011 | &nbsp;&nbsp;Representative Director and Senior Managing Executive Officer, Head of Management in charge of Corporate Planning of SATORI ELECTRIC CO., LTD. |  |
| &nbsp;&nbsp; Hiroyuki Satori<br> (July 13, 1966) | &nbsp;&nbsp;Aug. 2012 | &nbsp;&nbsp;Representative Director and Vice President in charge of Corporate Planning of SATORI ELECTRIC CO., LTD. | &nbsp;&nbsp; (1) - shares<br> (2) 104,938 shares<br> (3) 107,036 shares |
|  | &nbsp;&nbsp;June 2013 | &nbsp;&nbsp;Representative Director and President and COO of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2013 | &nbsp;&nbsp; Director of SATORI PINICS CO., LTD.<br> Director of STAR ELECTRONICS CO., LTD. (current position) |  |
|  | &nbsp;&nbsp;June 2016 | &nbsp;&nbsp;Representative Director and President and CEO of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;May 2018 | &nbsp;&nbsp;Representative Director and Chairman of SATORI SP TECHNOLOGY CO., LTD. (current position) |  |
|  | &nbsp;&nbsp;Aug. 2020 | &nbsp;&nbsp; Representative Director and President and Executive Officer of SATORI ELECTRIC CO., LTD. (current position)<br> Representative Director and Chairman of SATORI PINICS CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2023 | &nbsp;&nbsp;Director of SATORI PINICS CO., LTD. (current position) |  |
|  | &nbsp;&nbsp;Sep. 2025 | &nbsp;&nbsp; Director of SM Electronic Technologies Pvt. Ltd. (current position)<br> Director of MAGnetIC Holding B.V. (current position) |  |

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&nbsp;&nbsp;Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) <br>Hiroyuki Satori has been involved in domestic and overseas business operations and has extensive experience, including working experience at overseas business locations, and broad knowledge. He has demonstrated strong leadership in promoting management reforms as the Representative Director and President and Executive Officer of SATORI ELECTRIC CO., LTD. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience.

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Satori Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1987 | &nbsp;&nbsp;Joined MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. (currently PANASONIC HOLDINGS CORPORATION) |  |
|  | &nbsp;&nbsp;Apr. 2010 | &nbsp;&nbsp; Deputy Managing Director, PANASONIC SHUN HING INDUSTRIAL DEVICES SALES CO., LTD.<br> Deputy Managing Director, PANASONIC SHUN HING INDUSTRY (SHENZHEN) CO., LTD. |  |
|  | &nbsp;&nbsp;Mar. 2013 | &nbsp;&nbsp; Head of Power Device Div, PANASONIC AUTOMOTIVE & INDUSTRIAL SYSTEMS CO., LTD.<br> President and Representative Director, PANASONIC DEVICE DISCRETE SEMICONDUCTOR CO., LTD. |  |
| &nbsp;&nbsp; Naruhiko Mizukoshi<br> (December 17, 1963) | &nbsp;&nbsp;July 2017 | &nbsp;&nbsp;Director, Head of Semiconductor Business Unit, PANASONIC SEMICONDUCTOR SOLUTIONS CO., LTD. | &nbsp;&nbsp; (1) - shares<br> (2) 3,005 shares<br> (3) 3,065 shares |
|  | &nbsp;&nbsp;Sep. 2020 | &nbsp;&nbsp;Joined SATORI SP TECHNOLOGY CO., LTD. |  |
|  | &nbsp;&nbsp;Dec. 2020 | &nbsp;&nbsp;Executive Officer, SATORI SP TECHNOLOGY CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2021 | &nbsp;&nbsp;Director and Managing Executive Officer, SATORI SP TECHNOLOGY CO., LTD. |  |
|  | &nbsp;&nbsp;June 2022 | &nbsp;&nbsp;President and Representative Director, SATORI SP TECHNOLOGY CO., LTD. (current position) |  |
|  | &nbsp;&nbsp;June 2023 | &nbsp;&nbsp;Managing Executive Officer, Head of Enterprise Segment, SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2025 | &nbsp;&nbsp;Director and Managing Executive Officer, Head of Enterprise Segment, SATORI ELECTRIC CO., LTD. (current position) |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Naruhiko Mizukoshi has extensive knowledge and deep insight on management gained from his many years of involvement in business management in Japan and overseas at a major electronics manufacturer, and from his work experience at SATORI ELECTRIC CO., LTD., including serving as the President of a domestic subsidiary. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Naruhiko Mizukoshi has extensive knowledge and deep insight on management gained from his many years of involvement in business management in Japan and overseas at a major electronics manufacturer, and from his work experience at SATORI ELECTRIC CO., LTD., including serving as the President of a domestic subsidiary. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Naruhiko Mizukoshi has extensive knowledge and deep insight on management gained from his many years of involvement in business management in Japan and overseas at a major electronics manufacturer, and from his work experience at SATORI ELECTRIC CO., LTD., including serving as the President of a domestic subsidiary. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Naruhiko Mizukoshi has extensive knowledge and deep insight on management gained from his many years of involvement in business management in Japan and overseas at a major electronics manufacturer, and from his work experience at SATORI ELECTRIC CO., LTD., including serving as the President of a domestic subsidiary. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Satori Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1989 | &nbsp;&nbsp;Join Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;July 2006 | &nbsp;&nbsp;Manager of 1st Sales Department of 1st Electron Devices Division of Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;July 2011 | &nbsp;&nbsp;Deputy Manager of 2nd Electron Devices Division of Hagiwara Electric Co., Ltd. |  |
| &nbsp;&nbsp; Takeshi Soejima<br> (August 13, 1965) | &nbsp;&nbsp;July 2013 | &nbsp;&nbsp;General Manager of 2nd Electron Devices Division of Hagiwara Electric Co., Ltd. | &nbsp;&nbsp; (1) 3,229 shares<br> (2) - shares<br> (3) 6,458 shares |
|  | &nbsp;&nbsp;June 2015 | &nbsp;&nbsp;Executive Officer of Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2018 | &nbsp;&nbsp;Director of Hagiwara Electronics Co., Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2020 | &nbsp;&nbsp;Representative Director and President of Hagiwara Electronics Co., Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2025 | &nbsp;&nbsp;Representative Director, President, and Executive Officer of Hagiwara Electronics Co., Ltd. (current position) |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takeshi Soejima has abundant work experience in the electronic devices business over many years, and he has used that experience to provide strong leadership as the Representative Director, President, and Executive Officer of Hagiwara Electronics Co., Ltd. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takeshi Soejima has abundant work experience in the electronic devices business over many years, and he has used that experience to provide strong leadership as the Representative Director, President, and Executive Officer of Hagiwara Electronics Co., Ltd. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takeshi Soejima has abundant work experience in the electronic devices business over many years, and he has used that experience to provide strong leadership as the Representative Director, President, and Executive Officer of Hagiwara Electronics Co., Ltd. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takeshi Soejima has abundant work experience in the electronic devices business over many years, and he has used that experience to provide strong leadership as the Representative Director, President, and Executive Officer of Hagiwara Electronics Co., Ltd. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Satori Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1988 | &nbsp;&nbsp;Joined Mitsubishi Corporation |  |
|  | &nbsp;&nbsp;June 1997 | &nbsp;&nbsp;Investment and Credit Department of Mitsubishi International Corporation |  |
|  | &nbsp;&nbsp;Dec. 2002 | &nbsp;&nbsp;Treasurer Office (Finance Department) of Mitsubishi Corporation |  |
|  | &nbsp;&nbsp;Apr. 2009 | &nbsp;&nbsp;Accounting Department of Industrial Finance, Logistics & Development Group |  |
|  | &nbsp;&nbsp;May 2011 | &nbsp;&nbsp;Executive Vice President & CFO of Mitsubishi Corporation China Co., Ltd. |  |
|  | &nbsp;&nbsp;July 2013 | &nbsp;&nbsp;Deputy General Manager of Risk Management Department, in charge of Business Portfolio Management, of Mitsubishi Corporation |  |
|  | &nbsp;&nbsp;Jan. 2016 | &nbsp;&nbsp;Member of the Board, Managing Executive Officer, CFO of Mitsubishi Corporation Energy Co., Ltd. |  |
| &nbsp;&nbsp; Takuma Oyama<br> (February 1, 1966) | &nbsp;&nbsp;Mar. 2019 | &nbsp;&nbsp;General Manager of Accounting Department of Saudi Petrochemicals Development Co., Ltd. (SPDC) | &nbsp;&nbsp; (1) 828 shares<br> (2) - shares<br> (3) 1,656 shares |
|  | &nbsp;&nbsp;July 2020 | &nbsp;&nbsp;General Manager of Accounting Department, General Affairs Department, Information Systems Department & Assistant to President of SPDC |  |
|  | &nbsp;&nbsp;Apr. 2024 | &nbsp;&nbsp;Joined Hagiwara Electric Holdings Co., Ltd., Senior Managing Executive, Assistant to President |  |
|  | &nbsp;&nbsp;Apr. 2025 | &nbsp;&nbsp; Managing Executive Officer of Hagiwara Electric Holdings Co., Ltd.<br> Director of Hagiwara Electronics Co., Ltd. (current position)<br> Director of Hagiwara Techno Solutions Co., Ltd. (current position) |  |
|  | &nbsp;&nbsp;June 2025 | &nbsp;&nbsp; Director and Managing Executive Officer of Hagiwara Electric Holdings Co., Ltd. (current position)<br> In charge of Accounting & Finance Division of Hagiwara Electric Holdings Co., Ltd. (current position) |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takuma Oyama has extensive experience in the finance and accounting divisions at Mitsubishi Corporation, particularly serving as CFO in China and during his assignment to a domestic subsidiary. He also has experience working overseas in the U.S. and China, and after assuming office as a Director of the Company, he has been deeply involved in financial strategy. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takuma Oyama has extensive experience in the finance and accounting divisions at Mitsubishi Corporation, particularly serving as CFO in China and during his assignment to a domestic subsidiary. He also has experience working overseas in the U.S. and China, and after assuming office as a Director of the Company, he has been deeply involved in financial strategy. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takuma Oyama has extensive experience in the finance and accounting divisions at Mitsubishi Corporation, particularly serving as CFO in China and during his assignment to a domestic subsidiary. He also has experience working overseas in the U.S. and China, and after assuming office as a Director of the Company, he has been deeply involved in financial strategy. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takuma Oyama has extensive experience in the finance and accounting divisions at Mitsubishi Corporation, particularly serving as CFO in China and during his assignment to a domestic subsidiary. He also has experience working overseas in the U.S. and China, and after assuming office as a Director of the Company, he has been deeply involved in financial strategy. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Satori Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1991 | &nbsp;&nbsp;Joined THE DAI-ICHI MUTUAL LIFE INSURANCE COMPANY (currently THE DAI-ICHI LIFE INSURANCE CO., LTD.) |  |
|  | &nbsp;&nbsp;Feb. 2015 | &nbsp;&nbsp;Director, COO, DLI NORTH AMERICA INC. |  |
|  | &nbsp;&nbsp;Apr. 2017 | &nbsp;&nbsp;General Manager of Credit Department, THE DAI-ICHI LIFE INSURANCE CO., LTD. |  |
|  | &nbsp;&nbsp;Apr. 2020 | &nbsp;&nbsp; General Manager of Audit and Supervisory Committee's Center, DAI-ICHI LIFE HOLDINGS, INC.<br> General Manager of Audit and Supervisory Board Member's Center, THE DAI-ICHI LIFE INSURANCE CO., LTD. |  |
| &nbsp;&nbsp; Shunji Tsuchiya<br> (April 28, 1968) | &nbsp;&nbsp;Aug. 2022 | &nbsp;&nbsp;Executive Managing Director, VERTEX INVESTMENT SOLUTIONS CO., LTD. | &nbsp;&nbsp; (1) - shares<br> (2) - shares<br> (3) - shares |
|  | &nbsp;&nbsp;Apr. 2025 | &nbsp;&nbsp; Seconded to SATORI ELECTRIC CO., LTD.<br> Executive Fellow, Corporate Div., SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2025 | &nbsp;&nbsp; Joined SATORI ELECTRIC CO., LTD.<br> Director, SATORI ELECTRIC CO., LTD.<br> Director, SATORI PINICS CO., LTD. (current position)<br> Director, STAR ELECTRONICS CO., LTD. (current position)<br> Director, SATORI SP TECHNOLOGY CO., LTD. (current position) |  |
|  | &nbsp;&nbsp;Sep. 2025 | &nbsp;&nbsp;Director and Managing Executive Officer in charge of corporate affairs, SATORI ELECTRIC CO., LTD. |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Shunji Tsuchiya has extensive knowledge and deep insight, which he earned through his many years of involvement in diverse operations at a financial institution, including financial services, overseas business, and auditing, and through his involvement in management, including serving as Executive Managing Director in charge of corporate planning at an affiliate of that institution. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Shunji Tsuchiya has extensive knowledge and deep insight, which he earned through his many years of involvement in diverse operations at a financial institution, including financial services, overseas business, and auditing, and through his involvement in management, including serving as Executive Managing Director in charge of corporate planning at an affiliate of that institution. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Shunji Tsuchiya has extensive knowledge and deep insight, which he earned through his many years of involvement in diverse operations at a financial institution, including financial services, overseas business, and auditing, and through his involvement in management, including serving as Executive Managing Director in charge of corporate planning at an affiliate of that institution. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Shunji Tsuchiya has extensive knowledge and deep insight, which he earned through his many years of involvement in diverse operations at a financial institution, including financial services, overseas business, and auditing, and through his involvement in management, including serving as Executive Managing Director in charge of corporate planning at an affiliate of that institution. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Satori Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1980 | &nbsp;&nbsp;Joined OLYMPUS OPTICAL CO., LTD. (currently OLYMPUS CORPORATION) |  |
|  | &nbsp;&nbsp;June 2010 | &nbsp;&nbsp; Executive Officer, OLYMPUS CORPORATION<br> Director and Member of the Board, OLYMPUS MEDICAL SYSTEMS CORP. |  |
|  | &nbsp;&nbsp;Apr. 2012 | &nbsp;&nbsp; Senior Executive Managing Officer, OLYMPUS CORPORATION<br> President, OLYMPUS MEDICAL SYSTEMS CORP. |  |
|  | &nbsp;&nbsp;Apr. 2013 | &nbsp;&nbsp; Senior Executive Managing Officer, OLYMPUS CORPORATION<br> Outside Director, SONY OLYMPUS MEDICAL SOLUTIONS INC. |  |
|  | &nbsp;&nbsp;Apr. 2015 | &nbsp;&nbsp; Head of Sales Group and Business Management Officer of Medical Business, OLYMPUS CORPORATION<br> Director and Member of the Board, OLYMPUS MEDICAL SYSTEMS CORP. |  |
|  | &nbsp;&nbsp;June 2015 | &nbsp;&nbsp;Director and Senior Executive Managing Officer, OLYMPUS CORPORATION |  |
| &nbsp;&nbsp; (Outside Director)<br>Akihiro Taguchi<br> (January 26, 1958) | &nbsp;&nbsp;Apr. 2019 | &nbsp;&nbsp; Director and Senior Executive Managing Officer and Chief Operating Officer, OLYMPUS CORPORATION<br> President, OLYMPUS MEDICAL SYSTEMS CORP. | &nbsp;&nbsp; (1) - shares<br> (2) 2,038 shares<br> (3) 2,078 shares |
|  | &nbsp;&nbsp;June 2019 | &nbsp;&nbsp;Executive Officer and Chief Operating Officer, OLYMPUS CORPORATION |  |
|  | &nbsp;&nbsp;Apr. 2020 | &nbsp;&nbsp; Executive Officer and Chief Technology Officer, OLYMPUS CORPORATION<br> Director and Member of the Board, OLYMPUS MEDICAL SYSTEMS CORP. |  |
|  | &nbsp;&nbsp;Aug. 2022 | &nbsp;&nbsp;Outside Director, Audit and Supervisory Committee Member, SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Sep. 2023 | &nbsp;&nbsp;Outside Director and Member of Board, ASAHI INTECC CO., LTD. (current position) |  |
|  | &nbsp;&nbsp;Aug. 2024 | &nbsp;&nbsp;Outside Director and Chairman of the Board, SATORI ELECTRIC CO., LTD. (current position) |  |
|  | &nbsp;&nbsp; <br> (Significant concurrent positions)<br> Outside Director and Member of Board, ASAHI <br> INTECC CO., LTD. | &nbsp;&nbsp; <br> (Significant concurrent positions)<br> Outside Director and Member of Board, ASAHI <br> INTECC CO., LTD. |  |

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&nbsp;&nbsp;Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role <br>Akihiro Taguchi has extensive experience and broad knowledge from his background as a CTO and corporate manager at a group company of a comprehensive electronics maker, as well as professional insight and knowledge in design, development, and technology. The Companies propose his election as Outside Director of the Joint Holding Company to be newly established as they believe he will utilize that experience, knowledge, and insight. The Companies expect that he will provide advice and oversight of management of the Joint Holding Company, utilizing his abilities and experience.

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Satori Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Aug. 1989 | &nbsp;&nbsp;Joined Sony Corporation (currently Sony Group Corporation) |  |
|  | &nbsp;&nbsp;Sep. 2003 | &nbsp;&nbsp;Started research and development consultant business |  |
|  | &nbsp;&nbsp;Nov. 2004 | &nbsp;&nbsp;Outside Director of Digital Media Professionals Inc. (current position) |  |
| &nbsp;&nbsp;(Outside Director) | &nbsp;&nbsp;Mar. 2010 | &nbsp;&nbsp;Established Blue Shift Technology Inc., assumed office of Director (current position) | &nbsp;&nbsp; (1) 200 shares<br> (2) - shares<br> (3) 400 shares |
| &nbsp;&nbsp; Shinichi Okamoto<br> (April 28, 1958) | &nbsp;&nbsp;June 2022 | &nbsp;&nbsp;Outside Director of Hagiwara Electric Holdings Co., Ltd. (current position) |  |
|  | &nbsp;&nbsp; <br> (Significant concurrent positions)<br> Outside Director of Digital Media Professionals Inc. Director of Blue Shift Technology Inc. | &nbsp;&nbsp; <br> (Significant concurrent positions)<br> Outside Director of Digital Media Professionals Inc. Director of Blue Shift Technology Inc. |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Shinichi Okamoto has work experience as CTO of a group company of a comprehensive home electronics maker and as R&D consultant. The Companies propose his election as Outside Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. The Companies expect that he will provide advice and oversight of management of the Joint Holding Company, utilizing his abundant experience and deep insight. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Shinichi Okamoto has work experience as CTO of a group company of a comprehensive home electronics maker and as R&D consultant. The Companies propose his election as Outside Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. The Companies expect that he will provide advice and oversight of management of the Joint Holding Company, utilizing his abundant experience and deep insight. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Shinichi Okamoto has work experience as CTO of a group company of a comprehensive home electronics maker and as R&D consultant. The Companies propose his election as Outside Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. The Companies expect that he will provide advice and oversight of management of the Joint Holding Company, utilizing his abundant experience and deep insight. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Shinichi Okamoto has work experience as CTO of a group company of a comprehensive home electronics maker and as R&D consultant. The Companies propose his election as Outside Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. The Companies expect that he will provide advice and oversight of management of the Joint Holding Company, utilizing his abundant experience and deep insight. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Satori Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1989 | &nbsp;&nbsp;Joined Motorola, Inc. |  |
|  | &nbsp;&nbsp;June 1991 | &nbsp;&nbsp;Joined The Boston Consulting Group, Inc. |  |
|  | &nbsp;&nbsp;Jan. 2007 | &nbsp;&nbsp;Joined Globis Corporation |  |
|  | &nbsp;&nbsp;Apr. 2014 | &nbsp;&nbsp;Professor, Graduate School of Management, Globis University (current position) |  |
|  | &nbsp;&nbsp;July 2014 | &nbsp;&nbsp;Managing Director, General Manager, Corporate Administration Division, Globis Corporation |  |
|  | &nbsp;&nbsp;July 2019 | &nbsp;&nbsp;Senior Faculty Director, Faculty Division (currently Faculty Group Office) (current position) |  |
| &nbsp;&nbsp;(Outside Director) | &nbsp;&nbsp;May 2022 | &nbsp;&nbsp;Outside Director, Eat & Holdings Co., Ltd (current position) |  |
| &nbsp;&nbsp; Kyoko Hayashi<br> (November 9, 1966) | &nbsp;&nbsp;June 2023 | &nbsp;&nbsp;Outside Director of Hagiwara Electric Holdings Co., Ltd. (current position) | &nbsp;&nbsp; (1) - shares<br> (2) - shares<br> (3) - shares |
|  | &nbsp;&nbsp;Sep. 2023 | &nbsp;&nbsp;Outside Director (Audit and Supervisory Committee Member) of KOA SHOJI HOLDINGS Co., Ltd. (current position) |  |
|  | &nbsp;&nbsp; <br> (Significant concurrent positions)<br> Professor, Graduate School of Management, Globis University<br> Senior Faculty Director, Faculty Group Office, Globis Corporation<br> Outside Director, Eat & Holdings Co., Ltd<br> Outside Director (Audit and Supervisory Committee Member) of KOA SHOJI HOLDINGS Co., Ltd. | &nbsp;&nbsp; <br> (Significant concurrent positions)<br> Professor, Graduate School of Management, Globis University<br> Senior Faculty Director, Faculty Group Office, Globis Corporation<br> Outside Director, Eat & Holdings Co., Ltd<br> Outside Director (Audit and Supervisory Committee Member) of KOA SHOJI HOLDINGS Co., Ltd. |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Kyoko Hayashi possesses abundant experience in diversity, work style reform, DX promotion, crisis management, and disaster prevention, and the Companies believe that she will be able to utilize her abilities and experience as the Companies aim to sustainably enhance the corporate value of the entire group, and therefore the Companies propose her election as Outside Director of the Joint Holding Company to be newly established. The Companies expect that she will provide advice and oversight of management of the Joint Holding Company, utilizing her abundant experience and deep insight. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Kyoko Hayashi possesses abundant experience in diversity, work style reform, DX promotion, crisis management, and disaster prevention, and the Companies believe that she will be able to utilize her abilities and experience as the Companies aim to sustainably enhance the corporate value of the entire group, and therefore the Companies propose her election as Outside Director of the Joint Holding Company to be newly established. The Companies expect that she will provide advice and oversight of management of the Joint Holding Company, utilizing her abundant experience and deep insight. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Kyoko Hayashi possesses abundant experience in diversity, work style reform, DX promotion, crisis management, and disaster prevention, and the Companies believe that she will be able to utilize her abilities and experience as the Companies aim to sustainably enhance the corporate value of the entire group, and therefore the Companies propose her election as Outside Director of the Joint Holding Company to be newly established. The Companies expect that she will provide advice and oversight of management of the Joint Holding Company, utilizing her abundant experience and deep insight. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Kyoko Hayashi possesses abundant experience in diversity, work style reform, DX promotion, crisis management, and disaster prevention, and the Companies believe that she will be able to utilize her abilities and experience as the Companies aim to sustainably enhance the corporate value of the entire group, and therefore the Companies propose her election as Outside Director of the Joint Holding Company to be newly established. The Companies expect that she will provide advice and oversight of management of the Joint Holding Company, utilizing her abundant experience and deep insight. |

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|:---|:---|
| (Note 1) | The number of shares of the Company and Satori Electric owned by each candidate is based on ownership status as of September 30, 2025, and the number of shares of the Joint Holding Company to be allotted is based on that ownership status and the Share Transfer Ratio. The number of shares of the Joint Holding Company that will actually be allotted may change depending on the number of shares owned up to the point in time immediately before the establishment date of the Joint Holding Company. |

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(Note 2) There are no special interests between each candidate and the Company or Satori Electric, and no special interests are anticipated to arise between each candidate and the Joint Holding Company.

(Note 3) Akihiro Taguchi, Shinichi Okamoto, and Kyoko Hayashi are candidates for Outside Director. Kyoko Hayashi's name in the family register is Kyoko Otani.

(Note 4) If Akihiro Taguchi, Shinichi Okamoto, and Kyoko Hayashi are elected and assume office as Outside Directors, the Joint Holding Company plans to register them with the Tokyo Stock Exchange and the Nagoya Stock Exchange as independent officers under the regulations of each exchange.

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| (Note 5) | If Akihiro Taguchi, Shinichi Okamoto, and Kyoko Hayashi are elected and assume office as Outside Directors, pursuant to the provisions of Article 427, paragraph (1) of the Companies Act, the Joint Holding Company plans to enter into agreements limiting their liability for damages set out in Article 423, paragraph (1) of the Companies Act. The maximum amount of liability under such agreements is planned to be the minimum liability amount set out in laws and regulations. |

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| (Note 6) | The Joint Holding Company plans to enter into a directors and officers liability insurance policy set out in Article 430-3, paragraph (1) of the Companies Act with an insurance company, and if the candidates for Director are elected and assume office, they are planned to be insured under that policy. The policy is planned to provide compensation for damage, etc. in cases where an insured party bears liability for damages arising from acts performed in regard to their duties, and the Joint Holding Company plans to bear all of the insurance fees. |

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**8.** **Matters Set Out in Article 74-3 of the Regulations for Enforcement of the Companies Act Regarding Persons Who Will Be Directors Concurrently Serving as Audit & Supervisory Committee Members of the Joint Holding Company** 

The persons who will be Directors concurrently serving as Audit & Supervisory Committee Members of the Joint Holding Company are as follows.

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Satori Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1986 | &nbsp;&nbsp;Joined Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;June 2004 | &nbsp;&nbsp;Department Manager of Komaki Branch of Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;July 2012 | &nbsp;&nbsp; Department Manager of General Affairs<br> Department of Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;July 2015 | &nbsp;&nbsp;Deputy General Manager of General Affairs & Personnel Division of Hagiwara Electric Co., Ltd. |  |
| &nbsp;&nbsp; Noriaki Inoue<br> (February 22, 1964) | &nbsp;&nbsp;Apr. 2018 | &nbsp;&nbsp; General Manager of General Affairs & Personnel Division of Hagiwara Electric Co., Ltd.<br> Audit & Supervisory Board Member of Hagiwara Electronics Co., Ltd. | &nbsp;&nbsp; (1) 3,437 shares<br> (2) - shares<br> (3) 6,874 shares |
|  | &nbsp;&nbsp;Apr. 2021 | &nbsp;&nbsp;Senior Managing Executive of Hagiwara Electric Holdings Co., Ltd. |  |
|  | &nbsp;&nbsp;June 2022 | &nbsp;&nbsp; Audit & Supervisory Board Member of Hagiwara Techno Solutions Co., Ltd.<br> Audit & Supervisory Board Member of Hagiwara Hokuto Techno Co., Ltd. |  |
|  | &nbsp;&nbsp;Sep. 2022 | &nbsp;&nbsp;Audit & Supervisory Board Member of Hagiwara Engineering Co., Ltd. |  |
|  | &nbsp;&nbsp;June 2024 | &nbsp;&nbsp;Director (Audit & Supervisory Committee Member) of Hagiwara Electric Holdings Co., Ltd. (current position) |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Director concurrently serving as Audit & Supervisory Committee Member<br> Noriaki Inoue has many years of work experience in general affairs, and he also has practical experience as an Audit & Supervisory Board Member at business companies. The Companies propose his election as a Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience in the Joint Holding Company's audit and supervisory functions. | &nbsp;&nbsp; Reasons for nomination as candidate for Director concurrently serving as Audit & Supervisory Committee Member<br> Noriaki Inoue has many years of work experience in general affairs, and he also has practical experience as an Audit & Supervisory Board Member at business companies. The Companies propose his election as a Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience in the Joint Holding Company's audit and supervisory functions. | &nbsp;&nbsp; Reasons for nomination as candidate for Director concurrently serving as Audit & Supervisory Committee Member<br> Noriaki Inoue has many years of work experience in general affairs, and he also has practical experience as an Audit & Supervisory Board Member at business companies. The Companies propose his election as a Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience in the Joint Holding Company's audit and supervisory functions. | &nbsp;&nbsp; Reasons for nomination as candidate for Director concurrently serving as Audit & Supervisory Committee Member<br> Noriaki Inoue has many years of work experience in general affairs, and he also has practical experience as an Audit & Supervisory Board Member at business companies. The Companies propose his election as a Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience in the Joint Holding Company's audit and supervisory functions. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Satori Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1981 | &nbsp;&nbsp;Joined Ricoh Company, Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2010 | &nbsp;&nbsp;Corporate Vice President and General Manager, Controller Development Division & Deputy General Manager, MFP Business Group, Ricoh Company, Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2012 | &nbsp;&nbsp;Corporate Senior Vice President and General Manager, Human Resources Division, Ricoh Company, Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2018 | &nbsp;&nbsp;Corporate Executive Vice President and General Manager, Office Printing Business Group, Ricoh Company, Ltd. |  |
|  | &nbsp;&nbsp;June 2018 | &nbsp;&nbsp;Director, Corporate Executive Vice President, and General Manager, Office Printing Business Group, Ricoh Company, Ltd. |  |
| &nbsp;&nbsp;(Outside Director) | &nbsp;&nbsp;Apr. 2019 | &nbsp;&nbsp;Director, Corporate Executive Vice President, CTO, Ricoh Company, Ltd. | &nbsp;&nbsp; (1) - shares<br> (2) 628 shares<br> (3) 640 shares |
| &nbsp;&nbsp; Seiji Sakata<br> (September 12, 1958) | &nbsp;&nbsp;Apr. 2021 | &nbsp;&nbsp;Director, Executive Corporate Officer, CTO, and General Manager, Advanced Technology R&D Division, Ricoh Company, Ltd. |  |
|  | &nbsp;&nbsp;June 2023 | &nbsp;&nbsp;Outside Director, Hirose Electric Co., Ltd. (current position) |  |
|  | &nbsp;&nbsp;Mar. 2024 | &nbsp;&nbsp;Outside Board Member, MABUCHI MOTOR CO., LTD (current position) |  |
|  | &nbsp;&nbsp;Aug. 2024 | &nbsp;&nbsp;Outside Director, Audit and Supervisory Committee Member, SATORI ELECTRIC CO., LTD. (current position) |  |
|  | &nbsp;&nbsp; <br> (Significant concurrent positions)<br> Outside Director, Hirose Electric Co., Ltd.<br> Outside Board Member, MABUCHI MOTOR CO., LTD. | &nbsp;&nbsp; <br> (Significant concurrent positions)<br> Outside Director, Hirose Electric Co., Ltd.<br> Outside Board Member, MABUCHI MOTOR CO., LTD. |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Seiji Sakata has extensive experience and broad knowledge as a corporate manager, as well as professional insight and knowledge in design, development, and technology. Considering that he will contribute to strengthening the supervisory function for the business execution of the Joint Holding Company to be newly established, the Companies nominate him as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company. The Companies expect that he will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing his professional insight and experience in design, development, and technology. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Seiji Sakata has extensive experience and broad knowledge as a corporate manager, as well as professional insight and knowledge in design, development, and technology. Considering that he will contribute to strengthening the supervisory function for the business execution of the Joint Holding Company to be newly established, the Companies nominate him as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company. The Companies expect that he will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing his professional insight and experience in design, development, and technology. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Seiji Sakata has extensive experience and broad knowledge as a corporate manager, as well as professional insight and knowledge in design, development, and technology. Considering that he will contribute to strengthening the supervisory function for the business execution of the Joint Holding Company to be newly established, the Companies nominate him as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company. The Companies expect that he will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing his professional insight and experience in design, development, and technology. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Seiji Sakata has extensive experience and broad knowledge as a corporate manager, as well as professional insight and knowledge in design, development, and technology. Considering that he will contribute to strengthening the supervisory function for the business execution of the Joint Holding Company to be newly established, the Companies nominate him as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company. The Companies expect that he will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing his professional insight and experience in design, development, and technology. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Satori Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Nov. 2004 | &nbsp;&nbsp;Joined Tohmatsu & Co. (currently Deloitte Touche Tohmatsu LLC) |  |
|  | &nbsp;&nbsp;June 2008 | &nbsp;&nbsp;Registered as a certified public accountant |  |
|  | &nbsp;&nbsp;Aug. 2017 | &nbsp;&nbsp;Established Sachiko Enomoto Certified Public Accountant Office (current position) |  |
|  | &nbsp;&nbsp;July 2020 | &nbsp;&nbsp;Audit & Supervisory Board Member of Enomoto Corporation (current position) |  |
|  | &nbsp;&nbsp;Apr. 2021 | &nbsp;&nbsp;Domestic Relations Conciliation Commissioner of Nagoya Family Court |  |
|  | &nbsp;&nbsp;June 2023 | &nbsp;&nbsp;Outside Audit & Supervisory Board Member of TAIHO KOGYO CO., LTD. (current position) |  |
|  | &nbsp;&nbsp;Oct. 2023 | &nbsp;&nbsp;Civil Mediation Commissioner of Nagoya District Court and Nagoya Summary Court (current position) |  |
| &nbsp;&nbsp; (Outside Director)<br>Sachiko Enomoto<br> (May 26, 1974) | &nbsp;&nbsp;June 2024 | &nbsp;&nbsp;Outside Director (Audit & Supervisory Committee Member) of Hagiwara Electric Holdings Co., Ltd. (current position) | &nbsp;&nbsp; (1) 215 shares<br> (2) - shares<br> (3) 430 shares |
|  | &nbsp;&nbsp;Jan. 2025 | &nbsp;&nbsp;Judicial commissioner of Nagoya Summary Court (current position) |  |
|  | &nbsp;&nbsp;June 2025 | &nbsp;&nbsp;Outside Director (Audit & Supervisory Committee Member) of TAISEI ONCHO CO., LTD. (current position) |  |
|  | &nbsp;&nbsp; <br> (Significant concurrent positions)<br> Certified public accountant<br> Civil Mediation Commissioner of Nagoya District Court and Nagoya Summary Court<br> Outside Audit & Supervisory Board Member of TAIHO KOGYO CO., LTD.<br> Outside Director (Audit & Supervisory Committee Member) of TAISEI ONCHO CO., LTD.<br> Audit & Supervisory Board Member of Enomoto Corporation | &nbsp;&nbsp; <br> (Significant concurrent positions)<br> Certified public accountant<br> Civil Mediation Commissioner of Nagoya District Court and Nagoya Summary Court<br> Outside Audit & Supervisory Board Member of TAIHO KOGYO CO., LTD.<br> Outside Director (Audit & Supervisory Committee Member) of TAISEI ONCHO CO., LTD.<br> Audit & Supervisory Board Member of Enomoto Corporation |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> The Companies propose the election of Sachiko Enomoto as an Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because she is expected to capitalize on her specialized knowledge and experience as a certified public accountant in enhancing audit and supervisory functions. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her specialized knowledge and experience as a certified public accountant. Ms. Enomoto has never in the past been involved in the management of a company except as an outside officer. However, the Companies judge she will appropriately fulfill her duties as an Outside Director concurrently serving as Audit & Supervisory Committee Member based on the above reasons. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> The Companies propose the election of Sachiko Enomoto as an Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because she is expected to capitalize on her specialized knowledge and experience as a certified public accountant in enhancing audit and supervisory functions. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her specialized knowledge and experience as a certified public accountant. Ms. Enomoto has never in the past been involved in the management of a company except as an outside officer. However, the Companies judge she will appropriately fulfill her duties as an Outside Director concurrently serving as Audit & Supervisory Committee Member based on the above reasons. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> The Companies propose the election of Sachiko Enomoto as an Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because she is expected to capitalize on her specialized knowledge and experience as a certified public accountant in enhancing audit and supervisory functions. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her specialized knowledge and experience as a certified public accountant. Ms. Enomoto has never in the past been involved in the management of a company except as an outside officer. However, the Companies judge she will appropriately fulfill her duties as an Outside Director concurrently serving as Audit & Supervisory Committee Member based on the above reasons. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> The Companies propose the election of Sachiko Enomoto as an Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because she is expected to capitalize on her specialized knowledge and experience as a certified public accountant in enhancing audit and supervisory functions. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her specialized knowledge and experience as a certified public accountant. Ms. Enomoto has never in the past been involved in the management of a company except as an outside officer. However, the Companies judge she will appropriately fulfill her duties as an Outside Director concurrently serving as Audit & Supervisory Committee Member based on the above reasons. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Satori Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 2000 | &nbsp;&nbsp;Entered The Legal Training and Research Institute of Japan (54th Class) |  |
|  | &nbsp;&nbsp;Oct. 2001 | &nbsp;&nbsp;Judge, Tokyo District Court |  |
|  | &nbsp;&nbsp;Feb. 2008 | &nbsp;&nbsp; Registered as Attorney<br> Joined Yoshioka Tsuji Law Office (currently Yoshioka Ono Law Office) |  |
|  | &nbsp;&nbsp;May 2019 | &nbsp;&nbsp;Yokohama Sogo Law Office (current position) |  |
| &nbsp;&nbsp;(Outside Director) | &nbsp;&nbsp;July 2019 | &nbsp;&nbsp;Legal Specialist, Hiratsuka City (current position) |  |
|  | &nbsp;&nbsp;June 2021 | &nbsp;&nbsp;Outside Director, IPS, Inc. (current position) |  |
| &nbsp;&nbsp; Akiko Yukimaru<br> (January 7, 1977) | &nbsp;&nbsp;Aug. 2022 | &nbsp;&nbsp;Outside Director, Audit and Supervisory Committee Member, SATORI ELECTRIC CO., LTD. (current position) | &nbsp;&nbsp; (1) - shares<br> (2) 610 shares<br> (3) 622 shares |
|  | &nbsp;&nbsp;May 2025 | &nbsp;&nbsp;Outside Audit & Supervisory Board Member, Tebiki Inc. (current position) |  |
|  | &nbsp;&nbsp; <br> (Significant concurrent positions)<br> Attorney<br> Outside Director, IPS, Inc.<br> Outside Audit & Supervisory Board Member, Tebiki Inc. | &nbsp;&nbsp; <br> (Significant concurrent positions)<br> Attorney<br> Outside Director, IPS, Inc.<br> Outside Audit & Supervisory Board Member, Tebiki Inc. |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Akiko Yukimaru has professional insight and extensive experience cultivated as a judge and an attorney. Expecting her to offer advice from her professional point of view, the Companies nominate her as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her professional insight and experience as a judge and attorney. Although Ms. Yukimaru has never been involved in company management other than as an outside officer, the Companies consider, for the above reasons, that she will be able to appropriately fulfill the duties of Outside Director concurrently serving as Audit & Supervisory Committee Member. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Akiko Yukimaru has professional insight and extensive experience cultivated as a judge and an attorney. Expecting her to offer advice from her professional point of view, the Companies nominate her as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her professional insight and experience as a judge and attorney. Although Ms. Yukimaru has never been involved in company management other than as an outside officer, the Companies consider, for the above reasons, that she will be able to appropriately fulfill the duties of Outside Director concurrently serving as Audit & Supervisory Committee Member. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Akiko Yukimaru has professional insight and extensive experience cultivated as a judge and an attorney. Expecting her to offer advice from her professional point of view, the Companies nominate her as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her professional insight and experience as a judge and attorney. Although Ms. Yukimaru has never been involved in company management other than as an outside officer, the Companies consider, for the above reasons, that she will be able to appropriately fulfill the duties of Outside Director concurrently serving as Audit & Supervisory Committee Member. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Akiko Yukimaru has professional insight and extensive experience cultivated as a judge and an attorney. Expecting her to offer advice from her professional point of view, the Companies nominate her as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her professional insight and experience as a judge and attorney. Although Ms. Yukimaru has never been involved in company management other than as an outside officer, the Companies consider, for the above reasons, that she will be able to appropriately fulfill the duties of Outside Director concurrently serving as Audit & Supervisory Committee Member. |

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| | |
|:---|:---|
| (Note 1) | The number of shares of the Company and Satori Electric owned by each candidate is based on ownership status as of September 30, 2025, and the number of shares of the Joint Holding Company to be allotted is based on that ownership status and the Share Transfer Ratio. The number of shares of the Joint Holding Company that will actually be allotted may change depending on the number of shares owned up to the point in time immediately before the establishment date of the Joint Holding Company. |

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(Note 2) There are no special interests between each candidate and the Company or Satori Electric, and no special interests are anticipated to arise between each candidate and the Joint Holding Company.

(Note 3) Seiji Sakata, Sachiko Enomoto, and Akiko Yukimaru are candidates for Outside Director.

(Note 4) If Seiji Sakata, Sachiko Enomoto, and Akiko Yukimaru are elected and assume office as Outside Directors, the Joint Holding Company plans to register them with the Tokyo Stock Exchange and the Nagoya Stock Exchange as independent officers under the regulations of each exchange.

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| | |
|:---|:---|
| (Note 5) | If Seiji Sakata, Sachiko Enomoto, and Akiko Yukimaru are elected and assume office as Outside Directors, pursuant to the provisions of Article 427, paragraph (1) of the Companies Act, the Joint Holding Company plans to enter into agreements limiting their liability for damages set out in Article 423, paragraph (1) of the Companies Act. The maximum amount of liability under such agreements is planned to be the minimum liability amount set out in laws and regulations. |

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| | |
|:---|:---|
| (Note 6) | The Joint Holding Company plans to enter into a directors and officers liability insurance policy set out in Article 430-3, paragraph (1) of the Companies Act with an insurance company, and if the candidates for Director are elected and assume office, they are planned to be insured under that policy. The policy is planned to provide compensation for damage, etc. in cases where an insured party bears liability for damages arising from acts performed in regard to their duties, and the Joint Holding Company plans to bear all of the insurance fees. |

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<u>Reference: Director skills matrix</u>

The Joint Holding Company to be newly established will have multiple Outside Directors who maintain a certain distance from business execution.

In addition, the Board of Directors of the Joint Holding Company to be newly established will be composed of a number of Directors within the limits set out in the Companies Act and the Articles of Incorporation, and it will be well-balanced in terms of knowledge, experience, and skills to ensure that the Board of Directors effectively fulfills its roles and duties. Furthermore, the composition of the Board of Directors will achieve diversity while maintaining an appropriate size.

A matrix of the skills of the Directors is as follows.

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;Name | &nbsp;&nbsp;Position in the Joint Holding Company (planned) | &nbsp;&nbsp;Corporate management and management strategy | &nbsp;&nbsp;Sales and marketing |
| &nbsp;&nbsp;Moritaka Kimura | &nbsp;&nbsp;Representative Director and President &nbsp;&nbsp;Male | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;Hiroyuki Satori | &nbsp;&nbsp;Representative Director and Vice President &nbsp;&nbsp;Male | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;Naruhiko Mizukoshi | &nbsp;&nbsp;Director &nbsp;&nbsp;Male | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;Takeshi Soejima | &nbsp;&nbsp;Director &nbsp;&nbsp;Male | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;Takuma Oyama | &nbsp;&nbsp;Director &nbsp;&nbsp;Male | &nbsp;&nbsp;● |  |
| &nbsp;&nbsp;Shunji Tsuchiya | &nbsp;&nbsp;Director &nbsp;&nbsp;Male | &nbsp;&nbsp;● |  |
| &nbsp;&nbsp;Akihiro Taguchi | &nbsp;&nbsp;Outside Director &nbsp;&nbsp;Male | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;Shinichi Okamoto | &nbsp;&nbsp;Outside Director &nbsp;&nbsp;Male | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;Kyoko Hayashi | &nbsp;&nbsp;Outside Director &nbsp;&nbsp;Female |  |  |
| &nbsp;&nbsp;Noriaki Inoue | &nbsp;&nbsp;Director (Full-time Audit & Supervisory Committee Member) &nbsp;&nbsp;Male |  |  |
| &nbsp;&nbsp;Seiji Sakata | &nbsp;&nbsp;Outside Director (Audit & Supervisory Committee Member) &nbsp;&nbsp;Male | &nbsp;&nbsp;● |  |
| &nbsp;&nbsp;Sachiko Enomoto | &nbsp;&nbsp;Outside Director (Audit & Supervisory Committee Member) &nbsp;&nbsp;Female |  |  |
| &nbsp;&nbsp;Akiko Yukimaru | &nbsp;&nbsp;Outside Director (Audit & Supervisory Committee Member) &nbsp;&nbsp;Female |  |  |

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(Note) The above table indicates the areas in which each Director is particularly able to utilize their expertise
based on their experience, etc. and does not represent all of the knowledge possessed by each Director.

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;Global business | &nbsp;&nbsp;Technology (design, development, and production) | &nbsp;&nbsp;IT and DX | &nbsp;&nbsp;Finance and accounting | &nbsp;&nbsp;Risk management | &nbsp;&nbsp;Talent management | &nbsp;&nbsp;Sustainability |
| &nbsp;&nbsp;● |  | &nbsp;&nbsp;● |  | &nbsp;&nbsp;● |  | &nbsp;&nbsp;● |
| &nbsp;&nbsp;● |  |  |  | &nbsp;&nbsp;● | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;● | &nbsp;&nbsp;● |  |  |  | &nbsp;&nbsp;● |  |
| &nbsp;&nbsp;● |  |  |  |  |  |  |
| &nbsp;&nbsp;● |  |  | &nbsp;&nbsp;● | &nbsp;&nbsp;● | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;● |  |  | &nbsp;&nbsp;● | &nbsp;&nbsp;● | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;● | &nbsp;&nbsp;● |  |  | &nbsp;&nbsp;● |  |  |
| &nbsp;&nbsp;● | &nbsp;&nbsp;● | &nbsp;&nbsp;● |  |  |  |  |
| &nbsp;&nbsp;● |  |  |  |  | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
|  |  |  |  | &nbsp;&nbsp;● | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
|  | &nbsp;&nbsp;● | &nbsp;&nbsp;● |  | &nbsp;&nbsp;● | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
|  |  |  | &nbsp;&nbsp;● | &nbsp;&nbsp;● |  | &nbsp;&nbsp;● |
|  |  |  |  | &nbsp;&nbsp;● |  | &nbsp;&nbsp;● |

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**9.** **Matters Set Out in Article 77 of the Regulations for Enforcement of the Companies Act Regarding the Person Who Will Be the Financial Auditor of the Joint Holding Company** 

The person who will be the financial auditor of the Joint Holding Company is as follows.

(As of June 30, 2025)

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp;Name | &nbsp;&nbsp;KPMG AZSA LLC | &nbsp;&nbsp;KPMG AZSA LLC |
| &nbsp;&nbsp;Office location | &nbsp;&nbsp; Main office: 1-2 Tsukudo-cho, Shinjuku-ku, Tokyo<br> Number of offices: 12 | &nbsp;&nbsp; Main office: 1-2 Tsukudo-cho, Shinjuku-ku, Tokyo<br> Number of offices: 12 |
|  | &nbsp;&nbsp;July 1969: | &nbsp;&nbsp;Established Asahi Accounting Corporation |
|  | &nbsp;&nbsp;July 1985: | &nbsp;&nbsp;Established Asahi Shinwa Accounting Corporation |
|  | &nbsp;&nbsp;Oct. 1993: | &nbsp;&nbsp;Merged with Inoue Saito Eiwa Audit Corporation (established April 1978) and became Asahi & Co. |
| &nbsp;&nbsp;History | &nbsp;&nbsp;Jan. 2004: | &nbsp;&nbsp;Merged with AZSA & Co. (established February 2003) and became KPMG AZSA LLC |
|  | &nbsp;&nbsp;July 2010: | &nbsp;&nbsp;Converted to a limited liability audit corporation (*yugen sekinin kansa hojin*), and its name in Japanese became "Yugen Sekinin Azusa Kansa Hojin" |
|  | &nbsp;&nbsp;Stated capital: 3,000,000,000 yen | &nbsp;&nbsp;Stated capital: 3,000,000,000 yen |
|  | &nbsp;&nbsp;Personnel composition | &nbsp;&nbsp;Personnel composition |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Certified public accountants: 3,011 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Certified public accountants: 3,011 |
| &nbsp;&nbsp;Overview | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Newly certified and junior CPAs: 1,537 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Newly certified and junior CPAs: 1,537 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Audit support staff: 2,013 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Audit support staff: 2,013 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other staff: 801 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other staff: 801 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total: 7,362 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total: 7,362 |
|  | &nbsp;&nbsp;Audit client companies: 3,255 | &nbsp;&nbsp;Audit client companies: 3,255 |

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(Note) The Audit & Supervisory Committee of each of the Companies comprehensively considered factors such
as KPMG AZSA LLC's record of performing accounting audits over many years, its independence and other qualifications as a professional
expert, and its systems for ensuring that the accounting audits of the Joint Holding Company will be appropriately performed, as a result
of which the committees determined that KPMG AZSA LLC is suitable as the financial auditor of the Joint Holding Company.

**Proposal No. 2** Partial Amendment to the Articles of Incorporation

1. Reasons for Amendment

To facilitate the smooth execution of administrative procedures related to the convocation of Ordinary General Meetings of Shareholders and other matters, Article 11 of the current Articles of Incorporation (Record Dates) specifies the record dates of Ordinary General Meetings of Shareholders, in accordance with the provisions of Article 124, paragraph (3) of the Companies Act. If Proposal No. 1, "Approval of Share Transfer Plan," is approved at this Meeting, and the Share Transfer becomes effective as of Wednesday, April 1, 2026, the Company will have only one shareholder, namely the Joint Holding Company. As such, the provisions relating to record dates for Ordinary General Meetings of Shareholders will become unnecessary. For this reason, the record date system for Ordinary General Meetings of Shareholders will be abolished, Article 11 of the current Articles of Incorporation (Record Dates) will be deleted in its entirety, and the article numbers of Article 12 and subsequent articles of the current Articles of Incorporation will be renumbered accordingly (this partial amendment to the Articles of Incorporation is hereinafter referred to as the "Partial Amendment to Articles of Incorporation.").

The Partial Amendment to Articles of Incorporation will come into effect on Wednesday, April 1, 2026 on the condition that Proposal No. 1, "Approval of Share Transfer Plan," is approved as originally proposed at this Meeting and the Share Transfer becomes effective.

<u>Reference</u>

The Company plans to pay dividends of surplus (year-end dividends) for the fiscal year ending March 2026 (April 1, 2025 to March 31, 2026) to shareholders and registered pledgees of shares whose names are entered or recorded on the final shareholder register as of March 31, 2026 in accordance with Article 25, paragraph 1 of the current Articles of Incorporation (Article 24, paragraph 1 after the Partial Amendment to Articles of Incorporation).

2. Details of Amendments

The details of the amendments are as follows.

(Amendments are underlined.)

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| | |
|:---|:---|
| &nbsp;&nbsp;Current Articles of Incorporation | &nbsp;&nbsp;Proposed amendment |
| &nbsp;&nbsp;Article 1 to Article 10 (Text omitted) | &nbsp;&nbsp;Article 1 to Article 10 (No amendment) |
| &nbsp;&nbsp; <u>(Record Dates)</u><br> <u>Article 11 The Company shall deem the shareholders whose names are recorded on the shareholder register as of March 31 of each year to be the shareholders entitled to exercise their rights at the Ordinary General Meetings of Shareholders.</u> | &nbsp;&nbsp;(Deleted) |
| &nbsp;&nbsp;Article <u>12</u> to Article <u>26</u> (Text omitted) | &nbsp;&nbsp;Article <u>11</u> to Article <u>25</u> (No amendment) |

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**Proposal No. 3** Partial Revision of Restricted Stock Compensation Plan for Directors (Excluding Directors Concurrently Serving as Audit & Supervisory Committee Members, and Outside Directors)

The 61st Ordinary General Meeting of Shareholders of the Company held on June 28, 2018 approved matters including the establishment of a compensation limit pursuant to the introduction of a restricted stock compensation plan (the "Plan") for Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors; the same applies below in this proposal), and the Plan remains in effect at present.

Under the Plan, in light of the fact that the incentive structure between a corporation and its Directors will be substantially changed in the event of a merger or other organizational restructuring, etc., it has been approved that the details of the restricted stock allotment agreement shall include a provision which states, in summary, "if, during the transfer restriction period, a merger agreement under which the Company is to become a disappearing company, a share exchange agreement or a share transfer plan under which the Company is to become a wholly owned subsidiary, or any other proposal relating to organizational restructuring, etc. is approved at a general meeting of shareholders of the Company (however, if such organizational restructuring, etc. does not require approval at a general meeting of shareholders of the Company, the Board of Directors of the Company), the Company shall, by a resolution of the Board of Directors of the Company, lift the restriction on transfer of the restricted stock that have been allotted to the Company's Directors in a number reasonably determined based on the period from the commencement date of the transfer restriction period to the date of approval of such organizational restructuring, etc., prior to the effective date of such organizational restructuring, etc."

The Company seeks shareholder approval to make the following revisions to the Plan at this time in order to ensure that the Company's Directors share the same benefits and risks relating to share value changes as the shareholders and to continue to increase the Directors' desire to contribute to raising share value and enhancing corporate value by maintaining the transfer restriction on the restricted stock compensation already granted to the Company's Directors even after Proposal No. 1, "Approval of Share Transfer Plan," is approved as originally proposed at this Meeting and the Company becomes a wholly-owned subsidiary of the Joint Holding Company. In addition, the Company seeks to make these revisions in order to further increase the Directors' desire to contribute to enhancing the corporate value of the Joint Holding Company group by taking into account the possibility of the Company's Directors transferring within the Joint Holding Company group after the Business Integration and setting the conditions for and timing of the removal of the transfer restriction in a way that will enable the Directors to continue holding restricted stock if so transferred. The other content of the Plan will not be changed and will remain as previously approved.

The purpose of the Plan is to ensure that the Company's Directors share the same benefits and risks relating to share value changes as the shareholders and to increase the Directors' desire to contribute to raising share value and enhancing corporate value. This proposal is consistent with the purpose of the Plan and the policy on determining the details of compensation, etc. for individual Directors of the Company, and in order to ensure the fairness and transparency of the relevant procedures, the Nomination and Compensation Advisory Committee, a majority of whose members are Independent Outside Directors, deliberated and delivered a report on this proposal. Accordingly, the Company believes the content of this proposal is appropriate.

The details of the revisions are as follows.

(Changes are underlined.)

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| | |
|:---|:---|
| &nbsp;&nbsp;Before change | &nbsp;&nbsp;After change |
| &nbsp;&nbsp;3. Details of the Restricted Stock Allotment Agreement | &nbsp;&nbsp;3. Details of the Restricted Stock Allotment Agreement |
| &nbsp;&nbsp;(2) Acquisition of Restricted Stock without Charge | &nbsp;&nbsp;(2) Acquisition of Restricted Stock without Charge |
| &nbsp;&nbsp;If an Eligible Director who has been allotted the restricted stock resigns from their office as a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) from the commencement date of the transfer restriction period until the day immediately before the date of the Company's first Ordinary General Meeting of Shareholders to be held after such commencement date, the Company shall naturally acquire the restricted stock allotted to such Eligible Director (the "Allotted Shares") without charge, unless there are reasons that the Board of Directors of the Company deems to be justifiable. | &nbsp;&nbsp; If an Eligible Director who has been allotted the restricted stock resigns <u>or retires</u> from their office as a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) <u>or an executive officer thereof, a Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer of its subsidiaries, or any other position designated by the Board of Directors of the Company</u> from the commencement date of the transfer restriction period until the day immediately before the date of the Company's first Ordinary General Meeting of Shareholders to be held after such commencement date, the Company shall naturally acquire the restricted stock allotted to such Eligible Director (the "Allotted Shares") without charge, unless there are reasons that the Board of Directors of the Company deems to be justifiable.<br> <u>Furthermore, if, at the time of the expiration of the transfer restriction period, there are any Allotted Shares for which the restriction on transfer has not been lifted pursuant to the provisions of (3) below, the Company shall naturally acquire all the Allotted Shares without charge. However, if, during the transfer restriction period, a merger agreement under which the Company is to become a disappearing company, a share exchange agreement or a share transfer plan under which the Company is to become a wholly owned subsidiary, or any other proposal relating to organizational restructuring, etc. is approved at a general meeting of shareholders of the Company (however, if such organizational restructuring, etc. does not require approval at a general meeting of shareholders of the Company, the Board of Directors of the</u>  |

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| | |
|:---|:---|
|  | &nbsp;&nbsp;<u>Company) and if, in such organizational restructuring, etc., a corporation other than the Company subject to such organizational restructuring, etc. delivers shares of such corporation (limited to shares that are equivalent to shares with restriction on transfer) to Eligible Directors, the Company shall not acquire the Allotted Shares without charge.</u> |
| &nbsp;&nbsp;(3) Lifting of the Restriction on Transfer | &nbsp;&nbsp;(3) Lifting of the Restriction on Transfer |
| &nbsp;&nbsp;The Company shall lift the restriction on transfer of all the Allotted Shares upon the expiration of the transfer restriction period on the condition that an Eligible Director who has been allotted the restricted stock has continuously held the position of a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) from the commencement date of the transfer restriction period until the date of the Company's first Ordinary General Meeting of Shareholders to be held after such commencement date. However, if such Eligible Director resigns from their office as a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) prior to the expiration of the transfer restriction period for reasons that the Board of Directors of the Company deems to be justifiable, the number of the Allotted Shares for which the restriction on transfer will be lifted and the timing of such lifting shall be reasonably adjusted as necessary. | &nbsp;&nbsp;The Company shall lift the restriction on transfer of all the Allotted Shares upon the expiration of the transfer restriction period on the condition that an Eligible Director who has been allotted the restricted stock has continuously held the position of a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors<u>) or an executive officer thereof, a Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer of its subsidiaries, or any other position designated by the Board of Directors of the Company</u> from the commencement date of the transfer restriction period until the date of the Company's first Ordinary General Meeting of Shareholders to be held after such commencement date. However, if such Eligible Director resigns <u>or retires</u> from their office as a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors<u>) or an executive officer thereof, a Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer of its subsidiaries, or any other position designated by the Board of Directors of the Company</u> prior to the expiration of the transfer restriction period for reasons that the Board of Directors of the Company deems to be justifiable, the number of the Allotted Shares for which the restriction on transfer will be lifted and the timing of such lifting shall be reasonably adjusted as |

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| | |
|:---|:---|
|  | &nbsp;&nbsp;necessary. |
| &nbsp;&nbsp;(4) Handling of Organizational Restructuring, etc. | &nbsp;&nbsp;(4) Handling of Organizational Restructuring, etc. |
| &nbsp;&nbsp;If, during the transfer restriction period, a merger agreement under which the Company is to become a disappearing company, a share exchange agreement or a share transfer plan under which the Company is to become a wholly owned subsidiary, or any other proposal relating to organizational restructuring, etc. is approved at a general meeting of shareholders of the Company (however, if such organizational restructuring, etc. does not require approval at a general meeting of shareholders of the Company, the Board of Directors of the Company), the Company shall, by a resolution of the Board of Directors of the Company, lift the restriction on transfer of the Allotted Shares in a number reasonably determined based on the period from the commencement date of the transfer restriction period to the date of approval of such organizational restructuring, etc., prior to the effective date of such organizational restructuring, etc. In such a case, the Company shall naturally acquire the Allotted Shares for which the restriction on transfer has not been lifted at the time immediately following the lifting of the restriction on transfer in accordance with the above provisions. | &nbsp;&nbsp;If, during the transfer restriction period, a merger agreement under which the Company is to become a disappearing company, a share exchange agreement or a share transfer plan under which the Company is to become a wholly owned subsidiary, or any other proposal relating to organizational restructuring, etc. is approved at a general meeting of shareholders of the Company (however, if such organizational restructuring, etc. does not require approval at a general meeting of shareholders of the Company, the Board of Directors of the Company), the Company shall, by a resolution of the Board of Directors of the Company, lift the restriction on transfer of the Allotted Shares in a number reasonably determined based on the period from the commencement date of the transfer restriction period to the date of approval of such organizational restructuring, etc., prior to the effective date of such organizational restructuring, etc. In such a case, the Company shall naturally acquire the Allotted Shares for which the restriction on transfer has not been lifted at the time immediately following the lifting of the restriction on transfer in accordance with the above provisions. <u>Provided, however, if, in such organizational restructuring, etc., a corporation other than the Company subject to such organizational restructuring, etc. delivers shares of such corporation (limited to shares that are equivalent to restricted stock) to the Eligible Directors, the Company will not lift the restriction on transfer of the Allotted Shares nor acquire the Allotted Shares without charge.</u> |

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If this proposal is approved, the Company plans to take the prescribed procedures in accordance with the method stipulated in the said restricted stock allotment agreement in order to reflect the revisions to the Plan under this proposal in the restricted stock allotment agreement pertaining to the restricted stock that has been granted to the Eligible Directors up to the present. In addition, with respect to the Company's contractual status and rights and obligations under such restricted stock allotment agreement, if Proposal No. 1, "Approval of Share Transfer Plan," is approved as originally proposed at this Meeting, they will be transferred on April 1, 2026 to the Joint Holding Company, which will be established upon the Share Transfer Plan

taking effect. Furthermore, if Proposal No. 1 and this proposal are approved at this Meeting, the Joint Holding Company plans to introduce a restricted stock compensation plan similar to the revised Plan for its executive officers and the Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) and executive officers of its subsidiaries.

At present, there are four Directors subject to the Plan.

This proposal will take effect on the condition that Proposal No. 1, "Approval of Share Transfer Plan," is approved as originally proposed.

<u>Reference: Original resolution (passed at the 61st Ordinary General Meeting of Shareholders held on June 28, 2018)</u>

Proposal No. 3 Determination of Compensation for Allotting Restricted Stock to Directors (Excluding Directors Concurrently Serving as Audit & Supervisory Committee Members, and Outside Directors)

The current amount of compensation, etc. for the Company's Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members) has been set at 500,000,000 yen or less annually (however, excluding the employee salaries of employees who are also Directors) with the approval of the 59th Ordinary General Meeting of Shareholders held on June 29, 2016.

In order to ensure that the Company's Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors; the "Eligible Directors") share the same benefits and risks relating to share value changes as the shareholders and to increase the Eligible Directors' desire to contribute to raising share value and enhancing corporate value, the Company wishes to allot common shares of the Company subject to provisions including a specified transfer restriction period and grounds for the Company to acquire the shares without charge ("Restricted Stock") to the Eligible Directors as set out below.

Therefore, having comprehensively taken into account various factors such as the level of contribution of the Eligible Directors at the Company, the Company wishes to set the total amount of monetary compensation claims to be issued as compensation, etc. relating to Restricted Stock for the Eligible Directors at 100,000,000 yen or less annually, which is within the above limit on the annual amount of compensation, etc. of the Company's Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members). The Company believes that the content of the allotment of Restricted Stock is appropriate as it has been determined after comprehensively taking into account various factors such as the level of contribution of the Eligible Directors at the Company. The Company currently has six Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors), and if Proposal No. 1 is approved, the Company will continue to have six Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors).

The Board of Directors will be entrusted to determine the specific timing of the issuing of monetary compensation claims and the apportionment thereof to each individual Director within the annual amounts stated above.

<u>Specific details and maximum number of shares of restricted stock to be granted to the Eligible Directors</u>

1. Allotment of and payment for Restricted Stock

The Company shall, pursuant to a resolution of its Board of Directors, issue monetary compensation claims to the Eligible Directors within the annual amount stated above as compensation pertaining to Restricted Stock, and each Eligible Director shall receive an allotment of Restricted Stock by paying all of those monetary compensation claims as an in-kind investment.

The paid-in amount for Restricted Stock shall be determined by the Company's Board of Directors within an extent that is not particularly favorable to the Eligible Directors who will receive that Restricted Stock based on the closing price of the Company's common shares on the Tokyo Stock Exchange on the business day preceding the date of the resolution of the Company's Board of Directors regarding the issuance or disposal of the Restricted Stock (if no shares were traded on that day, then the closing price of the nearest preceding day on which shares were traded). In addition, the above monetary compensation claims shall be issued on the condition that the Eligible Directors consent to making the above in-kind investment and enter into the restricted stock allotment agreement containing the content set out in 3 below.

2. Total number of shares of Restricted Stock

The total number of shares of Restricted Stock to be allotted to the Eligible Directors shall be limited to a maximum of 90,000 shares in each business year. However, from the day of the resolution approving this proposal, if a share split (including a gratis allotment of shares) or share consolidation is performed in regard to the Company's common shares or if another similar situation occurs in which it is necessary to adjust the total number of shares of Restricted Stock to be allotted, the Company may make reasonable adjustments thereto.

3. Details of the restricted stock allotment agreement

The restricted stock allotment agreement to be entered into between the Company and the Eligible Directors who will receive allotments of Restricted Stock pursuant to a resolution of the Company's Board of Directors when allotting Restricted Stock shall contain the following content.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Details of the restriction on transfer

Eligible Directors who receive an allotment of Restricted Stock shall not be entitled to transfer to a third party, establish a pledge on, establish a right of security by assignment (*joto tanpo*) on, make an *inter vivos* gift of, bequeath, or otherwise dispose of that Restricted Stock for 30 years (the "Transfer Restriction Period").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Acquisition of Restricted Stock without charge

If an Eligible Director who has been allotted the restricted stock resigns from their office as a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) from the commencement date of the transfer restriction period until the day immediately before the date of the Company's first Ordinary General Meeting of Shareholders to be held after such commencement date, the Company shall naturally acquire the restricted stock allotted to such Eligible Director (the "Allotted Shares") without charge, unless there are reasons that the Board of Directors of the Company deems to be justifiable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Lifting of the restriction on transfer

The Company shall lift the restriction on transfer of all the Allotted Shares upon the expiration of the transfer restriction period on the condition that an Eligible Director who has been allotted the restricted stock has continuously held the position of a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) from the commencement date of the transfer restriction period until the date of the Company's first Ordinary General Meeting of Shareholders to be held after such commencement date. However, if such Eligible Director resigns from their office as a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) prior to the expiration of the transfer restriction period for reasons that the Board of Directors of the Company deems to be justifiable, the number of the Allotted Shares for which the restriction on transfer will be lifted and the timing of such lifting shall be reasonably adjusted as necessary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Handling of organizational restructuring, etc.

If, during the transfer restriction period, a merger agreement under which the Company is to become a disappearing company, a share exchange agreement or a share transfer plan under which the Company is to become a wholly owned subsidiary, or any other proposal relating to organizational restructuring, etc. is approved at a general meeting of shareholders of the Company (however, if such organizational restructuring, etc. does not require approval at a general meeting of shareholders of the Company, the Board of Directors of the Company), the Company shall, by a resolution of the Board of Directors of the Company, lift the restriction on transfer of the Allotted Shares in a number reasonably determined based on the period from the commencement date of the transfer restriction period to the date of approval of such organizational restructuring, etc., prior to the effective date of such organizational restructuring, etc. In such a case, the Company shall naturally acquire the Allotted Shares for which the restriction on transfer has not been lifted at the time immediately following the lifting of the restriction on transfer in accordance with the above provisions.

End

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| | |
|:---|:---|
| &nbsp;&nbsp;Question | Answer |
| Regarding the Business Integration and its significance and purpose | Regarding the Business Integration and its significance and purpose |
| &nbsp;&nbsp;What are the background and purpose of the Business Integration? | • The Companies, as comprehensive electronics trading companies handling semiconductors, electronic components, and electronic equipment, have been providing optimal solutions that meet the diverse needs of their customers and have expanded their businesses globally by leveraging a wide variety of products and advanced technologies. |
| &nbsp;&nbsp;What are the background and purpose of the Business Integration? | • The electronics market is currently experiencing a surge in demand for the adoption and utilization of technologies such as the Internet of Things (IoT), artificial intelligence (AI), edge computing, generative AI, and digital transformation (DX), not only in next-generation automobiles, but also to resolve the challenges of smartification across a broad range of industries, including manufacturing. |
| &nbsp;&nbsp;What are the background and purpose of the Business Integration? | • Amid this environmental change, there is an increasing need for solutions that are more closely aligned with customer challenges in the utilization and supply of semiconductors. Furthermore, the role of electronics trading companies is also evolving, as they are required to build more sophisticated supply chains in the face of the impact of overseas relocation of manufacturing bases in association with changes in semiconductor utilization needs, as well as growing uncertainties in the business environment caused by U.S.-China trade friction, export controls, and geopolitical tensions. |
| &nbsp;&nbsp;What are the background and purpose of the Business Integration? | • Under such a business environment, the Companies have reached a shared recognition that, in order to achieve continuous business growth and development going forward, it is essential to concentrate their respective management resources and leverage their strengths to expand the scale of their business, and thereby deliver even greater added value. Based on this recognition, the Companies have agreed to pursue the Business Integration through mutual cooperation based on the spirit of equality. |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? | • Amid substantial changes in the business environment, such as rapid digitalization, globalization, and diversification of customer needs, through the Business Integration, the Companies will seek to strengthen their competitiveness by integrating their respective management resources and know-how, with a focus on the following initiatives: |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Expansion of business scale through broader product lineups and customer bases |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? |  |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? |  |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? |  |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? |  |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? | |

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| | |
|:---|:---|
| &nbsp;&nbsp;Question | Answer |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? |  |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? |  |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Provision of high value-added solutions |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Acceleration of global expansion |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Productivity improvement through operational efficiency |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Strengthening the management foundations through the integration of organizations and human resources |
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? | • For details, please see "Announcement Concerning Execution of Business Integration Agreement on Business Integration through the Establishment of a Joint Holding Company (Share Transfer) between Hagiwara Electric Holdings Co., Ltd. and SATORI ELECTRIC CO., LTD. and Preparation of a Share Transfer Plan" released on Tuesday, October 14. |
| Regarding the Joint Holding Company | Regarding the Joint Holding Company |
| &nbsp;&nbsp;What is a joint share transfer? | • A joint share transfer is an organizational restructuring method where, in this case, Hagiwara Electric and Satori Electric, which will become wholly-owned subsidiaries, will establish a new Joint Holding Company that will become their wholly-owning parent company and cause it to acquire all of their issued shares, and the shareholders of Hagiwara Electric and Satori Electric will receive shares of the Joint Holding Company in exchange for the shares of Hagiwara Electric and Satori Electric that they hold. |
| &nbsp;&nbsp;What is a joint share transfer? | • On Wednesday, April 1, 2026, the Companies plan to allot shares of the Joint Holding Company to be newly established to their shareholders as of the effective date of the joint share transfer. |
| &nbsp;&nbsp;Why did the Companies choose to conduct a business integration through a joint share transfer? | • The Companies discussed and considered the optimal method for creating synergies, as a result of which they determined that a business integration through a joint share transfer was the best method in order to concentrate their management resources, expand the scale of their businesses by leveraging their strengths, and deliver even greater added value to customers and suppliers. |
| &nbsp;&nbsp;What are the share transfer plan and business integration agreement? | • The share transfer plan is a statutory document that states information such as the specific details of the share transfer and the basic matters of the new company. |
| &nbsp;&nbsp;What are the share transfer plan and business integration agreement? | • The business integration agreement is a contract concluded for the purpose of setting out the matters that the parties have agreed to regarding the Business Integration, including matters not set out in the share transfer plan. |

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| | |
|:---|:---|
| &nbsp;&nbsp;Question | Answer |
| &nbsp;&nbsp;How will the Companies transition to a holding company structure? Will they be delisted? | • Hagiwara Electric and Satori Electric will transition to a holding company structure by establishing a Joint Holding Company through a joint share transfer. As a result, they will become wholly-owned subsidiaries of the Joint Holding Company to be established and will be delisted. |
| &nbsp;&nbsp;How will the Companies transition to a holding company structure? Will they be delisted? | • However, the Companies plan to apply to the Tokyo Stock Exchange and the Nagoya Stock Exchange for a technical listing of the shares of the Joint Holding Company to be newly delivered to the shareholders of the Companies, which they plan to list on the Prime Market of the Tokyo Stock Exchange and the Premier Market of the Nagoya Stock Exchange. Therefore, it is planned that shareholders will continue to be able to trade shares of the Joint Holding Company in share units. |
| &nbsp;&nbsp;Why did the Companies choose to make the Joint Holding Company a company with an Audit & Supervisory Committee? | • Currently, the Companies are both companies with an Audit & Supervisory Committee, and they chose the same structure for the Joint Holding Company as they determined that establishing an Audit & Supervisory Committee composed of Directors concurrently serving as Audit & Supervisory Committee Members, including multiple Outside Directors, in order to further enhance the corporate governance systems of the Joint Holding Company would further strengthen the oversight function of the Board of Directors and ensure the transparency and increase the efficiency of group management. |
| Regarding shares | Regarding shares |
| &nbsp;&nbsp;What types of procedures will the shareholders of Hagiwara Electric and Satori Electric need to conduct in connection to the joint share transfer? | • Shareholders are asked to determine whether to vote for or against the relevant proposals at the general meeting of shareholders of each of the Companies. |
| &nbsp;&nbsp;What types of procedures will the shareholders of Hagiwara Electric and Satori Electric need to conduct in connection to the joint share transfer? | • If the proposals are approved, shares of the Joint Holding Company will be delivered to shareholders who hold shares of either of the Companies as of the effective date of the share transfer, and therefore no particular procedures are necessary. |
| &nbsp;&nbsp;Will the shares of Hagiwara Electric and Satori Electric still be tradable? Will the people who held shares in Hagiwara Electric or Satori Electric cease to be shareholders thereof? | • The Companies will become wholly-owned subsidiaries of the Joint Holding Company through the share transfer, and therefore, prior to the listing of the Joint Holding Company, the final market trading date for the shares of each of the Companies is planned to be Friday, March 27, 2026. On Monday, March 30, 2026, Hagiwara Electric is planned to be delisted from the Tokyo Stock Exchange and the Nagoya Stock Exchange, and Satori Electric is planned to be delisted from the Tokyo Stock Exchange. On Wednesday, April 1, 2026, the Companies plan to allot shares of the Joint Holding Company to be |

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| | |
|:---|:---|
| &nbsp;&nbsp;Question | Answer |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;newly established to the shareholders of each of the Companies as of the effective date of the joint share transfer, and they plan to apply to the Tokyo Stock Exchange and the Nagoya Stock Exchange for a technical listing of the shares of the Joint Holding Company, which they plan to list on the Prime Market of the Tokyo Stock Exchange and the Premier Market of the Nagoya Stock Exchange. Therefore, it is planned that shareholders of each of the Companies will continue to be able to trade shares of the Joint Holding Company in share units. |
| Regarding dividends | Regarding dividends |
| &nbsp;&nbsp;How will interim dividends and year-end dividends be handled? | • As stated in "Summary of Consolidated Financial Results for the Three Months Ended June 30, 2025 (Based on Japanese GAAP)" released on August 8, 2025, Hagiwara Electric plans to pay a dividend of 90 yen per share with a record date of September 30, 2025 and a dividend of 95 yen per share with a record date of March 31, 2026. |
| &nbsp;&nbsp;How will the Joint Holding Company's dividends with a record date of March 31, 2027 be handled? | • The Companies plan to determine the amount of the Joint Holding Company's dividends for the fiscal year ending March 31, 2027 by comprehensively taking into account factors such as the dividend policies and dividend levels of each of the Companies up to the present and the future performance of the Joint Holding Company, but no specific details have been determined at present. |

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## Exhibit 99.4

&nbsp;&nbsp;The business combination described in this document involves securities of Japanese companies. The business combination is subject to disclosure requirements of Japan that are different from those of the United States. Financial information included in this document, if any, was excerpted from financial statements prepared in accordance with foreign accounting standards that may not be comparable to the financial statements of United States companies.<br>It may be difficult for you to enforce your rights and any claim you may have arising under the U.S. federal securities laws, since the issuers are located in Japan and some or all of their officers and directors reside outside of the United States. You may not be able to sue a Japanese company or its officers or directors in a Japanese court for violations of the U.S. securities laws.<br>It may be difficult to compel a Japanese company and its affiliates to subject themselves to a U.S. court's judgment. You should be aware that the issuer may purchase securities otherwise than under the business combination, such as in the open market or through privately negotiated purchases.

Start of measures for electronic provision: November 19, 2025

Extraordinary General Meeting of Shareholders<br>Reference Documents for Extraordinary General Meeting—<br>Supplementary Volume

The details of the financial statements, etc. of Satori Electric Co., Ltd. for the fiscal year ended May 31, 2025 ("5. Matters Relating to Satori Electric" in the Convocation Notice)

Hagiwara Electric Holdings Co., Ltd.

1 Current Status of the Corporate Group

(1) Course of Operations and Operating Results

The Japanese economy during the current consolidated fiscal year was affected by the prolonged stagnation of the Chinese economy and the outlook remained unclear, despite signs of gradual recovery driven by the recovery of personal consumption resulting from wage hikes and the increase in demand from inbound tourists.

Amid this environment, regarding the financial results for the current consolidated fiscal year, net sales amounted to 156,242 million yen (an increase of 5.5% year on year), which is mainly attributed to positive factors including the increased sales of semiconductors for the Indian market and automotive applications market in Japan and electronic components for personal computers and servers, as well as the effects of depreciation in the yen, despite the decreased sales in the procurement management business. Operating profit amounted to 3,993 million yen (a decrease of 16.0% year on year) mainly attributed to the impacts of exchange rates and human capital investment, etc. Ordinary profit amounted to 3,052 million yen (a decrease of 16.5% year on year). Profit attributable to owners of parent amounted to 2,524 million yen (an increase of 17.0% year on year), due to the recording of gains on sale of investment securities and a decrease in tax expenses.

![](image_010.jpg)

xxxxx Net sales 156,242 million yen (an increase of 5.5% year on year) Operating profit 3,993 million yen (a decrease of 16.0% year on year) Ordinary profit 3,052 million yen (a decrease of 16.5% year on year) Profit attributable to owners of parent 2,524 million yen (an increase of 17.0% year on year)

![](image_011.jpg)

Net Sales (million yen) 148,113 2024/05 156,242 2025/05 Operating profit (million yen) 4,755 2024/05 3,993 2025/05 Ordinary profit (million yen) 3,653 2024/05 3,052 2025/05 Profit attributable to owners of parent (million yen) 2,156 2024/05 2,524 2025/05

Industrial Infrastructure Business

![](image_012.jpg)

Net Sales (million yen) 30,021 2024/05 28,932 2025/05 Net Sales 28,932 million yen (a decrease of 3.6% year on year) Description of Business The Industrial Infrastructure business is mainly engaged in the development and sales of system solutions, and the sales of various electronic components and equipment, for industrial and social infrastructure. Product Portfolio Control parts and equipment, PC servers, industrial controllers, robots, optical fiber products Business Status Due to declining demand for personal computers for business purposes and other factors, sales decreased to 28,932 million yen (a decrease of 3.6% year on year) and segment profit amounted to 1,352 million yen (a decrease of 15.2% year on year), due in part to the impacts of human capital investment, etc., in addition to the decrease of sales.

Enterprise Business

![](image_013.jpg)

Net Sales (million yen) 49,181 2024/05 45,599 2025/05 Net Sales 45,599 million yen (a decrease of 7.3% year on year) Description of Business The Enterprise business is mainly engaged in the sales of semiconductors and electronic components, procurement management services, and the provision of storage solutions, for domestic customers. Product Portfolio Semiconductors, electronic components, liquid crystal panels, batteries, and storage products Business Status Net sales amounted to 45,599 million yen (a decrease of 7.3% year on year) due to decreased sales in the Procurement Management Division and other factors. Segment profit amounted to 1,206 million yen (a decrease of 41.6% year on year), due to a decrease in net sales as well as the impact of foreign exchange rates and human capital investment, etc.

Mobility Business

![](image_014.jpg)

Net Sales (million yen) 32,003 2024/05 40,043 2025/05 Net Sales 40,043 million yen (an increase of 25.1% year on year) Description of Business The Mobility business is engaged in the sales of semiconductors for automotive applications, mainly for xEVs in Japan and India. Product Portfolio Semiconductors, electronic components, LCD Panels, and solutions for the Indian market Business Status Net sales amounted to 40,043 million yen (an increase of 25.1% year on year), driven by the strong performance of SM Electronic Technologies Pvt. Ltd., as well as strong sales of semiconductors for the automotive applications market in Japan. Segment profit amounted to 1,504 million yen (a decrease of 17.5% year on year), due to increased goodwill amortization and other factors.

Global Business

![](image_015.jpg)

Net Sales (million yen) 43,966 2024/05 49,066 2025/05 Net Sales 49,066 million yen (an increase of 11.6% year on year) Description of Business The Global business is mainly engaged in the sales of semiconductors and electronic components, and the provision of solutions, for overseas customers Product Portfolio Semiconductors and electronic components, unit products, and in-house products Business Status Net sales amounted to 49,066 million yen (an increase of 11.6% year on year), and segment profit amounted to 991 million yen (an increase of 71.0% year on year). This is mainly attributable to increased sales of unit products for office equipment and electronic components for personal computers and servers, among other factors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Status of Capital Investment

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Major facilities completed during the current consolidated fiscal year

There are no matters to be stated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Ongoing construction and expansion of major facilities in the current consolidated fiscal year

There are no matters to be stated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Sales, removal and loss of significant fixed assets conducted during the current consolidated fiscal
year.

In the current consolidated fiscal year, the Company sold its land in Kamakura, which was an idle asset, and transferred *Kikuna Bekkan* (the Annex in Kikuna), which was its business asset.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Status of Financing

In order to ensure the flexibility and safety of financing, the Company has concluded commitment line agreements with three financial institutions. The maximum contract amount is 9 billion yen, and the balance of borrowings under those agreements was 3 billion yen at the end of the current period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Status of Business Transfer, Absorption-Type Company Split or Incorporation-Type Company Split

As of August 30, 2024, the Company transferred the business related to the development, design, manufacture, and sales of trigger switches for power tools and gardening equipment to a newly established company formed through a company split (SHIBA Co., Ltd.), and the Company also transferred all of the issued shares of such newly established company to OTAX Co., Ltd.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Status of Acquisition of Business of Other Companies

There are no matters to be stated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) Status of Succession of Rights and Obligations Regarding the Business of Other Companies, Etc. as a Result of an Absorption-Type Merger or Absorption-Type Company Split

There are no matters to be stated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) Status of Acquisition or Disposal of Shares or Other Equity Interests of Other Companies or Stock Acquisition Rights, Etc.

As of June 1, 2024, the Company acquired all of the outstanding shares of SATORI PINICS CO., LTD., a wholly-owned subsidiary of the Company's wholly-owned subsidiary SATORI SP TECHNOLOGY CO., LTD., and made SATORI PINICS CO., LTD., its wholly-owned subsidiary.

The Company has acquired additional shares (representing 25.0% of the voting rights) of SM Electronic Technologies Pvt. Ltd. ("SM Electronic"), a consolidated subsidiary of the Company, by way of share transfer, which has resulted in

the Company holding 75.1% of the voting rights of SM Electronic. October 1, 2024 shall be the deemed acquisition date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(8) Issues to be Addressed

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Basic management policy of the Company

The Group established "Mission, Vision, Value" as its basic management policy in fiscal year 2023.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● Mission

The Company aims to utilize electronics to create a rich and prosperous society and to contribute to the realization and development of a better society globally.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● 2030 Vision

The Company aims to become a "Sustainability Solutions Company" that helps to solves social issues with customers by leveraging its deep knowledge of the industry, infrastructure, and mobility industries and by positioning its technological capabilities in IoT and data analytics as growth drivers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● Value

"Who is The First Penguin?"

The Company quickly identifies the needs of customers and the market and create its own business models, and will always incorporate a diverse range of opinions, constantly seek change, and unfailingly work as professionals to achieve both "individual growth" and "group growth". The Company places high value on such employees.

In the electronics industry, which will continue to expand in the future, the Company will strive to further enhance corporate value by achieving sustainable business growth and improving management efficiency in order to provide returns to stakeholders and contribute to society.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Target Management Indicators

The Group positions "net sales", "operating profit" and "return on equity (ROE)" as important management indicators and is working to strengthen profitability. Although the Company formulated the "Medium-Term Management Plan 2026" starting from the last fiscal year, FY 2024, it has now revised its performance targets in light of the future outlook as of today. For FY 2026, the final fiscal year of the plan, the Group has set targets for net sales of 165 billion yen, operating profit of 4.8 billion yen, and ROE of 9.0%, and will continue to address the issues described in (iv) below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Outlook for FY 2025

For FY 2025, the Group forecasts net sales of 160 billion yen (an increase of 2.4% year on year), operating profit of 4.3 billion yen (an increase of 7.7% year on year), ordinary profit of 3.5 billion yen (an increase of 14.7% year on year),

and profit attributable to owners of parent of 2.6 billion yen (an increase of 3.0% year on year).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Business environment and issues to be addressed

The Japanese economy was affected by the prolonged slowdown of the Chinese economy and the outlook remained unclear, despite signs of gradual recovery driven by the recovery of personal consumption resulting from wage hikes and the increase in demand from inbound tourists.

The electronics industry, to which the Group belongs, is expected to remain strong, with sustained demand for artificial intelligence continuing to drive growth in the semiconductor market, despite rising geopolitical risks such as tariff issues and export restrictions.

In such environment, the Company will aim for sustainable growth by promoting active initiatives in the mobility DX and industrial DX fields, which are expected to grow over the medium to long term, and in the Indian market, which boasts the world's largest population.

With the aim of becoming a Sustainability Solutions Company, the Company will address the following issues.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Optimizing business portfolio through promoting segment management

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Creating human resources aligned with company values through continuous human resource investment

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Expanding new businesses and enhancing line cards in Japan and overseas

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Improving management quality through governance reform and PMI

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Promoting M&A and alliances in Japan and overseas

(9) Status of Assets and Profit and Loss

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| Category | Category | Fiscal year ended May 31, 2021 | Fiscal year ended May 31, 2022 | Fiscal year ended May 31, 2023 | Fiscal year ended May 31, 2024 | (Fiscal year under review) fiscal year ended May 31, 2025 |
| Net sales | (million<br>yen) | 105843 | 125850 | 146336 | 148113 | 156242 |
| Ordinary profit | (million<br>yen) | 1139 | 2601 | 2867 | 3653 | 3052 |
| Profit attributable to owners of parent | (million<br>yen) | 520 | 1908 | 2257 | 2156 | 2524 |
| Basic earnings per share | (yen) | 31.63 | 115.96 | 137.22 | 148.86 | 175.99 |
| Total assets | (million<br>yen) | 63216 | 74492 | 81556 | 83798 | 79150 |
| Net assets | (million<br>yen) | 30372 | 32457 | 34945 | 34969 | 33306 |
| Net assets per share | (yen) | 1836.81 | 1959.38 | 2052.73 | 2334.65 | 2251.59 |
| Return on equity (ROE) | (%) | 1.8 | 6.1 | 6.8 | 6.4 | 7.7 |

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| | |
|:---|:---|
| (Note) 1. | The Company adopted the "Accounting Standards for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020), etc. from the beginning of the fiscal year ended May 31, 2022, and the major management indicators, etc. for the fiscal year ended May 31, 2022 and thereafter are those after applying such accounting standards, etc. |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The Company has finalized the provisional accounting treatment related to business combination during the fiscal year ended May 31, 2025,
and the figures for the fiscal year ended May 31, 2024 have been adjusted to reflect the finalized accounting treatment.

![](image_016.jpg)

Net Sales (million yen) 105,843 2021/05 125,850 2022/05 146,336 2023/05 148,113 2024/05 156,242 2025/05 Ordinary profit (million yen) 1,139 2021/05 2,601 2022/05 2,867 2023/05 3,653 2024/05 3,052 2025/05 Profit attributable to owners of parent/Basic earnings per share (million yen) 31 520 2021/05 115 1,908 2022/05 137 2,257 2023/05 148 2,156 2024/05 175 2,524 2025/05 Total assets (million yen) 63,216 2021/05 74,492 2022/05 81,556 2023/05 83,798 2024/05 79,150 2025/05 Net assets/Net assets per share (million yen) 1,836 30,372 2021/05 1,959 32,457 2022/05 2,057 34,945 2023/05 2,334 34,969 2024/05 2,251 33,306 2025/05

(10) Status of Major Subsidiaries (as of May 31, 2025)

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| | | | |
|:---|:---|:---|:---|
| Company name | Share capital | Percentage of voting rights held by Company | Description of major business |
| SATORI PINICS CO., LTD. | 310<br>million yen | 100% | Sale of electronic components, control components, etc. |
| STAR ELECTRONICS Co., Ltd. | 310<br>million yen | 100% | Development, import/export, and sale of electronic components, etc. |
| SATORI SP TECHNOLOGY CO., LTD. | 350<br>million yen | 85% | Development/design, sale, import/export, maintenance of, and consulting on electronic components, etc. |
| TAIWAN SATORI CO., LTD. | USD 10,023<br>thousand | 100% | Sale of electronic components, etc. |
| HONG KONG SATORI CO., LTD. | HKD 147,659<br>thousand | 100% | Sale of electronic components, etc. |
| SM Electronic Technologies Pvt. Ltd. | INR 248,689<br>thousand | 75.1% | Sale of electronic components, etc. |
| SMET SINGAPORE PTE. LTD. | USD 2,858<br>thousand | 100%<br>(100%) | Sale of electronic components, etc. |
| MAGnetIC Holding B.V. | EUR 168 | 80% | Design of semiconductor circuits, IP sales, and wafer sales, etc. |

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---

| | |
|:---|:---|
| (Note) 1. | The figures within the parentheses () in the percentage of voting rights column indicate the percentage of indirectly held voting rights. |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. There are no subsidiaries that fall under the category of specified wholly-owned subsidiaries.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. As of June 1, 2024, the Company acquired all of the outstanding shares of SATORI PINICS CO., LTD., a wholly-owned subsidiary of the Company's
wholly-owned subsidiary SATORI SP TECHNOLOGY CO., LTD., and made SATORI PINICS CO., LTD. its wholly-owned subsidiary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. During the fiscal year under review, the Company has acquired additional shares of SM Electronic, which has resulted in the Company holding
75.1% of the voting rights.

(11) Important Operating Locations (as of May 31, 2025)

---

| | |
|:---|:---|
| Satori Electric Co., Ltd. | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Head Office: Minato-ku, Tokyo<br>(Offices and Branches)<br> Osaka Office, Sapporo Branch, Sendai Branch, Nagoya Branch, Kyushu Branch |
| SATORI PINICS CO., LTD. | Head Office: Minato-ku, Tokyo |
| STAR ELECTRONICS Co., Ltd. | Head Office: Minato-ku, Tokyo |
| SATORI SP TECHNOLOGY CO., LTD. | Head Office: Minato-ku, Tokyo |

---

---

| | |
|:---|:---|
| TAIWAN SATORI CO., LTD. | (Taiwan) |
| HONG KONG SATORI CO., LTD. | (Hong Kong) |
| SM Electronic Technologies Pvt. Ltd. | (India) |
| SMET SINGAPORE PTE. LTD. | (Singapore) |
| MAGnetIC Holding B.V. | (Netherlands) |

---

**Domestic and Overseas Network (as of May 31, 2025)**

![](image_017.jpg)

MAGnetIC Holding B.V. (The Netherlands) SATORI NELECTRIC (GERMANY) GmbH (Germany) SHANGHAI SATORI CO., LTD. (China) TAIWAN SATORI CO., LTD. (Taiwan) HONG KONG SATORI CO., LTD. (Hong Kong) SM Electronic Technologies Pvt. Ltd. (India) SMET SINGAPORE PTE. LTD. (Singapore) THAI SATORI CO., LTD. (Thailand) KOREA SATORI CO., LTD. (Korea) SATORI E-TECHNOLOGY (AMERICA) INC. (America)

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| | | |
|:---|:---|:---|
| Head Office | Head Office | Major Offices / Branches, Operating Locations |
| Satori Electric Co., Ltd.  | Minato-ku, Tokyo | Osaka Office, Sapporo Branch, Sendai Branch, Nagoya Branch, Kyushu Branch, Hiroshima Office, Kumamoto Office, Akita Technology Center |
| SATORI PINICS CO., LTD. | Minato-ku, Tokyo | Sendai Office, Nishi-Nihon Office |
| STAR ELECTRONICS Co., Ltd. | Minato-ku, Tokyo | Nagoya Branch |
| SATORI SP TECHNOLOGY CO., LTD. | Minato-ku, Tokyo |  |

---

(12) Status of Employees (as of May 31, 2025)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Status of Corporate Group employees

Number of Corporate Group Employees Increase/Decrease from End of Previous Period <br> <u>762 [48]</u> <u>-31 [2]</u>

(Note) The number of employees is the number of employees employed by the Corporate Group; with regard to temporary employees, the number in the parentheses is not included in the above number or is separately stated and shows the average number of temporary employees annually.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Status of employees of the Company

Number of Employees Increase/Decrease from End of Previous Period Average Age Average Years of Service <br> <u>357 [30]</u> <u>-29 [-2]</u> <u>46.0 ages</u> <u>18.7 years</u>

(Note) The number of employees is the number of employees employed by the Company; with regard to temporary employees, the number in the parentheses is not included in the above number or is separately stated and shows the average number of temporary employees annually.

(13) Principal Lenders and Loans Payable (as of May 31, 2025)

---

| | |
|:---|:---|
| Lenders | Loans Payable (million yen) |
| Sumitomo Mitsui Banking Corporation | 10,909 |
| MUFG Bank, Ltd. | 4,461 |
| Mizuho Bank, Ltd. | 1,736 |
| Sumitomo Mitsui Trust Bank, Limited | 800 |

---

(Note) Other than the foregoing, the Company also holds the balance of private placement bonds underwritten by MUFG Bank, Ltd. in the amount of 1,400 million yen.

(14) Other Important Matters Regarding the Current Status of the Corporate Group

There are no matters to be stated.

2 Matters Regarding Company Stock (As of May 31, 2025)

![](image_018.jpg)

(1) Total number of authorized shares 69,000,000 shares (2) Total number of issued shares 17,946,826 shares (including the following number of treasury shares) 3,085,635 shares (3) Number of shareholders 13,192 Distribution status by owner Corporations and others 11.83% Financial institutions 19.49% Securities companies 0.92% Foreign corporations, etc. 1.33% Individuals and others (including the treasury shares of 17.19%) 66.43%

(4) Major shareholders (top 10)

---

| | | |
|:---|:---|:---|
| Name of shareholders | Number of shares owned | Shareholding ratio |
| The Master Trust Bank of Japan, Ltd. (trust account) | 1,387,200 shares | 9.33% |
| Custody Bank of Japan, Ltd. (trust account) | 746,500 shares | 5.02% |
| STR MANAGEMENT CO., LTD. | 715,400 shares | 4.81% |
| Sumitomo Mitsui Banking Corporation | 587,482 shares | 3.95% |
| MUFG Bank, Ltd. | 583,334 shares | 3.93% |
| Kabushiki Kaisha Office Satori | 515,400 shares | 3.47% |
| CKD Corporation | 446,400 shares | 3.00% |
| Hiroyuki Satori | 312,474 shares | 2.10% |
| Reiko Fujii | 267,733 shares | 1.80% |
| Satori Electric Employee Stock Ownership Association | 219,245 shares | 1.48% |

---

---

| | |
|:---|:---|
| (Note) 1. | The shareholding percentage is calculated after deducting the number of shares of treasury stock (14,861,191 shares) from the total number of shares issued. |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. These treasury shares do not include 507,300 Company Shares that are owned by Custody Bank of Japan, Ltd. (trust account) in relation
to the stock compensation plan (Board benefit trust): 475,000 shares, employment-type executive officer benefit trust: 32,000 shares ）

(5) Other Important Matters Regarding Stock

(Employment-type executive officer benefit trust)

(i) Overview of the Plan

At the Board of Directors meeting held on July 12, 2024, the Company introduced the Plan, effective as of August 1, 2024, for the purpose of enhancing the awareness among the employment-type Executive Officers of the Company and its domestic subsidiaries (collectively, the "Employment-type Executive Officers") of the importance of improving the performance of the Group and increasing the Company's stock value. This will help to further promote business performance aimed at improving business performance and enhancing the corporate value of the Group over the medium to long term.

The Plan is an incentive-based plan in which a trust established through monetary contributions by the Company (the "Trust") acquires shares of the Company common stock (the "Company Shares") and delivers the Company Shares through the Trust to Employment-type Executive Officers who have satisfied certain requirements according to the points granted. The points will be granted for each Employment-type Executive Officer according to their respective positions, their degree of achievement of performance targets, and other factors in accordance with the share delivery rules established by the Company and its domestic subsidiaries at their Board of Directors meetings. The number of Company Shares to be delivered to each Employment-type Executive Officer will be determined by the number of points granted. Employment-type Executive Officers will receive such Company Shares when they retire/resign from their office as an executive officer, in principle. The funds for the Trust to acquire the Company Shares are contributed by the Company in full, therefore, the Employment-type Executive Officers are not required to pay such funds.

The trust period of the Trust is approximately three years from August 2024 to October 2027.

(ii) Total number of shares to be delivered to Employment-type Executive Officers:

32,200 shares

(iii) Scope of persons eligible to obtain the beneficiary rights and other rights under the Plan:

Employment-type Executive Officers who have satisfied the beneficiary requirements

3 Matters Regarding the Company's Stock Acquisition Rights, etc.

&nbsp;&nbsp;&nbsp;&nbsp;(1) Status of stock acquisition rights owned by Company Officers

There are no matters to be stated.

(2) Status of stock acquisition rights delivered to employees, etc. as consideration
for the execution of duties during the current fiscal year

There are no matters to be stated.

(3) Other important matters regarding stock acquisition rights, etc.

There are no matters to be stated.

4 Status of Officers (Directors and Executive Officers) (as of May 31, 2025)

(1) Status of Directors

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| | | |
|:---|:---|:---|
| Name | Current positions at the Company | Responsibilities and important concurrent positions |
| Hiroyuki Satori | Representative Director, President, Executive Officer | Representative Director and Chairman, SATORI SP TECHNOLOGY CO., LTD.<br> Director, SATORI PINICS CO., LTD.<br> Director, STAR ELECTRONICS Co., Ltd. |
| Hiroshi Nakamaru | Director, Managing Executive Officer | Head of Global Segment |
| Koji Suwahara | Director, Managing Executive Officer | Head of Corporate Division Director,<br> SATORI PINICS CO., LTD.<br> Director, STAR ELECTRONICS Co., Ltd.<br> Director, SATORI SP TECHNOLOGY CO., LTD.<br> Director, SM Electronic Technologies Pvt. Ltd.<br> Director, MAGnetIC Holding B.V. |
| Akihiro Taguchi | Director and Chairman of the Board<br> [Outside]<br> [Independent] | Outside Director, ASAHI INTECC CO., LTD. |
| Masaki Mogi | Director (Full-time Audit and Supervisory Committee Member) | Statutory Auditor, SATORI PINICS CO., LTD.<br> Statutory Auditor, STAR ELECTRONICS Co., Ltd.<br> Statutory Auditor, SATORI SP TECHNOLOGY CO., LTD. |
| Hidetoshi Tawada | Director (Audit and Supervisory Committee Member)<br> [Outside]<br> [Independent] | Managing Partner, Tawada CPA Office<br> Outside Director, KSK Co., Ltd. |
| Seiji Sakata | Director (Audit and Supervisory Committee Member)<br> [Outside]<br> [Independent] | Outside Director, HIROSE ELECTRIC CO., LTD.<br> Outside Member of the Board, Mabuchi Motor Co., Ltd. |
| Akiko Yukimaru | Director (Audit and Supervisory Committee Member)<br> [Outside]<br>| Attorney-at-law<br> Outside Director, IPS, Inc.<br> External Audit & Supervisory Board Member, Tebiki, Inc. |

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  [Independent]  

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| | |
|:---|:---|
| (Note) 1. | Mr. Toshikage Miyazawa and Mr. Toshimitsu Iwanami have retired from their positions as Directors (excluding Directors who are Audit and Supervisory Committee members) due to the expiration of their terms of office at the conclusion of the Annual General Meeting of Shareholders for the fiscal year ended May 2024, held on August 21, 2024. |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Mr. Akihiro Taguchi has retired from the position of Director who was an Audit and Supervisory Committee member due to the expiration
of his term of office at the conclusion of the Annual General Meeting of Shareholders for the fiscal year ended May 2024, held on August
21, 2024, and was elected as a Director (excluding a Director who is an Audit and Supervisory Committee member) at the same Annual General
Meeting of Shareholders, and has assumed such office.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Mr. Seiji Sakata was newly elected as a Director and Audit and Supervisory Committee member at the Annual General Meeting of Shareholders
for the fiscal year ended May 2024, held on August 21, 2024, and has assumed such office.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The Company has elected full-time Audit and Supervisory Committee members to strengthen the auditing and supervisory functions, through
the collection of daily information and the attendance at important meetings, as well as cooperation with the Internal Auditing Department
and others.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Mr. Akihiro Taguchi, Mr. Hidetoshi Tawada, Mr. Seiji Sakata and Ms. Akiko Yukimaru, who are all Directors, are all Outside Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. Mr. Hidetoshi Tawada, who is an Audit and Supervisory Committee member, is qualified as a certified public accountant and has professional
insight and knowledge in the financing and accounting fields.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. Ms. Akiko Yukimaru, who is an Audit and Supervisory Committee member, is qualified as an attorney and has professional insight and knowledge
in corporate legal affairs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. The Company has registered Mr. Akihiro Taguchi, Mr. Hidetoshi Tawada, Mr. Seiji Sakata and Ms. Akiko Yukimaru, who are all Directors,
with the Tokyo Stock Exchange as independent officers as provided by the Tokyo Stock Exchange, Inc.

(2) Compensation, etc. for Directors

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Matters regarding the policy for determining the content of compensation, etc. for individual Directors

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Method of determining the policy

The Company's Board of Directors has adopted a resolution for a policy for determining the content of compensation, etc. for individual Directors (excluding Directors who are Audit and Supervisory Committee members) (hereinafter, the "Determination Policy"). Prior to this Board of Directors resolution, the Company consulted with and received recommendations from the Nomination and Compensation Advisory Committee regarding the content of the Determination Policy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Basic principles for the Officer compensation system

The Company's Officer compensation system is designed and operated based on the following basic principles.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The system motivates Officers to achieve sustainable growth and increase corporate value over the medium to long term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The system has Officers share interests with stakeholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The compensation structure has a link to the Company's performance and is based on roles and responsibilities of Officers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Compensation is set at appropriate levels to maintain and secure excellent human resources.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) The system is designed objectively and reasonably, and it is determined through a highly transparent process.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Overview of the Officer compensation system

Regarding compensation for Officers of the Company, the total amount of compensation is established according to the expected roles required for each position (job grade). The amount is determined by setting the average of the results of compensation surveys covering mainly domestic listed companies as a benchmark and comprehensively considering the Company's business performance and employee salary levels.

Compensation for Officers of the Company is divided into: (i) compensation for Directors, and (ii) compensation for Executive Officers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. Compensation for Directors

Compensation for Directors consists of "basic compensation" which is fixed compensation based on the Director's job grade and "stock compensation" which is non-monetary compensation as a medium- to long-term incentive. Directors are not paid a bonus as a short-term incentive.

Regarding the "basic compensation", the amount of compensation is determined according to the expected roles actually conducted by the Directors and is paid based on the job grade.

- "Stock compensation" is paid to the Directors who conduct the execution of business as an incentive to achieve the management figures stated in the Medium-term Management Plan. The stock compensation is not clearly divided into compensation for Directors and compensation for Executive Officers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. Compensation for Executive Officers

Compensation for Executive Officers consists of (i) "basic compensation" which is fixed compensation according to the Executive Officer's position and expected roles, and (ii) performance-linked compensation which includes an "annual bonus" as a short-term incentive and "stock compensation" as a medium- to long-term incentive.

Regarding the "basic compensation", expected roles required for job grades of the Executive Officers are reviewed and ranked from the perspective of the level of influence and business performance process, then grading is provided to the expected roles, and the basic compensation is determined by using the relative differences with the President and Executive Officer.

- "Annual bonus" is paid from the perspective of the pay for performance to motivate achieving the budget each year.

"Stock compensation" is paid to motivate achieving the management figures stated in the Medium-term Management Plan. The incentive to be provided during fiscal 2024 was paid (the points were granted) to the eligible Officers since all of the results for fiscal 2023 (i.e., the term ended in May 2024), which was the last fiscal year during the Medium-term Management Plan 2023, were achieved in the net sales/operating profit/return on equity (ROE) as a key performance indicator (KPI)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Policy for determining the amount of compensation, etc., for individual Officers as part of basic compensation (monetary compensation)

The amount of the basic compensation is determined according to the expected roles for each Officer by making the relative comparison between the position of each Officer and the scope of the expected roles required for each Officer and setting a compensation table for each position of the Officers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Policy for determining the content and method for calculating the amount of performance-linked compensation, etc., and non-monetary compensation,
etc.

- Performance-linked compensation consists of "annual bonus" (monetary compensation) as a short-term incentive and "stock compensation" (non-monetary compensation) as a long-term incentive and is paid to

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| |
|:---|
| Directors and Executive Officers who conduct the execution of business. |
| "Annual bonus" is designed to motivate the achievement of budgets each year, and based on the evaluation items for calculating the amount of annual bonus for each Officer, which are the results achieved by all the companies within the Company Group (consolidated net sales and consolidated operating profit) and business performance (net sales and operating profit) controlled by each Officer, and the amount of annual bonus is determined based on the status of achievement by each Officer for these evaluating indicators in accordance with the personnel evaluation by using a compensation KPI established for each Officer. |

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Regarding the "stock compensation", the performance-linked stock compensation plan using the Trust is introduced, and points according to the position and business performance are granted for each Medium-Term Management Plan Period, in accordance with the share delivery rules, and the Company Shares according to the points are provided if the stipulated requirements are met.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Matters regarding determination of compensation, etc., for individual Directors

The compensation for Directors (excluding Directors who are Audit and Supervisory Committee members) is determined through a resolution of the Board of Directors upon discussion at and recommendation from the Nomination and Compensation Advisory Committee, which consists of a majority of Outside Directors.

Furthermore, the Board of Directors conducts discussions regarding the consistency with the Determination Policy, etc., at the Nomination and Compensation Advisory Committee, and considers whether the determination of the amount of compensation for each individual Director (excluding Directors who are Audit and Supervisory Committee members) is in line with the Determination Policy.

For Directors who are Audit and Supervisory Committee members, compensation is determined through discussions among such Directors who are Audit and Supervisory Committee members.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Total amount of compensation etc., for the current fiscal year

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  | Total amount by type of compensation, etc. (million yen) | Total amount by type of compensation, etc. (million yen) | Total amount by type of compensation, etc. (million yen) |  |
| Classification | Total amount of compensation etc., (million yen) | Fixed compensation | Performance-linked compensation (officer bonus) | Non-monetary compensation, etc. | Number of subject officers |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Directors (excluding Directors who are Audit and Supervisory Committee members)<br> (Outside Directors) | 89<br>(11) | 41<br>(11) | －<br>(－) | 47<br>(－) | 6<br>(2) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Directors (who are Audit and Supervisory Committee members)<br> (Outside Directors) | 39<br>(23) | 39<br>(23) | －<br>(－) | －<br>(－) | 5<br>(4) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total<br> (Outside Officers) | 128<br>(34) | 81<br>(34) | －<br>(－) | 47<br>(－) | 11<br>(6) |

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| | |
|:---|:---|
| (Note) 1. | The numbers above include two (2) Directors (excluding Audit and Supervisory Committee members) who retired upon the conclusion of the Annual General Meeting of Shareholders for the fiscal year ended May 2024, held on August 21, 2024, and one (1) Director who retired as a Director who is an Audit and Supervisory Committee member due to the expiration of their term of office and was elected and assumed office as a Director (excluding Directors who are Audit and Supervisory Committee members) at the same Annual General Meeting of Shareholders. |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The amount to be paid to Directors does not include the employee portion of salaries for Directors who also serve as employees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. At the Annual General Meeting of Shareholders for the fiscal year ended May 2020, held on August 20, 2020, it was resolved that the maximum
compensation amount for Directors (excluding Directors who are Audit and Supervisory Committee members) shall be up to 300 million yen
per year (excluding the employee portion of their salaries) and the maximum compensation amount for Directors (who are Audit and Supervisory
Committee members) shall be up to 200 million yen per year. The number of Directors (excluding Directors who are Audit and Supervisory
Committee members) at the conclusion of such Annual General Meeting of Shareholders was five (5), and the number of Directors (who are
Audit and Supervisory Committee members) was also five (5). In addition, the introduction of performance-linked stock compensation was
resolved at the Annual General Meeting of Shareholders for the fiscal year ended May 2022, held on August 19, 2022. The number of Directors
(excluding Directors who are Audit and Supervisory Committee members and Outside Directors) subject to such decision at the conclusion
of such Annual General Meeting of Shareholders was five (5). Please refer to "(Note) 4." below for the outline of this resolution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. As non-monetary compensation, etc., the Company introduced performance-linked stock compensation at the Annual General Meeting of Shareholders
for the fiscal year ended May 2022, held on August 19, 2022. Under this compensation plan, the Company contributes money to a trust,
and the trust then acquires the Company's shares using such contributed money as funds and delivers the Company's shares
in a number corresponding to the number of points granted to the eligible Directors. The eligible Directors are Directors (excluding
Directors who are Audit and Supervisory Committee members and Outside Directors; the same shall apply hereinafter) who are in office
during the five (5) fiscal years from the fiscal year ended May 31, 2023, to the fiscal year ended May 31, 2027 (the "Coverage
Period"). Specifically, in accordance with the share delivery rules established by the Company's Board of Directors, the
Company will grant each Director a number of points according to their position and the degree of achievement of performance targets
(\*) on the point granting date specified in the share delivery rules during the trust period. The points shall be granted for each period
subject to the Company's medium-term management plan (the "MTP Period"), and, in principle, the point grant date shall
be the date of the meeting of the Board of Directors held immediately following the Company's annual general meeting of shareholders
convened immediately following the end of each MTP

Period. The MTP Period shall be each MTP Period for fiscal 2021 to fiscal 2023 (however, as fiscal 2021 had already passed at the time of introduction, the MTP Period shall instead be for fiscal 2022 to fiscal 2023) and fiscal 2024 to fiscal 2026. It was also resolved that the maximum amount to be contributed by the Company for acquiring the Company's shares necessary to deliver to the Company's Directors during the Coverage Period is 500 million yen in total, and the maximum number of points to be granted to eligible Directors is 50,000 points per fiscal year (one (1) point equates to one (1) Company share).

(\*) As for the first MTP Period, all of the targets set by the Company were achieved in terms of three indicators, namely, "net sales," "operating income" and "return on equity (ROE)" established for fiscal 2023, which was the final year of the "Medium-term Management Plan 2023." The Company therefore granted points in fiscal 2024 to each Director holding office as of the end of fiscal 2023.

(3) Matters Regarding Outside Officers (as of May 31, 2025)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Relationship between the Company and other corporations, etc., in which Outside Directors concurrently
hold significant positions

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Mr. Akihiro Taguchi serves as a Member of the Board (outside) of ASAHI INTECC CO., LTD., which has no significant business or other relationship
with the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Mr. Hidetoshi Tawada is Managing Partner of Tawada CPA Office and serves as an Outside Director of KSK Co., Ltd., which has no significant
business or other relationship with the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Mr. Seiji Sakata serves as an Outside Director of HIROSE ELECTRIC CO., LTD. and an Outside Member of the Board of Mabuchi Motor Co.,
Ltd., neither of which has any significant business or other relationship with the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Ms. Akiko Yukimaru is an attorney-at-law at Yokohama Sogo Law Office and serves as an Outside Director of IPS, Inc. and an External Audit
& Supervisory Board Member of Tebiki, Inc., neither of which has any significant business or other relationship with the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Relationship with specified related business operator, including major customers

There are no matters to be stated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Main activities in the current fiscal year

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| | | |
|:---|:---|:---|
| Classification / Name | Status of attendance at Board of Directors meetings, etc. | Summary of comments and duties conducted in relation to their expected roles |
| Director<br>Akihiro Taguchi | - Board of Directors 13/13<br> - Audit and Supervisory Committee 3/3<br> - Nomination and Compensation Advisory Committee 7/7 | Based on his extensive experience and broad knowledge as a corporate manager, as well as his professional insight and knowledge in design, development and technology, Mr. Akihiro Taguchi has fulfilled his roles and responsibilities expected as Outside Director by conducting supervision over business execution and providing useful comments and advice, etc. As Chairman of the Board, he has been committed to deliberation matters and proper operation of the Board of Directors, etc., and contributed to the separation of execution and supervision thereof. In addition, he served as Chairman of the Nomination and Compensation Advisory Committee and fulfilled his role, such as by taking the initiative in considering the appropriateness of appointing officers and their compensation and enhancing the transparency of the decision process therefor. |

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| | | |
|:---|:---|:---|
| Director Audit and Supervisory Committee Member<br>Hidetoshi Tawada | - Board of Directors 13/13<br> - Audit and Supervisory Committee 15/15 | Based on his extensive auditing experience and professional knowledge in finance and accounting, etc., as a certified public accountant, Mr. Hidetoshi Tawada has fulfilled his roles and responsibilities expected as an Outside Director by conducting proper audit and supervision and providing appropriate advice, etc. As Chairman of the Audit and Supervisory Committee, he has also contributed to the strengthening of the audit and supervision functions and the improvement of corporate governance. |
| Director Audit and Supervisory Committee Member<br>Seiji Sakata | - Board of Directors 10/10<br> - Audit and Supervisory Committee 12/12<br> - Nomination and Compensation Advisory Committee 4/4 | Based on his extensive experience and broad knowledge as a corporate manager, as well as his professional insight and knowledge in design, development and technology, Mr. Seiji Sakata has fulfilled his roles and responsibilities expected as an Outside Director by conducting audit and supervision over business execution and providing useful comments and advice, etc. In addition, he served as a member of the Nomination and Compensation Advisory Committee and fulfilled his role, such as by considering the appropriateness of appointing officers and their compensation and enhancing the transparency of the decision process therefor. |

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| | | |
|:---|:---|:---|
| Director Audit and Supervisory Committee Member<br>Akiko Yukimaru | - Board of Directors 13/13<br> - Audit and Supervisory Committee 15/15 | Based on her professional insight and extensive experience in corporate legal affairs, etc. cultivated as a judge and attorney-at-law, Ms. Akiko Yukimaru has fulfilled her roles and responsibilities expected as an Outside Director, such as conducting proper audit and supervision and providing appropriate advice, by ensuring the soundness of management and enhancing corporate value, etc., from her independent standpoint and objective perspective. |

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| | |
|:---|:---|
| (Note) 1. | Mr. Akihiro Taguchi has retired from the position of Director who was an Audit and Supervisory Committee member due to the expiration of his term of office at the conclusion of the Annual General Meeting of Shareholders for the fiscal year ended May 2024, held on August 21, 2024, and was elected as a Director (excluding a Director who is an Audit and Supervisory Committee member) at the same Annual General Meeting of Shareholders, and has assumed such office. |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Mr. Seiji Sakata was elected as a Director who is an Audit and Supervisory Committee member at the Annual General Meeting of Shareholders
for the fiscal year ended May 2024, held on August 21, 2024. The status of attendance at Board of Directors meetings, etc., specified
above reflects the attendance after assuming his office.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Amount of the Company's compensation, etc., and amount of compensation, etc., received as an
Officer for the current fiscal year from the Company's parent company, etc., or any subsidiary thereof, etc.

There are no matters to be stated.

(4) Outline of Contents of Limitation of Liability Agreement

Pursuant to Article 427, Paragraph 1 of the Companies Act, the Company has entered into an agreement with each Outside Director to limit his/her liability for damages as stipulated in Article 423, Paragraph 1 of the said Act.

The maximum amount of liability for damages under such agreement is the minimum liability amount stipulated in Article 425, Paragraph 1 of the Companies Act.

(5) Directors and Officers Liability Insurance Agreement

The Company has concluded a Directors and Officers Liability Insurance (D&O Insurance) Agreement as stipulated in Article 430-3, Paragraph 1 of the Companies Act, with an insurance company. The scope of the insured under such insurance agreement are the Directors, Corporate Auditors and Executive Officers of the Company and its subsidiaries, and the premiums thereof are borne by the Company in full. The insurance agreement will provide compensatory damages (excluding those applicable to the disclaimer set forth in the insurance agreement) in the event that the insured becomes liable for damage arising from their duties.

The effective period of the D&O insurance agreement is one year and will be renewed upon resolution at the Board of

Directors meeting prior to the expiration of such period.

5 Company System and Policies

![](image_023.jpg)

(1) Basic Policy Regarding Control of Stock Company There are no matters to be stated. (2) Policy Regarding Decision on Dividends of Surplus The Company deems dividend policy as a key management issue. Upon giving comprehensive consideration to the outlook of the management status, etc., the Company aims to implement performance-linked dividends with an expected dividend payout ratio of 50% of the net income for the period under review attributable to the parent company's shareholders, while balancing shareholder returns through stable and continuous dividends with retained earnings for the reinforcement of the financial structure and for future business development. At the Board of Directors meeting held on July 14, 2025, it was resolved that the year-end dividend for the current fiscal year would be 46 yen per share. As a result, the annual dividend (including an interim dividend of 40 yen per share) will amount to 86 yen per share. As for the dividend forecast for the fiscal year ended May 2026, the annual dividend (including an interim dividend of 44 yen per share) is expected to be 90 yen per share. Progress of Dividend per Share (Unit: yen) Year End Interim 30 18 12 2021/5 62 44 18 2022/5 70 44 26 2023/5 80 50 30 2024/5 86 46 40 2025/5 90 46 44 2026/5 (plan)

Consolidated Balance Sheet (as of May 31, 2024)

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| | | | |
|:---|:---|:---|:---|
|  |  |  | (Million yen) |
| (Reference) | Title | For the fiscal year ended May 31,<br> 2025<br>(as of May 31, 2025) | For the fiscal year ended May 31,<br> 2024 (reference)<br>(as of May 31, 2024) |
|  | (Assets) |  |  |
| (Assets) | Current assets | 69954 | 72692 |
| &nbsp;&nbsp;&nbsp;Total assets were 79,150 million yen, a | Cash and deposits | 9128 | 9246 |
| decrease of 4,647 million yen compared to those | Notes and accounts receivable - trade | 36945 | 35689 |
| at the end of the previous fiscal year. | Electronically recorded monetary claims - operating | 5742 | 5753 |
| Current assets | Merchandise and finished goods | 12059 | 16034 |
| &nbsp;&nbsp;&nbsp;Current assets decreased by 2,737 million yen | Work in process | 294 | 300 |
| compared to those at the end of the previous | Raw materials and supplies | 1 | 489 |
| fiscal year, which is mainly attributed to the | Other | 5852 | 5270 |
| decrease in merchandise and finished goods. | Allowance for doubtful accounts | (70) | (91) |
|  | Non-current assets | 9196 | 11105 |
| Non-current assets | Property, plant and equipment | 2747 | 3071 |
| &nbsp;&nbsp;&nbsp;Non-current assets decreased by 1,909 million | Buildings and structures | 2105 | 2298 |
| yen compared to those at the end of the previous | &nbsp;&nbsp;&nbsp;Accumulated depreciation | (831) | (988) |
| fiscal year, which is mainly attributed to the | &nbsp;&nbsp;&nbsp;Buildings and structures, net | 1274 | 1310 |
| decrease in investment securities. | Land | 695 | 787 |
|  | Other | 2060 | 2319 |
|  | &nbsp;&nbsp;&nbsp;Accumulated depreciation | (1283) | (1345) |
|  | &nbsp;&nbsp;&nbsp;Other, net | 776 | 973 |
|  | Intangible assets | 2528 | 2933 |
|  | Goodwill | 1605 | 1951 |
|  | Customer-related intangible assets | 375 | 433 |
|  | Technology-related intangible assets | 237 | 308 |
|  | Other | 309 | 240 |
|  | Investments and other assets | 3920 | 5100 |
|  | Investment securities | 3207 | 4344 |
|  | Deferred tax assets | 393 | 423 |
|  | Other | 916 | 971 |
|  | Allowance for doubtful accounts | (597) | (639) |
|  | Total assets | 79150 | 83798 |
|  | \*The fiscal year ended May 31, 2024 (as of May 31, 2024) is provided for reference (not subject to audit). | \*The fiscal year ended May 31, 2024 (as of May 31, 2024) is provided for reference (not subject to audit). | \*The fiscal year ended May 31, 2024 (as of May 31, 2024) is provided for reference (not subject to audit). |

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| | | |
|:---|:---|:---|
|  |  | &nbsp;&nbsp;&nbsp;(Million yen) |
| &nbsp;&nbsp;&nbsp;Title | &nbsp;&nbsp;&nbsp;For the fiscal year ended May 31,<br> 2025<br>(as of May 31, 2025) | &nbsp;&nbsp;&nbsp;For the fiscal year ended May 31,<br> 2024 (reference)<br>(as of May 31, 2024)<br> &nbsp;&nbsp;&nbsp;(Reference) |
| (Liabilities) |  | &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;(Liabilities) |
| &nbsp;&nbsp;&nbsp;Current liabilities | &nbsp;&nbsp;&nbsp;39800 | &nbsp;&nbsp;&nbsp;43470 |
| &nbsp;&nbsp;&nbsp;&nbsp;Notes and accounts payable - trade | &nbsp;&nbsp;&nbsp;16535 | &nbsp;&nbsp;&nbsp;15072 |
| &nbsp;&nbsp;&nbsp;&nbsp;Electronically recorded obligations - | &nbsp;&nbsp;&nbsp;4247 | &nbsp;&nbsp;&nbsp;3386 |
| &nbsp;&nbsp;&nbsp;&nbsp;operating |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Short-term borrowings | &nbsp;&nbsp;&nbsp;15454 | &nbsp;&nbsp;&nbsp;15103 |
| &nbsp;&nbsp;&nbsp;&nbsp;Current portion of long-term borrowings | &nbsp;&nbsp;&nbsp;23 | &nbsp;&nbsp;&nbsp;1008 |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits received | &nbsp;&nbsp;&nbsp;923 | &nbsp;&nbsp;&nbsp;4734 |
| &nbsp;&nbsp;&nbsp;&nbsp;Income taxes payable | &nbsp;&nbsp;&nbsp;403 | &nbsp;&nbsp;&nbsp;793 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses | &nbsp;&nbsp;&nbsp;974 | &nbsp;&nbsp;&nbsp;1211 |
| &nbsp;&nbsp;&nbsp;&nbsp;Provision for losses on business transfer | &nbsp;&nbsp;&nbsp;127 | &nbsp;&nbsp;&nbsp;– |
| &nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp;&nbsp;1110 | &nbsp;&nbsp;&nbsp;2160 |
| &nbsp;&nbsp;&nbsp;Non-current liabilities | &nbsp;&nbsp;&nbsp;6044 | &nbsp;&nbsp;&nbsp;5358 |
| &nbsp;&nbsp;&nbsp;&nbsp;Bonds payable | &nbsp;&nbsp;&nbsp;1400 | &nbsp;&nbsp;&nbsp;1400 |
| &nbsp;&nbsp;&nbsp;&nbsp;Long-term borrowings | &nbsp;&nbsp;&nbsp;2844 | &nbsp;&nbsp;&nbsp;1815 |
| &nbsp;&nbsp;&nbsp;&nbsp;Provision for share awards for directors | &nbsp;&nbsp;&nbsp;99 | &nbsp;&nbsp;&nbsp;– |
| &nbsp;&nbsp;&nbsp;&nbsp;(and other officers) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred tax liabilities | &nbsp;&nbsp;&nbsp;142 | &nbsp;&nbsp;&nbsp;346 |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred tax liabilities for land revaluation | &nbsp;&nbsp;&nbsp;10 | &nbsp;&nbsp;&nbsp;9 |
| &nbsp;&nbsp;&nbsp;&nbsp;Retirement benefit liability | &nbsp;&nbsp;&nbsp;1337 | &nbsp;&nbsp;&nbsp;1467 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp;&nbsp;210 | &nbsp;&nbsp;&nbsp;318 |
| &nbsp;&nbsp;&nbsp;Total liabilities | &nbsp;&nbsp;&nbsp;45844 | &nbsp;&nbsp;&nbsp;48828 |
| &nbsp;&nbsp;&nbsp;(Net assets) |  |  |
| &nbsp;&nbsp;&nbsp;Shareholders' equity | &nbsp;&nbsp;&nbsp;29138 | &nbsp;&nbsp;&nbsp;28407 |
| &nbsp;&nbsp;&nbsp;&nbsp;Share capital | &nbsp;&nbsp;&nbsp;2611 | &nbsp;&nbsp;&nbsp;2611 |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital surplus | &nbsp;&nbsp;&nbsp;2988 | &nbsp;&nbsp;&nbsp;3447 |
| &nbsp;&nbsp;&nbsp;&nbsp;Retained earnings | &nbsp;&nbsp;&nbsp;28465 | &nbsp;&nbsp;&nbsp;27288 |
| &nbsp;&nbsp;&nbsp;&nbsp;Treasury shares | &nbsp;&nbsp;&nbsp;(4927) | &nbsp;&nbsp;&nbsp;(4940) |
| &nbsp;&nbsp;&nbsp;Accumulated other comprehensive income | &nbsp;&nbsp;&nbsp;3181 | &nbsp;&nbsp;&nbsp;5034 |
| &nbsp;&nbsp;&nbsp;&nbsp;Valuation difference on available-for-sale | &nbsp;&nbsp;&nbsp;1085 | &nbsp;&nbsp;&nbsp;1795 |
| &nbsp;&nbsp;&nbsp;&nbsp;securities |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred gains or losses on hedges | &nbsp;&nbsp;&nbsp;6 | &nbsp;&nbsp;&nbsp;(23) |
| &nbsp;&nbsp;&nbsp;&nbsp;Revaluation reserve for land | &nbsp;&nbsp;&nbsp;21 | &nbsp;&nbsp;&nbsp;22 |
| &nbsp;&nbsp;&nbsp;&nbsp;Foreign currency translation adjustment | &nbsp;&nbsp;&nbsp;2067 | &nbsp;&nbsp;&nbsp;3239 |
| &nbsp;&nbsp;&nbsp;Non-controlling interests | &nbsp;&nbsp;&nbsp;987 | &nbsp;&nbsp;&nbsp;1527 |
| &nbsp;&nbsp;&nbsp;Total net assets | &nbsp;&nbsp;&nbsp;33306 | &nbsp;&nbsp;&nbsp;34969 |
| &nbsp;&nbsp;&nbsp;Total liabilities and net assets | &nbsp;&nbsp;&nbsp;79150 | &nbsp;&nbsp;&nbsp;83798 |
| &nbsp;&nbsp;&nbsp;\*The fiscal year ended May 31, 2024 (as of May 31, 2024) is provided for reference (not subject to audit). | &nbsp;&nbsp;&nbsp;\*The fiscal year ended May 31, 2024 (as of May 31, 2024) is provided for reference (not subject to audit). | &nbsp;&nbsp;&nbsp;\*The fiscal year ended May 31, 2024 (as of May 31, 2024) is provided for reference (not subject to audit). |

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Consolidated Statement of Operations (from June 1, 2024 to May 31, 2025)

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| | | | |
|:---|:---|:---|:---|
|  |  | (Million yen) |  |
| Title | For the fiscal year ended May 31,<br> 2025<br> (from June 1, 2024 to May 31 2025) | For the fiscal year ended May 31,<br> 2024 (reference)<br> (from June 1, 2023 to May 31 2024) | (Reference) |
| Net sales | 156242 | 148113 | Net sales |
| Cost of sales | 140689 | 132365 | &nbsp;&nbsp;&nbsp;Net sales increased by 8,129 million yen compared  |
| Gross profit | 15552 | 15748 | to those of the previous fiscal year, which is mainly  |
| Selling, general and administrative express | 11559 | 10992 | attributed to positive factors including the increased  |
| Operating profit | 3993 | 4755 | sales of semiconductors for Indian market and  |
| Non-operating income | 277 | 386 | automotive applications the market in Japan and  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest income | 79 | 95 | electronic components for personal computers and  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend income | 84 | 82 | servers, as well as the effects of the depreciation in  |
| &nbsp;&nbsp;&nbsp;&nbsp;Purchase discounts | 20 | 40 | the yen, despite the decreased sales in the  |
| &nbsp;&nbsp;&nbsp;&nbsp;Compensation income | 11 | 102 | procurement management business. |
| &nbsp;&nbsp;&nbsp;&nbsp;Subsidy income | 30 | 40 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Others | 50 | 25 | Selling, general and administrative expenses |
| Non-operating expenses | 1219 | 1488 | &nbsp;&nbsp;&nbsp;Selling, general and administrative expenses  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest expenses | 458 | 498 | increased by 566 million yen compared to those of the  |
| &nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange losses | 389 | 288 | previous fiscal year, which is mainly attributed to the  |
| &nbsp;&nbsp;&nbsp;&nbsp;Loss on sale of receivables | 345 | 589 | increase in travel and transportation expenses, and  |
| &nbsp;&nbsp;&nbsp;&nbsp;Other | 26 | 111 | salaries and allowance, etc. |
| Ordinary profit | 3052 | 3653 |  |
| Extraordinary income | 378 | 74 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of non-current assets | – | 73 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Gain om sale of investment securities | 353 | 1 | Ordinary profit |
| &nbsp;&nbsp;&nbsp;&nbsp;Gain on redemption of membership | 5 | – | &nbsp;&nbsp;&nbsp;Ordinary profit decreased by 601 million yen  |
| &nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of businesses | 19 | – | compared to that of the previous fiscal year, which is  |
| Extraordinary losses | 20 | 232 | mainly attributed to the decrease in operating profit. |
| &nbsp;&nbsp;&nbsp;&nbsp;Loss on retirement of non-current assets | 1 | 54 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Impairment losses | 19 | 177 | Profit attributable to owners of parent  |
| Profit before income taxes | 3410 | 3496 | &nbsp;&nbsp;&nbsp;Profit attributable to owners of parent increased by  |
| Income taxes – current | 637 | 1082 | 367 million yen compared to that of the previous  |
| Income taxes – deferred | 83 | 85 | fiscal year, which is mainly attributed to the increase  |
| Profit | 2689 | 2329 | in the gain on sale of investment securities and  |
| Profit attributable to non-controlling interests | 165 | 172 | decrease in tax expenses. |
| Profit attributable to owners of parent | 2524 | 2156 |  |
| \* The fiscal year ended May 31, 2024 (from June 1, 2023 to May 31, 2024) is provided for reference (not subject to audit). | \* The fiscal year ended May 31, 2024 (from June 1, 2023 to May 31, 2024) is provided for reference (not subject to audit). | \* The fiscal year ended May 31, 2024 (from June 1, 2023 to May 31, 2024) is provided for reference (not subject to audit). |  |

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(Reference)

Consolidated Statement of Cash Flows (Overview) (from June 1, 2024 to May 31, 2025)

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| | | | |
|:---|:---|:---|:---|
|  |  | (Million yen) |  |
| Title | For the fiscal year ended May 31, 2025 <br> (from June 1, 2024 to <br> May 31, 2025 | For the fiscal year ended <br> May 31, 2024<br> (from June 1, 2023 to <br> May 31 2024) | (Reference) |
|  |  |  | Cash flows from operating activities |
| Cash flows from operating activities | 1303 | 5325 | &nbsp;&nbsp;&nbsp;Capital provided by operating activities during the  |
|  |  |  | current fiscal year amounted to 1,303 million yen  |
|  |  |  | (compared with 5,325 million yen provided in the  |
| Cash flows from investing activities | 592 | (2057) | previous fiscal year). |
|  |  |  | &nbsp;&nbsp;&nbsp;This is mainly attributable to an increase in capital  |
|  |  |  | caused by recording of profit before income taxes, a  |
| Cash flows from financing activities | (1905) | (4519) | decrease in inventories and an increase in trade  |
|  |  |  | payables, despite a decrease in capital due to an  |
|  |  |  | increase in trade receivables and a decrease in  |
| Effect of exchange rate change on cash  | (394) | 471 | deposits received. |
| and cash equivalents |  |  |  |
|  |  |  | Cash flows from investing activities |
| Net increase (decrease) in cash and cash  | (403) | (779) | &nbsp;&nbsp;&nbsp;Capital provided by investing activities amounted to  |
| equivalents |  |  | 592 million yen (compared with 2,057 million yen in  |
|  |  |  | the previous fiscal year). |
| Cash and cash equivalents at begi9nning  | 9243 | 10023 | &nbsp;&nbsp;&nbsp;This is mainly attributable to an increase in capital  |
| of period |  |  | due to sale of businesses. |
| Cash and cash equivalents at end of  | 8840 | 9243 | Cash flows from financing activities |
| period |  |  | &nbsp;&nbsp;&nbsp;Capital used in financing activities amounted to  |
|  |  |  | 1,905 million yen (compared with 4,519 million yen  |
| \*This Consolidated Statement of Cash Flows is not subject to audit. | \*This Consolidated Statement of Cash Flows is not subject to audit. | \*This Consolidated Statement of Cash Flows is not subject to audit. | used during the previous |
|  |  |  | &nbsp;&nbsp;&nbsp;This is mainly attributable to a decrease in capital  |
|  |  |  | due to dividends paid and the acquisition of additional  |
|  |  |  | shares of SM Electronic, despite an increase in capital  |
|  |  |  | due to a net increase in short-term borrowings. |

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Balance Sheet (as of May 31, 2025)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  |  |  |  | (Million yen) |
| Title | For the fiscal year ended May 31, 2025<br> (as of May 31, 2025) | For the fiscal year ended May 31, 2024 (reference)<br> (as of May 31, 2024) | Title | For the fiscal year ended May 31, 2025<br> (as of May 31, 2025) | For the fiscal year ended May 31, 2024 (reference)<br> (as of May 31, 2024) |
| (Assets) |  |  | (Liabilities) |  |  |
| Current assets | 29428 | 32196 | Current liabilities | 20664 | 20143 |
| &nbsp;&nbsp;&nbsp;Cash and deposits | 3282 | 3436 | &nbsp;&nbsp;&nbsp;&nbsp;Notes payable – trade | 38 | 114 |
| &nbsp;&nbsp;&nbsp;Notes receivable – trade | 327 | 519 | &nbsp;&nbsp;&nbsp;&nbsp;Electronically recorded obligations – operating | 4147 | 2993 |
| &nbsp;&nbsp;&nbsp;Electronically recorded monetary claims – operating | 5127 | 5034 | &nbsp;&nbsp;&nbsp;&nbsp;Accounts payable – trade | 5533 | 3994 |
| &nbsp;&nbsp;&nbsp;Accounts receivable – trade | 11715 | 11650 | &nbsp;&nbsp;&nbsp;&nbsp;Short-term borrowings | 9600 | 10000 |
| &nbsp;&nbsp;&nbsp;Merchandise and finished goods | 2716 | 3709 | &nbsp;&nbsp;&nbsp;&nbsp;Current portion of long-term borrowings | - | 1000 |
| &nbsp;&nbsp;&nbsp;Work in process | 294 | 300 | &nbsp;&nbsp;&nbsp;&nbsp;Accounts payable – other | 338 | 607 |
| &nbsp;&nbsp;&nbsp;Raw materials and supplies | 1 | 102 | &nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses | 513 | 756 |
| &nbsp;&nbsp;&nbsp;Short-term loans receivable from associated companies | 5127 | 6670 | &nbsp;&nbsp;&nbsp;&nbsp;Income taxes payable | 50 | 41 |
| &nbsp;&nbsp;&nbsp;Other | 837 | 775 | &nbsp;&nbsp;&nbsp;&nbsp;Provision for the losses on business transfer | 127 | 117 |
| &nbsp;&nbsp;&nbsp;Allowance for doubtful accounts | (1) | (1) | &nbsp;&nbsp;&nbsp;&nbsp;Other | 314 | 518 |
| Non-current assets | 18308 | 14907 | Non-current liabilities | 5674 | 4813 |
| &nbsp;&nbsp;Property, plant and equipment | 2061 | 2217 | &nbsp;&nbsp;&nbsp;&nbsp;Bonds payable | 1400 | 1400 |
| &nbsp;&nbsp;&nbsp;Buildings | 1122 | 1134 | &nbsp;&nbsp;&nbsp;&nbsp;Long-term borrowings | 2800 | 1800 |
| &nbsp;&nbsp;&nbsp;Structures | 0 | 1 | &nbsp;&nbsp;&nbsp;&nbsp;Allowance for retirement benefits | 1285 | 1411 |
| &nbsp;&nbsp;&nbsp;Machinery and equipment | 1 | 10 | &nbsp;&nbsp;&nbsp;&nbsp;Provision for share awards for directors (and other officers) | 99 | - |
| &nbsp;&nbsp;&nbsp;Tools, furniture and fixtures | 171 | 134 | &nbsp;&nbsp;&nbsp;&nbsp;Deferred tax liabilities for land revaluation | 10 | 9 |
| &nbsp;&nbsp;&nbsp;Land | 630 | 714 | &nbsp;&nbsp;&nbsp;&nbsp;Other | 80 | 192 |
| &nbsp;&nbsp;&nbsp;Leased assets | 134 | 219 | Total liabilities | 26339 | 24957 |
| &nbsp;&nbsp;&nbsp;Construction in progress | - | 2 | (Net assets) |  |  |
| Intangible assets | 231 | 218 | Shareholders' equity | 20288 | 20329 |
| &nbsp;&nbsp;&nbsp;Software | 231 | 218 | &nbsp;&nbsp;&nbsp;Share capital | 2611 | 2611 |
| Investments and other assets | 16016 | 12472 | &nbsp;&nbsp;&nbsp;Capital surplus | 3667 | 3644 |
| &nbsp;&nbsp;&nbsp;Investment securities | 3200 | 4337 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Legal capital surplus | 3606 | 3606 |
| &nbsp;&nbsp;&nbsp;Shares in associated companies | 10066 | 7909 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other capital surplus | 61 | 37 |
| &nbsp;&nbsp;&nbsp;Long-term loans receivable from associated companies | 2307 | - | &nbsp;&nbsp;&nbsp;Retained earnings | 18937 | 19014 |
| &nbsp;&nbsp;&nbsp;Deferred tax assets | 272 | 60 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Legal retained earnings | 208 | 208 |
| &nbsp;&nbsp;&nbsp;Other | 189 | 184 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other retained earnings | 18728 | 18805 |
| &nbsp;&nbsp;&nbsp;Allowance for doubtful accounts | (20) | (20) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reserve for dividends | 100 | 100 |
| Total assets | 47737 | 47104 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reserve for tax purpose reduction entry of non-current assets | 22 | 22 |
| \* The fiscal year ended May 31, 2024 (as of May 31, 2024) is provided for reference (not subject to audit). | \* The fiscal year ended May 31, 2024 (as of May 31, 2024) is provided for reference (not subject to audit). | \* The fiscal year ended May 31, 2024 (as of May 31, 2024) is provided for reference (not subject to audit). | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;General reserve | 15000 | 15000 |
|  |  |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Retained earnings brought forward | 3606 | 3682 |
|  |  |  | &nbsp;&nbsp;&nbsp;Treasury shares | (4927) | (4940) |
|  |  |  | Valuation and translation adjustments | 1108 | 1817 |
|  |  |  | &nbsp;&nbsp;&nbsp;Valuation difference on available-for-sale securities | 1085 | 1795 |
|  |  |  | &nbsp;&nbsp;&nbsp;Deferred gains or losses on hedges | 1 | - |
|  |  |  | &nbsp;&nbsp;&nbsp;Revaluation reserve for land | 21 | 22 |
|  |  |  | Total net assets | 21397 | 22147 |

---

---

| | | |
|:---|:---|:---|
| Total liabilities and net assets | 47737 | 47104 |

---

Statement of Operation (from June 1, 2024 to May 31, 2025)

---

| | | |
|:---|:---|:---|
|  |  | &nbsp;&nbsp;(Million yen) |
| Title | For the fiscal year ended May 31, 2025<br> (from June 1, 2024 to May 31, 2025) | For the fiscal year ended May 31, 2024 (reference)<br> (from June 1, 2023 to May 31, 2024) |
| Net sales | 47663 | 47805 |
| Cost of sales | 42091 | 41933 |
| Gross profit | 5571 | 5871 |
| Selling, general and administrative expenses | 5572 | 5479 |
| Operating profit (loss) | (1) | 392 |
| Non-operating income | 1212 | 1486 |
| Interest income | 164 | 120 |
| Dividend income | 927 | 788 |
| Foreign exchange gains | - | 354 |
| Other | 120 | 222 |
| Non-operating expenses | 439 | 234 |
| Interest expenses | 118 | 88 |
| Foreign exchange losses | 274 | - |
| Foreign withholding tax | 35 | 57 |
| Commission for purchase of treasury shares | - | 30 |
| Idle asset expenses | 3 | 50 |
| Other | 7 | 7 |
| Ordinary profit | 771 | 1644 |
| Extraordinary income | 358 | 73 |
| Gain on sale of non-current assets | - | 73 |
| Gain on sale of investment securities | 353 | - |
| Gain on redemption of membership | 5 | - |
| Extraordinary losses | 85 | 216 |
| Loss on retirement of non-current assets | 1 | 38 |
| Impairment losses | 19 | 60 |
| Provision for losses on business transfer | - | 117 |
| Losses on business transfer | 64 | - |
| Other | - | 0 |
| Profit before income taxes | 1045 | 1501 |
| Income taxes – current  | (268) | (57) |
| Income taxes – deferred | 54 | 269 |
| Profit | 1258 | 1289 |
| &nbsp;&nbsp;\* The fiscal year ended May 31, 2024 (from June 1, 2023 to May 31, 2024) is provided for reference (not subject to audit). | &nbsp;&nbsp;\* The fiscal year ended May 31, 2024 (from June 1, 2023 to May 31, 2024) is provided for reference (not subject to audit). | &nbsp;&nbsp;\* The fiscal year ended May 31, 2024 (from June 1, 2023 to May 31, 2024) is provided for reference (not subject to audit). |

---

**Accounting Audit Report on Consolidated Financial Statements**

![](image_023.gif)

Independent Auditor's Report July 11, 2025 To the Board of Directors of SATORI ELECTRIC CO., LTD.: KPMG AZSA LLC Tokyo Office, Japan Tsutomu Fukushima Designated Limited Liability Partner Engagement Partner Certified Public Accountant Kenta Kurosu Designated Limited Liability Partner Engagement Partner Certified Public Accountant Opinion We have audited the consolidated financial statements, which comprise the consolidated balance sheet, consolidated statement of operations, consolidated statement of changes in net assets and the notes to the consolidated financial statements of Satori Electric Co., Ltd. (the "Company"), as of May 31, 2025, and for the fiscal year from June 1, 2024 to May 31, 2025, in accordance with Article 444, Paragraph 4 of the Companies Act. In our opinion, the consolidated financial statements referred to above fairly present, in all material respects, the consolidated financial position and the results of operations of the corporate group consisting of the Company and its consolidated subsidiaries for the period, for which the consolidated financial statements were prepared, in accordance with the auditing standards generally accepted in Japan. Basis for Opinion We conducted our audit in accordance with auditing standards generally accepted in Japan. Our responsibilities under those standards are further described in the "Auditor's Responsibilities for the Audit of the Consolidated Financial Statements" section of our report. We are independent of the Company and its consolidated subsidiaries in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Japan and have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Other Contents The business report and its supplementary schedules are comprised of other contents. Management is responsible for the preparation and presentation of such other contents. In addition, the Audit and Supervisory Committee is In preparing the consolidated financial statements, management is responsible for assessing whether it is appropriate to prepare the consolidated financial statements with the assumption of a going concern and for disclosing, as necessary, matters related to a going concern in accordance with auditing standards generally accepted in Japan. The Audit and Supervisory Committee is responsible for overseeing the directors' execution of their duties with regard to the development and operation of the financial reporting process. Auditor's Responsibilities for the Audit of the Consolidated Financial Statements Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that expresses our opinion on the consolidated financial statements based on our audit from an independent point of view. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users. As part of our audit in accordance with auditing standards generally accepted in Japan, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: Identify and assess the risks of material misstatement in the consolidated financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Selection and application of audit procedures is at the discretion of the auditor. In addition, we obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances when making risk assessments, while the objective of the audit is not to express an opinion on the effectiveness of the entity's internal control. Evaluate the appropriateness of accounting policies used by management and their method of application, as well as the reasonableness of accounting estimates made by management and the appropriateness of the related notes thereto. Render a conclusion on the appropriateness of management's preparation of the consolidated financial statements with the assumption of a going concern, and based on the audit evidence obtained, conclude whether any material uncertainty exists in relation to events or conditions that may cast significant doubt on the Company's and its consolidated subsidiaries' ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the notes to the consolidated financial statements or, if such notes on material uncertainty are inadequate, to express a qualified opinion with exceptions on the consolidated financial statements. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company and its consolidated subsidiaries to cease to continue as a going

![](image_024.jpg)

responsible for overseeing the directors' execution of their duties with regard to the development and operation of the reporting process for other contents. Our opinion on the consolidated financial statements does not cover any other contents and we do not express any opinion thereon. Our responsibility for auditing the consolidated financial statements is to read through the other contents and, in the process of reading, consider whether there is any significant difference between such other contents and the consolidated financial statements or our knowledge obtained through the process of auditing, and also pay attention to whether there are any other signs of material error in the other contents other than such significant differences. If, based on the work we have performed, we conclude that there is any material misstatement in the other contents, we are required to report that fact. There are no matters to be reported by us regarding the other contents. Responsibilities of Management and Audit and Supervisory Committee for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with auditing standards generally accepted in Japan, and for such internal control as management determines is necessary to enable the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. concern. Evaluate whether the presentation and notes to the consolidated financial statements are in accordance with auditing standards generally accepted in Japan, evaluate the overall presentation, structure and content of the consolidated financial statements, including the related notes thereto, and check whether the consolidated financial statements fairly represent the underlying transactions and accounting events. Plan and perform an audit of the consolidated financial statements to obtain sufficient and appropriate audit evidence regarding the financial information of the Company and its consolidated subsidiaries to provide a basis for our opinion on the consolidated financial statements. We are responsible for the direction, supervision and review of the audit of the consolidated financial statements. We remain solely responsible for our audit opinion. We report to the Audit and Supervisory Committee regarding, among other matters, the planned scope and timing of the audit, significant audit findings, including any significant deficiencies in internal control that we identify during our audit process, and other matters required by the auditing standards. We also provide the Audit and Supervisory Committee with a statement that we have complied with relevant ethical requirements regarding independence, and if measures have been taken to remove matters or impediments reasonably considered to affect the auditor's independence or if safeguards have been applied to reduce such impediments to an acceptable level, we report the details of such measures or safeguards. Interest required to be disclosed by the Certified Public Accountants Act of Japan Our firm and our designated engagement partners do not have any interest in the Company or its subsidiaries which is required to be disclosed pursuant to the provisions of the Certified Public Accountants Act of Japan

**Accounting Audit Report on Non-Consolidated Financial Statements**

![](image_025.jpg)

Independent Auditor's Report To the Board of Directors of SATORI ELECTRIC CO., LTD.: KPMG AZSA LLC Tokyo Office, Japan Tsutomu Fukushima July 11, 2025 Opinion Designated Limited Liability Partner Engagement Partner Certified Public Accountant Kenta Kurosu Designated Limited Liability Partner Engagement Partner Certified Public Accountant We have audited the financial statements, which comprise the balance sheet, the statement of operations, the statement of changes in net assets, the notes to the financial statements, and the supplementary schedules (collectively, the "Financial Statements, Etc.") of Satori Electric Co., Ltd. (the "Company"), as of May 31, 2025, and for the 83rd fiscal period from June 1, 2024 to May 31, 2025, in accordance with Article 436, Paragraph 2, Item 1 of the Companies Act. In our opinion, the Financial Statements, Etc. referred to above fairly present, in all material respects, the financial position and the results of operations of the Company for the period for which the Financial Statements, Etc. were prepared, in accordance with the auditing standards generally accepted in Japan. Basis for Opinion We conducted our audit in accordance with auditing standards generally accepted in Japan. Our responsibilities under those standards are further described in the "Auditor's Responsibilities for the Audit of the Financial Statements, Etc." section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the Financial Statements, Etc. in Japan, and have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Other contents The business report and its supplementary schedules are comprised of other contents. Management is responsible for the preparation and presentation of such other contents. In addition, the Audit and Supervisory Committee is responsible for overseeing the directors' execution of their duties with regard to the development and operation of the Responsibilities of Management and Audit and Supervisory Committee for the Financial Statements, Etc. Management is responsible for the preparation and fair presentation of the Financial Statements, Etc. in accordance with auditing standards generally accepted in Japan, and for such internal control as management determines is necessary to enable the preparation and fair presentation of Financial Statements, Etc. that are free from material misstatement, whether due to fraud or error. In preparing the Financial Statements, Etc., management is responsible for assessing whether it is appropriate to prepare the Financial Statements, Etc. with the assumption of a going concern and for disclosing, as necessary, matters related to a going concern in accordance with auditing standards generally accepted in Japan. The Audit and Supervisory Committee is responsible for overseeing the directors' execution of their duties with regard to the development and operation of the Company's financial reporting process. Auditor's Responsibilities for the Audit of the Financial Statements, Etc. Our objectives are to obtain reasonable assurance about whether the Financial Statements, Etc. as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that expresses our opinion on the Financial Statements, Etc. based on our audit from an independent point of view. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users. As part of our audit in accordance with auditing standards generally accepted in Japan, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: Identify and assess the risks of material misstatement in the Financial Statements, Etc., whether due to fraud or error, and design and perform audit procedures responsive to those risks. Selection and application of audit procedures is at the discretion of the auditor. In addition, we obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances when making risk assessments, while the objective of the audit is not to express an opinion on the effectiveness of the entity's internal control Evaluate the appropriateness of accounting policies used by management and their method of application, as well as the reasonableness of accounting estimates made by management and the appropriateness of the related notes thereto. Render a conclusion on the appropriateness of management's preparation of the Financial Statements, Etc. with the assumption of a going concern, and based on the audit evidence obtained, conclude whether any material uncertainty exists in relation to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we

![](image_026.jpg)

reporting process for other contents. Our opinion on the Financial Statements, Etc. does not cover other contents and we do not express any opinion thereon. Our responsibility for auditing the Financial Statements, Etc. is to read through the other contents and, in the process of reading, consider whether there is any significant difference between such other contents and the Financial Statements, Etc. or our knowledge obtained through the process of auditing, and also pay attention to whether there are any other signs of material error in the other contents other than such significant differences. If, based on the work we have performed, we conclude that there is a material misstatement in the other contents, we are required to report that fact. There are no matters to be reported by us regarding the other contents. conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the notes to the Financial Statements, Etc., or, if notes on material uncertainty are inadequate, to express a qualified opinion with exceptions on the Financial Statements, Etc. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern. Evaluate whether the presentation and notes to the Financial Statements, Etc. are in accordance with auditing standards generally accepted in Japan, evaluate the overall presentation, structure and content of the Financial Statements, Etc., including the related notes thereto, and check whether the Financial Statements, Etc. fairly represent the underlying transactions and accounting events. We report to the Audit and Supervisory Committee regarding, among other matters, the planned scope and timing of the audit, significant audit findings, including any significant deficiencies in internal control that we identify during our audit process, and other matters required by the auditing standards. We also provide the Audit and Supervisory Committee with a statement that we have complied with relevant ethical requirements regarding independence, and if measures have been taken to remove matters or impediments reasonably considered to affect the auditor's independence or if safeguards have been applied to reduce such impediments to an acceptable level, we report the details of such measures or safeguards. Interest required to be disclosed by the Certified Public Accountants Act of Japan Our firm and its our designated engagement partners do not have any interest in the Company which is required to be disclosed pursuant to the provisions of the Certified Public Accountants Act of Japan.

**Audit Report of the Audit and Supervisory Committee**

Audit Report

We have audited the execution of the duties by the Directors during the fiscal year from June 1, 2024, to May 31, 2025, and hereby report the auditing method and the results thereof as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Auditing Method and Details Thereof

We received reports on a regular basis from Directors and employees, etc. regarding the contents of resolutions made by the Board of Directors on matters stipulated in Article 399-13, Paragraph 1, Item 1 (b) and (c) of the Companies Act and the status of establishment and operation of the system (i.e., the internal control system) developed based on such resolutions, requested explanations when necessary, expressed our opinions regarding such reports, and conducted an audit according to the following methods:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) In accordance with the audit policy and the assignment of duties etc. established by the Audit and Supervisory Committee, and in coordination
with the Company's internal control division, we attended important meetings, received reports from Directors and employees, etc.
regarding the matters concerning the performance of their duties, requested explanations when necessary, reviewed important documents
for approval, etc., and examined the business and financial condition at the head offices and other important operating locations. With
respect to domestic subsidiaries, a full-time Audit and Supervisory Committee member is concurrently holding a position as a corporate
auditor of such subsidiaries and attended Board of Directors meetings and other important meetings of such subsidiaries, received reports
concerning business, and requested explanations when necessary. With respect to overseas subsidiaries, the Audit and Supervisory Committee
received reports concerning business from Directors and employees, etc. of such subsidiaries when necessary, and fully understood their
business management status.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) We monitored and reviewed to make sure that the Accounting Auditor maintained its independent position and performed appropriate audits.
In addition, we received reports from the Accounting Auditor on the status of the performance of their duties and requested explanations
when necessary. We also received a notice from the Accounting Auditor to the effect that the "system to secure appropriate performance
of duties" (i.e., the matters listed in each item of Article 131 of the Regulations for Corporate Accounting) has been established
in accordance with the "Quality Control Standards for Audit" (Business Accounting Council), etc., and requested explanations
when necessary.

Based on the methods specified above, we reviewed the business report and its supplementary schedules, non-consolidated financial statements (non-consolidated balance sheet, non-consolidated statement of operations, non-consolidated statement of changes in net assets, and notes to non-consolidated financial statements) and the supplementary schedules thereof, as well as the consolidated financial statements (consolidated balance sheet, consolidated statement of operations, consolidated statement of changes in net assets, and notes to consolidated financial statements) for the relevant fiscal year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Audit Results

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Audit Result for Business Report, etc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) We acknowledge that the business report and its supplementary schedules correctly represent the status of the Company in accordance with
the laws and regulations and the Articles of Incorporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) No unlawful acts or significant facts in violation of the laws or regulations or the Articles of Incorporation have been recognized in
relation to the execution of duties by the Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) We acknowledge that the resolutions of the Board of Directors with respect to the internal control system are appropriate. In addition,
we have found no matters to point out as to the description of the business report and the execution of duties by the Directors with
respect to the internal control system.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Audit Result for Non-Consolidated Financial Statements and Supplementary Schedules

We acknowledge that the methods and results of the audit by KPMG AZSA LLC, the Accounting Auditor, are appropriate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Audit Result for Consolidated Financial Statements

We acknowledge that the methods and results of the audit by KPMG AZSA LLC, the Accounting Auditor, are appropriate.

---

| | | |
|:---|:---|:---|
| July 11, 2025 |  |  |
|  | SATORI ELECTRIC CO., LTD. |  |
|  | Audit and Supervisory Committee |  |
|  | Full-time Audit and Supervisory Committee member | Masaki Mogi<br> (seal) |
|  | Audit and Supervisory Committee member | Hidetoshi Tawada<br> (seal) |
|  | Audit and Supervisory Committee member | Seiji Sakata<br> (seal) |
|  | Audit and Supervisory Committee member | Akiko Yukimaru<br> (seal) |

---

(Note) Audit and Supervisory Committee members, Mr. Hidetoshi Tawada, Mr. Seiji Sakata and Ms. Akiko Yukimaru, are Outside Directors as prescribed
in Article 2, Item (xv) and Article 331, Paragraph (6) of the Companies Act.

End

&nbsp;&nbsp;The business combination described in this document involves securities of Japanese companies. The business combination is subject to disclosure requirements of Japan that are different from those of the United States. Financial information included in this document, if any, was excerpted from financial statements prepared in accordance with foreign accounting standards that may not be comparable to the financial statements of United States companies.<br>It may be difficult for you to enforce your rights and any claim you may have arising under the U.S. federal securities laws, since the issuers are located in Japan and some or all of their officers and directors reside outside of the United States. You may not be able to sue a Japanese company or its officers or directors in a Japanese court for violations of the U.S. securities laws.<br>It may be difficult to compel a Japanese company and its affiliates to subject themselves to a U.S. court's judgment. You should be aware that the issuer may purchase securities otherwise than under the business combination, such as in the open market or through privately negotiated purchases.

Commencement Date of Electronic Provision Measures: July 25, 2025

Matters Not Stated in the Delivered Documents for the

Notice of Convocation of the Annual General Meeting of Shareholders

for the Fiscal Year Ended May 2025

Business Report

Status of the Accounting Auditor

System to Ensure Appropriate Services and Implementation of

Such System

Consolidated Financial Statements

Consolidated Statement of Changes in Net Assets

Notes on Consolidated Financial Statements

Financial Statements

Statement of Changes in Net Assets

Notes on Non-consolidated Financial Statements

(From June 1, 2024 to May 31, 2025)

![](image_019.jpg)

&nbsp;&nbsp;Pursuant to the provisions of laws, regulations and Article 14 of the Articles of Incorporation, the matters listed above are not stated in the documents delivered to shareholders who have requested delivery of documents.<br>For this Annual General Meeting of Shareholders, a document excluding the above-mentioned matters from the full set of electronically provided materials will be sent to all shareholders, regardless of whether they have requested delivery of documents.

**Business Report**

**Status of Accounting Auditor**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Name of Accounting Auditor

KPMG AZSA LLC

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Amount of Compensation, Etc.

---

| | |
|:---|:---|
|  | &nbsp;&nbsp;Amount |
| &nbsp;&nbsp; - Amount of compensation, etc. for each Accounting Auditor in relation to the current fiscal year<br>Amount of compensation, etc. pertaining to the services set forth in Article 2, Paragraph 1 of the Certified Public Accountants Act (Act No. 103 of 1948) | &nbsp;&nbsp;64 million yen |
| - Total amount of monetary or other economic benefit the Company and the subsidiaries thereof are to pay to the Accounting Auditor | &nbsp;&nbsp;64 million yen |

---

(Notes)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Among the Company's major subsidiaries, TAIWAN SATORI CO., LTD., HONG KONG SATORI CO., LTD., SMET SINGAPORE PTE. LTD., SM Electronic
Technologies Pvt. Ltd. and THAI SATORI CO., LTD. have their respective financial documents subject to audit by a certified public accountant
or an auditing firm other than the Company's Accounting Auditor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Since the amounts of the audit compensation for the audit pursuant to the Companies Act and the audit pursuant to the Financial Instruments
and Exchange Act are not clearly distinguished in the audit agreement entered into by and between the Company and the Accounting Auditor
and they cannot be substantially distinguished, the sum of these amounts is shown in the section for the amount of compensation, etc.
in relation to the current fiscal year in the table above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The Audit and Supervisory Committee has provided the Company with its consent to the compensation, etc. for the Accounting Auditor set
forth in Article 399, Paragraph 1 of the Companies Act, based on its review on the details of the Accounting Auditor's audit plan,
the status of execution of its duties in the past fiscal years and the grounds for the estimated amount of the audit compensation, by
obtaining necessary documents and reporting from Directors, related departments within the Company and the Accounting Auditor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. In addition to the above, the Company has paid the Accounting Auditor six million (6,000,000) yen as additional compensation in relation
to the previous fiscal year and twelve million (12, 000,000) yen as compensation pertaining to the audit on the comparative fiscal year
for the International Financial Reporting Standards (IFRS), etc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Details of Non-Auditing Services

There are no matters to be stated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Policy on Determination of Dismissal of or Refusal to Reelect Accounting Auditor

The Audit and Supervisory Committee determines the details of the proposal related to dismissal of or refusal to reelect the Accounting Auditor that is to be submitted to the general meeting of shareholders, if such Committee considers it necessary to do so, for instance, in the case where the Accounting Auditor has difficulty in executing its duties.

Moreover, if it is found that the Accounting Auditor falls under any of the items listed in Article 340, Paragraph 1 of the Companies Act, the Accounting Auditor is dismissed subject to the consent of all the Audit and Supervisory Committee members. In such case, an Audit and Supervisory Committee member elected by such Committee reports that the Accounting Auditor has been dismissed and the reason therefor at the first general meeting of shareholders to be held after such dismissal.

**System to Ensure Appropriate Services and Implementation of Such System**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(Reference) Basic Policy on Corporate Governance**

The Company has established the following matters as its basic corporate governance policy, seeks to enrich the same and enhance its corporate value on a medium to long term basis, and contributes to society through its business activities:

- Ensuring transparency, soundness and compliance in terms of management; and

- Timely and appropriate information disclosure and clarification of accountability to all stakeholders, including shareholders.

In addition, the status of corporate governance is indicated on the Company's website below:

<u>https://www.satori.co.jp/ir/strategy/governance.html</u>

![](image_021.jpg)

The Company has established the following Basic Policy regarding the establishment of the system (Internal Control System) as defined in Article 399-13, Paragraph 1, Item 1, (b) and (c) of the Companies Act:

&nbsp;&nbsp;&nbsp;&nbsp;1. System to Ensure that Execution of Duties by Directors and Employees Conforms to the Laws and Regulations, and the Articles of Incorporation

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) In order to ensure the establishment of corporate ethics and compliance with the laws and regulations, the articles of incorporation,
company regulations and social norms by Directors and employees of the Company and its subsidiaries (the "**Satori Group** ")
the Company has established the "Ethical Standards for Corporate Behavior of the Satori Group."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) The Company has established the Compliance Risk Committee which is composed of the Representative Director as its chair, and others,
in order to promote improvement and maintenance of the compliance system of the Satori Group as a whole and provide awareness programs
and training for Directors and employees of the Satori Group (the "**Officers and Employees**") as necessary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) The Audit Department under the direct control of the Audit and Supervisory Committee ensures appropriate services and reliable financial
reporting by conducting audits on the services of each company within the Satori Group and assessing and reporting on their internal
control over financial reporting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Upon discovery of a serious violation of the laws and regulations or any other important fact with regard to compliance within the Satori
Group, a Director shall immediately report such violation or fact to the Audit and Supervisory Committee and the Representative Director,
and also report the same to the Management Committee without delay.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Regarding any violation of the laws and regulations or any other unethical conduct, etc., a system shall be established and managed to
allow any of the Officers and Employees to submit a direct report to the Department in charge of personnel affairs or an outside lawyer
under the "Internal Whistle-Blower Regulations."

&nbsp;&nbsp;&nbsp;&nbsp;2. System Regarding Storage and Management of Information on Execution of Duties by Directors

The Company stores and manages information on the execution of duties by Directors under the "Document Control Regulations" in an appropriate retrieval state.

The Company also handles the applicable information based on the "Information Security Management Regulations."

&nbsp;&nbsp;&nbsp;&nbsp;3. Regulations on Management of Risk of Loss and Other System

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Based on the "Risk Management Regulations," a department in charge shall be determined for each risk category in the Satori
Group. Each department in charge shall take preventive measures for the applicable risks and shall continuously monitor the status thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Various regulations for emergency measures, procedures to limit the spread of damage, restoration, and the prevention of a recurrence
when a risk has occurred shall be promoted to avoid and minimize loss by rapidly and appropriately handling the problem.

&nbsp;&nbsp;&nbsp;&nbsp;4. System to Ensure Efficient Execution of Duties by Directors

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Important matters regarding management policies and strategies of the Satori Group shall be subject to deliberation by the Management
Committee before deliberations by the Board of Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Services shall be operated in accordance with the division of duties and the authorities stipulated in the "Regulations Regarding
Division of Duties" and the "Regulations Regarding Official Authorities" to make services more specialized, sophisticated
and efficient through the division of work. In addition, authorities may be delegated depending on the importance of the duties in order
to enhance flexibility in decision-making and execution of services.

&nbsp;&nbsp;&nbsp;&nbsp;5. System to Ensure Appropriateness of Services in Corporate Group Consisting of the Company and Subsidiaries

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The "Ethical Standards of Corporate Behavior of the Satori Group" shall serve as the code of conduct for the Satori Group
as a whole, and various regulations shall be developed and operated as required to secure the appropriateness and efficiency of services
in the corporate group.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Regarding matters set forth in the "Subsidiaries Management Regulations," subsidiaries shall be required to apply for prior
approval from the Company and to report to the Company. In addition, in the event that business management and management guidance of
the Company to subsidiaries have violated any of the laws and regulations or are suspected of violating social norms, a subsidiary may
report to the Audit and Supervisory Committee of the Company and state its opinion to that effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) As for the management of each subsidiary, the Company has in place a system that respects their autonomy and properly manages and supports
each subsidiary depending on their position and size pursuant to the "Subsidiaries Management Regulations" in order to ensure
appropriate and efficient execution of services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) In order to ensure the reliability of financial reports under the provisions of the Financial Instruments and Exchange Act, the Satori
Group strives to secure a sound internal control environment and strengthen control activities at a company-wide level, thereby establishing
and appropriately managing the internal control system for effective and valid evaluations.

&nbsp;&nbsp;&nbsp;&nbsp;6. Matters Regarding Employees when Audit and Supervisory Committee Requests them to Assist Audit and Supervisory Committee's Duties,
Matters Regarding Such Employees' Independence from Directors (Excluding Directors who are Audit and Supervisory Committee Members),
and Matters Regarding Ensuring Effectiveness of Instructions Given to Such Employees

The Company places a full-time staff member as an employee to support the Audit and Supervisory Committee's duties in the Audit Department under the direct control of the Audit and Supervisory Committee and thereby ensures the effectiveness of the Audit and Supervisory Committee's instructions. The Audit and Supervisory Committee may instruct any matter required by its audit to appointed employees and such employees may not receive any instructions from the Directors (excluding Directors who are Audit and Supervisory Committee members) with respect to any of their activities on the designated audit.

Personnel transfers and personnel evaluations, etc. of such employees shall be determined subject to the prior approval of the Audit and Supervisory Committee to ensure independence from the Directors (excluding Directors who are Audit and Supervisory Committee members). In addition, such employees shall not double in a post related to the execution of services.

7. System for Reporting to Audit and Supervisory Committee by Directors and Employees, and System to Ensure Effective Implementation of
Audit by Audit and Supervisory Committee

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Audit and Supervisory Committee members shall attend the Management Committee and other important meetings as well as board meetings
to understand the process of decision-making and the status of executing services. The Audit and Supervisory Committee members shall
also read important approval documents on the execution of services and request explanations thereon by Officers and Employees if necessary.
Such Officers and Employees shall promptly make an appropriate report in response thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) When the Company finds a fact of an act committed by any of the Officers and Employees which may cause serious damage to the Satori Group
such as violation of laws or regulations, the Company immediately report such fact to the Audit and Supervisory Committee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) The Company prohibits any disadvantageous treatment against any Officer or Employee who reported such fact to the Audit and Supervisory
Committee for the reason that such Officer or Employee has made such report, and makes this policy known to the Officers and Employees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) The Audit and Supervisory Committee shall convene periodic meetings to exchange opinions with the Representative Director, the Audit
Department, the Accounting Auditor, and auditors of subsidiaries.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) When any of the Audit and Supervisory Committee members request that the Company make advance payment of expenses, etc. associated with
the execution of their duties, the department in charge thereof shall review such request and promptly process the expenses or debts
related to such request, unless the relevant request is considered unnecessary for the execution of their duties.

8. Basic Policy on Elimination of Antisocial Forces, and Maintenance Thereof

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Basic Policy

Under the basic policy on elimination of antisocial forces and fair and ethical business conduct included in the "Ethical Standards for Corporate Behavior of the Satori Group," the Satori Group maintains a firm attitude towards antisocial forces that pose a threat to social order and safety, and strictly avoids any association with them.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Maintenance of Such Policy

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| | |
|:---|:---|
| ・ | Under the "Compliance Risk Committee Regulations" and the "Risk Management Regulations," the Satori Group clearly states a management framework which has the Compliance Risk Committee at the top, has a department in charge of controlling the response to antisocial forces, and appoints a person in charge of preventing unjust demands by antisocial forces. |

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・ The Company belongs to Public Interest Incorporated, a Special Violent Crimes Prevention Association in the Metropolitan Police Department Area, and has established a close system of cooperation with related entities such as the police.

The outline of the implementation status of the system to ensure the appropriateness of the Company's services during the current fiscal year is as follows:

1. Efforts Related to Compliance System

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Company has made the "Ethical Standards for Corporate Behavior of the Satori Group" universally known among the Officers
and Employees and conducts regular self-inspections regarding compliance with various laws and regulations and information security,
and seeks to enhance the Officers' and Employees' compliance awareness through implementing internal training and guidance
on compliance related to each separate topic.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) The Compliance Risk Committee has exerted its efforts to ensure the compliance system through monitoring the compliance status of each
company in the Satori Group.

2. Efforts Related to Risk Management System

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Compliance Risk Committee seeks thorough risk management of the Satori Group's major risks by sharing information, reviewing
measures, etc. Moreover, in the case of any event arising that may cause a significant impact on its corporate activities, the Company
shall respond thereto in accordance with the "Risk Management Regulations."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) The Company strengthens the transaction examination system of the Satori Group as a whole and exerts its efforts to visualize any risk
related to transactions and avoid and minimize risk of loss.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) The Company continues to review the Satori Group's Business Continuity Plan (BCP) in order to enhance its effectiveness. Furthermore,
the Company regularly holds emergency drills for preparation in the event of a natural disaster.

3. Efforts Related to Ensuring Effectiveness of Execution of Duties

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Company seeks effective execution of services in each segment by clarifying the division of duties and decision-making authority.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) The Company implements assessment of the effectiveness of the Board of Directors by means of a third-party body.

4. Efforts Related to Group Management

The Company exerts its efforts to consolidate the business management of its subsidiaries in accordance with the "Subsidiaries Management Regulations." Moreover, important matters regarding management policies and strategies of the Satori Group are subject to prior deliberation and decision by the Management Committee (including its sub-committee, the Business Management Committee).

5. Efforts Related to Ensuring Appropriate Audits by Audit and Supervisory Committee

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Audit and Supervisory Committee members attend important meetings of the Board of Directors, the Management Committee, and the Compliance
Risk Committee, etc., receive reports on the status of execution of duties, etc. and make proposals, etc., as necessary. Furthermore,
the Audit and Supervisory Committee holds

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| | |
|:---|:---|
|  | regular information exchange meetings with the Representative Director, Audit Department and Accounting Auditor in order to share information and exchange opinions on audit activity. |
| (2) | The Audit Department implements internal audits of each company within the Satori Group based on the internal audit plan, provides indications for improvement and makes periodic reports on the status of internal audits to the Audit and Supervisory Committee and the Board of Directors. |

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![](image_022.jpg)

General Meeting of Shareholders Appointment and dismissal Appointment and dismissal Appointment and dismissal Board of Directors Nomination and Compensation Advisory Committee Response Directors who are not Audit and Supervisory Committee members Audit and Supervision Report Audit and Supervisory Committee Directors who are Audit and Supervisory Committee members Cooperation Accounting Auditor Compliance Risk Committee Reference and report to Selection, removal and supervision Audit Cooperation Human Capital Strategy Committee Sustainability Promotion Committee SMET Business Management Committee SystematIC Business Management Committee President & Executive Officer Report Audit Department Accounting audit Each department and group companies Internal audit and internal control assessment

Consolidated Financial Statements

Consolidated Statement of Changes in Net Assets (from June 1, 2024 to May 31, 2025)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  |  |  | (million yen) | (million yen) |
|  | Shareholders'equity | Shareholders'equity | Shareholders'equity | Shareholders'equity | Shareholders'equity |
|  | Share capital | Capital surplus | Retained earnings | Treasury shares | Total shareholders' equity |
| Balance as of June 1, 2024 | 2611 | 3447 | 27288 | (4940) | 28407 |
| Change during fiscal year |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividends of surplus |  |  | (1335) |  | (1335) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Profit attributable to owners of parent |  |  | 2524 |  | 2524 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of treasury shares |  |  |  | (67) | (67) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Disposal of treasury shares |  | 23 |  | 80 | 104 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in ownership interest of parent due to transactions with non-controlling interests |  | (482) | (11) |  | (493) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other |  |  | (0) |  | (0) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net changes in items other than shareholders' equity |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total changes during fiscal year | - | (458) | 1176 | 13 | 730 |
| Balance as of May 31, 2025 | 2611 | 2988 | 28465 | (4927) | 29138 |

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---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Accumulated other comprehensive income | Accumulated other comprehensive income | Accumulated other comprehensive income | Accumulated other comprehensive income | Accumulated other comprehensive income |  |  |
|  | Valuation difference on available-for-sale securities | Deferred gains or losses on hedges | Revaluation reserve for land | Foreign currency translation adjustment | Total accumulated other comprehensive income | Non-controlling interests | Total net assets |
| Balance as of June 1, 2024 | 1795 | (23) | 22 | 3239 | 5034 | 1527 | 34969 |
| Change during fiscal year |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividends of surplus |  |  |  |  |  |  | (1353) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Profit attributable to owners of parent |  |  |  |  |  |  | 2524 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of treasury shares |  |  |  |  |  |  | (67) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Disposal of treasury shares |  |  |  |  |  |  | 104 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in ownership interest of parent due to transactions with non-controlling interests |  |  |  |  |  |  | (493) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other |  |  |  |  |  |  | (0) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net changes in items other than shareholders' equity | (709) | 29 | (0) | (1172) | (1853) | (540) | (2393) |
| Total changes during fiscal year | (709) | 29 | (0) | (1172) | (1853) | (540) | (1663) |
| Balance as of May 31, 2025 | 1085 | 6 | 21 | 2067 | 3181 | 987 | 33306 |

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**Notes on Consolidated Financial Statements**

**[Notes on Important Matters That Are to Become the Basis for Preparation of Consolidated Financial Statements]**

&nbsp;&nbsp;&nbsp;&nbsp;1. Matters Regarding the Scope of Consolidation

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Number of Consolidated Subsidiaries and the Names of Consolidated Subsidiaries

Number of consolidated subsidiaries: 16 companies

Names of consolidated subsidiaries:

SATORI PINICS CO., LTD.

STAR ELECTRONICS Co., Ltd.

SATORI SP TECHNOLOGY CO., LTD.

TAIWAN SATORI CO., LTD.

HONG KONG SATORI CO., LTD.

SHANGHAI SATORI CO., LTD.

KOREA SATORI CO., LTD.

THAI SATORI CO., LTD.

SM Electronic Technologies Pvt. Ltd.

SMET SINGAPORE PTE. LTD.

SATORI E-TECHNOLOGY (AMERICA) INC.

SATORI ELECTRIC (GERMANY) GmbH

MAGnetIC Holding B.V.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Names , Etc. of Major Unconsolidated Subsidiaries

Major unconsolidated subsidiary:

SHENZHEN SATORI CO., LTD.

(Reason for unconsolidated subsidiary's exclusion from the scope of the consolidation)

The unconsolidated subsidiary (SHENZHEN SATORI CO., LTD.) was excluded from the scope of the consolidation because the scale of its operations is small and its total assets, net sales, net profit or loss for the current period (amount corresponding to the equity interests) and retained earnings (amount corresponding to the equity interests), etc. do not have any material impact on the consolidated financial statements.

&nbsp;&nbsp;&nbsp;&nbsp;2. Matters Regarding Application of the Equity Method

The unconsolidated subsidiary (SHENZHEN SATORI CO., LTD.) was excluded from the scope of application of the equity method because the impact on net profit or loss for the current period (amount corresponding to the equity interests) and retained earnings (amount corresponding to the equity interests), etc. is insignificant, with no importance as a whole.

&nbsp;&nbsp;&nbsp;&nbsp;3. Matters Regarding Accounting Policies

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Valuation Criteria and Method of Valuation for Important Assets

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Securities:

Other securities:

Securities other than shares, etc. without market prices:

Stated at fair value (valuation differences are recognized directly in net assets; the cost of securities sold is calculated by the moving-average method).

Shares, etc. without market prices:

Stated at cost using the moving-average method.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Derivatives:

Stated at fair value

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Valuation criteria and method of valuation for inventories:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Merchandise, finished goods and raw materials:

Stated primarily at cost using the moving-average method (the value stated in the balance sheets is calculated by writing down the book value based on declining profitability)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Work in process:

Stated primarily at cost using the specific identification method (the value stated in the balance sheets is calculated by writing down the book value based on declining profitability)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Depreciation Methods for Important Depreciable Assets

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Property, plant and equipment (excluding lease assets)

The declining-balance method is principally adopted; however, for the Company and its consolidated domestic subsidiaries, buildings (excluding building accessories) acquired on or after April 1, 1998, and building accessories and structures acquired on or after April 1, 2016, are depreciated by using the straight-line method. The useful lives are determined primarily pursuant to the same standards as the method prescribed in the Corporation Tax Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Intangible assets (excluding lease assets) The straight-line method is used.

The useful lives and residual values are determined primarily pursuant to the same standards as the method prescribed in the Corporation Tax Act; provided, however, that, software (for internal use) is amortized using a straight-line method based on the estimated internal useful life, and software (for market sale) is amortized using the method under which the greater of the following amounts is recorded:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the amount of amortization based on the estimated sales volume, or (b) the amount of amortization on a straight-line basis over the estimated remaining sales-effective period. The initial estimated sales-effective period is set at three (3) years.

Customer-related intangible assets and technology-related intangible assets are amortized over the periods in which the benefits are realized; the amortization periods are as follows:

Customer-related intangible assets: 10 years

Technology-related intangible assets: 5 years

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Lease assets

Lease assets pertaining to finance lease transactions that do not transfer ownership

Lease assets are depreciated using a straight-line method over the lease period as the useful life, with zero residual value.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Recording Criteria for Important Allowances and Provisions

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Allowance for doubtful accounts

To provide for losses from uncollectible receivables, an allowance is recorded for ordinary receivables based on the historical bad-debt ratio, and for specific doubtful receivables, an amount equal to the estimated uncollectible is recorded based on an individual assessment of collectability.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Provision for bonus for Directors (and other officers)

To provide for the payment of bonuses to Directors (and other officers), an amount to be borne as of the end of the current consolidated fiscal year is recorded based on the estimated annual amount to be paid as of the end of the current consolidated fiscal year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Provision for share awards for Directors (and other officers)

To provide for the delivery and payment of the Company's shares, the estimated amount of shares to be delivered and paid that correspond to the number of points allotted to Directors (and other officers) is recorded in accordance with the Share Delivery Regulations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Provision for losses on business transfer

An amount is recorded for the estimated losses expected to arise in the future in connection with the share transfer following the company split.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Accounting Policies for Retirement Benefits

In order to prepare for retirement benefits to employees, the liabilities for retirement benefits are recorded primarily based on the estimated amount of retirement benefit obligations as of the end of the current consolidated fiscal year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Method for attributing the estimated retirement benefits to periods

In calculating retirement benefit obligations, the benefit formula method is applied to attribute the estimated retirement benefits to the periods up to the end of the current consolidated fiscal year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Recognition of actuarial gain/loss and amortization of past service cost Actuarial gain/loss is recognized
in full as an expense in the year incurred.

Past service cost is amortized using the straight-line method over a fixed number of years (i.e., five (5) years) within the average remaining service period of employees at the time of occurrence thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Standards for Recording Revenues and Expenses

The Group's main businesses constitute the sale of semiconductors and electronic components and the development, design, manufacture and sale of products. In part of its industrial infrastructure business, the Group engages in the sale of electronic equipment and the development, design, manufacture and sale of products.

The details of the main performance obligations in the major businesses and the regular timing when such performance obligations are fulfilled (i.e., the usual timing of revenue recognition) are as follows:

Revenue is mainly recognized at the time when merchandise and finished goods are delivered to a customer, which is the timing when control of the merchandise and finished goods is transferred to the customer. Also, in the export sales transactions, except for transactions that require a substantive acceptance inspection, revenue is recognized at the time when the risks are transferred to the customer in accordance with Incoterms.

In part of the Group's industrial infrastructure business, revenue is recognized at the time when a customer inspects and accepts the merchandise and finished goods. In addition, for contracts under which services are provided over the contract term (e.g., maintenance services), revenue is recognized evenly over the contract period.

For transactions related to sale of goods or services for which the Company acts as an agent, the net amount of the consideration received from the customer less the amount payable to suppliers is recognized as revenue.

In determining whether acting as a principal or an agent, a comprehensive determination is made based on the following indicators:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether the Company bears the primary responsibility for performing the contract on the goods or services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether the Company bears inventory risk before and/or after the goods or services are transferred
to the customer; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether the Company has discretion in setting the prices of the goods or services.

As consideration for the transaction is received within approximately one (1) year after the fulfillment of performance obligations, significant financing components are not included.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) Significant Hedge Accounting Methods

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Hedge accounting methods

Deferral hedge accounting is adopted. The exceptional accounting method is adopted for interest rate swaps that meet the special matching criteria ("*Tokureishori*").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Hedging instruments and hedged items

Hedging instruments:

Foreign exchange forward contracts and interest rate swaps

Hedged items:

Foreign exchange forward contracts: Receivables and payables denominated in foreign currencies, and forecast transactions denominated in foreign currencies

Interest rate swaps: Interest on borrowings.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Hedging policy

The Company uses foreign exchange forward contracts for the purpose of hedging risks arising from fluctuations in exchange rates, and uses foreign exchange forward contracts to the extent necessary based on contracts and other arrangements pertaining to ordinary business transactions denominated in foreign currencies; the Company has a policy of not engaging in speculative transactions.

The interest rate swap transactions are exclusively for funds procurement, and the Company uses interest rate swap transactions to reduce funds procurement costs; the Company has a policy of not engaging in speculative transactions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Method for evaluating hedge effectiveness

From the commencement of hedging to the timing of effectiveness assessment, the cumulative fluctuation in cash flows of the hedging instruments is compared with the cumulative fluctuation in cash flows of the hedged items, and hedge effectiveness is assessed based on the amounts of such fluctuations. For interest rate swaps to which the exceptional accounting method is applied, the evaluation of hedge effectiveness is omitted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) Method and Period of Amortization of Goodwill

Goodwill is evenly amortized over a reasonable period of no longer than ten (10) years, determined for each individual case.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(8) Other Significant Matters for Preparing Consolidated Financial Statements

Application of the group tax sharing system

The Company and certain domestic consolidated subsidiaries apply the group tax sharing system.

**[Notes on Changes in Accounting Policies]**

(Application of the "Accounting Standard for Current Income Taxes," etc.)

The Company has applied the "Accounting Standard for Current Income Taxes" (ASBJ Statement No. 27, October 28, 2022; the "2022 Revised Accounting Standard"), etc. from the beginning of the current consolidated fiscal year. With respect to the revisions regarding the classification of income taxes (taxation on other comprehensive income), the Company follows the transitional treatment prescribed in the proviso to paragraph 20-3 of the 2022 Revised Accounting Standard and the transitional treatment prescribed in the proviso to paragraph 65-2 (2) of the "Guidance on Accounting Standard for Tax Effect Accounting" (ASBJ Guidance No. 28, October 28, 2022; the "2022 Revised Guidance"). This change in accounting policies has no effect on the consolidated financial statements.

In addition, with respect to the revisions related to the review of the treatment in the consolidated financial statements when gains or losses on the sale of subsidiary shares, etc. among consolidated companies are deferred for tax purposes, the Company has applied the 2022 Revised Guidance from the beginning of the current consolidated fiscal year. This change in accounting policies has been applied retrospectively, and the consolidated financial statements for the previous consolidated fiscal year are those prepared after retrospective application. This change has no effect on the consolidated financial statements.

(Application of "Accounting for and Disclosure of Current Taxes Related to the Global Minimum Tax Rules")

The Company has applied the "Accounting for and Disclosure of Current Taxes Related to the Global Minimum Tax Rules" (ASBJ Practical Solution No. 46, March 22, 2024) from the beginning of the current consolidated fiscal year. This change in accounting policies has an immaterial impact on the consolidated financial statements.

**[Notes on Accounting Estimates]**

1. Valuation of Inventories

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Amounts Recognized in the Consolidated Financial Statements

---

| | |
|:---|:---|
|  | Current Consolidated Fiscal Year<br> (million yen) |
| Merchandise and finished goods | 12,059 |
| Work in process | 294 |
| Raw materials and supplies | 1 |

---

Note: This accounts for 15.6% of consolidated total assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Information on the Content of Significant Accounting Estimates Pertaining to the Identified Items

For merchandise and finished goods and raw materials that have remained on hand beyond a specified holding period ("**Slow-Moving Inventory**"), the Group applies a method under which the book value is written down on a systematic basis pursuant to a policy determined based on the past sales results and disposal results, so as to reflect the fact of any decline in profitability.

While efforts are made to maintain an appropriate inventory level, taking into account a comprehensive consideration of customers' requirements, suppliers' supply conditions and market trends, the electronics industry to which the Group belongs is characterized by extremely rapid changes in technological innovation and business environment, and customers' required functions are increasingly diverse and complex, and therefore, unexpected shrinkage in market size may occur. Accordingly, when product demand fluctuates significantly due to factors beyond management's control, a portion of the inventory may become slow-moving.

Consequently, if the valuation policy for Slow-Moving Inventory were to deviate from actual conditions, there is a possibility that a decline in profitability would not be appropriately reflected in the consolidated financial statements. If future product demand decreases, this could have a significant impact on profit or loss in the consolidated financial statements for the following consolidated fiscal year.

2. Recoverability of Deferred Tax Assets

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Amounts Recorded in the Consolidated Financial Statements of the Current Consolidated Fiscal Year

Current consolidated fiscal year (million yen) <br> Deferred tax assets (before offsetting against deferred tax liabilities) 1,241

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Information on Details of Significant Accounting Estimates Pertaining to Identified Items

The Group's deferred tax assets are recorded to the extent that they are deemed capable of reducing the tax burden after deductible temporary differences and tax losses carried forward are offset against the estimated amount of future taxable income and the expected amount of reversal of taxable temporary differences.

The recoverability of deferred tax assets is determined based on future taxable income, tax planning, the schedule for the reversal of taxable temporary differences, and other factors. In addition, the estimates of future taxable income are prepared in consideration of information on external factors (e.g., the business environment) and internal information.

The timing at which taxable income will arise, and the amount thereof, may be affected by the business plan, deterioration in the business environment, and other factors. If there is a significant change in the assumptions used for the estimate, there is a possibility of a material impact on profit or loss in the consolidated financial statements for the following consolidated fiscal year.

3. Valuation of Goodwill Recognized Through the Acquisition of MAGnetIC Holding B.V.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Amounts Recorded in the Consolidated Financial Statements of the Current Consolidated Fiscal Year

Current consolidated fiscal year (million yen) <br> <u>Goodwill</u> <u>1,314</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Information on Details of Significant Accounting Estimates Pertaining to Identified Items

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Method for calculating the amounts recorded in the consolidated financial statements of the current
consolidated fiscal year

Goodwill is calculated as the difference between the acquisition costs and net assets after appropriately performing the allocation procedures of the acquisition value as of the business combination date. The goodwill amortization period is determined by calculating the payback period of investment capital based on the relevant business plan.

With regard to the book value of goodwill resulting from the acquisition of a consolidated subsidiary, a grouping is performed on a larger unit that adds goodwill to the asset group related to the business of such consolidated subsidiary, and it is determined whether any indication of impairment exists. If any indication of impairment is found, a determination is made as to whether it is necessary to recognize an impairment loss by way of the estimates on the recoverable amount based on future cash flows. In determining whether there are any such indicators, factors such as deviations from the business plan and deterioration in the business environment are taken into account, and based on the foregoing, we have determined that there are no indications of impairment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Key assumptions used in calculating the amounts recognized in the current consolidated fiscal year
consolidated financial statements

In determining whether indicators of impairment exist, a comprehensive assessment is made based on the latest business plan and the assumptions underlying the estimates for the target business, including net sales growth rate, gross profit margin, operating margin, headcount plan, revenue recognition outlook for individual projects, and the status of progress in new business negotiations, to determine whether any matters corresponding to indicators of impairment, including significant deterioration in the business environment, have occurred.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Impact on the consolidated financial statements for the following consolidated fiscal year

The major assumptions set forth above are established as reasonable estimates based on information currently available and management's judgment; however, future results may deviate from the initial estimates due to fluctuations in the business environment and uncertainties in customer trends. As a result, there is a possibility of a significant impact on the book value of goodwill in the consolidated financial statements for the following consolidated fiscal year.

**[Additional information]**

(Board Benefit Trust)

For the purpose of enhancing awareness of contributing to medium- to long-term improvement of business performance and corporate value, as of October 14, 2022, the Company has introduced a performance-linked stock compensation plan using a trust (i.e., the "Board Benefit Trust") for its Directors (excluding Directors who are Audit and Supervisory Committee members and Outside Directors), Executive Officers who have entered into an entrustment contract with the Company, and the Directors of the Company's domestic subsidiaries (excluding Non-Executive Directors and Outside Directors) as well as Executive Officers who have entered into entrustment contracts with the Company's domestic subsidiaries (collectively, the "**Directors, Etc.**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Outline of the Transaction

This plan is a stock compensation plan under which a trust established through a monetary contribution by the Company (the "**Trust**") acquires the Company's shares, and the Company's shares in a number corresponding to the number of points granted by the Company to each of the Directors, Etc. are delivered to such Directors, Etc. through the Trust. Under this plan, the Company's shares shall be delivered to Directors, Etc. who are in office during the five (5) fiscal years from the fiscal year ending May 31, 2023 to the fiscal year ending May 31, 2027.

The points shall be granted for each period subject to the Company's medium-term management plan (the "**MTP Period**"), and, in principle, the point grant date shall be the date of the meeting of the Board of Directors held immediately following the Company's annual shareholders meeting convened immediately following the end of each MTP Period.

As for the first MTP Period, the points shall be granted if all of the targets set by the Company for the three indicators, namely, "net sales," "operating income" and "return on equity (ROE)" in fiscal year 2023 (i.e., the final year of "Medium-Term Management Plan 2023") are achieved. Similarly, for the immediately following MTP Period (the "Medium-Term Management Plan 2026," announced in July 2024), the points shall be granted if all of the targets set by the Company for the indicators in fiscal year 2026 (i.e., the final year of the "Medium-Term Management Plan 2026") are achieved.

In principle, the Company's shares shall be delivered to the Directors, Etc. when they no longer hold their positions as Directors, Executive Officers or any other positions determined by the Board of Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Treasury Stock Remaining in the Trust

The Company's shares remaining in the Trust are recorded as treasury shares under net assets at their book value in the Trust (excluding ancillary expenses). The book value of such treasury shares as of the end of the current consolidated fiscal year is 582 million yen, and the number of shares is 475,100 shares.

**[Notes on the Consolidated Balance Sheet]**

The balances of receivables arising from contracts with customers are as follows:

Notes receivable – trade: 330 million yen

Accounts receivable – trade: 36,615 million yen

Electronically recorded monetary claims – operating: 5,742 million yen

**[Notes on the Consolidated Statement of Operations]**

Impairment losses

In the current consolidated fiscal year, the Group has recorded impairment losses for the following asset group:

Location Use Type Impairment Losses <br> (million yen) <br> Kamakura-shi, Kanagawa Idle assets Land 19

In principle, the Group performs groupings for idle assets on an individual property basis.

In the current consolidated fiscal year, the book value of the above-mentioned idle assets was reduced to the recoverable amount, and the amount of the reduction was recorded as impairment losses (19 million yen) under special losses.

The recoverable amount was measured at net sales value and calculated based on the contract price.

**[Notes on Consolidated Statement of Changes in Net Assets]**

&nbsp;&nbsp;&nbsp;&nbsp;1. Matters Regarding the Type and Total Number of Shares Issued

Type of shares Number of shares at beginning of period (thousand shares) Increase in shares during period (thousand shares) Decrease in shares during period (thousand shares) Number of shares at end of period (thousand shares) <br> Common shares 17,946 - - 17,946

&nbsp;&nbsp;&nbsp;&nbsp;2. Matters Regarding Dividends

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Dividends Paid

Matters regarding dividends pursuant to the resolution of the Board of Directors held on July 12, 2024

Total amount of dividends: 741 million yen

Dividend per share: 50 yen Record date: May 31, 2024

Effective date: August 5, 2024

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Note) The total amount of dividends pursuant to the resolution of the Board of Directors held on July 12, 2024, includes 25 million yen of dividends on the Company's shares held by a trust in connection with the stock compensation plan.

Matters regarding dividends pursuant to the resolution of the Board of Directors held on December 18, 2024

Total amount of dividends: 594 million yen

Dividend per share: 40 yen Record date: November 30, 2024

Effective date: February 14, 2025

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Note) The total amount of dividends pursuant to the resolution of the Board of Directors held on December 18, 2024, includes 20 million yen of dividends on the Company's shares held by a trust in connection with the stock compensation plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Dividends with Record Dates that Fall within the Current Consolidated Fiscal Year, the Effective Date
of Which Falls in the Following Consolidated Fiscal Year

Matters regarding dividends pursuant to the resolution of the Board of Directors held on July 14, 2025

Total amount of dividends: 683 million yen

Source of dividends: Retained earnings

Dividend per share: 46 yen

Record date: May 31, 2025

Effective date: August 5, 2025

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Note) The total amount of dividends pursuant to the resolution of the Board of Directors held on July 14, 2025, includes 23 million yen of dividends on the Company's shares held by a trust in connection with the stock compensation plan.

&nbsp;&nbsp;&nbsp;&nbsp;3. Matters Regarding Share Options

There are no matters to be stated.

**[Notes on Financial Instruments]**

1. Matters Regarding Status of Financial Instruments

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Policy on Efforts Related to Financial Instruments

The Group conducts necessary financing such as by taking out borrowings from financial institutions in accordance with a financing plan. Temporary surplus funds are subject to safe and secure investment and no investments shall be made for any speculative purposes.

Derivatives are used for hedging the risks described below, and the Group has a policy of not engaging in any speculative transactions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Details and Risks of Financial Instruments

Notes and accounts receivable - trade, and electronically recorded monetary claims - operating, are exposed to customer credit risks. Trade receivables and payables denominated in foreign currencies are exposed to exchange rate fluctuation risks but are hedged by using foreign exchange forward contracts.

Investment securities consist primarily of shares in corporations having a business relationship with the Group and are exposed to market price fluctuation risks.

Notes and accounts payable - trade, electronically recorded obligations - operating, and income taxes payable are due within a year.

Borrowings and bonds payable are used as a financing method related primarily to business transactions. Part of the borrowings is exposed to interest fluctuation risks.

Derivatives trading is a kind of foreign exchange forward contract executed for the purpose of hedging exchange rate fluctuation risks related to trade receivables and payables denominated in foreign currencies. Please refer to 3. Matters Regarding Accounting Policies, (6) Significant Hedge Accounting Methods under the "Notes on Important Matters that are to Become the Basis for Preparation of Consolidated Financial Statements" above for details on the hedging instruments and hedged items related to hedge accounting, the hedging policy, and the valuation criteria for hedge effectiveness, etc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Risk Management System Related to Financial Instruments

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Management of credit risks (risks related to breach of contract by customers, etc.)

The Group regularly monitors the status of trade receivables pertaining to major customers for each business department in accordance with the Sales Management Regulations, manages the deadlines and balances pertaining to each customer, and aims for early detection and mitigation of concerns related to collection of trade receivables arising from deterioration of the customer's financial status, etc.

Derivatives are only used for transactions with high credit rating financial institutions, in order to mitigate credit risks.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Management of market risks (exchange rate fluctuation risks)

The Company and some of its consolidated subsidiaries hedge currency exchange fluctuation risks detected in relation to trade receivables and payables denominated in foreign currencies during each month for each currency by using foreign exchange forward contracts, in principle. Foreign exchange forward contracts are executed for trade receivables and payables denominated in foreign currencies which are expected to definitely arise from forecast transactions related to exports and imports, depending on the exchange rate conditions.

With respect to investment securities, the Group regularly confirms the fair value thereof and the financial status of the issuer (customer corporation), etc., and continuously reviews the holding status thereof by taking the market conditions and the Group's relationship with the customer corporation into consideration.

The Group executes and manages derivatives trading in accordance with the company regulations which stipulate provisions on the authority to execute trading.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Management of liquidity risks related to financing (risk of becoming unable to make payments by the deadline)

The Group manages liquidity risks such as by having each company prepare a monthly financing plan.

2. Matters Regarding Fair Value of Financial Instruments, etc.

The amounts of items recorded in the consolidated balance sheet as of May 31, 2025, the fair value thereof, and the balance between such figures are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | Amount recorded in the consolidated balance sheet (million yen) | Fair value (million yen) | Balance (million yen) |
| Investment securities | 3074 | 3074 | - |
| &nbsp;&nbsp;&nbsp;Total assets | 3074 | 3074 | - |
| Bonds payable | 1400 | 1376 | (23) |
| Long-term borrowings (Note) 2 | 2867 | 2832 | (34) |
| &nbsp;&nbsp;&nbsp;Total liabilities | 4267 | 4209 | (57) |
| Derivatives (Note) 3 | 10 | 10 | - |

---

---

| | |
|:---|:---|
| (Notes) 1. | Notes on "cash" have been omitted, and the figures for "deposits," "notes and accounts receivable - trade," "electronically recorded monetary claims - operating," "notes and accounts payable - trade," "electronically recorded obligations - operating," "short-term borrowings (excluding current portion of long-term borrowings)," "accrued expenses," "income taxes payable" and "deposits received" have been omitted, as the fair value thereof approximate the book value thereof since these items are settled in a short period of time. |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Presented in the sum of the current portion of long-term borrowings and long-term borrowings.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Net assets and liabilities arising from derivatives trading are presented on a net basis, and net liabilities are presented in parentheses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Shares with no market prices, etc.

---

| | | |
|:---|:---|:---|
| Classification | Classification | Amount recorded in the consolidated balance sheet (million yen) |
| Unlisted shares | Investment securities | 133 |
| Unlisted shares are not included in "investment securities." | Unlisted shares are not included in "investment securities." | Unlisted shares are not included in "investment securities." |

---

3. Matters Regarding Breakdown, etc. of Fair Value of Financial Instruments by Level

The fair value of financial instruments is classified into the following three levels, depending on the observability and significance of inputs used for calculating such fair value.

---

| | |
|:---|:---|
| Level 1 fair value: | Fair value calculated using, from among the observable inputs used for calculating fair value, the quoted prices of assets or liabilities which are created in active markets and are subject to such calculation of fair value. |
| Level 2 fair value: | Fair value calculated using, from among the observable inputs used for calculating fair value, the inputs used for calculating fair value other than those set forth in level 1. |
| Level 3 fair value: | Fair value calculated using unobservable inputs used for calculating fair value. |

---

If two or more inputs are used which have significant impacts on the calculation of fair value, the fair value is classified into the level with the lowest priority in calculating the fair value from among the levels to which each of the inputs belong.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Financial Instruments Recorded at Fair Value in the Consolidated Balance Sheet Current consolidated fiscal year (May 31, 2025)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Fair value (million yen) | Fair value (million yen) | Fair value (million yen) | Fair value (million yen) |
| Classification | Level 1 | Level 2 | Level 3 | Total |
| Investment securities | 3074 | - | - | 3074 |
| Derivatives | - | 10 | - | 10 |
| &nbsp;&nbsp;&nbsp;Total assets | 3074 | 10 | - | 3084 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Financial Instruments other than those Recorded at Fair Value in the Consolidated Balance Sheet Current consolidated fiscal year (May
31, 2025)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Fair value (million yen) | Fair value (million yen) | Fair value (million yen) | Fair value (million yen) |
| Classification | Level 1 | Level 2 | Level 3 | Total |
| Payable Bonds | - | 1376 | - | 1376 |
| Long-term borrowings | - | 2809 | - | 2809 |
| &nbsp;&nbsp;&nbsp;Toal liabilities | - | 4186 | - | 4186 |

---

(Notes) Explanations of the valuation technique and inputs used for calculating fair value

<u>Investment securities</u>

Listed shares are valued using quoted prices. The fair value of listed shares is classified into level 1 as they are traded in active markets.

<u>Derivatives trading</u>

Derivatives are traded over the counter, and the fair value thereof is calculated based on the prices presented by the counterparty financial institution, etc., and is classified into level 2, as no quoted prices are presented.

<u>Payable bonds</u>

The fair value of payable bonds issued by the Company is calculated using the discounted cash flow method based on the sum of principal and interest and an interest rate reflecting the remaining maturity of and credit risks related to such payable bonds, and is classified into level 2.

<u>Long-term borrowings</u>

The fair value of long-term borrowings with variable interest is based on the book value thereof, as the fair value thereof is considered to approximate the book value since such borrowings reflect the market interest rate in a short period of time. The fair value of long-term borrowings with fixed interest is calculated using the discounted cash flow method based on the sum of principal and interest and an interest rate reflecting the remaining maturity of and credit risks related to such debts. The fair value of these transactions is classified into level 2.

**[Notes on Revenue Recognition]**

&nbsp;&nbsp;&nbsp;&nbsp;1. Information on Disaggregation of Revenue from Contracts with Customers

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  |  |  |  |  |  | (million yen) |
|  | Reportable segment | Reportable segment | Reportable segment | Reportable segment | Reportable segment |  |
|  | Industrial Infrastructure business | Enterprise business | Mobility business | Global business | Subtotal | Total |
| Revenue from contracts with customers | 28663 | 39125 | 39452 | 49001 | 156242 | 156242 |
| Net sales to outside customers | 28663 | 39125 | 39452 | 49001 | 156242 | 156242 |

---

&nbsp;&nbsp;&nbsp;&nbsp;2. Basic Information for Understanding Revenue

The basic information for understanding revenue is as presented in 3. Matters Regarding Accounting Policies, (5) Standards for Recording Revenues and Expenses under the "[Notes on Important Matters that are to Become the Basis for Preparation of Consolidated Financial Statements.]"

&nbsp;&nbsp;&nbsp;&nbsp;3. Information for Recognizing Amounts of Revenue for the Period under Review and Years to Follow

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Balance of Receivables Arising from Contracts with Customers and Balance of Contract Liabilities, etc.

---

| | | |
|:---|:---|:---|
|  | Current consolidated fiscal year | Current consolidated fiscal year |
|  | Balance at beginning of period (million yen) | Balance at end of period (million yen) |
| Receivables arising from contracts with customers | 41442 | 42688 |
| &nbsp;&nbsp;&nbsp;Notes receivable - trade | 525 | 330 |
| &nbsp;&nbsp;&nbsp;Accounts receivable - trade | 35164 | 36615 |
| &nbsp;&nbsp;&nbsp;Electronically recorded monetary claims – operating | 5753 | 5742 |
| Contract liabilities | 426 | 127 |

---

Contract liabilities are related primarily to advances received from customers and are reversed upon recognition of revenue. These are included in "other" under current liabilities in the consolidated balance sheet. The amount of revenue recognized in the current consolidated fiscal year, which was included in the contract liability balance at the beginning of the period, was 405 million yen.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Transaction Price Allocated to Remaining Performance Obligations

With respect to the transaction price allocated to the Group's remaining performance obligations, the Group has applied a practical expedient and has omitted the statement thereof, as there are no significant contracts regarding which the initially expected contract period is more than one year.

Consideration promised in contracts with customers does not comprise any significant amounts not included in the transaction price.

**[Notes on Per Share Information]**

&nbsp;&nbsp;&nbsp;&nbsp;1. Net assets per share: 2,251.59 yen

&nbsp;&nbsp;&nbsp;&nbsp;2. Basic earnings per share: 175.99 yen

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Note) In the calculation of net assets per share, the Company's shares held by the trust in connection with the stock compensation plan
are included in the treasury shares deducted from the total number of shares issued at the end of the fiscal year (507,300 shares for
the current consolidated fiscal year).

In addition, when calculating basic earnings per share, the Company's shares held by the trust in connection with the stock compensation plan are included in the treasury shares deducted in the calculation of the average number of shares during the period (511,354 shares for the current consolidated fiscal year).

**[Notes on Business Combination]**

(Finalization of provisional accounting treatment for business combination)

For the business combination with MAGnetIC Holding B.V. (a Dutch company engaged in semiconductor design business), which took place on May 1, 2024 (deemed acquisition date: May 31, 2024), the Company applied provisional accounting treatment in the previous fiscal year, but has finalized it during the current consolidated fiscal year.

As a result of the finalization of the provisional accounting treatment, significant revisions have been reflected in the initial allocation of the acquisition cost. Accordingly, the amount of goodwill of 1,964 million yen provisionally calculated in the consolidated balance sheet as of the end of the previous fiscal year has decreased by 448 million yen due to the finalization of the accounting treatment, resulting in a goodwill amount of 1,516 million yen. This decrease in the amount of goodwill is attributable to increases of 433 million yen in customer-related intangible assets, 308 million yen in technology-related intangible assets, 9 million yen in other intangible assets, 191 million yen in deferred tax liabilities, and 112 million yen in non-controlling interests.

(Transfer of business related to the development, design, manufacture, and sale of trigger switches for power tools and gardening equipment)

As of August 30, 2024, the Company transferred the Group's business related to the development, design, manufacture, and sales of trigger switches for power tools and gardening equipment (the "Target Business") to SHIBA Co., Ltd. ("SHIBA"), a newly established company formed through a company split, and the Company also transferred all of the issued shares of SHIBA to OTAX Co., Ltd. ("OTAX").

1. Overview of the Business Separation

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Name of company to which the separated business was transferred and name of company to which the shares were transferred

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Name of company to which the separated business was transferred: SHIBA Co., Ltd.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Name of company to which the shares were transferred: OTAX Co., Ltd.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Description of the Separated Business

The Company's business related to the development, design, manufacture, and sale of trigger switches for power tools and gardening equipment

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Reasons for the Business Separation

At the consolidated financial results briefing for the 2nd quarter of the fiscal year ended May 2024 held on January 16, 2024, the Company announced that it would promote business portfolio management as part of its efforts to maximize corporate value. The Company has been reviewing its business portfolio with the aim of enhancing sales growth and capital profitability for the Group as a whole over the medium to long term. In this process, with the intention of leveraging the strengths of the Target Business, such as its technological capabilities and robust customer relationships, the Company has decided to transfer the operation of the Target Business to OTAX. OTAX, renowned for its strengths as a manufacturer and distributor of industrial switches, aligns well with the objectives of the Target Business, and the Company anticipates that this transfer will further enhance the growth thereof. Under these circumstances, the Company has reached an agreement to conduct the business separation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Date of the Business Separation

August 30, 2024

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Matters Regarding the Overview of Other Transactions, Including Legal Forms

Transfer with consideration to be received in cash or other property only

2. Overview of Accounting Treatment Implemented

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Amount of Gain or Loss on Transfer

Gain on sale of business: 19 million yen

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Appropriate Book Value of Assets and Liabilities Related to the Transferred Business, and Breakdown of the Main Items Thereof

Current assets: 1,725 million yen

Non-current assets: 167 million yen

---

| | |
|:---|:---|
| Total assets: | 1,893 million yen |

---

Non-current liabilities: 102 million yen

---

| | |
|:---|:---|
| Total liabilities: | 102 million yen |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Accounting treatment

The Company has accounted for this transaction in accordance with the "Accounting Standards for Business Divestitures" (ASBJ Statement No. 7, September 13, 2013) and the "Guidance on Accounting Standards for Business Combinations and Accounting Standards for Business Divestitures" (ASBJ Guidance No. 10, January 16, 2019).

3. Name of Reportable Segment Including the Separated Business

Enterprise business

4. Estimated Amount of Profit/Loss Related to the Target Business Recorded in the Consolidated Statement of Operations for the Current Consolidated Fiscal Year

Net sales: 959 million yen

Operating profit (loss): (90 million yen)

(Transactions under Common Control)

The Company has acquired additional shares of its consolidated subsidiary, SM Electronic Technologies Pvt. Ltd. ("SM Electronic").

1. Overview of Transaction

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Name and Business of Combined Company

Name: SM Electronic (consolidated subsidiary of the Company)

Business description: Wholesale of electronic components

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Date of Business Combination

October 1, 2024 (deemed acquisition date)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Legal Form of Business Combination

Acquisition of shares from non-controlling shareholders

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Company Name after Business Combination There was no change to the company name.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Other Matters Related to Overview of Transaction

The Company acquired additional shares representing 25.0% of the voting rights, which has resulted in the Company holding 75.1% of the voting rights of SM Electronic. The aim of the acquisition of additional shares is to improve the Group's corporate value by capturing the growing Indian market and expanding business, as well as to further strengthen governance over the Group as a whole.

2. Overview of Accounting Treatment Implemented

Based on the Accounting Standard for Business Combinations (ASBJ Statement No. 21, January 16, 2019) and the Implementation Guidance on Accounting Standard for Business Combinations and Accounting Standard for Business Divestitures (ASBJ Guidance No. 10, January 16, 2019), the transaction has been treated as a transaction under common control with non-controlling shareholders under transactions.

3. Matters to be Stated upon Additional Acquisition of Subsidiary Shares <br>Acquisition costs of the acquired company and breakdown thereof

<u>Consideration for acquisition (Cash):</u> <u>1,085 million yen</u> <br> Acquisition costs: 1,085 million yen

4. Matters Related to Change in Ownership Interest of the Company due to Transactions with Non-Controlling Shareholders

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Main Factors for Change in Capital Surplus<br>Additional acquisition of subsidiary shares

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Amount of Decrease in Capital Surplus Due to Transactions with Non-Controlling Shareholders:<br>632 million yen

**[Notes on Significant Subsequent Events]**

There are no matters to be stated.

Financial Statements

Statement of Changes in Net Assets (from June 1, 2024 to May 31, 2025)

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| (Million yen) | (Million yen) | (Million yen) | (Million yen) | (Million yen) | (Million yen) | (Million yen) | (Million yen) | (Million yen) | (Million yen) | (Million yen) |
|  | Shareholders' equity | Shareholders' equity | Shareholders' equity | Shareholders' equity | Shareholders' equity | Shareholders' equity | Shareholders' equity | Shareholders' equity | Shareholders' equity | Shareholders' equity |
|  |  | Capital surplus | Capital surplus | Capital surplus | Retained earnings | Retained earnings | Retained earnings | Retained earnings | Retained earnings | Retained earnings |
|  |  |  |  |  |  | Other retained earnings | Other retained earnings | Other retained earnings | Other retained earnings |  |
|  | Share capital | Legal capital surplus | Other capital surplus | Total capital surplus | Legal retained earnings | Reserve for dividends | Reserve for tax purpose reduction entry of non-current assets | General reserve | Retained earnings brought forward | Total retained earnings |
| Balance as of June 1, 2024 | 2611 | 3606 | 37 | 3644 | 208 | 100 | 22 | 15000 | 3682 | 19014 |
| Change during fiscal year |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Dividends of surplus |  |  |  |  |  |  |  |  | (1335) | (1335) |
| &nbsp;&nbsp;&nbsp;Profit |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Purchase of treasury shares |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Disposal of treasury shares |  |  | 23 | 23 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Other |  |  |  |  |  |  | (0) |  | 0 |  |
| &nbsp;&nbsp;&nbsp;Net changes in items other than shareholders' equity |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Total changes during fiscal year | - | - | 23 | 23 | - | - | (0) | - | (76) | (77) |
| Balance as of May 31, 2025 | 2611 | 3606 | 61 | 3667 | 208 | 100 | 22 | 15000 | 3606 | 18937 |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Shareholders' equity | Shareholders' equity | Valuation and translation adjustments | Valuation and translation adjustments | Valuation and translation adjustments | Valuation and translation adjustments |  |
|  | Treasury shares | Total shareholders' equity | Valuation difference on available-for-sale securities | Deferred gains or losses on hedges | Revaluation reserve for land | Total valuation and translation adjustments | Total net assets |
| Balance as of June 1, 2024 | (4940) | 20329 | 1795 | - | 22 | 1817 | 22147 |
| Change during fiscal year |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Dividends of surplus |  | (1335) |  |  |  |  | (1335) |
| &nbsp;&nbsp;&nbsp;Profit |  | 1258 |  |  |  |  | 1258 |
| &nbsp;&nbsp;&nbsp;Purchase of treasury shares | (67) | (67) |  |  |  |  | (67) |
| &nbsp;&nbsp;&nbsp;Disposal of treasury shares | 80 | 104 |  |  |  |  | 104 |
| &nbsp;&nbsp;&nbsp;Other |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Net changes in items other than shareholders' equity |  |  | (710) | 1 | (0) | (708) | (708) |
| Total changes during fiscal year | 13 | (40) | (710) | 1 | (0) | (708) | (749) |
| Balance as of May 31, 2025 | (4927) | 20288 | 1085 | 1 | 21 | 1108 | 21397 |

---

**Notes on Non-Consolidated Financial Statements**

**[Notes on Matters Related to Significant Accounting Policies]**

1. Valuation Criteria and Method of Valuation for Securities

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Shares in Subsidiaries and Affiliates

Stated at cost using the moving-average method.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Other Securities

Securities other than shares, etc. without market prices:

Stated at fair value (valuation differences are recognized directly in net assets; the cost of securities sold is calculated by the moving-average method)

Shares, etc. without market prices:

Stated at cost using the moving-average method.

2. Valuation Criteria and Method of Valuation for Derivatives, Etc.

Stated at fair value

3. Valuation Criteria and Method of Valuation for Inventories:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Merchandise, Finished Goods and Raw Materials:

Stated primarily at cost using the moving-average method (the value stated in the balance sheets is calculated by writing down the book value based on declining profitability)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Work in Process:

Stated primarily at cost using the specific identification method (the value stated in the balance sheets is calculated by writing down the book value based on declining profitability)

4. Depreciation Methods for Depreciable Assets

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Property, Plant and Equipment (Excluding Lease Assets)

The declining-balance method is adopted; however, buildings (excluding building accessories) acquired on or after April 1, 1998, and building accessories and structures acquired on or after April 1, 2016, are depreciated by the straight-line method. The useful lives are determined primarily pursuant to the same standards as the method prescribed in the Corporation Tax Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Intangible Assets (Excluding Lease Assets) The straight-line method is used.

The useful lives and residual values are determined pursuant to the same standards as the method prescribed in the Corporation Tax Act; provided, however, that software (for internal use) is amortized using a straight-line method based on the estimated internal useful life, and software (for market sale) is amortized using the method under which the greater of the following amounts is recorded: (a) the amount of amortization based on the estimated sales volume, or (b) the amount of amortization on a straight-line basis over the estimated remaining sales-effective period. The initial estimated sales-effective period is set at three (3) years.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Lease Assets

Lease assets pertaining to finance lease transactions that do not transfer ownership

Lease assets are depreciated using a straight-line method over the lease period as the useful life, with zero residual value.

5. Recording Criteria for Allowances and Provisions

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Allowance for Doubtful Accounts

To provide for losses from uncollectible receivables, an allowance is recorded for ordinary receivables based on the historical bad-debt ratio, and for specific doubtful receivables, an amount equal to the estimated uncollectible is recorded based on an individual assessment of collectability.

uncollectible is recorded based on an individual assessment of collectability. <br>(2) Allowance for Bonus for Directors (and Other Officers)

To provide for the payment of bonuses to Directors (and other officers), an amount to be borne as of the end of the current fiscal year is recorded based on the estimated annual amount to be paid as of the end of the current fiscal year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Provision for Share Awards for Directors (and Other Officers)

To provide for the delivery and payment of the Company's shares, the estimated amount of shares to be delivered and paid that correspond to the number of points allotted to Directors (and other officers) is recorded in accordance with the Share Delivery Regulations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Allowance for Retirement Benefits

To provide for retirement benefits to employees, an amount is recorded based on the estimated amount of retirement benefit obligations as of the end of the current fiscal year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Method for attributing the estimated retirement benefits to periods

In calculating retirement benefit obligations, the benefit formula method is used to attribute the estimated retirement benefits to the periods up to the end of the current fiscal year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Recognition of actuarial gain/loss and amortization of past service cost Actuarial gain/loss is recognized
in full as expense in the year incurred.

Past service cost is amortized using the straight-line method over a fixed number of years (i.e., five (5) years) within the average remaining service period of employees at the time of occurrence thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Provision for Losses on Business Transfer

An amount is recorded for the estimated losses expected to arise in the future in connection with the share transfer following the company split.

6. Standards for Recording Revenues and Expenses

The Company's main businesses constitute the sale of semiconductors and electronic components and the development, design, manufacture and sale of products. In part of its industrial infrastructure business, the Company engages in the sale of electronic equipment and the development, design, manufacture and sale of products.

The details of the main performance obligations in the major businesses and the regular timing when such performance obligations are fulfilled (i.e., the usual timing of revenue recognition) are as follows:

Revenue is mainly recognized at the time when merchandise and finished goods are delivered to a customer, which is the timing when control of the merchandise and finished goods is transferred to the customer. Moreover, in export sales transactions, except for transactions that require substantive acceptance inspection, revenue is recognized at the time when the risks are transferred to the customer in accordance with Incoterms.

In part of the Company's industrial infrastructure business, revenue is recognized at the time when a customer inspects and accepts the merchandise and finished goods. In addition, for contracts under which services are provided over the contract term (e.g., maintenance services), revenue is recognized evenly over the contract period.

For transactions related to sale of goods or services for which the Company acts as an agent, the net amount of the consideration received from the customer less the amount payable to suppliers is recognized as revenue.

In determining whether the Company is acting as a principal or an agent, a comprehensive determination is made based on the following indicators:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether the Company bears the primary responsibility for performing the contract on the goods or services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether the Company bears inventory risk before and/or after the goods or services are transferred
to the customer; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• whether the Company has discretion in setting the prices of the goods or services.

As consideration for the transaction is received within approximately one (1) year after the fulfillment of performance obligations, significant financing components are not included.

7. Hedge Accounting Methods

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Hedge Accounting Methods

Deferral hedge accounting is adopted. The exceptional accounting method is adopted for interest rate swaps that meet the special matching criteria ("*Tokureishori*").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Hedging Instruments and Hedged Items

Hedging instruments:

Foreign exchange forward contracts and interest rate swaps

Hedged items:

Foreign exchange forward contracts: Receivables and payables denominated in foreign currencies, and forecast transactions denominated in foreign currencies

Interest rate swaps:

Interest on borrowings.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Hedging Policy

The Company uses foreign exchange forward contracts for the purpose of hedging risks arising from fluctuations in exchange rates, and uses foreign exchange forward contracts to the extent necessary based on contracts and other arrangements pertaining to ordinary business transactions denominated in foreign currencies; the Company has a policy of not engaging in speculative transactions.

The interest rate swap transactions are exclusively for funds procurement, and the Company uses interest rate swap transactions to reduce funds procurement costs. The Company has a policy of not engaging in speculative transactions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Method for Evaluating Hedge Effectiveness

From the commencement of hedging to the timing of assessing the effectiveness, the cumulative fluctuation in cash flows of the hedging instruments is compared with the cumulative fluctuation in cash flows of the hedged items, and hedging effectiveness is assessed based on the amounts of such fluctuations. The evaluation of hedge effectiveness is omitted for interest rate swaps to which the exceptional accounting method is applied.

8. Application of the Group Tax Sharing System

The Company and certain domestic consolidated subsidiaries apply the group tax sharing system.

**[Notes on Changes in Accounting Policies]**

(Application of the "Accounting Standard for Current Income Taxes," etc.)

The Company has applied the "Accounting Standard for Current Income Taxes" (ASBJ Statement No. 27, October 28, 2022; the "2022 Revised Accounting Standard"), etc. from the beginning of the current fiscal year. With respect to the revisions regarding the classification of income taxes, the Company follows the transitional treatment prescribed in the proviso to paragraph 20-3 of the 2022 Revised Accounting Standard. This change in accounting policies has no effect on the financial statements.

(Application of "Accounting for and Disclosure of Current Taxes Related to the Global Minimum Tax Rules") The Company has applied the "Accounting for and Disclosure of Current Taxes Related to the Global Minimum Tax Rules" (ASBJ Practical Solution No. 46, March 22, 2024) from the beginning of the current fiscal year. This change in accounting policy has an immaterial impact on the financial statements.

**[Notes on Accounting Estimates]**

1. Valuation of Inventory

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Amounts recognized in the financial statements for the current fiscal year

---

| | |
|:---|:---|
|  | Current fiscal year<br> (Million yen) |
| Merchandise and finished goods | 2716 |
| Work in process | 294 |
| Raw materials and supplies | 1 |
| (Note) These balances account for 6.3% of total assets. | (Note) These balances account for 6.3% of total assets. |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Information on Details of Significant Accounting Estimates Pertaining to Identified Items:

The details of the accounting estimates pertaining to the valuation of Slow-Moving Inventory is omitted because such information is the same as that stated in the Notes on Consolidated Financial Statements.

2. Recoverability of deferred tax assets

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Amounts recognized in the financial statements for the current fiscal year

Current fiscal year (Million yen) <br> Deferred tax assets (before offsetting against deferred tax liabilities) 763

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Information on details of significant accounting estimates pertaining to identified items

The details of the accounting estimates pertaining to deferred tax assets is omitted because such information is the same as that stated in the Notes on Consolidated Financial Statements.

3. Valuation of Shares in Associated Companies Pertaining to MAGnetIC Holding B.V.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Amounts recognized in the financial statements for the current fiscal year

Current fiscal year (Million yen) <br> Shares in associated companies 2,108

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Information on Details of Significant Accounting Estimates Pertaining to Identified Items

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Method for calculating the amounts recorded in the financial statements for the current fiscal year

For shares of associated companies with no market value, the acquisition value is compared with the substance value that reflects excess earning power. When it is determined that the substance value of the shares has significantly declined, it is the Company's policy to recognize impairment down to the substance value, except where recovery is deemed probable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Major assumptions used in calculating the amounts recorded in the financial statements for the current
fiscal year

In determining whether there is any impairment of the excess earning power included in the substance value, judgment is made based on the latest business plan, and the major assumptions of such business plan are as stated in the Notes on Consolidated Financial Statements [Notes on accounting estimates] 3. Valuation of goodwill recognized through the acquisition of MAGnetIC Holding B.V.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Impact on the financial statements for the next fiscal year

The above-stated major assumptions are established under reasonable estimates based on information currently available under management's judgment; however, due to fluctuations in the business environment, uncertainties in customer trends and other factors, future results may deviate from the initial estimates. As a result, this could have a significant impact on the financial statements for the next fiscal year.

**[Notes on Balance Sheets]**

&nbsp;&nbsp;&nbsp;&nbsp;1. Monetary Claims or Monetary Liabilities Regarding Associated Companies

The amounts of monetary claims or monetary liabilities regarding such associated companies other than those presented separately are as follows:

Short-term monetary claims regarding associated companies 932 million yen

Short-term monetary liabilities regarding associated companies 552 million yen

&nbsp;&nbsp;&nbsp;&nbsp;2. Accumulated Depreciation of Property, Plant and Equipment 1,320 million yen

&nbsp;&nbsp;&nbsp;&nbsp;3. Guarantee Obligations

The Company guarantees obligations for the borrowings and trade payables, etc. of the subsidiaries stated below from financial institutions, as follows:

---

| | |
|:---|:---|
| SATORI PINICS CO., LTD. | 297 million yen |
| STAR ELECTRONICS Co., Ltd. | 7,376 million yen |
| TAIWAN SATORI CO., LTD. | 408 million yen |
| HONG KONG SATORI CO., LTD. | 1 million yen |
| SHANGHAI SATORI CO., LTD. | 0 million yen |
| KOREA SATORI CO., LTD. | 92 million yen |
| SMET SINGAPORE PTE. LTD. | 3,614 million yen |
| Total | 11,790 million yen |

---

**[Notes on Statement of Operations]**

&nbsp;&nbsp;&nbsp;&nbsp;1. Volume of Trade with Associated Companies

Business transactions (revenue) 6,609 million yen

Business transactions (expenditures) 3,739 million yen

Transactions other than business transactions (revenue) 1,078 million yen

**[Notes on Statement of Changes in Net Assets]**

Matters Regarding Type and Number of Treasury Shares

Type of shares Number of shares at beginning of period (thousand shares) Increase in number of shares during period (thousand shares) Decrease in number of shares during period (thousand shares) Number of shares at end of period (thousand shares) <br> Common shares 3,622 32 62 3,592

(Note) 1. The treasury shares at the beginning and end of the current fiscal year include 507,000 shares of the Company held by the trust.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The breakdown of the increase in the number of treasury shares that are common shares is as follows:

---

| | |
|:---|:---|
| Increase in acquisitions by the trust under the stock compensation plan for employment-type Executive Officers | 32,000 shares |
| Increase due to acquisition of shares less than one unit | 0 shares |
| Decrease due to issuance of shares to officers under the stock compensation plan for officers, etc. | 32,000 shares |
| Decrease due to transferring shares to the trust under the stock compensation plan for employment-type Executive Officers | 30,000 shares |

---

**[Notes on Tax Effect Accounting]**

&nbsp;&nbsp;&nbsp;&nbsp;1. List of Major Causes of Deferred Tax Assets and Deferred Tax Liabilities

Deferred tax assets

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tax losses carried forward | 454 | &nbsp;&nbsp;&nbsp;&nbsp;(million yen) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory write-down | 173 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued bonuses | 107 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Excess of provision of allowance for retirement benefits | 405 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Impairment losses | 53 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | 286 |  |
| Subtotal of deferred tax assets | 1479 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Valuation allowance for tax losses carried forward | (337) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Valuation allowance for total future deductible temporary differences, etc. | (378) |  |
| Subtotal of valuation allowance | (716) |  |
| Total deferred tax assets | 763 |  |
| Deferred tax liabilities |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reserve for tax purpose reduction entry of non-current assets | (10) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Valuation difference on available-for-sale securities | 480 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | (10) |  |
| Total deferred tax liabilities | (501) |  |
| Net deferred tax assets | 262 |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;2. Accounting Treatment for Corporate Taxes and Local Corporate Taxes, or for Tax Effect Accounting Related
Thereto

The Company applies the group tax sharing system, and performs accounting treatment for corporate taxes and local corporate taxes, or performs accounting treatment for and discloses tax effect accounting related to such taxes, in accordance with "Practical Solution on the Accounting and Disclosure Under the Group Tax Sharing System" (ASBJ Practical Solution No. 42, August 12, 2021).

&nbsp;&nbsp;&nbsp;&nbsp;3. Modification of Amounts of Deferred Tax Assets and Deferred Tax Liabilities Due to Change in Rates
of Corporate Tax, etc.

Due to the "Act for Partial Amendment of the Income Tax Act, etc." (Act No. 13 of 2025) being enacted in the Diet Session on March 31, 2025, "Special Defense Corporation Tax" will be imposed from the fiscal year starting on or after April 1, 2026.

In accordance with the above, the deferred tax assets and deferred tax liabilities pertaining to the temporary differences, which are expected to be reversed during or after the fiscal year starting on June 1, 2026, are calculated after changing the normal effective statutory tax rate from 30.6% to 31.5%.

The impact of such change in the tax rate is minor.

**[Notes on Transactions with Affiliated Parties]**

Company's Subsidiaries and Affiliates, etc.

---

| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  |  |  |  |  |  | Details of relationships | Details of relationships |  |  |  |  |
| Attribution | Name of company, etc. or name | Location | Share capital or investments in capital (million yen) | Business description or occupation | Ownership (owned) ratio of voting rights, etc. (%) | Officers holding concurrent positions, etc. | Business relationships | Details of transaction | Transaction amounts (million yen) | Title | Balance at end of period (million yen) |
|  | SATORI PINICS CO., LTD. | Minato-ku, Tokyo | 310 | Wholesale business | (Ownership) Direct 100.0 | 3 | Sale and purchase of goods; guarantee of obligations; financial assistance | Loaning of funds (Note) 2 (Note) 3 | 969 | Short-term loans receivable from associated companies | 950 |
|  | STAR ELECTRONICS Co., Ltd. | Minato-ku, Tokyo | 310 | Wholesale business | (Ownership) Direct 100.0 | 3 | Sale and purchase of goods; financial assistance | Loaning of funds (Note) 2 (Note) 3 | 1569 | Short-term loans receivable from associated companies | 600 |
| Subsidiaries | SATORI SP TECHNOLOGY CO., LTD. | Minato-ku, Tokyo | 350 | Wholesale business | (Ownership) Direct 85.0 | 3 | Sale and purchase of goods; guarantee of obligations; financial assistance | Guarantee of obligations (Note) 1 | 7376 | - | - |
|  |  |  |  |  |  |  |  | Loaning of funds (Note) 2 (Note) 3 | 2984 | Short-term loans receivable from associated companies | 2570 |
|  | KOREA SATORI CO., LTD. | Seoul, Korea | KRW 3,000,000,000 | Wholesale business | (Ownership) Direct 100.0 | 2 | Purchase of goods; guarantee of obligations; financial assistance | Loaning of funds (Note) 2 (Note) 3 | 1083 | Short-term loans from associated companies | 1007 |
|  | SMET SINGAPORE PTE. LTD. | The Republic of Singapore | USD 2,858,000 | Wholesale business | (Ownership) Direct 100.0 | - | Sale of goods; guarantee of obligations; financial assistance | Guarantee of obligations (Note) 1 | 3614 | - | - |
|  |  |  |  |  |  |  |  | Loaning of funds (Note) 2 (Note) 3 | 2307 | Long-term receivable from associated companies | 2307 |

---

(Note) 1. The Company guarantees obligations for bank borrowings and trade payables, etc. of
consolidated subsidiaries. No guarantee charge is received.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. With respect to "loaning of funds," decisions are made by taking into account the market interest rate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The "transaction amounts" is the average balance during the period.

****

<br> **[Notes on Revenue Recognition]**

(Basic information for understanding revenue from contracts with customers)

The basic information for understanding revenue from contracts with customers is omitted as it is the same as that specified in the "Notes on Consolidated Financial Statements [Notes on Revenue Recognition]".

**[Notes on Per Share Information]**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Net assets per share 1,490.74 yen

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Basic earnings per share 87.77 yen

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Note) In the calculation of net assets per share, the Company's shares held by the trust in connection
with the stock compensation plan are included in the treasury shares deducted from the total number of shares issued at the end of the
fiscal year (507,300 shares for the current fiscal year).

In addition, in the calculation of basic earnings per share, the Company's shares held by the trust in connection with the stock compensation plan are included in the treasury shares deducted in the calculation of the average number of shares during the period (511,354 shares for the current fiscal year).

**[Notes on Significant Subsequent Events]**

There are no matters to be stated.

**[Notes on Companies to which Consolidated Dividend Regulations Apply]**

The Company is a company to which consolidated dividend regulations apply.

## Exhibit 99.5

&nbsp;&nbsp; The business combination described in this document involves securities of Japanese companies. The business combination is subject to disclosure requirements of Japan that are different from those of the United States. Financial information included in this document, if any, was excerpted from financial statements prepared in accordance with foreign accounting standards that may not be comparable to the financial statements of United States companies.<br>It may be difficult for you to enforce your rights and any claim you may have arising under the U.S. federal securities laws, since the issuers are located in Japan and some or all of their officers and directors reside outside of the United States. You may not be able to sue a Japanese company or its officers or directors in a Japanese court for violations of the U.S. securities laws.<br>It may be difficult to compel a Japanese company and its affiliates to subject themselves to a U.S. court's judgment. You should be aware that the issuer may purchase securities otherwise than under the business combination, such as in the open market or through privately negotiated purchases.<br>

Dear Shareholders:

We would like to express our appreciation to shareholders for their continued support.

SATORI ELECTRIC CO., LTD. on October 14, 2025, reached a final agreement on the business integration with Hagiwara Electric Holdings Co., Ltd. through the establishment of a joint holding company. The electronics and IT markets in which the Group operates continue to expand while changing rapidly, and customer needs are also diversifying and growing more sophisticated than ever before. Against such a backdrop, we seek to provide even greater functional value and to improve corporate value by concentrating the management resources of both companies in the newly established MIRAINI HOLDINGS CO., LTD. and leveraging each of our strengths.

We seek the understanding of shareholders for this business integration and ask for your continued support.

Hiroyuki Satori

Representative Director,

President, Executive Officer

November 2025

&nbsp;&nbsp;&nbsp;&nbsp;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. The Company assumes no responsibility for this translation or for direct, indirect or any other forms of damages arising from the translation.

Securities code: 7420

November 25, 2025

(Commencement date of measures for electronic provision: November 19, 2025)

**To Shareholders with Voting Rights:**

Hiroyuki Satori Representative Director, President, Executive Officer SATORI ELECTRIC CO., LTD. 14-10, Shiba 1-chome, Minato-ku, Tokyo, Japan

**NOTICE OF**

**AN EXTRAORDINARY SHAREHOLDERS MEETING**

Dear Shareholders:

We would like to express our appreciation to all of the shareholders of SATORI ELECTRIC CO., LTD. (the "Company") for their continued support.

We are pleased to announce that an Extraordinary Shareholders Meeting will be held as described below (on the next page).

In accordance with laws and regulations and the Company's Articles of Incorporation, this Shareholders Meeting will be held exclusively online as a "shareholders meeting without a designated location" (virtual-only shareholders meeting). As there will be no venue where shareholders can physically attend the meeting, shareholders are kindly asked to attend via the Internet.

In convening this Shareholders Meeting, the Company has taken measures for electronic provision of information; the matters subject to measures for electronic provision (the reference documents for this Shareholders Meeting, etc.) are provided in the "NOTICE OF AN EXTRAORDINARY SHAREHOLDERS MEETING" posted on the website listed below.

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| &nbsp;&nbsp;Shareholders meeting website | &nbsp;&nbsp;https://www.satori.co.jp/ir/stock/meeting.html |
| &nbsp;&nbsp;TSE website (Listed Company Search) | &nbsp;&nbsp; https://www2.jpx.co.jp/tseHpFront/JJK020010Action.do?Show=Show<br> Access the website above and search the records by entering the issue name (company name) or the Company's securities code "7420." Next, click "Basic information" and then "Documents for public inspection/PR information." |

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If you are not attending the meeting in person, or if you are attending the meeting but wish to be prepared in the case of communication issues, etc. on the day of the meeting, you may exercise your voting rights in advance in writing (by post) or via the Internet. Please review the reference documents and exercise your voting rights by 5:00 p.m. on Wednesday, December 10, 2025.

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| &nbsp;&nbsp;**1. Date and Time:** | &nbsp;&nbsp; Thursday, December 11, 2025 at 10:00 a.m.<br> \* Online streaming is scheduled to begin at 9:30 a.m.<br> \* If it becomes difficult to hold the meeting at the above date and time due to communication issues, etc., the meeting will be held on the backup date of Friday, December 12, 2025 at 10:00 a.m. In this case, details will be re-posted on the Company's website (https://www.satori.co.jp/english.html). |
| &nbsp;&nbsp;**2. Method for Holding the Meeting:** | &nbsp;&nbsp; Shareholders meeting without a designated location (virtual-only shareholders meeting)<br> **\*** This meeting is a virtual-only shareholders meeting held exclusively online.<br> There will be no physical venue for shareholders to attend.<br> **\*** Please access and log in to the designated website (https://web.sharely.app/ym) for shareholders and attend the meeting. For details, please refer to "Information Regarding the Virtual-Only Shareholders Meeting" beginning on page 6 of this convocation notice. |
| &nbsp;&nbsp;**3. Meeting Agenda: Proposal to be resolved:** |  |
| &nbsp;&nbsp;**Proposal** | &nbsp;&nbsp;Approval of the share transfer plan with Hagiwara Electric Holdings Co., Ltd. |

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● The method of communication used to send and receive information for this Extraordinary Shareholders Meeting will be via the Internet.

● If any revisions are made to the matters subject to measures for electronic provision, the amended documents will be posted on each website where these matters are posted.

● If you wish to attend the meeting by proxy, you are kindly asked to appoint another shareholder with voting rights as your proxy, in accordance with laws and regulations and the Articles of Incorporation. For details on the procedure, please refer to "9. Attendance by Proxy" on page 9.

● For this Shareholders Meeting, we send a document that contains the matters subject to measures for electronic provision, regardless of whether a request for delivery of documents has been made. Among the matters subject to measures for electronic provision, the items below are not included in the paper copy to be sent to shareholders who have requested it in accordance with laws and regulations and provisions in Article 14 of the Company's Articles of Incorporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Content of Hagiwara Electric Holdings Co., Ltd.'s financial statements for
the fiscal year ended March 2025

● This Shareholders Meeting will be conducted in Japanese only.

**Guide to Exercising Voting Rights**

Voting rights at shareholders meetings are important rights of shareholders. Please review the reference documents for this Shareholders Meeting attached to this notice (from page 15) and exercise your voting rights.

There are three ways to exercise your voting rights, as described below:

⮚ **If You Are Attending the Virtual-Only Shareholders Meeting**

Please attend the Shareholders Meeting and exercise voting rights in accordance with the "Information Regarding the Virtual-Only Shareholders Meeting" beginning on page 6.

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|:---|:---|
| &nbsp;&nbsp;**Date and Time:** | &nbsp;&nbsp; **Thursday, December 11, 2025 at 10:00 a.m.**<br> **(Online streaming is scheduled to begin at 9:30 a.m.)** |

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⮚ **If You Are Exercising Voting Rights by Post**

Please indicate approval or disapproval of the proposal on the enclosed Voting Rights Exercise Form and return it by post. Please return the form as early as possible given that delivery could take several days on account of the postal conditions and other factors.

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|:---|:---|
| &nbsp;&nbsp;**Deadline for exercise:** | &nbsp;&nbsp;**The Voting Rights Exercise Form must reach us no later than Wednesday, December 10, 2025, 5:00 p.m.** |

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⮚ **If You Are Exercising Voting Rights via the Internet**

Please follow the instructions on the next page to enter approval or disapproval of the proposal.

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|:---|:---|
| &nbsp;&nbsp;**Deadline for exercise:** | &nbsp;&nbsp;**Wednesday, December 10, 2025, 5:00 p.m.** |

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**Guide to Filling Out the Voting Rights Exercise Form**

Please indicate approval or disapproval of the proposal in the designated section on the Voting Rights Exercise Form.

To indicate approval, circle the Approve field. To indicate disapproval, circle the Disapprove field.

Note on handling of exercise of voting rights

If there is no indication of approval or disapproval of the proposal on the Voting Rights Exercise Form, it will be considered as indication of approval.

**Guide for Exercising Voting Rights Via the Internet**

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|:---|:---|
| &nbsp;&nbsp; **Scanning the QR Code<br> "Smart Vote"**<br> Shareholders can log in to the website for exercising voting rights without entering a voting right exercise code or password.<br>**1. Please scan the QR Code at the bottom of the right of the Voting Rights Exercise Form.**<br> \* QR Code is a registered trademark of DENSO WAVE INCORPORATED.<br>**2. Please enter approval or disapproval by following the instructions on the screen.**<br>| &nbsp;&nbsp; **Entering the Voting Right Exercise<br> Code and Password**<br> Website for Exercise of Voting Rights:<br> https://www.web54.net<br>**1. Please access the Website for Exercise of Voting Rights**<br>Click "Next" to continue.<br>**2. Please enter the Voting Rights Exercise Code printed on the Voting Rights Exercise Form.**<br>Enter the Voting Right Exercise Code.<br>|
| &nbsp;&nbsp; **Voting rights can be exercised only once using the Smart Vote method.**<br> To make a correction after exercising your voting rights, please access the PC website and log in by entering your voting right exercise code and password printed on the Voting Rights Exercise Form and exercise your voting rights again.<br> \* The PC website can be accessed by scanning the QR Code again.<br>| &nbsp;&nbsp; Click "Log In."<br>**3. Please enter the password printed on the Voting Rights Exercise Form**<br> Enter the password.<br>Please set a new password for actual use then click "Register."<br>**4. Please enter approval or disapproval by following the instructions on the screen.**<br>|

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**Should you have any questions about how to exercise your voting rights via the Internet using a personal computer, smartphone, etc., please contact:**

&nbsp;&nbsp; **Sumitomo Mitsui Trust Bank Ltd.** <br> **Stock Transfer Agency Web Support**<br> **Phone: 0120-652-031 (toll free)** <br> **(Hours: 9:00 a.m. through 9:00 p.m.)**<br>

• If shareholders exercise their voting rights both via the Internet and by post, the exercise of voting rights via the Internet will be deemed valid.

• If shareholders exercise their voting rights via the Internet multiple times or exercise their voting rights in duplicate by personal computer and smartphone, the last exercise shall be deemed valid.

**The electronic platform for exercising voting rights operated by ICJ, Inc. is available to institutional investors.**

**Information Regarding the Virtual-Only Shareholders Meeting**

The Company's Board of Directors has decided to hold this shareholders meeting in the form of a virtual-only shareholders meetings in order to improve shareholder convenience, ensure fairness by providing equal opportunities to participate, and promote dialogue, as well as out of consideration of the opinions of shareholders. As there is no venue where shareholders can physically attend the meeting, shareholders are kindly asked to attend virtually via the Internet by accessing the designated website for shareholders and verifying their identity with their ID and password.

**1. Date and Time**

**Thursday, December 11, 2025 at 10:00 a.m.**

\* Online streaming is scheduled to begin at 9:30 a.m.

\* If it becomes difficult to hold the meeting at the above date and time due to communication issues, etc., the meeting will be held on the backup date of Friday, December 12, 2025 at 10:00 a.m. In this case, details will be reposted on the Company's website:

https://www.satori.co.jp/english.html

**2. Log-in Method**

&nbsp;&nbsp;&nbsp;&nbsp;(1) Please access the designated website for shareholders.

&nbsp;&nbsp;&nbsp;&nbsp;(2) Please enter your ID and password contained in the Notice on How to Attend the Virtual Shareholders Meeting enclosed with this convocation notice, and log in.

**Designated website for shareholders:** https://web.sharely.app/ym

**Note: ID and password are required.**

&nbsp;&nbsp;&nbsp;&nbsp;**3. Handling of Exercise of Voting Rights on the Day of the Meeting and Prior**

For shareholders who have exercised voting rights in advance either by post or via the Internet, but then attended the Shareholders Meeting, the following shall apply. We ask for your understanding.

&nbsp;&nbsp;&nbsp;&nbsp;(1) When the exercise of voting rights on the day of the meeting has been confirmed, the prior exercise of voting rights will be deemed void.

&nbsp;&nbsp;&nbsp;&nbsp;(2) When the exercise of voting rights on the day cannot be confirmed, prior exercise of voting rights will be deemed effective.

If a shareholder attends virtually on the day of the meeting without having exercised their voting rights in advance but their exercise of voting rights on the day cannot be confirmed, it will be deemed an abstention.

&nbsp;&nbsp;&nbsp;&nbsp;**4. Method for Exercising Voting Rights**

Shareholders attending virtually may exercise their voting rights. After logging in, please select approval or disapproval of the proposal on the screen and submit it, in accordance with the instructions given by the Chair of the meeting.

&nbsp;&nbsp;&nbsp;&nbsp;**5. Method of Submitting Questions and Motions on the Day of the Meeting**

When attending virtually, shareholders may submit questions and motions. After logging in, shareholders are requested to follow the instructions of the Chair and to select the question or motion button on the screen before submitting.

Due to the limited time for the Q&A session and to ensure smooth proceedings, each shareholder will be limited to no more than three questions (one question per submission / each question no more than 150 characters). Please make your submission in Japanese.

Please note that not all submitted questions may be answered during the Shareholders Meeting depending on how deliberations progress. We plan to answer questions that are related to the meeting's agenda item and that do not overlap with other questions. Answers for questions related to the agenda item of this meeting and that cannot be answered will be posted on the Company's website following the close of the meeting together with answered questions, provided there are no obstacles to disclosure, including possible infringements of the privacy of individuals.

If it is determined that the smooth proceedings or the stable operation of the virtual-only shareholder meeting system may be hindered by repeatedly sending similar questions, etc., or by repeatedly sending text data exceeding the character count, or by repeatedly sending questions, etc. containing inappropriate content or content unrelated to the agenda item for this Shareholder Meeting, the Company may forcibly disconnect communication with the shareholder upon a decision by the Secretariat at the order or direction of the Chair.

With regard to motions as well, please limit each submission to one motion and a maximum of 150 characters to ensure smooth proceedings. Please make your submission in Japanese.

&nbsp;&nbsp;&nbsp;&nbsp;**6. Responses to Telecommunication Failures, etc.**

At the beginning of this Shareholders Meeting, a resolution will be submitted to grant the Chair the authority to decide to postpone or adjourn the Shareholders Meeting in the event the proceedings are impeded due to telecommunication failures, etc. If the Chair decides on the postponement or adjournment of the Shareholders Meeting based on the resolution set forth above, a postponed meeting or an adjourned meeting will be held on the alternative date and time set forth below:

Friday, December 12, 2025 at 10:00 a.m.

In that event, the details will be re-posted on the Company's website (https://www.satori.co.jp/english.html).

&nbsp;&nbsp;&nbsp;&nbsp;**7. Policy for Handling Prior Questions**

Questions from shareholders will be accepted from the designated shareholder website in advance. Please enter the question by clicking the question button on the screen and then submit. Please limit questions to content related to the agenda item for this Shareholders Meeting. Answers will be provided on the day of the Shareholders Meeting to questions that are of particularly high interest to shareholders, but please note that individual answers cannot be given.

Prior questions will be accepted:

From Tuesday, November 25, 2025 through Thursday, December 4, 2025 at 5:00 p.m. JST

\* Shareholders may submit no more than three questions (one question per transmission / each question no more than 150 characters). Please make your submission in Japanese.

\* Please note that questions will not be able to be submitted after the acceptance period. We request that you submit your questions early in the acceptance period.

&nbsp;&nbsp;&nbsp;&nbsp;**8. For Shareholders with Trouble Using the Internet**

Shareholders who wish to exercise their voting rights but have difficulty in using the Internet are asked to exercise their voting rights in advance in writing.

&nbsp;&nbsp;&nbsp;&nbsp;**9. Attendance by Proxy**

Voting rights may be exercised by appointing another shareholder with voting rights as a proxy. For shareholders requesting attendance by proxy, a document stating the intention to appoint a proxy (power of attorney) must be submitted to the Company prior to this Shareholders Meeting by sending it by post to the address below.

The power of attorney form can be downloaded from the shareholder meeting website.

**Necessary documents:**

- Power of attorney \* Must bear the signature or seal of the delegating shareholder.

- Copy of the Voting Rights Exercise Form of the delegating shareholder and a copy of the "Notice on How to Attend the Virtual Shareholders Meeting" \* Enclosed with this convocation notice

- Copy of the Voting Rights Exercise Form of the delegated shareholder

Addressee:

To: SATORI ELECTRIC CO., LTD.

Shareholder Meeting Secretariat

14-10, Shiba 1-chome, Minato-ku, Tokyo 105-0014

Submission deadline:

Documents must arrive by 5:00 p.m. on Thursday, December 4, 2025.

\* If the required documents have not been received by the submission deadline, attendance by proxy will not be permitted.

\* If the required documents are incomplete, attendance by proxy may not be permitted.

&nbsp;&nbsp;&nbsp;&nbsp;**10. Manual for Attending the Extraordinary Shareholders Meeting**

Please refer to the following shareholder meeting website to view the manual for attending the Extraordinary Shareholders Meeting for logging in, the exercise of voting rights, submission of questions and motions on the day, prior questions, and attendance by proxy, etc.

Shareholder Meeting Website:https://www.satori.co.jp/ir/stock/meeting.html

&nbsp;&nbsp;&nbsp;&nbsp;**11. Inquiries**

We will answer inquiries by telephone if there are questions about attendance. Please have the "Notice on How to Attend the Virtual Shareholders Meeting" (ID and password) on hand when calling the following number.

**General inquiries about the virtual shareholders meeting**

**Shareholder Registry Administrator: Sumitomo Mitsui Trust Bank Limited Virtual Shareholders Meeting Support Center**

Telephone: 0120-782-041 (toll free)

Period: Tuesday, November 25, 2025 through Thursday, December 11, 2025

(Hours of operation: 9:00 a.m. through 5:00 p.m., excluding Saturday, Sunday, holidays)

Please note that answers cannot be provided concerning the following matters:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) ID and password for attendance

If a shareholder loses their attendance ID and password, please contact the above service to inquire about their reissuance. These will be mailed to the registered address on the document that contained that password and ID. Requests for reissuance can be accepted no later than 5 business days prior to this Shareholders Meeting (5:00 p.m. on Thursday, December 4). Please note that the ID and password cannot be reissued after the above deadline.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Questions regarding Internet connectivity or the performance of the PC, smartphone, or other device being used and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Inquiries about not being able to connect due to causes likely due to issues with the shareholder's environment on the day of the Shareholder Meeting, lagging audio issues, problems with not being able to cast votes, etc.

**Inquiries concerning poor audiovisual play during live streaming**

Sharely Co., Ltd.

Phone: 03-6683-7661

Period: From Thursday, December 11, 2025 at 9:00 a.m. to the close of the Shareholders Meeting

**Notices**

**1. Necessary Environment for Virtual Meeting Attendance**

The proceedings of the Shareholders Meeting on the day can be viewed via live streaming on personal computers, smartphones, etc. The following environment is recommended for virtual meeting attendance. The telecommunication devices, connection fees and all other expenses required for virtual attendance will be the responsibility of the shareholder. Due to issues with PCs or smartphones, etc. used by the shareholder or problems with the telecommunication environment of the shareholder, the shareholder may not be able to virtually attend the Shareholders Meeting or exercise their voting rights. As such, we ask that shareholders attend having exercised their voting rights in advance.

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|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp;PC | &nbsp;&nbsp;PC | &nbsp;&nbsp;Mobile | &nbsp;&nbsp;Mobile |
|  | &nbsp;&nbsp;Windows | &nbsp;&nbsp;Mac | &nbsp;&nbsp;Android | &nbsp;&nbsp;iOS |
| &nbsp;&nbsp;OS\*<sup>1</sup> | &nbsp;&nbsp;Windows 11 | &nbsp;&nbsp;Latest MacOS | &nbsp;&nbsp;Android 15 or later | &nbsp;&nbsp; iPhone: iOS 18 or later<br>iPad: iOS 18 or later |
| &nbsp;&nbsp;Browser\*<sup>2, 3</sup> | &nbsp;&nbsp; Microsoft Edge<br>Google Chrome | &nbsp;&nbsp; Google Chrome<br>Safari | &nbsp;&nbsp;Google Chrome | &nbsp;&nbsp;Safari |

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\*1. We recommend the latest version of each browser.

\*2. Please enable JavaScript and cookies in your browser. We recommend using the latest version of browsers.

\*3. Internet Explorer mode cannot be used in Microsoft Edge.

**2. Other Notices**

• In holding the virtual-only shareholders meeting, the Company will take reasonable preventative measures against network failures, but it is possible that shareholders may not be able to attend or exercise their voting rights due to issues with PCs and smartphones, etc. used by the shareholder or problems with the telecommunication environment of the shareholder. The Company will not bear any responsibility for any disadvantage, etc. incurred by shareholders due to such network failures. We appreciate your understanding.

• The sharing of visual or audio data with third parties, publication, posting to social media, etc., screening, reprinting, reproduction, and video and audio recording as well as the disclosure of log-in methods and information required for log-in to third parties are prohibited.

• The sharing of IDs and passwords for virtual attendance with third parties is strictly prohibited.

• At the beginning of this Shareholders Meeting, a resolution will be submitted to grant the Chair the authority to decide to postpone or adjourn the Shareholders Meeting in the event the proceedings are significantly impeded due to network failures, etc. If the Chair decides on the postponement or adjournment of the Shareholders Meeting based on the resolution set forth above, a postponed meeting or an adjourned meeting will be held on the alternative date and time of Friday, December 12, 2025 at 10:00 a.m. Notification will swiftly be made on the Company's website and we request your attendance at the postponed or adjourned Shareholders Meeting in accordance with the procedures set forth in "Information Regarding the Virtual-Only Shareholders Meeting" from page 6.

• The only language accommodated at this Shareholders Meeting will be Japanese.

**Prior to Shareholders Meeting**

**Access the designated shareholder website**

Please check access prior to the meeting.

(Ability to log-in, system requirements, internet connection)

Log-in screen: https://web.sharely.app/ym

**Read the reference documents**

Access the Company website.

https://www.satori.co.jp/ir/stock/meeting.html

**Ask questions in advance**

https://web.sharely.app/e/satori-202512/pre_question

&nbsp;&nbsp;&nbsp;&nbsp;• Questions are limited to content concerning the agenda item of this Shareholders Meeting. Questions will be accepted in advance on the designated shareholder website.

&nbsp;&nbsp;&nbsp;&nbsp;• Questions that are of particularly high interest to all shareholders will be answered on the day of the Shareholders Meeting. However, individual answers cannot be provided, and we ask for your understanding.

&nbsp;&nbsp;&nbsp;&nbsp;• Questions are limited to no more than three per shareholder (one question per transmission / each question no more than 150 characters). Please submit your question in Japanese.

Acceptance period: Tuesday, November 25, 2025 through 5:00 p.m. on Thursday, December 4, 2025

**Exercise voting rights**

&nbsp;&nbsp;&nbsp;&nbsp;• Voting rights can be exercised in advance by two methods. We ask shareholders who also plan to attend on the day to exercise their voting rights in advance in case of unexpected communication failures, etc.

Exercise of voting rights in writing (by post)

Deadline: Wednesday, December 10, 2025 by 5:00 p.m.

Exercise of voting rights via the Internet

Deadline: Wednesday, December 10, 2025 by 5:00 p.m.

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| &nbsp;&nbsp; **On the day of the Shareholders Meeting**<br>**Thursday, December 11, 2025 at 10:00 a.m.**<br>**Attend the virtual shareholders meeting**<br> Online streaming is scheduled to begin at 9:30 a.m.<br> https://web.sharely.app/ym<br>**Ask questions**<br> • Questions can be asked via text. Please follow the guide provided on the day for details.<br> • Questions are limited to content related to the agenda item of this Shareholders Meeting.<br> • Each shareholder may submit no more than three questions (one question per transmission / each question no more than 150 characters). Please submit your question in Japanese.<br> • To ensure smooth proceedings, answers will be given in the order determined at the discretion of the Chair, and it is possible that all questions may not be answered during the Shareholders Meeting.<br> • Questions that infringe on individuals' privacy or are slanderous will not be accepted.<br>**Submit motions**<br> • Motions can be submitted via text. Please follow the guide provided on the day for details.<br> • To ensure smooth proceedings, please limit each submission to one motion of up to 150 characters. Please submit your motion in Japanese.<br> **Exercise voting rights**<br> • Please exercise voting rights following the directions of the Chair.<br> • Voting rights may be exercised again during the specified time period. | &nbsp;&nbsp; **After the close of the Shareholders Meeting**<br>**We will post information as it becomes available on the Company's website.**<br> https://www.satori.co.jp/ir/stock/meeting.html<br>**See results of exercise of voting rights**<br> We will post the Extraordinary Report that we will submit to the Financial Services Agency.<br>**Confirm answers to questions on the day**<br> We will post questions received and answers on our website at a later date.<br>|
| &nbsp;&nbsp; **Inquiries concerning poor audiovisual play during live streaming**<br> Sharely Co., Ltd.<br> Phone: 03-6683-7661<br> Hours: Thursday, December 11, 2025<br> (From 9:00 a.m. to the close of the Shareholders Meeting) | &nbsp;&nbsp; **General inquiries about the virtual shareholders meeting**<br> Shareholder Registry Administrator:<br> Sumitomo Mitsui Trust Bank Limited<br> Virtual Shareholders Meeting Support Center<br> Telephone: 0120-782-041 (toll free)<br> Period: Tuesday, November 25, 2025 through<br> Thursday, December 11, 2025<br> (Hours of operation: 9:00 a.m. through 5:00 p.m.,<br> excluding Saturday, Sunday, holidays) |

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**Reference Documents for General Meeting of Shareholders**

**Proposal Approval of the share transfer plan with Hagiwara Electric Holdings Co., Ltd.**

SATORI ELECTRIC CO., LTD. (the "Company") and Hagiwara Electric Holdings Co., Ltd. ("Hagiwara Electric") (the Company and Hagiwara Electric shall hereinafter be collectively referred to as the "Companies") held discussions regarding the implementation of a business integration between the Companies (the "Business Integration") under the spirit of equality based on the memorandum of understanding executed by the Companies on July 28, 2025 (the "MOU"), following which they reached an agreement regarding the establishment of MIRAINI HOLDINGS Co., Ltd. (the "Joint Holding Company"), which will become the wholly-owning parent company of the Companies through a joint share transfer (the "Share Transfer") planned to be conducted on April 1, 2026, as well as regarding the terms and conditions of the Business Integration, and pursuant to a resolution of a Board of Directors meeting of each of the Companies held on October 14, 2025, the Companies executed a business integration agreement (the "Business Integration Agreement") on the same date and jointly prepared a share transfer plan (the "Share Transfer Plan").

Accordingly, the Company requests shareholder approval for the Share Transfer Plan.

The reasons for the Share Transfer, a summary of the Share Transfer Plan, and other matters relating to this proposal are as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **Reasons for the Share Transfer** 

The Companies, as comprehensive electronics trading companies handling semiconductors, electronic components, and electronic equipment, have been providing optimal solutions that meet the diverse needs of their customers and have expanded their businesses globally by leveraging a wide variety of products and advanced technologies. The electronics market is currently experiencing a surge in demand for the adoption and utilization of technologies such as the Internet of Things (IoT), artificial intelligence (AI), edge computing, generative AI, and digital transformation (DX), not only in next-generation automobiles, but also to resolve the challenges of smartification across a broad range of industries, including manufacturing. Amid this environmental change, there is an increasing need for solutions that are more closely aligned with customer challenges in the utilization and supply of semiconductors. Furthermore, the role of electronics trading companies is also evolving, as they are required to build more sophisticated supply chains in the face of the impact of overseas relocation of manufacturing bases in association with changes in semiconductor utilization needs, as well as growing uncertainties in the business environment caused by U.S.-China trade friction, export controls, and geopolitical tensions.

Under such a business environment, the Companies have reached a shared recognition that, in order to achieve continuous business growth and development going forward, it is essential to concentrate their respective management resources and leverage their strengths to expand the scale of their business, and thereby deliver even greater added value. Based on this recognition, the Companies have reached a final agreement to conduct the Business Integration through mutual cooperation based on the spirit of equality.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **Summary of the Share Transfer Plan** 

A summary of the Share Transfer Plan is as stated in "Share Transfer Plan (Copy)" below.

**Share Transfer Plan (Copy)**

SATORI ELECTRIC CO., LTD. ("Satori Electric") and Hagiwara Electric Holdings Co., Ltd. ("Hagiwara Electric") have agreed to carry out a share transfer by means of a joint share transfer and have therefore jointly prepared the following share transfer plan (this "Plan").

**Article 1 Share Transfer**

In accordance with the provisions of this Plan, on the Establishment Date (defined in Article 6; hereinafter the same) of the wholly-owning parent company that is to be newly established by means of a joint share transfer (the "New Company"), Satori Electric and Hagiwara Electric shall carry out a share transfer (the "Share Transfer") causing the New Company to acquire all of the issued shares of Satori Electric and Hagiwara Electric, and as a result, Satori Electric and Hagiwara Electric will become wholly-owned subsidiaries of the New Company.

**Article 2 Purpose, Trade Name, Headquarters Location, Total Number of Authorized Shares, and Other Matters to Be Set Forth in the Articles of Incorporation of the New Company**

1. The New Company's purpose, trade name, headquarters location, and total number of authorized shares
shall be as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Purpose

The purpose of the New Company shall be as set forth in Article 2 of the Articles of Incorporation in Exhibit 1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Trade name

The trade name of the New Company shall be MIRAINI HOLDINGS Kabushiki Kaisha, rendered in English as MIRAINI HOLDINGS CO., LTD.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Headquarters location

The location of the headquarters of the New Company shall be Minato-ku, Tokyo, and the address of its headquarters shall be 1-14-10 Shiba, Minato-ku, Tokyo.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Main office addresses

The addresses of the main offices of the New Company shall be 2-2-1 Higashi Sakura, Higashi-ku, Nagoya-shi, Aichi and 1-14-10 Shiba, Minato-ku, Tokyo.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Total number of authorized shares<br>
The total number of authorized shares of the New Company shall be 100,000,000 shares.

2. In addition to the matters listed in the preceding paragraph, the matters to be provided for in the articles
of incorporation of the New Company shall be as set forth in the Articles of Incorporation in Exhibit 1.

**Article 3 Names of the Directors and Financial Auditor Upon Establishment of the New Company**

1. The names of the Directors upon establishment of the New Company (excluding Directors upon establishment
concurrently serving as Audit & Supervisory Committee Members upon establishment) are as follows.

Director upon establishment (planned to be appointed as Representative Director and President): Moritaka Kimura

Director upon establishment (planned to be appointed as Representative Director and Vice President): Hiroyuki Satori

Director upon establishment: Naruhiko Mizukoshi

Director upon establishment: Takeshi Soejima

Director upon establishment: Takuma Oyama

Director upon establishment: Shunji Tsuchiya

Outside Director upon establishment: Akihiro Taguchi

Outside Director upon establishment: Shinichi Okamoto

Outside Director upon establishment: Kyoko Hayashi

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The names of the Directors upon establishment of the New Company who are Audit & Supervisory Committee
Members upon establishment are as follows.

Director (Full-time Audit & Supervisory Committee Member) upon establishment: Noriaki Inoue

Outside Director (Audit & Supervisory Committee Member) upon establishment: Seiji Sakata

Outside Director (Audit & Supervisory Committee Member) upon establishment: Sachiko Enomoto

Outside Director (Audit & Supervisory Committee Member) upon establishment: Akiko Yukimaru

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The name of the financial auditor upon establishment of the New Company is as follows.

KPMG AZSA LLC

**Article 4 Shares to Be Delivered at the Time of the Share Transfer and Their Allocation**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. At the time of the Share Transfer, the New Company shall deliver to the shareholders of Satori Electric
and Hagiwara Electric as of the time immediately prior to the New Company acquiring all issued shares of Satori Electric and Hagiwara
Electric (the "Reference Time"), in exchange for the common shares of Satori Electric and Hagiwara Electric that each shareholder
owns, common shares of the New Company (the "Delivered Shares") in the same number as the total of (i) the number obtained
by multiplying the total number of common shares issued by Satori Electric as of the Reference Time by 1.02 and (ii) the number obtained
by multiplying the total number of common shares issued by Hagiwara Electric as of the Reference Time by 2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The New Company shall allocate the Delivered Shares that are delivered pursuant to the provisions of the
preceding paragraph to the shareholders of Satori Electric and Hagiwara Electric as of the Reference Time in the following proportions
(the "Share Transfer Ratio").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) To shareholders of Satori Electric, 1.02 common shares of the New Company for each common share of Satori
Electric that the shareholder owns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) To shareholders of Hagiwara Electric, 2 common shares of the New Company for each common share of Hagiwara
Electric that the shareholder owns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Any fraction of less than one share in the calculation set forth in the preceding two paragraphs shall
be handled in accordance with the provisions of Article 234 of the Companies Act (Act No. 86 of July 26, 2005, as amended) and other relevant
laws and regulations.

**Article 5 Amounts of the New Company's Stated Capital and Capital Reserves**

The amounts of stated capital and capital reserves on the Establishment Date of the New Company shall be as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Amount of stated capital: 10,000,000,000 yen

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Amount of capital reserves: 2,500,000,000 yen

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Amount of retained earnings reserves: 0 yen

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Amount of other capital surplus: The amount obtained by subtracting the total of the amounts set forth
in (1) and (2) above from the amount of changes in shareholder equity stipulated in Article 52, paragraph (1) of the Regulations for Corporate
Accounting (Ministry of Justice Order No. 12 of 2006, as amended).

**Article 6 New Company Establishment Date**

The date on which the establishment of the New Company is to be registered (referred to as the "Establishment Date" in this Plan) shall be April 1, 2026. However, Satori Electric and Hagiwara Electric may change this by agreement upon consultation if necessary due to the progress of the procedures for the Share Transfer or for other reasons.

**Article 7 General Meetings of Shareholders to Approve the Share Transfer Plan**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Satori Electric shall convene an extraordinary general meeting of shareholders on December 11, 2025 and
seek resolutions regarding the approval of this Plan and matters required for the Share Transfer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Hagiwara Electric shall convene an extraordinary general meeting of shareholders on December 11, 2025
and seek resolutions regarding the approval of this Plan and matters required for the Share Transfer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. If necessary due to the progress of the procedures for the Share Transfer or for any other reason, Satori
Electric and Hagiwara Electric may, upon consultation and agreement, change the date of each general meeting of shareholders seeking resolutions
regarding the approval of this Plan and matters required for the Share Transfer stipulated in the preceding two paragraphs.

**Article 8 Share Listing and Shareholder Register Administrator**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. On the Establishment Date, the New Company plans to list its common shares on the Tokyo Stock Exchange,
Inc. ("TSE") Prime Market and the Nagoya Stock Exchange, Inc. ("NSE") Premier Market, and Satori Electric and
Hagiwara Electric shall, upon consultation, mutually cooperate to the extent possible to carry out the procedures required for such listing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Satori Electric and Hagiwara Electric shall mutually cooperate and carry out necessary procedures to ensure
that the listing of common shares issued by the New Company on the TSE Prime Market and on the NSE Premier Market is maintained.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The shareholder register administrator for the New Company upon establishment will be Sumitomo Mitsui
Trust Bank, Limited.

**Article 9 Dividends of Surplus**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Satori Electric may distribute dividends of surplus (i) up to a maximum of 44 yen per common share to
the common shareholders or registered pledgees of common shares of Satori Electric who are entered or recorded in the final shareholder
register on November 30, 2025 and (ii) up to a maximum of 46 yen per common share to the common shareholders or registered pledgees of
common shares of Satori Electric who are entered or recorded in the final shareholder register on March 31, 2026.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Hagiwara Electric may distribute dividends of surplus (i) up to a maximum of 90 yen per

common share to the common shareholders or registered pledgees of common shares of Hagiwara Electric who are entered or recorded in the final shareholder register on September 30, 2025 and (ii) up to a maximum of 95 yen per common share to the common shareholders or registered pledgees of common shares of Hagiwara Electric who are entered or recorded in the final shareholder register on March 31, 2026.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Except for the cases set forth in the preceding two paragraphs, during the period after the preparation
of this Plan and until the New Company's Establishment Date, Satori Electric and Hagiwara Electric shall not pass a resolution to
distribute dividends of surplus with a record date on or before the New Company's Establishment Date. However, this provision will
not apply if Satori Electric and Hagiwara Electric otherwise agree through consultation.

**Article 10 Handling of Treasury Shares**

After the preparation of this Plan, Satori Electric and Hagiwara Electric shall consult in good faith in regard to the timing, method, and other such matters relating to the disposal of the treasury shares held by each party.

**Article 11 Management of Company Assets, etc.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. During the period after the preparation of this Plan and until the New Company's Establishment Date,
Satori Electric and Hagiwara Electric shall each perform their own business and manage and operate their assets with the due care of a
prudent manager, shall each cause their respective subsidiaries to perform their own business and manage and operate their assets with
the due care of a prudent manager, and except where otherwise set out in this Plan, shall consult and agree in advance before carrying
out or causing to be carried out any act that could have a material impact on their respective assets or rights and obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. During the period after the preparation of this Plan and until the New Company's Establishment Date,
if Satori Electric or Hagiwara Electric discovers events or circumstances that could have a material adverse impact on the execution of
the Share Transfer or the reasonableness of the Share Transfer Ratio, it shall promptly give written notice thereof to the other party,
and the parties shall consult in good faith on the handling thereof.

**Article 12 Effect of this Plan**

This Plan shall lose effect if the general meeting of shareholders of either Satori Electric or Hagiwara Electric set forth in Article 7 does not approve this Plan and resolve the matters necessary for the Share Transfer, if permits, etc. by relevant authorities necessary upon conducting the Share Transfer are not obtained by the New Company's Establishment Date, or if the Share Transfer is suspended pursuant to the following article.

**Article 13 Changes to Share Transfer Conditions and Suspension of the Share Transfer**

During the period after the preparation of this Plan and until the New Company's Establishment Date, if a material change has occurred or if it is discovered that there is an event that has a material impact on the financial or management condition of Satori Electric or Hagiwara Electric, if a situation that would materially impede the execution of the Share Transfer occurs or becomes evident, or if it otherwise becomes significantly difficult to achieve the purpose of this Plan, Satori Electric and Hagiwara Electric may, upon consultation and agreement, change the terms and conditions of the Share Transfer, amend the content of this Plan, or suspend the

Share Transfer.

**Article 14 Matters for Consultation**

In addition to the matters stipulated in this Plan, Satori Electric and Hagiwara Electric shall separately consult on and determine any matters not provided for in this Plan and other matters required for the Share Transfer in accordance with the intent of this Plan.

IN WITNESS WHEREOF, two counterparts of this Plan are prepared, and upon affixing their names and seals thereto, one counterpart will be held by each of Satori Electric and Hagiwara Electric.

October 14, 2025

Satori Electric<br> 1-14-10 Shiba, Minato-ku, Tokyo<br> SATORI ELECTRIC CO., LTD.<br> Representative Director and President: Hiroyuki Satori [seal]

Hagiwara Electric<br> 2-2-1 Higashi Sakura, Higashi-ku, Nagoya-shi, Aichi<br> Hagiwara Electric Holdings Co., Ltd.<br> Representative Director and President Executive Officer: Moritaka Kimura [seal]

Exhibit 1

**Articles of Incorporation**

**Chapter 1 General Provisions**

**Article 1 Trade Name**

The trade name of the Company shall be MIRAINI HOLDINGS Kabushiki Kaisha, rendered in English as MIRAINI HOLDINGS CO., LTD.

**Article 2 Purpose**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The purpose of the Company shall be to control and manage the business activities of companies (including
foreign companies), partnerships (including foreign organizations equivalent to partnerships), and other business entities engaged in
the following businesses by holding the shares or equity, etc. thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Manufacturing, selling, exporting, and importing electronic measurement devices and applied electronic
devices.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Manufacturing, selling, exporting, and importing medical equipment and devices.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Purchasing for sale, exporting, importing, planning, developing, designing, manufacturing, processing,
leasing, and maintaining electronic circuit components.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Developing, designing, manufacturing, processing, purchasing for sale, exporting, importing, leasing,
and maintaining telecommunications equipment, optical communication equipment and devices, applied electronic equipment and devices, electrical
equipment and devices, and devices and wires related to any of the foregoing (including semiconductor devices, integrated circuits, and
other parts and materials used in, and other articles related to, any of the foregoing).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Planning, developing, designing, producing for sale, purchasing for sale, exporting, importing, leasing,
and maintaining computer systems and software.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) Electrical work and telecommunications work.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) Labor dispatch.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(8) Selling and purchasing secondhand goods.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(9) Loaning money, guaranteeing and assuming obligations, selling and purchasing various claims, and other
financial services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(10) Services relating to the planning, design, development, establishment, maintenance, and operation of information
systems.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(11) Services relating to the development of application software using the internet and the sale of licenses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(12) Telecommunications services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(13) Information processing services and information provision services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(14) Consulting relating to the businesses stated in item (3), item (4), item (5), item (12), and
item (13).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(15) Processing, selling, exporting, and importing synthetic resins, other chemical products, and metals.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(16) Any businesses incidental to any of the foregoing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The Company may engage in any of the businesses set out in the items of the preceding paragraph and any
businesses incidental or related thereto.

**Article 3 Location of Headquarters, etc.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The headquarters of the Company shall be located in Minato-ku, Tokyo.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. In addition to the headquarters stated in the preceding paragraph, the Company shall have its main offices
in Nagoya-shi, Aichi and Minato-ku, Tokyo.

**Article 4 Establishment of Organs**

In addition to the general meetings of shareholders and Directors, the Company shall establish the following organs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Board of Directors

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Audit & Supervisory Committee

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Financial auditor

**Article 5 Method of Public Notices**

The Company shall provide its public notices electronically. However, if the Company is unable to provide electronic public notices due to an accident or other unavoidable circumstances, the Company shall publish its public notices in the Nihon Keizai Shimbun.

**Chapter 2 Shares**

**Article 6 Total Number of Authorized Shares**

The total number of authorized shares of the Company shall be 100,000,000 shares.

**Article 7 Number of Shares in a Share Unit**

The number of shares in a share unit of the Company shall be 100 shares.

**Article 8 Rights Pertaining to Shares of Less than One Share Unit**

Shareholders of the Company shall not be entitled to exercise any rights other than those stated below in regard to any shares of less than one share unit held thereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The rights stated in each item of Article 189, paragraph (2) of the Companies Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) The right to make a demand pursuant to the provisions of Article 166, paragraph (1) of the Companies
Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) The right to receive an allotment of shares for subscription or share options for subscription in proportion
to the number of shares owned by the shareholder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) The right to make a demand set out in Article 11.

**Article 9 Share Handling Regulations**

The handling of the shares of the Company shall be governed by the Share Handling Regulations established by the Board of Directors.

**Article 10 Shareholder Register Administrator**

The Company shall have a shareholder register administrator.

**Article 11 Demand for Sale of Additional Shares**

Shareholders who hold shares of less than one share unit may demand the Company to sell additional shares to them in the number that will equal one share unit when totaled with the shares of less than one share unit held by the shareholder.

**Chapter 3 General Meetings of Shareholders**

**Article 12 Record Date**

The shareholders recorded in the shareholder register on March 31 of each year shall be entitled to exercise rights at the Ordinary General Meeting of Shareholders of that year.

**Article 13 Timing of Convocation**

An Ordinary General Meeting of Shareholders of the Company shall be convened in June of each year. Extraordinary general meetings of shareholders shall be convened whenever necessary.

**Article 14 Convener and Chairperson**

General meetings of shareholders of the Company shall be convened and chaired by the Director who is President and Executive Officer. If that Director is unable to do so, another Director in the order determined in advance by the Board of Directors shall convene and chair the meeting.

**Article 15 Resolution Requirements**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Unless otherwise provided for in laws and regulations or these Articles of Incorporation, the passage
of a resolution of a general meeting of shareholders shall require approval by a majority of the voting rights of the attending shareholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The passage of a resolution of a general meeting of shareholders pursuant to Article 309, paragraph (2)
of the Companies Act shall require (i) the attendance of shareholders holding one third or more of the voting rights of all shareholders
entitled to vote and (ii) approval by a majority of two thirds or more of the voting rights of the attending shareholders.

**Article 16 Measures for Electronic Provision, etc.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. When convening a general meeting of shareholders, the Company shall take measures to electronically provide
information contained in the general meeting of shareholders reference documents and other such documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. In regard to the matters for which electronic provisions measures will be taken that are set out in a
Ministry of Justice order, the Company may choose not to state all or some of those matters in the documents to be delivered to shareholders
who requested the delivery of documents by the record date for voting rights.

**Article 17 Proxy Exercise of Voting Rights**

Shareholders may exercise their voting rights through a proxy who is another shareholder with voting rights in the Company. In this case, the shareholder or the proxy must submit a document certifying the right of proxy to the Company for each general meeting of shareholders.

**Chapter 4 Directors and the Board of Directors** 

**Article 18 Number of Directors**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The Company shall have 15 or fewer Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Of the Directors set out in the preceding paragraph, five or fewer shall be Directors concurrently serving
as Audit & Supervisory Committee Members.

**Article 19 Election**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The election of a Director shall require (i) the attendance at a general meeting of shareholders of shareholders
holding one third or more of the voting rights of all shareholders entitled to vote and (ii) approval by a majority of the voting rights
of the attending shareholders. However, Directors concurrently serving as Audit & Supervisory Committee Members shall be elected separately
from other Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Cumulative voting shall not be used when electing Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The election of reserve Directors concurrently serving as Audit & Supervisory Committee Members shall
be effective until the start of the Ordinary General Meeting of Shareholders pertaining to the final business year to end within two years
following their election.

**Article 20 Term of Office**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The term of office of Directors (excluding Directors concurrently serving as Audit & Supervisory Committee
Members) shall be until the close of the Ordinary General Meeting of Shareholders pertaining to the final business year to end within
one year following their election.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The term of office of Directors concurrently serving as Audit & Supervisory Committee Members shall
be until the close of the Ordinary General Meeting of Shareholders pertaining to the final business year to end within two years following
their election.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The term of office of a Director concurrently serving as an Audit & Supervisory Committee Member and
who was elected as a reserve to fill a vacancy left by a Director concurrently serving as an Audit & Supervisory Committee Member
leaving office before the completion of his or her term shall be until the completion of the term of the Director concurrently serving
as an Audit & Supervisory Committee Member who left office.

**Article 21 Representative Directors**

The Board of Directors shall appoint several Representative Directors from among the Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members).

**Article 22 Board of Directors**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Unless otherwise provided for in laws and regulations, Board of Directors meetings shall be convened and
chaired by the Director determined in advance by the Board of Directors. If that Director is unable to do so, another Director in the
order determined in advance by the Board of Directors shall convene and chair the meeting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Notice of the convocation of a Board of Directors meeting shall be sent to each Director at least three
days before the date of the meeting. However, this period may be shortened in urgent cases.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. If all of the Directors so consent, a Board of Directors meeting may be held without following the convocation
procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. If a Director proposes a matter to be resolved on by the Board of Directors, and all of the Directors
entitled to participate in the vote regarding that resolution express their consent in writing or by electronic or magnetic means, a Board
of Directors resolution approving that proposal shall be deemed to have been passed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Matters relating to the operation of the Board of Directors and other such matters shall be governed by
the Board of Directors Regulations established by the Board of Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. Pursuant to the provisions of Article 399-13, paragraph (6) of the Companies Act, the Company may delegate
all or part of the decisions regarding the execution of important operations (excluding the matters stated in the items of paragraph (5)
of that article) to the Directors by a Board of Directors resolution.

**Article 23 Executive Officers**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. By a Board of Directors resolution, the Company may appoint executive officers and cause them to execute
the operations of the Company assigned to them.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. By a Board of Directors resolution, the Board of Directors may appoint a President and Executive Officer
and other executive officers with titles from among the executive officers.

**Chapter 5 Audit & Supervisory Committee**

**Article 24 Audit & Supervisory Committee**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Notice of the convocation of an Audit & Supervisory Committee meeting shall be sent to each Audit
& Supervisory Committee Member at least three days before the date of the meeting. However, this period may be shortened in urgent
cases.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. If all of the Audit & Supervisory Committee Members so consent, an Audit & Supervisory Committee
meeting may be held without following the convocation procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Matters relating to the operation of the Audit & Supervisory Committee and other such matters shall
be governed by the Audit & Supervisory Committee Regulations established by the Audit & Supervisory Committee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. By an Audit & Supervisory Committee resolution, the Audit & Supervisory Committee may appoint
full-time Audit & Supervisory Committee Members.

**Chapter 6 Director Liability Exemption**

**Article 25 Director Liability Exemption**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Pursuant to the provisions of Article 426, paragraph (1) of the Companies Act, the Company may, by a Board
of Directors resolution, exempt Directors (including former Directors) from liability for damages up to the maximum exemption amount set
out in laws and regulations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Pursuant to the provisions of Article 427, paragraph (1) of the Companies Act, the Company may enter into
agreements with Directors (excluding Directors who are executive Directors, etc.) limiting their liability for damages. However, the maximum
amount of liability under such agreements shall be the amount set out in laws and regulations.

**Chapter 7 Accounting**

**Article 26 Business Year**

The business year of the Company shall be from April 1 of each year until March 31 of the following year.

**Article 27 Dividends of Surplus, etc.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The Company may pay year-end dividends to the shareholders or registered pledgees of shares recorded in
the shareholder register on the last day of each business year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. In addition to the preceding paragraph, the Company may pay interim dividends to the shareholders or registered
pledgees of shares recorded in the shareholder register on September 30 of each year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. In addition to the preceding two paragraphs, the Company may pay other dividends of surplus after establishing
a reference date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Unless otherwise provided for in laws and regulations, the Company shall determine the payment of dividends
of surplus and other matters set out in the items of Article 459, paragraph (1) of the Companies Act by a Board of Directors resolution.

**Article 28 Limitation of Dividend Payment Period**

If dividends of surplus are not collected after three years have passed from the date on which payment commenced, the Company shall be released from its obligation to pay those dividends.

**Supplementary Provisions**

**Article 1 Representative Directors Upon Establishment**

The Company's Representative Directors upon establishment shall be as follows.

Representative Director upon establishment: Moritaka Kimura

Representative Director upon establishment: Hiroyuki Satori

**Article 2 Initial Compensation, etc. for Directors**

The amount of compensation, etc. for the Company's Directors for the period from the establishment date of the Company until the close of its first Ordinary General Meeting of Shareholders shall be as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Monetary compensation, etc. for Directors (excluding Directors concurrently serving as Audit & Supervisory
Committee Members)

The total amount of compensation, etc. shall be 800,000,000 yen or less annually (however, excluding the employee salaries of employees who are also Directors).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Compensation, etc. for Directors concurrently serving as Audit & Supervisory Committee Members

The total amount of compensation, etc. shall be 280,000,000 yen or less annually.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Monetary compensation claims issued in order to grant restricted stock

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. Allotment of and payment for restricted stock

The Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors; the "Eligible Directors") shall, as an in-kind investment, pay all of the monetary compensation claims issued pursuant to a resolution of the Company's Board of Directors and receive an allotment of the Company's common shares ("Restricted Stock").

The paid-in amount for Restricted Stock shall be determined by the Company's Board of Directors within an extent that is not particularly favorable to the Eligible Directors based on the closing price of the Company's common shares on the Tokyo Stock Exchange on the business day preceding the date of the resolution of the Company's Board of Directors regarding the issuance or disposal of the Restricted Stock (if no shares were traded on that day, then the closing price of the nearest preceding day on which shares were traded). In addition, the monetary compensation claims shall be issued on the condition that the Eligible Directors consent to making that in-kind investment and enter into the restricted stock allotment agreement set out in D below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. Amount of monetary compensation claims to be issued to the Eligible Directors

The amount of monetary compensation claims to be issued to the Eligible Directors in order to grant Restricted Stock shall be within the annual amount of compensation stated in "(1) Monetary compensation, etc. for Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members)" and shall be 200,000,000 yen or less annually.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. Total number of shares of Restricted Stock

The total number of shares of Restricted Stock to be allotted to the Eligible Directors in each business year shall be limited to a maximum of 200,000 shares. However, if a share split (including a gratis allotment of shares) or share consolidation is performed in regard to the Company's common shares or if it is otherwise necessary to adjust the total number of shares of Restricted Stock to be allotted to the Eligible Directors, the Company may make reasonable adjustments thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. Details of the restricted stock allotment agreement

When allotting Restricted Stock, the Company shall, pursuant to a resolution of its Board of Directors, enter into a restricted stock allotment agreement with the Eligible Directors who will receive allotments of Restricted Stock containing the content summarized below (shares of Restricted Stock allotted to those Eligible Directors are hereinafter referred to as "Allotted Shares").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Details of transfer restriction

Eligible Directors who receive an allotment of Restricted Stock shall not be entitled to transfer to a third party, establish a pledge on, establish a right of security by assignment (*joto tanpo*) on, make an *inter vivos* gift of, bequeath, or otherwise dispose of the Allotted Shares for 30 years following the day on which the allotment was received (the "Transfer Restriction Period"; this restriction is hereinafter referred to as the "Transfer Restriction").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Acquisition of Restricted Stock without charge

If an Eligible Director who has been allotted the restricted stock resigns or retires from their office as a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer thereof, a Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer of its subsidiaries, or any other position designated by the Board of Directors of the Company from the commencement date of the Transfer Restriction Period until the day immediately before the date of the Company's first Ordinary General Meeting of Shareholders to be held after such commencement date, the Company shall naturally acquire all of the Allotted Shares without charge, unless there are reasons that the Board of Directors of the Company deems to be justifiable. Furthermore, if, at the time of the expiration of the Transfer Restriction Period, there are any Allotted Shares for which the Transfer Restriction has not been lifted pursuant to the provisions of (c) below, the Company shall naturally acquire all the Allotted Shares without charge. However, if, during the Transfer Restriction Period, a merger agreement under which the Company is to become a disappearing company, a share exchange agreement or a share transfer plan under which the Company is to become a wholly owned subsidiary, or any other proposal relating to organizational restructuring, etc. is approved at a general meeting of shareholders of the Company (however, if such organizational restructuring, etc. does not require approval at a general meeting of shareholders of the Company, the Board of Directors of the Company) and if, in such organizational restructuring, etc., a corporation other than the Company subject to such organizational restructuring, etc. delivers shares of such corporation (limited to shares that are equivalent to shares with restriction on transfer) to Eligible Directors, the Company shall not acquire the Allotted Shares without charge.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Lifting of Transfer Restriction

The Company shall lift the Transfer Restriction of all the Allotted Shares upon the expiration of the Transfer Restriction Period on the condition that an Eligible Director who has been allotted the restricted

stock has continuously held the position of a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer thereof, a Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer of its subsidiaries, or any other position designated by the Board of Directors of the Company from the commencement date of the Transfer Restriction Period until the date of the Company's first Ordinary General Meeting of Shareholders to be held after such commencement date. However, if such Eligible Director resigns or retires from their office as a Director of the Company (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer thereof, a Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members, and Outside Directors) or an executive officer of its subsidiaries, or any other position designated by the Board of Directors of the Company prior to the expiration of the Transfer Restriction Period for reasons that the Board of Directors of the Company deems to be justifiable, the number of the Allotted Shares for which the Transfer Restriction will be lifted and the timing of such lifting shall be reasonably adjusted as necessary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Handling of organizational restructuring, etc.

If, during the Transfer Restriction Period, a merger agreement under which the Company is to become a disappearing company, a share exchange agreement or a share transfer plan under which the Company is to become a wholly owned subsidiary, or any other proposal relating to organizational restructuring, etc. is approved at a general meeting of shareholders of the Company (however, if such organizational restructuring, etc. does not require approval at a general meeting of shareholders of the Company, the Board of Directors of the Company), the Company shall, by a resolution of the Board of Directors of the Company, lift the Transfer Restriction of the Allotted Shares in a number reasonably determined based on the period from the commencement date of the Transfer Restriction Period to the date of approval of such organizational restructuring , etc., prior to the effective date of such organizational restructuring, etc.

In such a case, the Company shall naturally acquire the Allotted Shares for which the Transfer Restriction has not been lifted at the time immediately following the lifting of the Transfer Restriction in accordance with the above provisions. Provided, however, if, in such organizational restructuring, etc., a corporation other than the Company subject to such organizational restructuring, etc. delivers shares of such corporation (limited to shares that are equivalent to restricted stock) to the Eligible Directors, the Company will not lift the Transfer Restriction of the Allotted Shares nor acquire the Allotted Shares without charge.

**Article 3 Assumption of Contractual Status Relating to Restricted Stock**

On April 1, 2026, the Company shall assume the contractual status and rights and obligations of Hagiwara Electric Holdings Co., Ltd. under the allotment agreement pertaining to the

restricted stock delivered pursuant to the restricted stock compensation plan approved at the 61st Ordinary General Meeting of Shareholders of Hagiwara Electric Holdings Co., Ltd. held on June 28, 2018.

**Article 4 Deletion of Supplementary Provisions**

Article 1 through Article 3 of these supplementary provisions shall be deleted upon the close of the Company's first Ordinary General Meeting of Shareholders.

**3.** **Matters Relating to the Appropriateness of Provisions Regarding the Matters Stated in Article 773, Paragraph (1), Items (v) and (vi) of the Companies Act** 

(1) Matters Relating to the Allotment of Shares of the Joint Holding Company to Be Delivered to the Shareholders
of the Companies by the Joint Holding Company Upon the Share Transfer

(i) Content of Allotment Pertaining to the Share Transfer (Share Transfer Ratio)

The Companies have determined that the allotment ratio of common shares of the Joint Holding Company to be allotted and delivered to the shareholders of each of the Companies upon the establishment of the Joint Holding Company through the Share Transfer (the "Share Transfer Ratio") shall be as follows.

Company name <u>The Company</u> <u>Hagiwara Electric</u> <br> <u>Share Transfer Ratio</u> <u>1.02</u> <u>2</u>

(Note 1) Details of the Share Allotment pertaining to the Share Transfer

For each common share of the Company, 1.02 common shares of the Joint Holding Company shall be allotted and delivered; and for each common share of Hagiwara Electric, two common shares of the Joint Holding Company shall be allotted and delivered. In the event that any fractional shares of the Joint Holding Company arise as a result of the Share Transfer, the amount of money corresponding to such fractional shares will be paid to the relevant shareholders, in accordance with Article 234 of the Companies Act and other applicable laws and regulations; provided, however, that the above Share Transfer Ratio may be subject to change upon mutual consultation between the Companies, if there is any material change in the conditions that form the basis of the valuation thereof or if any material discrepancy is found.

(Note 2) The share unit of the Joint Holding Company shall be 100 shares.

(Note 3) Number of new shares to be delivered by the Joint Holding Company (scheduled)

Common shares: 35,481,762 shares

The above number is based on the total number of issued shares of the Company as of August 31, 2025 (14,946,826 shares), and the total number of issued shares of Hagiwara Electric as of September 30, 2025 (10,118,000 shares).

(Note 4) Handling of Shares Less Than One Unit

Shareholders of the Companies who receive an allotment of shares of the Joint Holding Company constituting less than one unit (100 shares) ("Shares Less Than One Unit") in the Share Transfer will not be able to sell the Shares Less Than One Unit that they hold on the Tokyo Stock Exchange or other financial instruments exchanges. However, such shareholders may demand that the Joint Holding Company purchase the Shares Less Than One Unit that they hold in accordance with the provision of Article 192, paragraph (1) of the Companies Act.

Additionally, it is planned that provisions will be set forth in the articles of incorporation of the Joint Holding Company to the effect that the shareholders

may demand that the Joint Holding Company sell them a sufficient number of shares to constitute one share unit when combined with the Shares Less Than One Unit that they hold. Therefore, pursuant to such provision of the articles of incorporation and the provision of Article 194, paragraph (1) of the Companies Act, the shareholders will be able to demand that the Joint Holding Company sell them a sufficient number of shares to constitute one share unit when combined with the Shares Less Than One Unit that they hold.

(ii) Grounds and Reasons for the Content of the Allotment Pertaining to the Share Transfer

To ensure the fairness of the Share Transfer Ratio in the Share Transfer and to otherwise ensure the fairness of the Share Transfer, the Company appointed Daiwa Securities Co. Ltd. ("Daiwa Securities") as a third-party appraiser and TMI Associates as its legal advisor. Meanwhile, Hagiwara Electric appointed SMBC Nikko Securities Inc.("SMBC Nikko") as a third-party appraiser and Mori Hamada & Matsumoto LPC ("Mori Hamada") as its legal advisor.

The Companies have requested their respective third-party appraisers to perform a valuation on the Share Transfer Ratio to be used in the Share Transfer. Based on the valuation results provided by the respective third-party appraisers and advice from their respective legal advisors, and after comprehensively considering their respective financial conditions, asset status, future outlook, and other factors, the Companies engaged in multiple rounds of careful negotiations and consultations concerning the Share Transfer Ratio. As a result, the Companies determined that the Share Transfer Ratio set forth in "(i) Content of Allotment Pertaining to the Share Transfer (Share Transfer Ratio)" above is appropriate. Accordingly, at the respective Board of Directors meetings held on July 28, 2025, the Companies resolved to approve the Share Transfer Ratio and execute the MOU, and the MOU was duly executed.

The Companies have confirmed that, with respect to the basis for calculating the Share Transfer Ratio stated above, no material change that affects the Share Transfer Ratio stated above occurred after the execution of the MOU and agreed on the Share Transfer Ratio stated above in the Business Integration Agreement dated October 14, 2025 and the Share Transfer Plan.

(iii) Matters Related to the Valuation

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Names of appraisers and their relationship with the Companies

Neither Daiwa Securities, as the third-party appraiser for the Company, nor SMBC Nikko, as the third-party appraiser for Hagiwara Electric, is a related party of the Companies, and neither SMBC Nikko nor Daiwa Securities has any material interest in connection with the Share Transfer which needs to be stated. The fees to be paid to Daiwa Securities and SMBC Nikko in relation to the Share Transfer include fixed fees to be paid irrespective of whether the Share Transfer is successful or unsuccessful and contingency fees to be paid subject to the completion of the Share Transfer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Summary of valuation

In order to ensure the fairness of the valuation of the Share Transfer Ratio to be used in the Share Transfer, the Company appointed Daiwa Securities as its third-party appraiser, and Hagiwara Electric appointed SMBC Nikko as its third-party appraiser, following which each of the Companies requested its appraiser to conduct a valuation and analysis of the Share Transfer Ratio.

Daiwa Securities conducted the valuation employing the market share price method, since

the Companies have listed their shares on financial instruments exchanges and their market share prices are available. Additionally, Daiwa Securities employed the comparable company method, since there are multiple listed companies comparable to the Companies and it is therefore possible to estimate the share value by comparing similar companies. Furthermore, Daiwa Securities employed the DCF method in order to reflect the status of future business activities in the valuation.

The results of the valuation under each of the above methods are as follows. The figures below represent the results of the valuation of the number of common shares of the Joint Holding Company to be allotted per common share of the Company when allotting two common shares of the Joint Holding Company for one common share of Hagiwara Electric.

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| | |
|:---|:---|
| &nbsp;&nbsp;Methods employed | &nbsp;&nbsp;Valuation range of the Share Transfer Ratio |
| &nbsp;&nbsp;Market share price method | &nbsp;&nbsp;1.01 - 1.04 |
| &nbsp;&nbsp;Comparable listed company method | &nbsp;&nbsp;0.65 - 1.54 |
| &nbsp;&nbsp;DCF method | &nbsp;&nbsp;0.72 - 1.37 |

---

The market share price method was conducted with the valuation reference date set as July 25, 2025, by employing the closing price on the Tokyo Stock Exchange on the valuation reference date and the simple average of the closing prices on the Tokyo Stock Exchange for each period of the past one month, three months, and six months immediately preceding the valuation reference date, respectively.

Under the DCF method, the corporate value is calculated by discounting future cash flows, etc. (which are expected to be generated based on the financial forecasts prepared by the Companies) to present value at a certain discount rate. The financial forecast of the Company which the calculation was based on does not include a fiscal year in which a substantial increase or decrease in profit is expected; however, the financial forecast of Hagiwara Electric does include such a fiscal year in which a substantial increase or decrease in the profit from the previous fiscal year is expected. Specifically, during the fiscal year ending March 31, 2027, a substantial increase in the operating profits from the previous fiscal year is expected due to an increase in net sales resulting from expanded sales in the engineering business that supports the utilization of software for mobility systems and in high value added devices, as well as due to a recovery of the gross profit margin resulting from a rebound from worsened profits caused by currency exchange fluctuations and certain low-profit projects.

In calculating the Share Transfer Ratio, Daiwa Securities, in principle, used the information provided by the Companies as well as information, etc. available to the general public. Daiwa Securities relied on the assumption that all such materials and information, etc. were accurate and complete and did not independently verify their accuracy and completeness. In addition, Daiwa Securities did not conduct any independent valuation, appraisal, or assessment of the assets and liabilities of the Companies and their associated companies (including off-balance sheet assets and liabilities and other contingent liabilities), nor did it request a third-party appraiser to conduct any valuation, appraisal, or assessment. Furthermore, Daiwa Securities assumed that the information concerning the financial forecasts of the Companies (including the profit plans and other information) was reasonably prepared by the respective managements of the Companies based on the best forecasts and judgments as at the time

such information was provided.

Meanwhile, SMBC Nikko conducted the valuation employing the market share price method, since the shares of the Company are listed on the Prime Market of the Tokyo Stock Exchange, and the shares of Hagiwara Electric are listed on the Prime Market of the Tokyo Stock Exchange and the Premier Market of the Nagoya Stock Exchange, and each of their market share prices is available. Additionally, SMBC Nikko employed the comparable listed company method, since there are multiple listed companies that are engaged in businesses relatively comparable to the Company and Hagiwara Electric, and it is therefore possible to infer the share value by comparing similar listed companies. Furthermore, the discounted cash flow (DCF) method was employed to evaluate the intrinsic value based on the status of the Company's and Hagiwara Electric's future business activities.

The valuation results under each of the above methods are as follows. The valuation range of the Share Transfer Ratio below represents the valuation results of the number of common shares of the Joint Holding Company to be allotted per common share of the Company when allotting two common shares of the Joint Holding Company for one common share of Hagiwara Electric.

---

| | |
|:---|:---|
| &nbsp;&nbsp;Methods employed | &nbsp;&nbsp;Valuation range of the Share Transfer Ratio |
| &nbsp;&nbsp;Market share price method | &nbsp;&nbsp;1.01 - 1.03 |
| &nbsp;&nbsp;Comparable company method | &nbsp;&nbsp;0.87 - 1.75 |
| &nbsp;&nbsp;DCF method | &nbsp;&nbsp;0.53 - 1.16 |

---

The market share price method was conducted for the Company and Hagiwara Electric with the valuation reference date set as July 25, 2025, by employing the simple average of the closing prices (rounded to the nearest yen) on the Prime Market of the Tokyo Stock Exchange for the period of one month, three months, and six months immediately preceding the valuation reference date, respectively, and the range of the Share Transfer Ratio was calculated as specified above based on the results of each such evaluation.

In calculating the Share Transfer Ratio, SMBC Nikko, in principle, used the information provided by the Company and Hagiwara Electric and information, etc. available to the general public. SMBC Nikko relied on the assumption that all such materials and information, etc. were accurate and complete and did not independently verify their accuracy and completeness. In addition, SMBC Nikko did not conduct any independent valuation, appraisal, or assessment of the assets and liabilities of the Company and Hagiwara Electric and their associated companies (including off-balance sheet assets and liabilities and other contingent liabilities), nor did it request a third-party appraiser to conduct any valuation, appraisal, or assessment. Furthermore, SMBC Nikko assumed that the information concerning the financial forecasts of the Company and Hagiwara Electric (including the profit plans and other information) was reasonably prepared by the respective managements of the Company and Hagiwara Electric based on the best forecasts and judgments as at the time such information was provided.

In addition, the business plans of the Company and Hagiwara Electric, which SMBC Nikko used as a basis for its valuation under the DCF method, do not incorporate any synergy effects to be achieved as a result of the Business Integration. Moreover, the business plan of Hagiwara Electric for the fiscal years ending March 31, 2026 through March 31, 2028, which SMBC Nikko used as a basis for its valuation under the DCF

method, includes fiscal years in which substantial fluctuations in profit are anticipated compared to the previous fiscal year. Specifically, for the fiscal year ending March 31, 2027, a substantial increase in operating income is anticipated compared to the previous fiscal year, driven by revenue growth in the electronic devices business due to the acquisition of new projects and, in the technology solutions business, by steady demand for DX investment as well as an acceleration in the transition to a high value-added business model centered on data utilization.

(iv) Measures to Ensure Fairness

The Company has taken the following measures to ensure the fairness of the Share Transfer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Procurement of a share transfer ratio valuation report from an independent third-party appraiser

As stated in "(ii) Grounds and Reasons for the Content of the Allotment Pertaining to the Share Transfer" above, in order to ensure the fairness and appropriateness of the Share Transfer, the Company has appointed Daiwa Securities as an independent third-party appraiser and has obtained a share transfer ratio valuation report to serve as the basis for the agreement on the Share Transfer Ratio in the Share Transfer. In addition, the Company has engaged in negotiations and consultations with Hagiwara Electric, with reference to the analysis and advice of Daiwa Securities as a financial advisor and third-party appraiser, and the Company resolved at its Board of Directors meeting held on July 28, 2025 to carry out the Share Transfer based on the Share Transfer Ratio stated in "(i) Content of Allotment Pertaining to the Share Transfer (Share Transfer Ratio)" above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Advice from independent law firm

In order to ensure the fairness and appropriateness of decision making by its Board of Directors, the Company has obtained legal advice from TMI Associates, a legal advisor independent from the Companies, regarding matters such as procedures for the Share Transfer and decision-making methods and processes to be undertaken by the Company. TMI Associates is not a related party of the Companies and does not have any material interest in connection with the Business Integration which needs to be stated.

Meanwhile, Hagiwara Electric has taken the following measures to ensure the fairness of the Share Transfer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Procurement of a share transfer ratio valuation report, etc. from an independent third-party appraiser

As stated in "(ii) Grounds and Reasons for the Content of the Allotment Pertaining to the Share Transfer" above, in order to ensure the fairness and appropriateness of the Share Transfer, Hagiwara Electric has appointed SMBC Nikko as an independent third-party appraiser and has obtained a share transfer ratio valuation report to serve as the basis for the agreement on the Share Transfer Ratio in the Share Transfer. In addition, Hagiwara Electric has engaged in negotiations and consultations with the Company, with reference to the analysis and advice of SMBC Nikko as a financial advisor and third-party appraiser, and Hagiwara Electric resolved at its Board of Directors meeting held on July 28, 2025 to carry out the Share Transfer based on the Share Transfer Ratio stated in "(i) Content of Allotment Pertaining to the Share Transfer (Share Transfer Ratio)" above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Advice from independent law firm

In order to ensure the fairness and appropriateness of decision making by its Board of Directors, Hagiwara Electric has obtained legal advice from Mori Hamada, a legal advisor

independent from the Companies, regarding matters such as procedures for the Share Transfer and decision-making methods and processes to be undertaken by Hagiwara Electric. Mori Hamada is not a related party of the Companies and does not have any material interest in connection with the Business Integration which needs to be stated.

(v) Matters relating to application for listing of Joint Holding Company, etc.

The Companies plan to apply for a technical listing of the common shares of the Joint Holding Company to be newly established on the Tokyo Stock Exchange and Nagoya Stock Exchange. The scheduled listing date is April 1, 2026. As the Companies will become wholly-owned subsidiaries of the Joint Holding Company as a result of the Share Transfer, the shares of The Company are scheduled to be delisted from the Tokyo Stock Exchange, and the shares of Hagiwara Electric are scheduled to be delisted from the Tokyo Stock Exchange and the Nagoya Stock Exchange, respectively, on March 30, 2026, prior to the listing of the shares of the Joint Holding Company. The date of the delisting will be determined pursuant to the respective rules of the Tokyo Stock Exchange and the Nagoya Stock Exchange.

(vi) Measures to Avoid Conflicts of Interest

No special measures have been taken in connection with the Share Transfer as there are no particular conflicts of interest between the Companies.

(2) Matters Relating to the Amounts of Stated Capital and Capital Reserves of the Joint Holding Company

The Companies have determined that the amounts of the stated capital and capital reserves of the Joint Holding Company upon its establishment through the Share Transfer shall be as follows.

(i) Amount of stated capital: 10,000,000,000 yen

(ii) Amount of capital reserves: 2,500,000,000 yen

(iii) Amount of retained earnings reserves: 0 yen

(iv) Amount of other capital surplus: The amount obtained by subtracting the total of the amounts set forth
in (i) and (ii) above from the amount of changes in shareholder equity stipulated in Article 52, paragraph (1) of the Regulations for
Corporate Accounting.

The Companies held discussions and determined the above amounts of stated capital and capital reserves within the scope of the provisions of Article 52 of the Regulations for Corporate Accounting after comprehensively taking into account and considering the size of the Joint Holding Company and other various factors.

**4.** **Matters Relating to the Appropriateness of Provisions Regarding the Matters Stated in Article 773, Paragraph (1), Items (ix) and (x) of the Companies Act** 

There are no applicable matters.

**5.** **Matters Relating to Hagiwara Electric** 

(1) Details of Financial Statements, etc. for Most Recent Business Year (Fiscal Year Ended March 31, 2025)

The details of the financial statements, etc. of Hagiwara Electric for the fiscal year ended March 31, 2025 are not stated in these reference documents pursuant to the provisions of laws and regulations and Article 14, paragraph 2 of the Company's Articles of Incorporation as they are

available on the Company's website (https://www.satori.co.jp/ir/stock/meeting.html) and the website of the Tokyo Stock Exchange.

(2) Details of Events Having a Material Impact on the Status of Company Assets That Occurred After the Last
Day of the Most Recent Business Year

There are no applicable matters.

**6.** **Details of Events Pertaining to the Company Having a Material Impact on the Status of Company Assets That Occurred After the Last Day of the Most Recent Business Year** 

There are no applicable matters.

**7.** **Matters Set Out in Article 74 of the Regulations for Enforcement of the Companies Act Regarding Persons Who Will Be Directors (Excluding Persons Who Will Be Directors Concurrently Serving as Audit & Supervisory Committee Members) of the Wholly-Owning Parent Company Established Through the Share Transfer** 

The persons who will be Directors (excluding Directors concurrently serving as Audit & Supervisory Committee Members) of the Joint Holding Company are as follows.

---

| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Hagiwara Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Jan. 2007 | &nbsp;&nbsp;Joined Oracle Corporation Japan |  |
|  | &nbsp;&nbsp;Jan. 2011 | &nbsp;&nbsp;Joined Hagiwara Electric Co., Ltd., Department Manager of Overseas Department |  |
|  | &nbsp;&nbsp;Apr. 2011 | &nbsp;&nbsp;President and CEO of Hagiwara America, Inc. |  |
|  | &nbsp;&nbsp;Oct. 2012 | &nbsp;&nbsp;Managing Director of Hagiwara Electric Europe GmbH |  |
|  | &nbsp;&nbsp;July 2014 | &nbsp;&nbsp;General Manager of 1st Electron Devices Division of Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;June 2015 | &nbsp;&nbsp;Executive Officer of Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2018 | &nbsp;&nbsp;Director of Hagiwara Electronics Co., Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2020 | &nbsp;&nbsp;Managing Executive Officer of Hagiwara Electric Holdings Co., Ltd. <br> Director of Hagiwara Techno Solutions Co., Ltd. |  |
| &nbsp;&nbsp;Moritaka Kimura <br> (January 30, 1967) | &nbsp;&nbsp;June 2020 | &nbsp;&nbsp;Director of Hagiwara Electric Holdings Co., Ltd. <br> Supervising Corporate Planning Division of Hagiwara Electric Holdings Co., Ltd. | &nbsp;&nbsp; (1) - shares<br> (2) 11,128 shares<br> (3) 22,256 shares |
|  | &nbsp;&nbsp;June 2021 | &nbsp;&nbsp;President and Representative Director of Hagiwara Electric Holdings Co., Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2022 | &nbsp;&nbsp;Supervising Corporate Strategy Division of Hagiwara Electric Holdings Co., Ltd. (current position) |  |
|  | &nbsp;&nbsp;June 2023 | &nbsp;&nbsp;Supervising Internal Audit Office of Hagiwara Electric Holdings Co., Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2024 | &nbsp;&nbsp;Supervising Internal Auditing Department of Hagiwara Electric Holdings Co., Ltd. (current position) |  |
|  | &nbsp;&nbsp;Apr. 2025 | &nbsp;&nbsp;Representative Director, President Executive Officer of Hagiwara Electric Holdings Co., Ltd. (current position) Supervising Accounting & Finance Division of Hagiwara Electric Holdings Co., Ltd. (current position) |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Moritaka Kimura has many years of work experience in the device business and has been promoting initiatives related to new business as Director of business companies. He has been demonstrating his excellent leadership in promoting the new medium-term management plan since assuming the office of President and Representative Director of Hagiwara Electric. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Moritaka Kimura has many years of work experience in the device business and has been promoting initiatives related to new business as Director of business companies. He has been demonstrating his excellent leadership in promoting the new medium-term management plan since assuming the office of President and Representative Director of Hagiwara Electric. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Moritaka Kimura has many years of work experience in the device business and has been promoting initiatives related to new business as Director of business companies. He has been demonstrating his excellent leadership in promoting the new medium-term management plan since assuming the office of President and Representative Director of Hagiwara Electric. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Moritaka Kimura has many years of work experience in the device business and has been promoting initiatives related to new business as Director of business companies. He has been demonstrating his excellent leadership in promoting the new medium-term management plan since assuming the office of President and Representative Director of Hagiwara Electric. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. |

---

---

| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Hagiwara Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Sep. 1995 | &nbsp;&nbsp;Joined SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2002 | &nbsp;&nbsp;Director in charge of Overseas Business of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2005 | &nbsp;&nbsp;Director in charge of Greater China Business of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2007 | &nbsp;&nbsp;Managing Director, Head of Asia Business of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2008 | &nbsp;&nbsp;Director and Managing Executive Officer, Head of Overseas Business of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;June 2009 | &nbsp;&nbsp;Director and Managing Executive Officer, Head of Sales Promotion Business Unit in charge of Sales Promotion of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;June 2011 | &nbsp;&nbsp;Director and Senior Managing Executive Officer, Head of Sales in charge of Corporate Planning of SATORI ELECTRIC CO., LTD. |  |
| &nbsp;&nbsp;Hiroyuki Satori<br> (July 13, 1966) | &nbsp;&nbsp;Aug. 2011 | &nbsp;&nbsp;Representative Director and Senior Managing Executive Officer, Head of Management in charge of Corporate Planning of SATORI ELECTRIC CO., LTD. | &nbsp;&nbsp; (1) 104,938 shares<br> (2) shares<br> (3) 107,036 shares |
|  | &nbsp;&nbsp;Aug. 2012 | &nbsp;&nbsp;Representative Director and Vice President in charge of Corporate Planning of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;June 2013 | &nbsp;&nbsp;Representative Director and President and COO of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2013 | &nbsp;&nbsp;Director of SATORI PINICS CO., LTD.<br> Director of STAR ELECTRONICS CO., LTD. (current position) |  |
|  | &nbsp;&nbsp;June 2016 | &nbsp;&nbsp;Representative Director and President and CEO of SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;May 2018 | &nbsp;&nbsp;Representative Director and Chairman of SATORI SP TECHNOLOGY CO., LTD.<br> (current position) |  |
|  | &nbsp;&nbsp;Aug. 2020 | &nbsp;&nbsp;Representative Director and President and Executive Officer of SATORI ELECTRIC CO., LTD. (current position) Representative Director and Chairman of SATORI PINICS CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2023 | &nbsp;&nbsp;Director of SATORI PINICS CO., LTD.<br> (current position) |  |
|  | &nbsp;&nbsp;Sep. 2025 | &nbsp;&nbsp;Director of SM Electronic Technologies Pvt. Ltd. (current position)<br> Director of MAGnetIC Holding B.V. (current position) |  |

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&nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Hiroyuki Satori has been involved in domestic and overseas business operations and has extensive experience, including working experience at overseas business locations, and broad knowledge. He has demonstrated strong leadership in promoting management reforms as the Representative Director and President and Executive Officer of SATORI ELECTRIC CO., LTD. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience.<br>

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Hagiwara Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1987 | &nbsp;&nbsp;Joined MATSUSHITA ELECTRIC<br> INDUSTRIAL CO., LTD. (currently PANASONIC HOLDINGS CORPORATION) |  |
|  | &nbsp;&nbsp;Apr. 2010 | &nbsp;&nbsp;Deputy Managing Director, PANASONIC SHUN HING INDUSTRIAL DEVICES SALES CO., LTD.<br> Deputy Managing Director, PANASONIC SHUN HING INDUSTRY (SHENZHEN) CO., LTD. |  |
|  | &nbsp;&nbsp;Mar. 2013 | &nbsp;&nbsp;Head of Power Device Div, PANASONIC AUTOMOTIVE & INDUSTRIAL SYSTEMS CO., LTD.<br> President and Representative Director, PANASONIC DEVICE DISCRETE SEMICONDUCTOR CO., LTD. |  |
| &nbsp;&nbsp;Naruhiko Mizukoshi (December 17, 1963) | &nbsp;&nbsp;July 2017 | &nbsp;&nbsp;Director, Head of Semiconductor Business Unit, PANASONIC SEMICONDUCTOR SOLUTIONS CO., LTD. | &nbsp;&nbsp; (1) 3,005 shares<br> (2) shares<br> (3) 3,065 shares |
|  | &nbsp;&nbsp;Sep. 2020 | &nbsp;&nbsp;Joined SATORI SP TECHNOLOGY CO., LTD. |  |
|  | &nbsp;&nbsp;Dec. 2020 | &nbsp;&nbsp;Executive Officer, SATORI SP TECHNOLOGY CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2021 | &nbsp;&nbsp;Director and Managing Executive Officer, SATORI SP TECHNOLOGY CO., LTD. |  |
|  | &nbsp;&nbsp;June 2022 | &nbsp;&nbsp;President and Representative Director, SATORI SP TECHNOLOGY CO., LTD.<br> (current position) |  |
|  | &nbsp;&nbsp;June 2023 | &nbsp;&nbsp;Managing Executive Officer, Head of Enterprise Segment, SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2025 | &nbsp;&nbsp;Director and Managing Executive Officer, Head of Enterprise Segment, SATORI ELECTRIC CO., LTD. <br> (current position) |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Naruhiko Mizukoshi has extensive knowledge and deep insight on management gained from his many years of involvement in business management in Japan and overseas at a major electronics manufacturer, and from his work experience at SATORI ELECTRIC CO., LTD., including serving as the President of a domestic subsidiary. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Naruhiko Mizukoshi has extensive knowledge and deep insight on management gained from his many years of involvement in business management in Japan and overseas at a major electronics manufacturer, and from his work experience at SATORI ELECTRIC CO., LTD., including serving as the President of a domestic subsidiary. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Naruhiko Mizukoshi has extensive knowledge and deep insight on management gained from his many years of involvement in business management in Japan and overseas at a major electronics manufacturer, and from his work experience at SATORI ELECTRIC CO., LTD., including serving as the President of a domestic subsidiary. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Naruhiko Mizukoshi has extensive knowledge and deep insight on management gained from his many years of involvement in business management in Japan and overseas at a major electronics manufacturer, and from his work experience at SATORI ELECTRIC CO., LTD., including serving as the President of a domestic subsidiary. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. |

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|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Hagiwara Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1989 | &nbsp;&nbsp;Join Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;July 2006 | &nbsp;&nbsp;Manager of 1st Sales Department of 1st Electron Devices Division of Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;July 2011 | &nbsp;&nbsp;Deputy Manager of 2nd Electron Devices Division of Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;July 2013 | &nbsp;&nbsp;General Manager of 2nd Electron Devices Division of Hagiwara Electric Co., Ltd. |  |
| &nbsp;&nbsp;Takeshi Soejima <br> (August 13, 1965) | &nbsp;&nbsp;June 2015 | &nbsp;&nbsp;Executive Officer of Hagiwara Electric Co., Ltd. | &nbsp;&nbsp; (1) - shares<br> (2) 3,229 shares<br> (3) 6,458 shares |
|  | &nbsp;&nbsp;Apr. 2018 | &nbsp;&nbsp;Director of Hagiwara Electronics Co., Ltd. Apr. 2020<br> Representative Director and President of Hagiwara Electronics Co., Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2025 | &nbsp;&nbsp;Representative Director, President, and Executive Officer of Hagiwara Electronics Co., Ltd. (current position) |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takeshi Soejima has abundant work experience in the electronic devices business over many years, and he has used that experience to provide strong leadership as the Representative Director, President, and Executive Officer of Hagiwara Electronics Co., Ltd. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takeshi Soejima has abundant work experience in the electronic devices business over many years, and he has used that experience to provide strong leadership as the Representative Director, President, and Executive Officer of Hagiwara Electronics Co., Ltd. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takeshi Soejima has abundant work experience in the electronic devices business over many years, and he has used that experience to provide strong leadership as the Representative Director, President, and Executive Officer of Hagiwara Electronics Co., Ltd. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takeshi Soejima has abundant work experience in the electronic devices business over many years, and he has used that experience to provide strong leadership as the Representative Director, President, and Executive Officer of Hagiwara Electronics Co., Ltd. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Hagiwara Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1988 | &nbsp;&nbsp;Joined Mitsubishi Corporation |  |
|  | &nbsp;&nbsp;June 1997 | &nbsp;&nbsp;Investment and Credit Department of Mitsubishi International Corporation |  |
|  | &nbsp;&nbsp;Dec. 2002 | &nbsp;&nbsp;Treasurer Office (Finance Department) of Mitsubishi Corporation |  |
|  | &nbsp;&nbsp;Apr. 2009 | &nbsp;&nbsp;Accounting Department of Industrial Finance, Logistics & Development Group |  |
|  | &nbsp;&nbsp;May 2011 | &nbsp;&nbsp;Executive Vice President & CFO of Mitsubishi Corporation China Co., Ltd. |  |
|  | &nbsp;&nbsp;July 2013 | &nbsp;&nbsp;Deputy General Manager of Risk Management Department, in charge of Business Portfolio Management, of Mitsubishi Corporation |  |
|  | &nbsp;&nbsp;Jan. 2016 | &nbsp;&nbsp;Member of the Board, Managing Executive Officer, CFO of Mitsubishi Corporation Energy Co., Ltd. |  |
| &nbsp;&nbsp;Takuma Oyama<br> (February 1, 1966) | &nbsp;&nbsp;Mar. 2019 | &nbsp;&nbsp;General Manager of Accounting Department of Saudi Petrochemicals Development Co., Ltd. (SPDC) | &nbsp;&nbsp; (1) - shares<br> (2) 828 shares<br> (3) 1,656 shares |
|  | &nbsp;&nbsp;July 2020 | &nbsp;&nbsp;General Manager of Accounting Department, General Affairs Department, Information Systems Department & Assistant to President of SPDC |  |
|  | &nbsp;&nbsp;Apr. 2024 | &nbsp;&nbsp;Joined Hagiwara Electric Holdings Co., Ltd., Senior Managing Executive, Assistant to President |  |
|  | &nbsp;&nbsp;Apr. 2025 | &nbsp;&nbsp;Managing Executive Officer of Hagiwara Electric Holdings Co., Ltd.<br> Director of Hagiwara Electronics Co., Ltd. (current position)<br> Director of Hagiwara Techno Solutions Co., Ltd. (current position) |  |
|  | &nbsp;&nbsp;June 2025 | &nbsp;&nbsp;Director and Managing Executive Officer of Hagiwara Electric Holdings Co., Ltd. <br> (current position)<br> In charge of Accounting & Finance Division of Hagiwara Electric Holdings Co., Ltd. (current position) |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takuma Oyama has extensive experience in the finance and accounting divisions at Mitsubishi Corporation, particularly serving as CFO in China and during his assignment to a domestic subsidiary. He also has experience working overseas in the U.S. and China, and after assuming office as a Director of the Company, he has been deeply involved in financial strategy. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takuma Oyama has extensive experience in the finance and accounting divisions at Mitsubishi Corporation, particularly serving as CFO in China and during his assignment to a domestic subsidiary. He also has experience working overseas in the U.S. and China, and after assuming office as a Director of the Company, he has been deeply involved in financial strategy. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takuma Oyama has extensive experience in the finance and accounting divisions at Mitsubishi Corporation, particularly serving as CFO in China and during his assignment to a domestic subsidiary. He also has experience working overseas in the U.S. and China, and after assuming office as a Director of the Company, he has been deeply involved in financial strategy. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Takuma Oyama has extensive experience in the finance and accounting divisions at Mitsubishi Corporation, particularly serving as CFO in China and during his assignment to a domestic subsidiary. He also has experience working overseas in the U.S. and China, and after assuming office as a Director of the Company, he has been deeply involved in financial strategy. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Hagiwara Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1991 | &nbsp;&nbsp;Joined THE DAI-ICHI MUTUAL LIFE INSURANCE COMPANY (currently THE DAI-ICHI LIFE INSURANCE CO., LTD.) |  |
|  | &nbsp;&nbsp;Feb. 2015 | &nbsp;&nbsp;Director, COO, DLI NORTH AMERICA INC. |  |
|  | &nbsp;&nbsp;Apr. 2017 | &nbsp;&nbsp;General Manager of Credit Department, THE DAI-ICHI LIFE INSURANCE CO., LTD. |  |
|  | &nbsp;&nbsp;Apr. 2020 | &nbsp;&nbsp;General Manager of Audit and Supervisory Committee's Center, DAI-ICHI LIFE HOLDINGS, INC.<br> General Manager of Audit and Supervisory Board Member's Center, THE DAI-ICHI LIFE INSURANCE CO., LTD. |  |
| &nbsp;&nbsp;Shunji Tsuchiya<br> (April 28, 1968) | &nbsp;&nbsp;Aug. 2022 | &nbsp;&nbsp;Executive Managing Director, VERTEX INVESTMENT SOLUTIONS CO., LTD. | &nbsp;&nbsp; (1) - shares<br> (2) - shares<br> (3) - shares |
|  | &nbsp;&nbsp;Apr. 2025 | &nbsp;&nbsp;Seconded to SATORI ELECTRIC CO., LTD.<br> Executive Fellow, Corporate Div., SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Aug. 2025 | &nbsp;&nbsp;Joined SATORI ELECTRIC CO., LTD. Director, SATORI ELECTRIC CO., LTD. Director, SATORI PINICS CO., LTD.<br> (current position)<br> Director, STAR ELECTRONICS CO., LTD. (current position)<br> Director, SATORI SP TECHNOLOGY CO., LTD. (current position) |  |
|  | &nbsp;&nbsp;Sep. 2025 | &nbsp;&nbsp;Director and Managing Executive Officer in charge of corporate affairs, SATORI ELECTRIC CO., LTD. |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Shunji Tsuchiya has extensive knowledge and deep insight, which he earned through his many years of involvement in diverse operations at a financial institution, including financial services, overseas business, and auditing, and through his involvement in management, including serving as Executive Managing Director in charge of corporate planning at an affiliate of that institution. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Shunji Tsuchiya has extensive knowledge and deep insight, which he earned through his many years of involvement in diverse operations at a financial institution, including financial services, overseas business, and auditing, and through his involvement in management, including serving as Executive Managing Director in charge of corporate planning at an affiliate of that institution. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Shunji Tsuchiya has extensive knowledge and deep insight, which he earned through his many years of involvement in diverse operations at a financial institution, including financial services, overseas business, and auditing, and through his involvement in management, including serving as Executive Managing Director in charge of corporate planning at an affiliate of that institution. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. | &nbsp;&nbsp; Reasons for nomination as candidate for Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members)<br> Shunji Tsuchiya has extensive knowledge and deep insight, which he earned through his many years of involvement in diverse operations at a financial institution, including financial services, overseas business, and auditing, and through his involvement in management, including serving as Executive Managing Director in charge of corporate planning at an affiliate of that institution. The Companies propose his election as Director of the Joint Holding Company to be newly established because he is expected to continue capitalizing on his abilities and experience. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Hagiwara Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1980 | &nbsp;&nbsp;Joined OLYMPUS OPTICAL CO., LTD.<br> (currently OLYMPUS CORPORATION) |  |
|  | &nbsp;&nbsp;June 2010 | &nbsp;&nbsp;Executive Officer, OLYMPUS CORPORATION<br> Director and Member of the Board, OLYMPUS MEDICAL SYSTEMS CORP. |  |
|  | &nbsp;&nbsp;Apr. 2012 | &nbsp;&nbsp;Senior Executive Managing Officer, OLYMPUS CORPORATION<br> President, OLYMPUS MEDICAL SYSTEMS CORP. |  |
|  | &nbsp;&nbsp;Apr. 2013 | &nbsp;&nbsp;Senior Executive Managing Officer, OLYMPUS CORPORATION<br> Outside Director, SONY OLYMPUS MEDICAL SOLUTIONS INC. |  |
|  | &nbsp;&nbsp;Apr. 2015 | &nbsp;&nbsp;Head of Sales Group and Business Management Officer of Medical Business, OLYMPUS CORPORATION<br> Director and Member of the Board, OLYMPUS MEDICAL SYSTEMS CORP. |  |
| &nbsp;&nbsp;(Outside Director)<br>Akihiro Taguchi <br> (January 26, 1958) | &nbsp;&nbsp;June 2015 | &nbsp;&nbsp;Director and Senior Executive Managing Officer, OLYMPUS CORPORATION | &nbsp;&nbsp; (1) 2,038 shares<br> (2) - shares<br> (3) 2,078 shares |
|  | &nbsp;&nbsp;Apr. 2019 | &nbsp;&nbsp;Director and Senior Executive Managing Officer and Chief Operating Officer, OLYMPUS CORPORATION<br> President, OLYMPUS MEDICAL SYSTEMS CORP. |  |
|  | &nbsp;&nbsp;June 2019 | &nbsp;&nbsp;Executive Officer and Chief Operating Officer, OLYMPUS CORPORATION |  |
|  | &nbsp;&nbsp;Apr. 2020 | &nbsp;&nbsp;Executive Officer and Chief Technology Officer, OLYMPUS CORPORATION<br> Director and Member of the Board, OLYMPUS MEDICAL SYSTEMS CORP. |  |
|  | &nbsp;&nbsp;Aug. 2022 | &nbsp;&nbsp;Outside Director, Audit and Supervisory Committee Member, SATORI ELECTRIC CO., LTD. |  |
|  | &nbsp;&nbsp;Sep. 2023 | &nbsp;&nbsp;Outside Director and Member of Board, ASAHI INTECC CO., LTD. (current position) |  |
|  | &nbsp;&nbsp;Aug. 2024 | &nbsp;&nbsp;Outside Director and Chairman of the Board, SATORI ELECTRIC CO., LTD.<br> (current position) |  |
|  | &nbsp;&nbsp; (Significant concurrent positions)<br> Outside Director and Member of Board, ASAHI <br> INTECC CO., LTD. | &nbsp;&nbsp; (Significant concurrent positions)<br> Outside Director and Member of Board, ASAHI <br> INTECC CO., LTD. |  |

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&nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Akihiro Taguchi has extensive experience and broad knowledge from his background as a CTO and corporate manager at a group company of a comprehensive electronics maker, as well as professional insight and knowledge in design, development, and technology. The Companies propose his election as Outside Director of the Joint Holding Company to be newly established as they believe he will utilize that experience, knowledge, and insight. The Companies expect that he will provide advice and oversight of management of the Joint Holding Company, utilizing his abilities and experience.<br>

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|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Hagiwara Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Aug. 1989 | &nbsp;&nbsp;Joined Sony Corporation (currently Sony Group Corporation) |  |
|  | &nbsp;&nbsp;Sep. 2003 | &nbsp;&nbsp;Started research and development consultant business |  |
|  | &nbsp;&nbsp;Nov. 2004 | &nbsp;&nbsp;Outside Director of Digital Media Professionals Inc. (current position) |  |
| &nbsp;&nbsp;(Outside Director)<br>Shinichi Okamoto <br> (April 28, 1958) | &nbsp;&nbsp;Mar. 2010 | &nbsp;&nbsp;Established Blue Shift Technology Inc., assumed office of Director <br> (current position) | &nbsp;&nbsp; (1) - shares<br> (2) 200 shares<br> (3) 400 shares |
|  | &nbsp;&nbsp;June 2022 | &nbsp;&nbsp;Outside Director of Hagiwara Electric Holdings Co., Ltd. (current position) |  |
|  | &nbsp;&nbsp; (Significant concurrent positions)<br> Outside Director of Digital Media Professionals Inc. Director of Blue Shift Technology Inc. | &nbsp;&nbsp; (Significant concurrent positions)<br> Outside Director of Digital Media Professionals Inc. Director of Blue Shift Technology Inc. |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Shinichi Okamoto has work experience as CTO of a group company of a comprehensive home electronics maker and as R&D consultant. The Companies propose his election as Outside Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. The Companies expect that he will provide advice and oversight of management of the Joint Holding Company, utilizing his abundant experience and deep insight. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Shinichi Okamoto has work experience as CTO of a group company of a comprehensive home electronics maker and as R&D consultant. The Companies propose his election as Outside Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. The Companies expect that he will provide advice and oversight of management of the Joint Holding Company, utilizing his abundant experience and deep insight. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Shinichi Okamoto has work experience as CTO of a group company of a comprehensive home electronics maker and as R&D consultant. The Companies propose his election as Outside Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. The Companies expect that he will provide advice and oversight of management of the Joint Holding Company, utilizing his abundant experience and deep insight. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Shinichi Okamoto has work experience as CTO of a group company of a comprehensive home electronics maker and as R&D consultant. The Companies propose his election as Outside Director of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience. The Companies expect that he will provide advice and oversight of management of the Joint Holding Company, utilizing his abundant experience and deep insight. |

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|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Hagiwara Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1989 | &nbsp;&nbsp;Joined Motorola, Inc. |  |
|  | &nbsp;&nbsp;June 1991 | &nbsp;&nbsp;Joined The Boston Consulting Group, Inc. |  |
|  | &nbsp;&nbsp;Jan. 2007 | &nbsp;&nbsp;Joined Globis Corporation |  |
|  | &nbsp;&nbsp;Apr. 2014 | &nbsp;&nbsp;Professor, Graduate School of Management, Globis University (current position) |  |
|  | &nbsp;&nbsp;July 2014 | &nbsp;&nbsp;Managing Director, General Manager, Corporate Administration Division, Globis Corporation |  |
|  | &nbsp;&nbsp;July 2019 | &nbsp;&nbsp;Senior Faculty Director, Faculty Division (currently Faculty Group Office) (current position) |  |
| &nbsp;&nbsp;(Outside Director)<br>Kyoko Hayashi <br> (November 9, 1966) | &nbsp;&nbsp;May 2022 | &nbsp;&nbsp;Outside Director, Eat & Holdings Co., Ltd (current position) | &nbsp;&nbsp; (1) - shares<br> (2) - shares<br> (3) - shares |
|  | &nbsp;&nbsp;June 2023 | &nbsp;&nbsp;Outside Director of Hagiwara Electric Holdings Co., Ltd. (current position) |  |
|  | &nbsp;&nbsp;Sep. 2023 | &nbsp;&nbsp;Outside Director (Audit and Supervisory Committee Member) of KOA SHOJI HOLDINGS Co., Ltd. (current position) |  |
|  | &nbsp;&nbsp; (Significant concurrent positions)<br> Professor, Graduate School of Management, Globis University<br> Senior Faculty Director, Faculty Group Office, Globis Corporation<br> Outside Director, Eat & Holdings Co., Ltd<br> Outside Director (Audit and Supervisory Committee Member) of KOA SHOJI HOLDINGS Co., Ltd. | &nbsp;&nbsp; (Significant concurrent positions)<br> Professor, Graduate School of Management, Globis University<br> Senior Faculty Director, Faculty Group Office, Globis Corporation<br> Outside Director, Eat & Holdings Co., Ltd<br> Outside Director (Audit and Supervisory Committee Member) of KOA SHOJI HOLDINGS Co., Ltd. |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Kyoko Hayashi possesses abundant experience in diversity, work style reform, DX promotion, crisis management, and disaster prevention, and the Companies believe that she will be able to utilize her abilities and experience as the Companies aim to sustainably enhance the corporate value of the entire group, and therefore the Companies propose her election as Outside Director of the Joint Holding Company to be newly established. The Companies expect that she will provide advice and oversight of management of the Joint Holding Company, utilizing her abundant experience and deep insight. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Kyoko Hayashi possesses abundant experience in diversity, work style reform, DX promotion, crisis management, and disaster prevention, and the Companies believe that she will be able to utilize her abilities and experience as the Companies aim to sustainably enhance the corporate value of the entire group, and therefore the Companies propose her election as Outside Director of the Joint Holding Company to be newly established. The Companies expect that she will provide advice and oversight of management of the Joint Holding Company, utilizing her abundant experience and deep insight. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Kyoko Hayashi possesses abundant experience in diversity, work style reform, DX promotion, crisis management, and disaster prevention, and the Companies believe that she will be able to utilize her abilities and experience as the Companies aim to sustainably enhance the corporate value of the entire group, and therefore the Companies propose her election as Outside Director of the Joint Holding Company to be newly established. The Companies expect that she will provide advice and oversight of management of the Joint Holding Company, utilizing her abundant experience and deep insight. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director (excluding Directors concurrently serving as Audit & Supervisory Committee Members) and outline of expected role<br> Kyoko Hayashi possesses abundant experience in diversity, work style reform, DX promotion, crisis management, and disaster prevention, and the Companies believe that she will be able to utilize her abilities and experience as the Companies aim to sustainably enhance the corporate value of the entire group, and therefore the Companies propose her election as Outside Director of the Joint Holding Company to be newly established. The Companies expect that she will provide advice and oversight of management of the Joint Holding Company, utilizing her abundant experience and deep insight. |

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| (Note 1) | The number of shares of the Company and Hagiwara Electric owned by each candidate is based on ownership status as of September 30, 2025, and the number of shares of the Joint Holding Company to be allotted is based on that ownership status and the Share Transfer Ratio. The number of shares of the Joint Holding Company that will actually be allotted may change depending on the number of shares owned up to the point in time immediately before the establishment date of the Joint Holding Company. |

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(Note 2) There are no special interests between each candidate and the Company or Hagiwara Electric, and no special interests are anticipated to arise between each

candidate and the Joint Holding Company.

(Note 3) Akihiro Taguchi, Shinichi Okamoto, and Kyoko Hayashi are candidates for Outside Director. Kyoko Hayashi's name in the family register is Kyoko Otani.

(Note 4) If Akihiro Taguchi, Shinichi Okamoto, and Kyoko Hayashi are elected and assume office as Outside Directors, the Joint Holding Company plans to register them with the Tokyo Stock Exchange and the Nagoya Stock Exchange as independent officers under the regulations of each exchange.

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|:---|:---|
| (Note 5) | If Akihiro Taguchi, Shinichi Okamoto, and Kyoko Hayashi are elected and assume office as Outside Directors, pursuant to the provisions of Article 427, paragraph (1) of the Companies Act, the Joint Holding Company plans to enter into agreements limiting their liability for damages set out in Article 423, paragraph (1) of the Companies Act. The maximum amount of liability under such agreements is planned to be the minimum liability amount set out in laws and regulations. |

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| | |
|:---|:---|
| (Note 6) | The Joint Holding Company plans to enter into a directors and officers liability insurance policy set out in Article 430-3, paragraph (1) of the Companies Act with an insurance company, and if the candidates for Director are elected and assume office, they are planned to be insured under that policy. The policy is planned to provide compensation for damage, etc. in cases where an insured party bears liability for damages arising from acts performed in regard to their duties, and the Joint Holding Company plans to bear all of the insurance fees. |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.** **Matters Set Out in Article 74-3 of the Regulations for Enforcement of the Companies Act Regarding Persons Who Will Be Directors Concurrently Serving as Audit & Supervisory Committee Members of the Joint Holding Company** 

The persons who will be Directors concurrently serving as Audit & Supervisory Committee Members of the Joint Holding Company are as follows.

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Hagiwara Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1986 | &nbsp;&nbsp;Joined Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;June 2004 | &nbsp;&nbsp;Department Manager of Komaki Branch of Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;July 2012 | &nbsp;&nbsp;Department Manager of General Affairs Department of Hagiwara Electric Co., Ltd. |  |
|  | &nbsp;&nbsp;July 2015 | &nbsp;&nbsp;Deputy General Manager of General Affairs & Personnel Division of Hagiwara Electric Co., Ltd. |  |
| &nbsp;&nbsp;Noriaki Inoue <br> (February 22, 1964) | &nbsp;&nbsp;Apr. 2018 | &nbsp;&nbsp;General Manager of General Affairs & Personnel Division of Hagiwara Electric Co., Ltd.<br> Audit & Supervisory Board Member of Hagiwara Electronics Co., Ltd. | &nbsp;&nbsp; (1) - shares<br> (2) 3,437 shares<br> (3) 6,874 shares |
|  | &nbsp;&nbsp;Apr. 2021 | &nbsp;&nbsp;Senior Managing Executive of Hagiwara Electric Holdings Co., Ltd. |  |
|  | &nbsp;&nbsp;June 2022 | &nbsp;&nbsp;Audit & Supervisory Board Member of Hagiwara Techno Solutions Co., Ltd. Audit & Supervisory Board Member of Hagiwara Hokuto Techno Co., Ltd. |  |
|  | &nbsp;&nbsp;Sep. 2022 | &nbsp;&nbsp;Audit & Supervisory Board Member of Hagiwara Engineering Co., Ltd. |  |
|  | &nbsp;&nbsp;June 2024 | &nbsp;&nbsp;Director (Audit & Supervisory Committee Member) of Hagiwara Electric Holdings Co., Ltd. (current position) |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Director concurrently serving as Audit & Supervisory Committee Member<br> Noriaki Inoue has many years of work experience in general affairs, and he also has practical experience as an Audit & Supervisory Board Member at business companies. The Companies propose his election as a Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience in the Joint Holding Company's audit and supervisory functions. | &nbsp;&nbsp; Reasons for nomination as candidate for Director concurrently serving as Audit & Supervisory Committee Member<br> Noriaki Inoue has many years of work experience in general affairs, and he also has practical experience as an Audit & Supervisory Board Member at business companies. The Companies propose his election as a Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience in the Joint Holding Company's audit and supervisory functions. | &nbsp;&nbsp; Reasons for nomination as candidate for Director concurrently serving as Audit & Supervisory Committee Member<br> Noriaki Inoue has many years of work experience in general affairs, and he also has practical experience as an Audit & Supervisory Board Member at business companies. The Companies propose his election as a Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience in the Joint Holding Company's audit and supervisory functions. | &nbsp;&nbsp; Reasons for nomination as candidate for Director concurrently serving as Audit & Supervisory Committee Member<br> Noriaki Inoue has many years of work experience in general affairs, and he also has practical experience as an Audit & Supervisory Board Member at business companies. The Companies propose his election as a Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because he is expected to capitalize on his abilities and experience in the Joint Holding Company's audit and supervisory functions. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Hagiwara Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 1981 | &nbsp;&nbsp;Joined Ricoh Company, Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2010 | &nbsp;&nbsp;Corporate Vice President and General Manager, Controller Development Division & Deputy General Manager, MFP Business Group, Ricoh Company, Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2012 | &nbsp;&nbsp;Corporate Senior Vice President and General Manager, Human Resources Division, Ricoh Company, Ltd. |  |
|  | &nbsp;&nbsp;Apr. 2018 | &nbsp;&nbsp;Corporate Executive Vice President and General Manager, Office Printing Business Group, Ricoh Company, Ltd. |  |
|  | &nbsp;&nbsp;June 2018 | &nbsp;&nbsp;Director, Corporate Executive Vice President, and General Manager, Office Printing Business Group, Ricoh Company, Ltd. |  |
| &nbsp;&nbsp;(Outside Director)<br>Seiji Sakata <br> (September 12, 1958) | &nbsp;&nbsp;Apr. 2019 | &nbsp;&nbsp;Director, Corporate Executive Vice President, CTO, Ricoh Company, Ltd. | &nbsp;&nbsp; (1) 628 shares<br> (2) - shares<br> (3) 640 shares |
|  | &nbsp;&nbsp;Apr. 2021 | &nbsp;&nbsp;Director, Executive Corporate Officer, CTO, and General Manager, Advanced Technology R&D Division, Ricoh Company, Ltd. |  |
|  | &nbsp;&nbsp;June 2023 | &nbsp;&nbsp;Outside Director, Hirose Electric Co., Ltd. (current position) |  |
|  | &nbsp;&nbsp;Mar. 2024 | &nbsp;&nbsp;Outside Board Member, MABUCHI MOTOR CO., LTD (current position) |  |
|  | &nbsp;&nbsp;Aug. 2024 | &nbsp;&nbsp;Outside Director, Audit and Supervisory Committee Member, SATORI ELECTRIC CO., LTD. (current position) |  |
|  | &nbsp;&nbsp; (Significant concurrent positions)<br> Outside Director, Hirose Electric Co., Ltd.<br> Outside Board Member, MABUCHI MOTOR CO., LTD. | &nbsp;&nbsp; (Significant concurrent positions)<br> Outside Director, Hirose Electric Co., Ltd.<br> Outside Board Member, MABUCHI MOTOR CO., LTD. |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Seiji Sakata has extensive experience and broad knowledge as a corporate manager, as well as professional insight and knowledge in design, development, and technology. Considering that he will contribute to strengthening the supervisory function for the business execution of the Joint Holding Company to be newly established, the Companies nominate him as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company. The Companies expect that he will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing his professional insight and experience in design, development, and technology. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Seiji Sakata has extensive experience and broad knowledge as a corporate manager, as well as professional insight and knowledge in design, development, and technology. Considering that he will contribute to strengthening the supervisory function for the business execution of the Joint Holding Company to be newly established, the Companies nominate him as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company. The Companies expect that he will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing his professional insight and experience in design, development, and technology. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Seiji Sakata has extensive experience and broad knowledge as a corporate manager, as well as professional insight and knowledge in design, development, and technology. Considering that he will contribute to strengthening the supervisory function for the business execution of the Joint Holding Company to be newly established, the Companies nominate him as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company. The Companies expect that he will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing his professional insight and experience in design, development, and technology. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Seiji Sakata has extensive experience and broad knowledge as a corporate manager, as well as professional insight and knowledge in design, development, and technology. Considering that he will contribute to strengthening the supervisory function for the business execution of the Joint Holding Company to be newly established, the Companies nominate him as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company. The Companies expect that he will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing his professional insight and experience in design, development, and technology. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Hagiwara Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Nov. 2004 | &nbsp;&nbsp;Joined Tohmatsu & Co. (currently Deloitte Touche Tohmatsu LLC) |  |
|  | &nbsp;&nbsp;June 2008 | &nbsp;&nbsp;Registered as a certified public accountant |  |
|  | &nbsp;&nbsp;Aug. 2017 | &nbsp;&nbsp;Established Sachiko Enomoto Certified<br> Public Accountant Office (current position) |  |
|  | &nbsp;&nbsp;July 2020 | &nbsp;&nbsp;Audit & Supervisory Board Member of Enomoto Corporation (current position) |  |
|  | &nbsp;&nbsp;Apr. 2021 | &nbsp;&nbsp;Domestic Relations Conciliation<br> Commissioner of Nagoya Family Court |  |
|  | &nbsp;&nbsp;June 2023 | &nbsp;&nbsp;Outside Audit & Supervisory Board<br> Member of TAIHO KOGYO CO., LTD.<br> (current position) |  |
|  | &nbsp;&nbsp;Oct. 2023 | &nbsp;&nbsp;Civil Mediation Commissioner of Nagoya District Court and Nagoya Summary Court (current position) |  |
| &nbsp;&nbsp;(Outside Director)<br>Sachiko Enomoto <br> (May 26, 1974) | &nbsp;&nbsp;June 2024 | &nbsp;&nbsp;Outside Director (Audit & Supervisory Committee Member) of Hagiwara Electric Holdings Co., Ltd. (current position) | &nbsp;&nbsp; (1) - shares<br> (2) 215 shares<br> (3) 430 shares |
|  | &nbsp;&nbsp;Jan. 2025 | &nbsp;&nbsp;Judicial commissioner of Nagoya Summary Court (current position) |  |
|  | &nbsp;&nbsp;June 2025 | &nbsp;&nbsp;Outside Director (Audit & Supervisory Committee Member) of TAISEI ONCHO CO., LTD. (current position) |  |
|  | &nbsp;&nbsp; (Significant concurrent positions) Certified public accountant<br> Civil Mediation Commissioner of Nagoya District Court and Nagoya Summary Court<br> Outside Audit & Supervisory Board Member of TAIHO KOGYO CO., LTD.<br> Outside Director (Audit & Supervisory Committee Member) of TAISEI ONCHO CO., LTD.<br> Audit & Supervisory Board Member of Enomoto Corporation | &nbsp;&nbsp; (Significant concurrent positions) Certified public accountant<br> Civil Mediation Commissioner of Nagoya District Court and Nagoya Summary Court<br> Outside Audit & Supervisory Board Member of TAIHO KOGYO CO., LTD.<br> Outside Director (Audit & Supervisory Committee Member) of TAISEI ONCHO CO., LTD.<br> Audit & Supervisory Board Member of Enomoto Corporation |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> The Companies propose the election of Sachiko Enomoto as an Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because she is expected to capitalize on her specialized knowledge and experience as a certified public accountant in enhancing audit and supervisory functions. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her specialized knowledge and experience as a certified public accountant. Ms. Enomoto has never in the past been involved in the management of a company except as an outside officer. However, the Companies judge she will appropriately fulfill her duties as an Outside Director concurrently serving as Audit & Supervisory Committee Member based on the above reasons. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> The Companies propose the election of Sachiko Enomoto as an Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because she is expected to capitalize on her specialized knowledge and experience as a certified public accountant in enhancing audit and supervisory functions. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her specialized knowledge and experience as a certified public accountant. Ms. Enomoto has never in the past been involved in the management of a company except as an outside officer. However, the Companies judge she will appropriately fulfill her duties as an Outside Director concurrently serving as Audit & Supervisory Committee Member based on the above reasons. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> The Companies propose the election of Sachiko Enomoto as an Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because she is expected to capitalize on her specialized knowledge and experience as a certified public accountant in enhancing audit and supervisory functions. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her specialized knowledge and experience as a certified public accountant. Ms. Enomoto has never in the past been involved in the management of a company except as an outside officer. However, the Companies judge she will appropriately fulfill her duties as an Outside Director concurrently serving as Audit & Supervisory Committee Member based on the above reasons. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> The Companies propose the election of Sachiko Enomoto as an Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established because she is expected to capitalize on her specialized knowledge and experience as a certified public accountant in enhancing audit and supervisory functions. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her specialized knowledge and experience as a certified public accountant. Ms. Enomoto has never in the past been involved in the management of a company except as an outside officer. However, the Companies judge she will appropriately fulfill her duties as an Outside Director concurrently serving as Audit & Supervisory Committee Member based on the above reasons. |

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; Name<br> (Date of birth) | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp;Career summary, positions and responsibilities, and <br> significant concurrent positions | &nbsp;&nbsp; (1) Number of the Company's shares owned<br> (2) Number of Hagiwara Electric's shares owned<br> (3) Number of the Joint Holding Company's shares to be allotted |
|  | &nbsp;&nbsp;Apr. 2000 | &nbsp;&nbsp;Entered The Legal Training and Research Institute of Japan (54th Class) |  |
|  | &nbsp;&nbsp;Oct. 2001 | &nbsp;&nbsp;Judge, Tokyo District Court Feb. 2008<br> Registered as Attorney<br> Joined Yoshioka Tsuji Law Office (currently Yoshioka Ono Law Office) |  |
|  | &nbsp;&nbsp;May 2019 | &nbsp;&nbsp;Yokohama Sogo Law Office (current position) |  |
|  | &nbsp;&nbsp;July 2019 | &nbsp;&nbsp;Legal Specialist, Hiratsuka City (current position) |  |
| &nbsp;&nbsp;(Outside Director)<br>Akiko Yukimaru <br> (January 7, 1977) | &nbsp;&nbsp;June 2021 | &nbsp;&nbsp;Outside Director, IPS, Inc. (current position) | &nbsp;&nbsp; (1) 610 shares<br> (2) - shares<br> (3) 622 shares |
|  | &nbsp;&nbsp;Aug. 2022 | &nbsp;&nbsp;Outside Director, Audit and Supervisory Committee Member, SATORI ELECTRIC CO., LTD. (current position) |  |
|  | &nbsp;&nbsp;May 2025 | &nbsp;&nbsp;Outside Audit & Supervisory Board Member, Tebiki Inc. (current position) |  |
|  | &nbsp;&nbsp; (Significant concurrent positions)<br> Attorney<br> Outside Director, IPS, Inc.<br> Outside Audit & Supervisory Board Member, Tebiki Inc. | &nbsp;&nbsp; (Significant concurrent positions)<br> Attorney<br> Outside Director, IPS, Inc.<br> Outside Audit & Supervisory Board Member, Tebiki Inc. |  |
| &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Akiko Yukimaru has professional insight and extensive experience cultivated as a judge and an attorney. Expecting her to offer advice from her professional point of view, the Companies nominate her as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her professional insight and experience as a judge and attorney. Although Ms. Yukimaru has never been involved in company management other than as an outside officer, the Companies consider, for the above reasons, that she will be able to appropriately fulfill the duties of Outside Director concurrently serving as Audit & Supervisory Committee Member. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Akiko Yukimaru has professional insight and extensive experience cultivated as a judge and an attorney. Expecting her to offer advice from her professional point of view, the Companies nominate her as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her professional insight and experience as a judge and attorney. Although Ms. Yukimaru has never been involved in company management other than as an outside officer, the Companies consider, for the above reasons, that she will be able to appropriately fulfill the duties of Outside Director concurrently serving as Audit & Supervisory Committee Member. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Akiko Yukimaru has professional insight and extensive experience cultivated as a judge and an attorney. Expecting her to offer advice from her professional point of view, the Companies nominate her as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her professional insight and experience as a judge and attorney. Although Ms. Yukimaru has never been involved in company management other than as an outside officer, the Companies consider, for the above reasons, that she will be able to appropriately fulfill the duties of Outside Director concurrently serving as Audit & Supervisory Committee Member. | &nbsp;&nbsp; Reasons for nomination as candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member and outline of expected role<br> Akiko Yukimaru has professional insight and extensive experience cultivated as a judge and an attorney. Expecting her to offer advice from her professional point of view, the Companies nominate her as a candidate for Outside Director concurrently serving as Audit & Supervisory Committee Member of the Joint Holding Company to be newly established. The Companies expect that she will fulfill a role to secure the validity and adequacy of decision-making by the Board of Directors of the Joint Holding Company by providing oversight and advice, utilizing her professional insight and experience as a judge and attorney. Although Ms. Yukimaru has never been involved in company management other than as an outside officer, the Companies consider, for the above reasons, that she will be able to appropriately fulfill the duties of Outside Director concurrently serving as Audit & Supervisory Committee Member. |

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| | |
|:---|:---|
| (Note 1) | The number of shares of the Company and Hagiwara Electric owned by each candidate is based on ownership status as of September 30, 2025, and the number of shares of the Joint Holding Company to be allotted is based on that ownership status and the Share Transfer Ratio. The number of shares of the Joint Holding Company that will actually be allotted may change depending on the number of shares owned up to the point in time immediately before the establishment date of the Joint Holding Company. |

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(Note 2) There are no special interests between each candidate and the Company or Hagiwara Electric, and no special interests are anticipated to arise between each candidate and the Joint Holding Company.

(Note 3) Seiji Sakata, Sachiko Enomoto, and Akiko Yukimaru are candidates for Outside

Director.

(Note 4) If Seiji Sakata, Sachiko Enomoto, and Akiko Yukimaru are elected and assume office as Outside Directors, the Joint Holding Company plans to register them with the Tokyo Stock Exchange and the Nagoya Stock Exchange as independent officers under the regulations of each exchange.

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| | |
|:---|:---|
| (Note 5) | If Seiji Sakata, Sachiko Enomoto, and Akiko Yukimaru are elected and assume office as Outside Directors, pursuant to the provisions of Article 427, paragraph (1) of the Companies Act, the Joint Holding Company plans to enter into agreements limiting their liability for damages set out in Article 423, paragraph (1) of the Companies Act. The maximum amount of liability under such agreements is planned to be the minimum liability amount set out in laws and regulations. |

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| | |
|:---|:---|
| (Note 6) | The Joint Holding Company plans to enter into a directors and officers liability insurance policy set out in Article 430-3, paragraph (1) of the Companies Act with an insurance company, and if the candidates for Director are elected and assume office, they are planned to be insured under that policy. The policy is planned to provide compensation for damage, etc. in cases where an insured party bears liability for damages arising from acts performed in regard to their duties, and the Joint Holding Company plans to bear all of the insurance fees. |

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<u>Reference: Director skills matrix</u>

The Joint Holding Company to be newly established will have multiple Outside Directors who maintain a certain distance from business execution.

In addition, the Board of Directors of the Joint Holding Company to be newly established will be composed of a number of Directors within the limits set out in the Companies Act and the Articles of Incorporation, and it will be well-balanced in terms of knowledge, experience, and skills to ensure that the Board of Directors effectively fulfills its roles and duties. Furthermore, the composition of the Board of Directors will achieve diversity while maintaining an appropriate size.

A matrix of the skills of the Directors is as follows.

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;Name | &nbsp;&nbsp;Position in the Joint Holding Company <br> (planned) | &nbsp;&nbsp;Corporate management and management strategy | &nbsp;&nbsp;Sales and marketing |
| &nbsp;&nbsp;Moritaka Kimura | &nbsp;&nbsp;Representative Director and President &nbsp;&nbsp;Male | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;Hiroyuki Satori | &nbsp;&nbsp;Representative Director and Vice President &nbsp;&nbsp;Male | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;Naruhiko Mizukoshi | &nbsp;&nbsp;Director &nbsp;&nbsp;Male | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;Takeshi Soejima | &nbsp;&nbsp;Director &nbsp;&nbsp;Male | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;Takuma Oyama | &nbsp;&nbsp;Director &nbsp;&nbsp;Male | &nbsp;&nbsp;● |  |
| &nbsp;&nbsp;Shunji Tsuchiya | &nbsp;&nbsp;Director &nbsp;&nbsp;Male | &nbsp;&nbsp;● |  |
| &nbsp;&nbsp;Akihiro Taguchi | &nbsp;&nbsp;Outside Director &nbsp;&nbsp;Male | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;Shinichi Okamoto | &nbsp;&nbsp;Outside Director &nbsp;&nbsp;Male | &nbsp;&nbsp;● | &nbsp;&nbsp;● |
| &nbsp;&nbsp;Kyoko Hayashi | &nbsp;&nbsp;Outside Director &nbsp;&nbsp;Female |  |  |
| &nbsp;&nbsp;Noriaki Inoue | &nbsp;&nbsp;Director (Full-time Audit & Supervisory Committee Member) &nbsp;&nbsp;Male |  |  |
| &nbsp;&nbsp;Seiji Sakata | &nbsp;&nbsp;Outside Director (Audit & Supervisory Committee Member) &nbsp;&nbsp;Male | &nbsp;&nbsp;● |  |
| &nbsp;&nbsp;Sachiko Enomoto | &nbsp;&nbsp;Outside Director (Audit & Supervisory Committee Member) &nbsp;&nbsp;Female |  |  |
| &nbsp;&nbsp;Akiko Yukimaru | &nbsp;&nbsp;Outside Director (Audit & Supervisory Committee Member) &nbsp;&nbsp;Female |  |  |

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(Note) The above table indicates the areas in which each Director is particularly able to utilize their expertise
based on their experience, etc. and does not represent all of the knowledge possessed by each Director.

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;Global business | &nbsp;&nbsp;Technology (design, development, and production) | &nbsp;&nbsp;IT and DX | &nbsp;&nbsp;Finance and accounting | &nbsp;&nbsp;Risk management | &nbsp;&nbsp;Talent management | &nbsp;&nbsp;Sustainability |
| ● | | ● | | ● | | ● |
| ● | | | | ● | ● | ● |
| &nbsp;&nbsp;● | &nbsp;&nbsp;● |  |  |  | &nbsp;&nbsp;● |  |
| &nbsp;&nbsp;● |  |  |  |  |  |  |
| ● | | | ● | ● | ● | ● |
| ● | | | ● | ● | ● | ● |
| &nbsp;&nbsp;● | &nbsp;&nbsp;● |  |  | &nbsp;&nbsp;● |  |  |
| &nbsp;&nbsp;● | &nbsp;&nbsp;● | &nbsp;&nbsp;● |  |  |  |  |
| ● | | | | | ● | ● |
| | | | | ● | ● | ● |
| | ● | ● | | ● | ● | ● |
| | | | ● | ● | | ● |
| | | | | ● | | ● |

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**9.** **Matters Set Out in Article 77 of the Regulations for Enforcement of the Companies Act Regarding the Person Who Will Be the Financial Auditor of the Joint Holding Company** 

The person who will be the financial auditor of the Joint Holding Company is as follows.

(As of June 30, 2025)

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| | |
|:---|:---|
| &nbsp;&nbsp;Name | &nbsp;&nbsp;KPMG AZSA LLC |
| &nbsp;&nbsp;Office location | &nbsp;&nbsp; Main office: 1-2 Tsukudo-cho, Shinjuku-ku, Tokyo<br> Number of offices: 12 |
| &nbsp;&nbsp;History | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; July 1969: Established Asahi Accounting Corporation<br> July 1985: Established Asahi Shinwa Accounting Corporation<br> Oct. 1993: Merged with Inoue Saito Eiwa Audit Corporation<br> (established April 1978) and became Asahi & Co.<br> Jan. 2004: Merged with AZSA & Co. (established February 2003) and became KPMG AZSA LLC<br> July 2010: Converted to a limited liability audit corporation (*yugen sekinin kansa hojin*), and its name in Japanese became "Yugen Sekinin Azusa Kansa Hojin" |
| &nbsp;&nbsp;Overview | &nbsp;&nbsp;&nbsp;&nbsp; Stated capital: 3,000,000,000 yen<br> Personnel composition<br> Certified public accountants: 3,011<br> Newly certified and junior CPAs: 1,537<br> Audit support staff: 2,013<br> Other staff: 801<br> Total: 7,362<br> Audit client companies: 3,255 |

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(Note) The Audit & Supervisory Committee of each of the Companies comprehensively considered factors such as KPMG AZSA LLC's record of performing accounting audits over many years, its independence and other qualifications as a professional expert, and its systems for ensuring that the accounting audits of the Joint Holding Company will be appropriately performed, as a result of which the committees determined that KPMG AZSA LLC is suitable as the financial auditor of the Joint Holding Company.

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| | |
|:---|:---|
| &nbsp;&nbsp;Question | &nbsp;&nbsp;Answer |
| &nbsp;&nbsp;Regarding the Business Integration and its significance and purpose | &nbsp;&nbsp;Regarding the Business Integration and its significance and purpose |
| &nbsp;&nbsp;What are the background and purpose of the Business Integration? | &nbsp;&nbsp; • The Companies, as comprehensive electronics trading companies handling semiconductors, electronic components, and electronic equipment, have been providing optimal solutions that meet the diverse needs of their customers and have expanded their businesses globally by leveraging a wide variety of products and advanced technologies.<br> • The electronics market is currently experiencing a surge in demand for the adoption and utilization of technologies such as the Internet of Things (IoT), artificial intelligence (AI), edge computing, generative AI, and digital transformation (DX), not only in next-generation automobiles, but also to resolve the challenges of smartification across a broad range of industries, including manufacturing.<br> • Amid this environmental change, there is an increasing need for solutions that are more closely aligned with customer challenges in the utilization and supply of semiconductors. Furthermore, the role of electronics trading companies is also evolving, as they are required to build more sophisticated supply chains in the face of the impact of overseas relocation of manufacturing bases in association with changes in semiconductor utilization needs, as well as growing uncertainties in the business environment caused by U.S.-China trade friction, export controls, and geopolitical tensions.<br> • Under such a business environment, the Companies have reached a shared recognition that, in order to achieve continuous business growth and development going forward, it is essential to concentrate their respective management resources and leverage their strengths to expand the scale of their business, and thereby deliver even greater added value. Based on this recognition, the Companies have agreed to pursue the Business Integration through mutual cooperation based on the spirit of equality.<br>|
| &nbsp;&nbsp;What kinds of initiatives will be advanced through the Business Integration? | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; • Amid substantial changes in the business environment, such as rapid digitalization, globalization, and diversification of customer needs, through the Business Integration, the Companies will seek to strengthen their competitiveness by integrating their respective management resources and know-how, with a focus on the following initiatives:<br> &nbsp;&nbsp;&nbsp;&nbsp;(i) Expansion of business scale through broader product lineups and customer bases<br>|

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| | |
|:---|:---|
| &nbsp;&nbsp;Question | &nbsp;&nbsp;Answer |
|  | &nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;(ii) Provision of high value-added solutions<br> &nbsp;&nbsp;&nbsp;&nbsp;(iii) Acceleration of global expansion<br> &nbsp;&nbsp;&nbsp;&nbsp;(iv) Productivity improvement through operational efficiency<br> &nbsp;&nbsp;&nbsp;&nbsp;(v) Strengthening the management foundations through the integration of organizations and human resources<br> • For details, please see "Announcement Concerning Execution of Business Integration Agreement on Business Integration through the Establishment of a Joint Holding Company (Share Transfer) between Hagiwara Electric Holdings Co., Ltd. and SATORI ELECTRIC CO., LTD. and Preparation of a Share Transfer Plan" released on Tuesday, October 14. |
| &nbsp;&nbsp;Regarding the Joint Holding Company | &nbsp;&nbsp;Regarding the Joint Holding Company |
| &nbsp;&nbsp;What is a joint share transfer? | &nbsp;&nbsp; • A joint share transfer is an organizational restructuring method where, in this case, Hagiwara Electric and Satori Electric, which will become wholly-owned subsidiaries, will establish a new Joint Holding Company that will become their wholly-owning parent company and cause it to acquire all of their issued shares, and the shareholders of Hagiwara Electric and Satori Electric will receive shares of the Joint Holding Company in exchange for the shares of Hagiwara Electric and Satori Electric that they hold.<br> • On Wednesday, April 1, 2026, the Companies plan to allot shares of the Joint Holding Company to be newly established to their shareholders as of the effective date of the joint share transfer.<br>|
| &nbsp;&nbsp;Why did the Companies choose to conduct a business integration through a joint share transfer? | &nbsp;&nbsp;• The Companies discussed and considered the optimal method for creating synergies, as a result of which they determined that a business integration through a joint share transfer was the best method in order to concentrate their management resources, expand the scale of their businesses by leveraging their strengths, and deliver even greater added value to customers and suppliers. |
| &nbsp;&nbsp;What are the share transfer plan and business integration agreement? | &nbsp;&nbsp; • The share transfer plan is a statutory document that states information such as the specific details of the share transfer and the basic matters of the new company.<br> • The business integration agreement is a contract concluded for the purpose of setting out the matters that the parties have agreed to regarding the Business Integration, including matters not set out in the share transfer plan. |

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| | |
|:---|:---|
| &nbsp;&nbsp;Question | &nbsp;&nbsp;Answer |
| &nbsp;&nbsp;How will the Companies transition to a holding company structure? Will they be delisted? | • Hagiwara Electric and Satori Electric will transition to a holding company structure by establishing a Joint Holding Company through a joint share transfer. As a result, they will become wholly-owned subsidiaries of the Joint Holding Company to be established and will be delisted.<br> • However, the Companies plan to apply to the Tokyo Stock Exchange and the Nagoya Stock Exchange for a technical listing of the shares of the Joint Holding Company to be newly delivered to the shareholders of the Companies, which they plan to list on the Prime Market of the Tokyo Stock Exchange and the Premier Market of the Nagoya Stock Exchange. Therefore, it is planned that shareholders will continue to be able to trade shares of the Joint Holding Company in share units.<br>|
| &nbsp;&nbsp;Why did the Companies choose to make the Joint Holding Company a company with an Audit & Supervisory Committee? | • Currently, the Companies are both companies with an Audit & Supervisory Committee, and they chose the same structure for the Joint Holding Company as they determined that establishing an Audit & Supervisory Committee composed of Directors concurrently serving as Audit & Supervisory Committee Members, including multiple Outside Directors, in order to further enhance the corporate governance systems of the Joint Holding Company would further strengthen the oversight function of the Board of Directors and ensure the transparency and increase the efficiency of group management. |
| &nbsp;&nbsp;Regarding shares | &nbsp;&nbsp;Regarding shares |
| &nbsp;&nbsp;What types of procedures will the shareholders of Hagiwara Electric and Satori Electric need to conduct in connection to the joint share transfer? | • Shareholders are asked to determine whether to vote for or against the relevant proposals at the general meeting of shareholders of each of the Companies.<br> • If the proposals are approved, shares of the Joint Holding Company will be delivered to shareholders who hold shares of either of the Companies as of the effective date of the share transfer, and therefore no particular procedures are necessary. |
| &nbsp;&nbsp;Will the shares of Hagiwara Electric and Satori Electric still be tradable? Will the people who held shares in Hagiwara Electric or Satori Electric cease to be shareholders thereof? | • The Companies will become wholly-owned subsidiaries of the Joint Holding Company through the share transfer, and therefore, prior to the listing of the Joint Holding Company, the final market trading date for the shares of each of the Companies is planned to be Friday, March 27, 2026. On Monday, March 30, 2026, Hagiwara Electric is planned to be delisted from the Tokyo Stock Exchange and the Nagoya Stock Exchange, and Satori Electric is planned to be delisted from the Tokyo Stock Exchange. On Wednesday, April 1, 2026, the Companies plan to allot shares of the Joint Holding Company to be |

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| | |
|:---|:---|
| &nbsp;&nbsp;Question | &nbsp;&nbsp;Answer |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;newly established to the shareholders of each of the Companies as of the effective date of the joint share transfer, and they plan to apply to the Tokyo Stock Exchange and the Nagoya Stock Exchange for a technical listing of the shares of the Joint Holding Company, which they plan to list on the Prime Market of the Tokyo Stock Exchange and the Premier Market of the Nagoya Stock Exchange. Therefore, it is planned that shareholders of each of the Companies will continue to be able to trade shares of the Joint Holding Company in share units. |
| &nbsp;&nbsp;Regarding dividends | &nbsp;&nbsp;Regarding dividends |
| &nbsp;&nbsp;How will interim dividends and year-end dividends be handled? | • Satori Electric (the Company) plans to pay a dividend of 44 yen per share with a record date of November 30, 2025, which is the end of the second quarter of the fiscal year ending May 2026. In addition, given that the effective date of the Business Integration is scheduled for April 1, 2026, Satori Electric plans to cancel its year-end dividend for the fiscal year ending May 2026. Instead, the Company intends to pay a special dividend of 46 yen per share with a record date of March 31, 2026. This is conditional upon the approval of the Share Transfer Plan for the Business Integration by a special resolution at the extraordinary general meetings of shareholders of both companies, scheduled for December 11, 2025. |
| &nbsp;&nbsp;How will the Joint Holding Company's dividends with a record date of March 31, 2027 be handled? | • The Companies plan to determine the amount of the Joint Holding Company's dividends for the fiscal year ending March 31, 2027 by comprehensively taking into account factors such as the dividend policies and dividend levels of each of the Companies up to the present and the future performance of the Joint Holding Company, but no specific details have been determined at present. |

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## Exhibit 99.6

The business combination described in this document involves securities of Japanese companies. The business combination is subject to disclosure requirements of Japan that are different from those of the United States. Financial information included in this document, if any, was excerpted from financial statements prepared in accordance with foreign accounting standards that may not be comparable to the financial statements of United States companies.

It may be difficult for you to enforce your rights and any claim you may have arising under the U.S. federal securities laws, since the issuers are located in Japan and some or all of their officers and directors reside outside of the United States. You may not be able to sue a Japanese company or its officers or directors in a Japanese court for violations of the U.S. securities laws.

It may be difficult to compel a Japanese company and its affiliates to subject themselves to a U.S. court's judgment. You should be aware that the issuer may purchase securities otherwise than under the business combination, such as in the open market or through privately negotiated purchases.

Start of measures for electronic provision: November 19, 2025

Extraordinary General Meeting of Shareholders

Reference Documents for Extraordinary General Meeting—

Supplementary Volume

Content of Financial Statements, etc. for the Most Recent Business Year (ended March 2025) for Hagiwara Electric Holdings Co., Ltd.

SATORI ELECTRIC CO., LTD.

\*The above matters are not stated in the document to be delivered to shareholders who have requested delivery of the document in accordance with laws and regulations and Article 14 of the Articles of Incorporation. In addition, at this Extraordinary General Meeting of Shareholders, regardless of whether or not a request for the delivery of a written document is made, a written document containing the items to be provided in electronic measures that excluded above matters will be sent to all shareholders in a uniform manner.

**Business Report**

(April 1, 2024 to March 31, 2025)

**1.** **Matters Relating to the Current Status of the Corporate Group** 

(1) Business developments and results

<u>Overall status</u>

The Company Group has set out a corporate vision of being an engineering solution partner that connects people, society, and technology through advanced electronics, and it is currently promoting "Make New Value 2026," its medium-term management plan for the three years from the fiscal year ending March 31, 2025 to that ending March 31, 2027.

Under the medium-term management plan, the Company Group is aiming to contribute to the creation of a sustainable society and to enhance its corporate value by creating and providing optimal solutions through business innovation activities both inside and outside the group to respond to issues in the areas of mobility and manufacturing in which the Company Group excels, as well as in adjacent industries such as robotics and logistics and in megatrend areas such as smart cities and energy that utilize digital technology.

In the environment surrounding the Company Group during the consolidated fiscal year under review, future outlooks continued to be uncertain due to factors such as sudden changes in exchange rates and trends such as automobile related companies, which are the group's main users, limiting the production of completed automobiles and industrial equipment related companies reducing their inventories in response to the stagnation of the Chinese market and other reasons.

Amid this environment, in order to enact structural reforms and establish business foundations under the medium-term management plan, the Company Group engaged in efforts to create business opportunities by expanding customers in the semiconductors and electronic components business and the subcontracting business, conducted M&A transactions to establish and strengthen new businesses, and increased growth investments, such as human capital investments and system investments.

As a result, in the consolidated fiscal year under review, net sales were 258,742 million yen (an increase of 14.9% year-on-year), operating profit was 7,112 million yen (a decrease of 7.8% year-on-year), ordinary profit was 6,210 million yen (a decrease of 14.0% year-on-year), and profit attributable to owners of parent was 3,699 million yen (a decrease of 16.3% year-on-year), and the Company Group therefore recorded increased income but decreased profit.

Segment performance is as follows.

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| | |
|:---|:---|
| &nbsp;&nbsp; <u>Status of segments</u><br>Electronic devices business<br> In the electronic devices business, the Company Group is engaged in sales and technological support for semiconductors and electronic components used for purposes such as system LSI (system on a chip) units for automobiles, in which electric controls are progressing, and contracted development relating mainly to development support and embedded software for proof-of-concepts of embedded systems. | &nbsp;&nbsp; <br> ![](image_006.jpg) |
| &nbsp;&nbsp;In the consolidated fiscal year under review, although demand for semiconductors and electronic components has failed to grow due to limited production of automobiles, net sales in the electronic devices business were 226,319 million yen (a year-on-year increase of 15.4%) due to factors such as the acquisition of new sales channels and increased income from the weak yen. However, operating profit was 5,688 million yen (a year-on-year increase of 0.3%) due to factors such as a decline following the one-off profits that arose in the previous year, an increase in human capital investments and other growth investments, and an increase in transfer compensation payments in connection with the transfer of sales channels. | &nbsp;&nbsp;In the consolidated fiscal year under review, although demand for semiconductors and electronic components has failed to grow due to limited production of automobiles, net sales in the electronic devices business were 226,319 million yen (a year-on-year increase of 15.4%) due to factors such as the acquisition of new sales channels and increased income from the weak yen. However, operating profit was 5,688 million yen (a year-on-year increase of 0.3%) due to factors such as a decline following the one-off profits that arose in the previous year, an increase in human capital investments and other growth investments, and an increase in transfer compensation payments in connection with the transfer of sales channels. |

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| | |
|:---|:---|
| &nbsp;&nbsp; <br> Technology solutions business<br> In the technology solutions business, the Company Group provides operational consulting and IoT solutions, offers proposals on building IT platforms, and sells IT equipment, measuring devices, and embedded devices, in addition to which it is engaged in designing, manufacturing, and selling factory automation systems and specialized measurement systems and developing, manufacturing, and selling industrial computers. <br>| &nbsp;&nbsp;![](image_007.jpg) |
| &nbsp;&nbsp; In the consolidated fiscal year under review, despite the impact of customers reducing their inventories in the embedded solutions area, where the Company Group's main customers are industrial equipment related companies, sales in the factory automation engineering area increased due to capturing demand for reinforcing manufacturing equipment and other such projects, driving net sales in the technology solutions business to 32,423 million yen (a year-on-year increase of 11.7%). However, operating profit was 1,423 million yen (a year-on-year decrease of 30.2%) due to receiving orders for projects involving temporary cost increases to build production lines in new areas and making human capital investments and growth investments, such as those for developing the next generation of the Company Group's own products. | &nbsp;&nbsp; In the consolidated fiscal year under review, despite the impact of customers reducing their inventories in the embedded solutions area, where the Company Group's main customers are industrial equipment related companies, sales in the factory automation engineering area increased due to capturing demand for reinforcing manufacturing equipment and other such projects, driving net sales in the technology solutions business to 32,423 million yen (a year-on-year increase of 11.7%). However, operating profit was 1,423 million yen (a year-on-year decrease of 30.2%) due to receiving orders for projects involving temporary cost increases to build production lines in new areas and making human capital investments and growth investments, such as those for developing the next generation of the Company Group's own products. |

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(2) Status of capital investments<br>

There are no applicable matters.

(3) Status of financing

The Company Group obtained financing through means such as long-term loans of 11.2 billion yen to be used for flexible and stable funding to respond to financing needs in connection with the increased business scale of the Company Group and for repaying long-term loans and other such obligations.

In addition, as of the end of the consolidated fiscal year under review, there is no outstanding loan balance under the committed credit line agreement for 30.0 billion yen (with a committed credit line period of October 1, 2024 to September 30, 2027).

(4) Status of assets and profits or losses

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| | | | | |
|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;Item | &nbsp;&nbsp;65th fiscal year (April 1, 2021 to March 31, 2022) | &nbsp;&nbsp;66th fiscal year (April 1, 2022 to March 31, 2023) | &nbsp;&nbsp;67th fiscal year (April 1, 2023 to March 31, 2024) | &nbsp;&nbsp;68th fiscal year (consolidated fiscal year under review) (April 1, 2024 to March 31, 2025) |
| &nbsp;&nbsp;Net sales (millions of yen) | &nbsp;&nbsp;158427 | &nbsp;&nbsp;186001 | &nbsp;&nbsp;225150 | &nbsp;&nbsp;258742 |
| &nbsp;&nbsp;Ordinary profit (millions of yen) | &nbsp;&nbsp;4335 | &nbsp;&nbsp;6417 | &nbsp;&nbsp;7221 | &nbsp;&nbsp;6210 |
| &nbsp;&nbsp;Profit attributable to owners of parent (millions of yen) | &nbsp;&nbsp;2876 | &nbsp;&nbsp;4912 | &nbsp;&nbsp;4421 | &nbsp;&nbsp;3699 |
| &nbsp;&nbsp;Earnings per share (yen) | &nbsp;&nbsp;325.07 | &nbsp;&nbsp;554.71 | &nbsp;&nbsp;458.80 | &nbsp;&nbsp;371.30 |
| &nbsp;&nbsp;Total assets (millions of yen) | &nbsp;&nbsp;82482 | &nbsp;&nbsp;106577 | &nbsp;&nbsp;119706 | &nbsp;&nbsp;130161 |
| &nbsp;&nbsp;Net assets (millions of yen) | &nbsp;&nbsp;39369 | &nbsp;&nbsp;43531 | &nbsp;&nbsp;50361 | &nbsp;&nbsp;52978 |
| &nbsp;&nbsp;Net assets per share (yen) | &nbsp;&nbsp;4208.13 | &nbsp;&nbsp;4672.91 | &nbsp;&nbsp;4839.87 | &nbsp;&nbsp;5099.30 |

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![](image_008.jpg)

(5) Issues to be addressed and management policy

Since its founding, the Company Group has set out "creativity and ambition" as its philosophy, and focusing its efforts on the field of electronics, it has provided optimal solutions to its customers in the manufacturing industry, mainly the automotive industry.

Currently, the environment surrounding the Company Group is changing radically in ways such as efforts to create new business models on a global scale that cross industry boundaries and the emergence of new technologies such as IoT and AI.

In addition, it is anticipated that, particularly among main customers, the implementation of electronic systems for achieving the next-generation mobility-focused society, investment in computerization for digital business management, and capital investment needs will continue to expand, due to which it will be necessary to provide greater added value and speed. In the current environment, it is also necessary to manage the Company Group's business while taking into consideration social issues such as carbon neutrality and coexistence with nature.

Under this environment, the Company Group has set out a corporate vision of being an engineering solution partner that connects people, society, and technology through advanced electronics, and it is currently promoting "Make New Value 2026," its medium-term management plan for the three years from the 68th to 70th fiscal years.

The Company Group will provide optimal solutions that contribute to resolving the issues faced by society and customers by leveraging the unique strengths that it has cultivated up to now, such as its understanding and knowledge of the mobility area, combining business strategies with technology strategies, and strengthening collaboration with partners.

The Company Group aims to contribute to creating value beyond the boundaries of the mobility area in which it has specialized, build appropriate relationships with stakeholders through improved profitability and capital productivity, and improve earning power while simultaneously resolving social issues.

<u>Management policy</u>

Under "Make New Value 2026," its medium-term management plan, the Company Group has set out the enhancement of corporate value by improving earning power as its priority policy. The Company Group also positions the plan period as a time to carry out structural reforms and establish a business base in readiness for a new stage of growth, and by promoting three structural reforms through six key strategies, the Company Group aims to grow its business to net sales of 300.0 billion yen and operating profit of 11.0 billion yen and to achieve an ROE of 11% or higher in the 70th fiscal year, which is the final year under the plan.

**Make New Value 2026**

<u>Priority policy: Enhance corporate value by improving earning power</u>

![](image_009.jpg)

<u>Three structural reforms</u>

The Company Group will work to implement three structural reforms to improve earning power in order to continue growing sustainably.

(i) Enhance proposal value through business model reform

The Company Group will strengthen its earning power by offering proposals to resolve the issues faced by society and customers, thereby enhancing its proposal value.

In regard to existing business models such as the wholesale business, system integration, and the manufacturing business, the Company Group as a whole will promote a solutions mindset to expand ancillary development and services with added value.

In addition, the Company Group will increase its presence on the market by working to create new business models, such as the platform business that can be expected to achieve profitability by creating value from data.

(ii) Reform management with an awareness of capital productivity

In addition to business model reforms, the Company Group will begin working on reforms to its management style based on an awareness of capital productivity.

The Company Group will establish an internal management structure aware of cost of shareholders' equity and focused on return on invested capital and will build and implement a system that enables a strategic approach toward the business portfolio, thereby aiming to achieve management with an awareness of timely capital productivity.

(iii) Maximize employee power by leveraging human capital

The Company Group will develop human resources with creativity and ambition who will be responsible for promoting business model reforms under a solutions mindset, and it will accelerate the strengthening of foundations for human resources development.

In order to maximize employee performance and synchronize employee activities to achieve management targets, the Company Group will implement and strengthen employee treatment that rewards expertise, opportunities to gain experience through transfers, and a system for managing targets that links company and employee targets in a scalable manner. It will thereby aim to foster employee awareness of their participation in management in preparation for the next growth stage and to achieve corporate management in which all employees work to enhance corporate value.

<u>Six key strategies</u>

The Company Group will provide optimal solutions that resolve the issues faced by society and customers by leveraging the unique strengths that it has cultivated, such as its understanding and knowledge of the mobility area, combining business strategies with technology strategies, and strengthening collaboration both internally and externally.

(i) Devices business strategy

Through efforts to expand the size of the semiconductor and electronic component wholesale business, which is the Company Group's main business, it will broaden and utilize its knowledge of the automotive onboard equipment and electronics areas cultivated so far, thereby aiming to improve earning power by entering new businesses that can be expected to generate added value together with internal and external partners, such as an engineering business that responds to the increasing importance of services in the mobility area and business as a manufacturer.

(ii) Solutions business strategy

The Company Group will achieve the expansion of the size of the three businesses of IT solutions, embedded solutions, and factory automation engineering, which are the Company Group's strengths, by means such as expanding the regions in which it operates, expanding the solutions it offers, and entering into alliances with partners.

In addition, the Company Group will make maximum use of the knowledge gained through the technology solutions business, where its efforts have been mainly focused on the manufacturing industry, and the knowledge of the automotive onboard equipment and electronics areas developed together with the electronic devices business, and it will expand the data platform business to applications not limited to the manufacturing industry under a mindset of providing total solutions, such as lifecycle management that utilizes data in ways including data collection and creating value from data.

By combining these four businesses, the Company Group will develop services and technologies that are applicable not only in manufacturing but also a wide range of industries and thereby aim to enter new markets and improve earning power.

(iii) Business innovation strategy

In addition to co-creation within the Company Group, it will accelerate the creation of new earning power through innovations achieved via collaboration and technological cooperation with other companies.

(iv) Advanced business management

The Company Group will streamline operations and optimize management resources by promoting IT and digital transformation and accelerate efforts to transition to a management style with an awareness of capital productivity.

(v) Human resources strategy

The Company Group will maximize the capabilities of all employees through human capital-focused management that utilizes the strengths of people who possess the qualities characteristic of the Company Group.

(vi) ESG promotion

The Company Group will enhance efforts in areas such as climate change and human capital while responding to external demands.

By expanding communication with a wide range of stakeholders through information disclosure, the Company Group will aim to increase environmental value, social value, and economic value and to further advance its sustainability initiatives.

(6) Main businesses (as of March 31, 2025)

(i) Electronic devices business

The Company Group is engaged in the sale of integrated circuits, semiconductors, and general electronic components and the contracted development business focusing mainly on software.

(ii) Technology solutions business

The Company Group is engaged in the sale of electronic equipment, the manufacture and sale of factory automation equipment and other such equipment, the creation of IT platforms and IoT systems, and the development, manufacture, and sale of other various manufacturing equipment.

(7) Main business locations (as of March 31, 2025)

(i) The Company

Name <u>Location</u> <br> <u>Hagiwara Electric Holdings Co., Ltd.</u> <u>Headquarters (Nagoya-shi, Aichi)</u>

(ii) Subsidiaries

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| | |
|:---|:---|
| &nbsp;&nbsp;Name | &nbsp;&nbsp;Location |
| &nbsp;&nbsp;Hagiwara Electronics Co., Ltd. | &nbsp;&nbsp; Headquarters (Nagoya-shi, Aichi)<br> Kansai Office (Osaka-shi, Osaka)<br> Miyoshi Distribution Center (Miyoshi-shi, Aichi) |
| &nbsp;&nbsp;Hagiwara Techno Solutions Co., Ltd. | &nbsp;&nbsp; Headquarters (Nagoya-shi, Aichi)<br> Tokyo Branch (Minato-ku, Tokyo)<br> Kansai Branch (Osaka-shi, Osaka)<br> Nisshin Office (Nisshin-shi, Aichi)<br> Kyushu Residence (Fukuoka-shi, Fukuoka) |
| &nbsp;&nbsp;Hagiwara Engineering Co., Ltd. | &nbsp;&nbsp;Headquarters (Iruma-shi, Saitama) |
| &nbsp;&nbsp;Hagiwara Hokuto Techno Co., Ltd. | &nbsp;&nbsp; Headquarters (Nagoya-shi, Aichi)<br> Sapporo Office (Sapporo-shi, Hokkaido) |
| &nbsp;&nbsp;Singapore Hagiwara Pte. Ltd. | &nbsp;&nbsp;Republic of Singapore |
| &nbsp;&nbsp;Hagiwara America, Inc. | &nbsp;&nbsp;United States of America |
| &nbsp;&nbsp;Hagiwara Electric Korea Co., Ltd. | &nbsp;&nbsp;Republic of Korea |
| &nbsp;&nbsp;Hagiwara (Shanghai) Co., Ltd. | &nbsp;&nbsp;People's Republic of China |
| &nbsp;&nbsp;Hagiwara Electric Europe GmbH | &nbsp;&nbsp;Federal Republic of Germany |
| &nbsp;&nbsp;Hagiwara Electric (Thailand) Co., Ltd. | &nbsp;&nbsp;Kingdom of Thailand |
| &nbsp;&nbsp;Hagiwara Electronics India Private Limited | &nbsp;&nbsp;Republic of India |
| &nbsp;&nbsp;Hagiwara Techno Solutions (Shanghai) Co., Ltd. | &nbsp;&nbsp;People's Republic of China |
| &nbsp;&nbsp;Hagiwara Electronics Hong Kong Limited | &nbsp;&nbsp;People's Republic of China |
| &nbsp;&nbsp;BellaDati Pte. Ltd. | &nbsp;&nbsp;Republic of Singapore |

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(Note 1) Hagiwara Techno Solutions Co., Ltd., a consolidated subsidiary of the Company, closed its Toyota Distribution Center (Toyota-shi, Aichi) and Nagoya Distribution Center (Nagoya-shi, Aichi) on August 19, 2024.

(Note 2) Hagiwara Techno Solutions Co., Ltd., a consolidated subsidiary of the Company, acquired the shares of BellaDati Pte. Ltd. and made it a subsidiary on July 16, 2024.

(8) Status of employees (as of March 31, 2025)

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp;Category | &nbsp;&nbsp;Number of employees | &nbsp;&nbsp;Change from end of previous consolidated fiscal year |
| &nbsp;&nbsp;Electronic devices business | &nbsp;&nbsp;409 (39) | &nbsp;&nbsp;Increase of 52 (increase of 5) |
| &nbsp;&nbsp;Technology solutions business | &nbsp;&nbsp;284 (61) | &nbsp;&nbsp;Increase of 14 (increase of 4) |
| &nbsp;&nbsp;All companies (general) | &nbsp;&nbsp;115 (17) | &nbsp;&nbsp;Increase of 6 (increase of 2) |
| &nbsp;&nbsp;Total | &nbsp;&nbsp;808 (117) | &nbsp;&nbsp;Increase of 72 (increase of 11) |

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(Note 1) The number of employees excludes five employees on temporary loan from the Company Group to other companies and includes ten employees on temporary loan from other companies to the Company Group.

(Note 2) The number of temporary employees as of the end of the fiscal year is stated in parentheses and is not included in the preceding number.

(9) Main lenders (as of March 31, 2025)

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| | |
|:---|:---|
| &nbsp;&nbsp;Lender | &nbsp;&nbsp;Borrowed amount (millions of yen) |
| &nbsp;&nbsp;MUFG Bank, Ltd. | &nbsp;&nbsp;12897 |
| &nbsp;&nbsp;Sumitomo Mitsui Banking Corporation | &nbsp;&nbsp;11148 |
| &nbsp;&nbsp;Resona Bank, Limited | &nbsp;&nbsp;3000 |
| &nbsp;&nbsp;The Bank of Yokohama, Ltd. | &nbsp;&nbsp;2200 |
| &nbsp;&nbsp;The Bank of Kyoto, Ltd. | &nbsp;&nbsp;2000 |
| &nbsp;&nbsp;The Hiroshima Bank, Ltd. | &nbsp;&nbsp;1425 |
| &nbsp;&nbsp;Aichi Bank Ltd. | &nbsp;&nbsp;1375 |
| &nbsp;&nbsp;The Bank of Nagoya, Ltd. | &nbsp;&nbsp;1080 |
| &nbsp;&nbsp;The Iyo Bank, Ltd. | &nbsp;&nbsp;1000 |
| &nbsp;&nbsp;Sumitomo Mitsui Trust Bank, Limited | &nbsp;&nbsp;800 |

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(Note) The amount borrowed from MUFG Bank, Ltd. includes 10.0 billion yen in outstanding corporate bonds (private
placement bonds).

(10) Status of significant subsidiaries

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;Company name | &nbsp;&nbsp;Share capital | &nbsp;&nbsp;Ratio of voting rights held by the Company | &nbsp;&nbsp;Main businesses |
| &nbsp;&nbsp;Hagiwara Electronics Co., Ltd. | &nbsp;&nbsp;1,310,000,000 JPY | &nbsp;&nbsp;100% | &nbsp;&nbsp;Electronic devices business |
| &nbsp;&nbsp;Hagiwara Techno Solutions Co., Ltd. | &nbsp;&nbsp;310,000,000 JPY | &nbsp;&nbsp;100% | &nbsp;&nbsp;Technology solutions business |
| &nbsp;&nbsp;Hagiwara Engineering Co., Ltd. | &nbsp;&nbsp;484,000,000 JPY | &nbsp;&nbsp;100% | &nbsp;&nbsp;Technology solutions business |
| &nbsp;&nbsp;Hagiwara Hokuto Techno Co., Ltd. | &nbsp;&nbsp;45,000,000 JPY | &nbsp;&nbsp;66.6% | &nbsp;&nbsp;Electronic devices business |
| &nbsp;&nbsp;Singapore Hagiwara Pte. Ltd. | &nbsp;&nbsp;500,000 SGD | &nbsp;&nbsp;100% | &nbsp;&nbsp;Electronic devices business |
| &nbsp;&nbsp;Hagiwara America, Inc. | &nbsp;&nbsp;2,500,000 USD | &nbsp;&nbsp;100% | &nbsp;&nbsp;Electronic devices business |
| &nbsp;&nbsp;Hagiwara Electric Korea Co., Ltd. | &nbsp;&nbsp;2,613,585,000 KRW | &nbsp;&nbsp;100% | &nbsp;&nbsp;Electronic devices business |
| &nbsp;&nbsp;Hagiwara (Shanghai) Co., Ltd. | &nbsp;&nbsp;10,300,000 USD | &nbsp;&nbsp;100% | &nbsp;&nbsp;Electronic devices business |
| &nbsp;&nbsp;Hagiwara Electric Europe GmbH | &nbsp;&nbsp;500,000 EUR | &nbsp;&nbsp;100% | &nbsp;&nbsp;Electronic devices business |
| &nbsp;&nbsp;Hagiwara Electric (Thailand) Co., Ltd. | &nbsp;&nbsp;31,500,000 THB | &nbsp;&nbsp;100% | &nbsp;&nbsp;Electronic devices business |
| &nbsp;&nbsp;Hagiwara Electronics India Private Limited | &nbsp;&nbsp;10,000,000 INR | &nbsp;&nbsp;100% | &nbsp;&nbsp;Electronic devices business |
| &nbsp;&nbsp;Hagiwara Techno Solutions (Shanghai) Co., Ltd. | &nbsp;&nbsp;100,000,000 JPY | &nbsp;&nbsp;100% | &nbsp;&nbsp;Technology solutions business |
| &nbsp;&nbsp;Hagiwara Electronics Hong Kong Limited | &nbsp;&nbsp;300,000 USD | &nbsp;&nbsp;100% | &nbsp;&nbsp;Electronic devices business |
| &nbsp;&nbsp;BellaDati Pte. Ltd. | &nbsp;&nbsp;130,000 SGD | &nbsp;&nbsp;100% | &nbsp;&nbsp;Technology solutions business |

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(Note) The ratio of voting rights held by the Company includes those indirectly held.

(11) Other significant matters relating to the current status of the corporate group

Hagiwara Techno Solutions Co., Ltd., a consolidated subsidiary of the Company, acquired the shares of BellaDati Pte. Ltd. and made it a subsidiary on July 16, 2024.

**2.** **Matters Relating to Shares (As of March 31, 2025)** 

(1) Total number of authorized shares: 16,000,000

(2) Total number of issued shares: 10,118,000 (including 153,044 treasury shares)

(3) Number of shareholders: 7,214

(4) Major shareholders

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp;Shareholder name | &nbsp;&nbsp;Number of shares held | &nbsp;&nbsp;Shareholding ratio |
| &nbsp;&nbsp;The Master Trust Bank of Japan, Ltd. (trust account) | &nbsp;&nbsp;1417900 | &nbsp;&nbsp;14.23% |
| &nbsp;&nbsp;Custody Bank of Japan, Ltd. (trust account) | &nbsp;&nbsp;733500 | &nbsp;&nbsp;7.36% |
| &nbsp;&nbsp;Stany Co., Ltd. | &nbsp;&nbsp;503250 | &nbsp;&nbsp;5.05% |
| &nbsp;&nbsp;Tomoaki Hagiwara | &nbsp;&nbsp;341482 | &nbsp;&nbsp;3.43% |
| &nbsp;&nbsp;MUFG Bank, Ltd. | &nbsp;&nbsp;232500 | &nbsp;&nbsp;2.33% |
| &nbsp;&nbsp;Nagoya Small and Medium Business Investment & Consultation Co., Ltd. | &nbsp;&nbsp;230000 | &nbsp;&nbsp;2.31% |
| &nbsp;&nbsp;Hagiwara Foundation of Japan | &nbsp;&nbsp;230000 | &nbsp;&nbsp;2.31% |
| &nbsp;&nbsp;Sumitomo Mitsui Trust Bank, Limited | &nbsp;&nbsp;178000 | &nbsp;&nbsp;1.79% |
| &nbsp;&nbsp;Sachiko Hagiwara | &nbsp;&nbsp;162575 | &nbsp;&nbsp;1.63% |
| &nbsp;&nbsp;State Street Bank and Trust Company 505223 | &nbsp;&nbsp;140900 | &nbsp;&nbsp;1.41% |

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(Note 1) The Company holds 153,044 treasury shares but is excluded from the major shareholders stated above.

(Note 2) Shareholding ratios have been calculated after deducting the number of treasury shares.

(5) Status of shares delivered to the Company's Directors as consideration for the performance of their
duties during the business year under review

<u>Number of shares</u> <u>Number of recipients</u> <br> <u>Directors (excluding Audit and Supervisory Committee Members and Outside Directors)</u> <u>2,461</u> <u>3</u>

(Note) The details of the Company's share compensation are stated in section "4.(4) Director compensation,
etc."

**3.** **Matters Relating to Share Options** 

There are no applicable matters

**4.** **Matters Relating to Company Officers** 

(1) Status of Directors (as of March 31, 2025)

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp;Position at the Company | &nbsp;&nbsp;Name | &nbsp;&nbsp;Responsibilities and significant concurrent positions |
| &nbsp;&nbsp;President and Representative Director | &nbsp;&nbsp;Moritaka Kimura | &nbsp;&nbsp; Supervising Corporate Strategy Division<br> Supervising Internal Auditing Department |
| &nbsp;&nbsp;Senior Vice President | &nbsp;&nbsp;Tomoaki Hagiwara | &nbsp;&nbsp;Supervising General Affairs & Personnel Division |
| &nbsp;&nbsp;Senior Vice President | &nbsp;&nbsp;Yoshihiro Hirakawa | &nbsp;&nbsp; Supervising Accounting & Finance Division<br> Supervising IT Strategy Division |
| &nbsp;&nbsp;Director | &nbsp;&nbsp;Shinichi Okamoto | &nbsp;&nbsp; Outside Director of Digital Media Professionals Inc.<br> Director of Blue Shift Technology Inc. |
| &nbsp;&nbsp;Director | &nbsp;&nbsp;Kyoko Hayashi | &nbsp;&nbsp; Professor, Graduate School of Management, Globis University<br> Senior Faculty Director, Faculty Division, Globis Corporation<br> Outside Director of Eat & Holdings Co., Ltd<br> Outside Director (Audit and Supervisory Committee Member) of KOA SHOJI HOLDINGS Co., Ltd. |
| &nbsp;&nbsp;Director (Full-time Audit and Supervisory Committee Member) | &nbsp;&nbsp;Noriaki Inoue |  |
| &nbsp;&nbsp;Director (Audit and Supervisory Committee Member) | &nbsp;&nbsp;Hisashi Hayakawa | &nbsp;&nbsp;Attorney at law |
| &nbsp;&nbsp;Director (Audit and Supervisory Committee Member) | &nbsp;&nbsp;Sachiko Enomoto | &nbsp;&nbsp; Certified public accountant<br> Domestic Relations Conciliation Commissioner of Nagoya Family Court<br> Civil Mediation Commissioner of Nagoya District<br> Court and Nagoya Summary Court<br> Outside Audit & Supervisory Board Member of TAIHO KOGYO CO., LTD.<br> Audit & Supervisory Board Member of Enomoto Corporation |

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(Note 1) Directors Shinichi Okamoto and Kyoko Hayashi and Directors (Audit and Supervisory Committee Members) Hisashi Hayakawa and Sachiko Enomoto are Outside Directors.

(Note 2) Director (Audit and Supervisory Committee Member) Hisashi Hayakawa possesses certification as an attorney at law and has a substantial degree of knowledge in regard to corporate legal affairs and law.

(Note 3) Director (Audit and Supervisory Committee Member) Sachiko Enomoto possesses certification as a certified public accountant and has a substantial degree of knowledge in regard to finance and accounting.

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| | |
|:---|:---|
| (Note 4) | The Company has designated Directors Shinichi Okamoto and Kyoko Hayashi and Directors (Audit and Supervisory Committee Members) Hisashi Hayakawa and Sachiko Enomoto as independent officers pursuant to the regulations of the Tokyo Stock Exchange and Nagoya Stock Exchange and has registered them as independent officers therewith. |

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| | |
|:---|:---|
| (Note 5) | The Audit and Supervisory Committee has appointed Noriaki Inoue as a Full-time Audit and Supervisory Committee Member in order to enhance information gathering, increase the effectiveness of audits through full cooperation with the internal audit department and other departments, and strengthen the committee's audit and supervisory functions. |

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(Note 6) Changes in Directors during the business year under review are as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Directors (Audit and Supervisory Committee Members) Keizo Miyamoto and Osamu Tsujinaka left office upon
the completion of their terms at the end of the 67th Ordinary General Meeting of Shareholders held on June 27, 2024.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Noriaki Inoue and Sachiko Enomoto were newly elected and assumed office as Directors (Audit and Supervisory
Committee Members) at the 67th Ordinary General Meeting of Shareholders held on June 27, 2024.

(Note 7) The Company has adopted an executive officer system in order to appropriately respond to changes in the management environment and increase the speed and efficiency of business execution. The Company has two executive officers, Tatsuhito Sato and Masayuki Hasegawa.

(2) Summary of content of liability limitation agreements

Pursuant to Article 427, paragraph (1) of the Companies Act, the Company has entered into a liability limitation agreement with each Outside Director limiting their liability for the damage set out in Article 423, paragraph (1) of the Companies Act.

The maximum amount of liability for damages under those agreements is the minimum liability amount set out in Article 425, paragraph (1) of the Companies Act.

(3) Summary of content of directors and officers liability insurance policy

The Company has entered into a directors and officers liability insurance policy set out in Article 430-3, paragraph (1) of the Companies Act with an insurance company. The Directors, Audit and Supervisory Board Members, executive officers, and other such officers of the Company and its subsidiaries are the insured parties under that insurance policy, and the insurance fees are borne entirely by the Company. Under that insurance policy, insurance benefits will be paid for damage, etc. in cases where an insured party bears liability for damages arising from acts conducted in regard to their duties. However, to ensure that the appropriateness of the performance of the duties of the insured parties is not impaired, insurance benefits will not be paid in cases where an insured party knowingly engages in a criminal, illegal, or other such act.

(4) Director compensation, etc.

(i) Policy, etc. on determining details of Director compensation, etc.

The Company has established a policy on determining the details of compensation, etc. for individual Directors of the Company. That policy has been approved by resolutions of the Board of Directors meetings held on February 26, 2021, May 31, 2021, and May 30, 2022, and those resolutions include a partial review of the policy to clarify the involvement of the Nomination and Compensation Advisory Committee.

Before passing those resolutions, the Board of Directors requested the Nomination and Compensation Advisory Committee to consider the content of the resolutions in advance and received a report that the policy was appropriate.

In addition, the Board of Directors has established procedures for determining the details of compensation, etc. for individual Directors (excluding Audit and Supervisory Committee Members) wherein the Company requests the Nomination and Compensation Advisory Committee to consider those details and provide a report. Through these procedures, by receiving a report from the Nomination and Compensation Advisory Committee that the matters it was requested to consider are appropriate, the Board of Directors ensures that the details of compensation, etc. for individual Directors (excluding Audit and Supervisory Committee Members) are consistent with the policy on determining those details.

The policy on determining the details of compensation, etc. for individual Directors is as follows.

i. Basic policy

When determining the compensation of individual Directors of the Company, the Company has established a basic policy of setting compensation at an appropriate level in consideration of the typical compensation levels of other companies and maintaining balance with employee wages. Specifically, the compensation of Directors (excluding Audit and Supervisory Committee Members and Outside Directors) is composed of base compensation (monetary compensation), performance-based compensation (bonuses), and restricted stock compensation, and the compensation of Directors concurrently serving as Audit and Supervisory Committee Members and of Outside Directors is composed only of base compensation (monetary compensation) in light of their duties. The Company does not pay officer severance bonuses (however, excluding the payment of officer severance bonuses pursuant to the "Cut-off Payment in Connection with Abolition of Officer Severance Bonus System" approved at the 56th Ordinary General Meeting of Shareholders held on June 27, 2013).

ii. Policy on determining the amount of base compensation (monetary compensation) for individual Directors
(including the policy on determining the timing of and conditions for granting compensation, etc.)

Base compensation (monetary compensation) is a fixed monthly amount, and the amount of compensation for individual Directors is determined by adding base Director compensation, position-based compensation, and Representative Director compensation.

iii. Policy on determining the details and amount or calculation method of performance-based compensation,
etc. and non-monetary compensation, etc. (including the policy on determining the timing of and conditions for granting compensation,
etc.)

The performance indicator for performance-based compensation (bonuses) is based on the amount of employee bonuses paid, which use ordinary profit as a performance indicator. Individual Director evaluations are then reflected, and performance-based compensation is paid at a specified time each year as an individual-specific bonus amount.

Restricted stock compensation is paid as non-monetary compensation. A specified portion of base compensation is issued as monetary compensation claims to the Directors (excluding Audit and Supervisory Committee Members and Outside Directors) at a specified time each year, and by paying all of those monetary compensation claims as an in-kind investment, the Directors receive an allotment of restricted stock subject to transfer restrictions until the expiration of the transfer restriction period.

iv. Policy on proportions of compensation, etc.

The Nomination and Compensation Advisory Committee considers the proportion of each type of compensation for Directors (excluding Audit and Supervisory Committee Members and Outside Directors) based on the benchmark proportions of other corporations with similar compensation structures. The Representative Director and President, as entrusted under item v. below, respects the report delivered by the Nomination and Compensation Advisory Committee and determines the details of compensation, etc. for individual Directors (excluding Audit and Supervisory Committee Members and Outside Directors) using the proportion of each type of compensation set out in the report as a guideline.

v. Matters relating to determination of details of compensation, etc. for individual Directors

The Board of Directors determines the composition of compensation, etc. for individual Directors (excluding Audit and Supervisory Committee Members) and the standards for calculating each type of compensation after requesting the Nomination and Compensation Advisory Committee to consider those matters and receiving a report therefrom.

The Representative Director and President is entrusted under a resolution of the Board of Directors to determine the specific amounts of compensation for individual Directors. That resolution grants the Representative Director and President authority to determine the monthly amount of base compensation (monetary compensation), the apportionment and payment timing of performance-based compensation (bonuses) based on the individual evaluation of each Director, and the amount and payment timing of officer severance bonuses pursuant to the "Cut-off Payment in Connection with Abolition of Officer Severance Bonus System" approved at the 56th Ordinary General Meeting of Shareholders held on June 27, 2013. To ensure that that authority is appropriately exercised by the Representative Director and President, the Board of Directors requests the Nomination and Compensation Advisory Committee to consider the above matters and receives a report therefrom, and the Representative Director and President, as entrusted above, must determine the above matters in accordance with that report. In regard to restricted stock compensation, the Board of Directors resolves on the number of shares to be allotted to each individual Director in accordance with the standards set out in a report received from the Nomination and Compensation Advisory Committee.

(ii) Total amount of Director compensation, etc. during the business year under review

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  | &nbsp;&nbsp;Total amount of compensation, etc. by type (millions of yen) | &nbsp;&nbsp;Total amount of compensation, etc. by type (millions of yen) | &nbsp;&nbsp;Total amount of compensation, etc. by type (millions of yen) |  |
| &nbsp;&nbsp;Category | &nbsp;&nbsp;Total amount of compensation, etc. (millions of yen) | &nbsp;&nbsp;Base compensation | &nbsp;&nbsp;Performance-based compensation, etc. | &nbsp;&nbsp;Non-monetary compensation, etc. | &nbsp;&nbsp;Number of Directors paid |
| &nbsp;&nbsp; Directors (excluding Audit and Supervisory Committee Members)<br>(Outside Directors (included in the above)) | &nbsp;&nbsp; 130<br>(17) | &nbsp;&nbsp; 94<br>(17) | &nbsp;&nbsp; 26<br>(–) | &nbsp;&nbsp; 9<br>(–) | &nbsp;&nbsp; 5<br>(2) |
| &nbsp;&nbsp; Directors (Audit and Supervisory Committee Members)<br>(Outside Directors (included in the above)) | &nbsp;&nbsp; 36<br>(17) | &nbsp;&nbsp; 36<br>(17) | &nbsp;&nbsp; –<br>(–) | &nbsp;&nbsp; –<br>(–) | &nbsp;&nbsp; 5<br>(3) |
| &nbsp;&nbsp; Total<br>(Outside Directors (included in the above)) | &nbsp;&nbsp; 166<br>(34) | &nbsp;&nbsp; 130<br>(34) | &nbsp;&nbsp; 26<br>(–) | &nbsp;&nbsp; 9<br>(–) | &nbsp;&nbsp; 10<br>(5) |

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(Note 1) The above table includes two Directors (Audit and Supervisory Committee Members) who left office upon the close of the 67th Ordinary General Meeting of Shareholders held on June 27, 2024.

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| | |
|:---|:---|
| (Note 2) | In addition to the above table, the Company paid 4,000,000 yen as an officer severance bonus to one former Director pursuant to a resolution of the 56th Ordinary General Meeting of Shareholders held on June 27, 2013. As a result, the payments of officer severance bonuses under that resolution have all been completed. |

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| | |
|:---|:---|
| (Note 3) | The performance indicator for performance-based compensation is based on the amount of employee bonuses paid, which use ordinary profit as a performance indicator. Individual bonus amounts are then calculated and reflect individual Director evaluations. The Company chose the amount of employee bonuses paid as a performance indicator as it is based on ordinary profit, which arises regularly and repeatedly each year through the Company's ordinary economic activities, and the Company therefore determined it to be appropriate as a performance indicator. Ordinary profit for the business year under review was 6,210,000,000 yen. |

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| | |
|:---|:---|
| (Note 4) | Restricted stock compensation is paid as non-monetary compensation, etc. A specified portion of base compensation is issued as monetary compensation claims to the Directors (excluding Audit and Supervisory Committee Members and Outside Directors) at a specified time each year, and by paying all of those monetary compensation claims as an in-kind investment, the Directors receive an allotment of restricted stock subject to transfer restrictions until the expiration of the transfer restriction period.<br> In addition, the details of restricted stock delivered in the business year under review are stated in section "2.(5) Status of shares delivered to the Company's Directors as consideration for the performance of their duties during the business year under review" above. |

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| | |
|:---|:---|
| (Note 5) | The amount of compensation, etc. for Directors (excluding Audit and Supervisory Committee Members) has been set at 500,000,000 yen or less annually (however, excluding the employee salaries of employees who are also Directors) by a resolution of the 59th Ordinary General Meeting of Shareholders held on June 29, 2016.<br> There were seven Directors (excluding Audit and Supervisory Committee Members) as of the close of that general meeting of shareholders.<br> Within the above compensation limit, the 61st Ordinary General Meeting of Shareholders held on June 28, 2018 resolved to introduce a restricted stock compensation system and to set the compensation amount at 100,000,000 yen or less annually and 90,000 shares (which will not be granted to Audit and Supervisory Committee Members and Outside Directors) or less annually.<br> There were six Directors (excluding Audit and Supervisory Committee Members and Outside Directors) as of the close of that general meeting of shareholders. |

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| | |
|:---|:---|
| (Note 6) | The amount of compensation, etc. for Directors (Audit and Supervisory Committee Members) has been set at 80,000,000 yen or less annually by a resolution of the 59th Ordinary General Meeting of Shareholders held on June 29, 2016. There were four Directors (Audit and Supervisory Committee Members) as of the close of that general meeting of shareholders. |

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| | |
|:---|:---|
| (Note 7) | The Board of Directors has entrusted Representative Director and President Moritaka Kimura to determine the monthly amount of base compensation (monetary compensation) of Directors (excluding Audit and Supervisory Committee Members), the apportionment and payment timing of performance-based compensation (bonuses) based on the individual evaluation of each Director (excluding Audit and Supervisory Committee Members and Outside Directors), and the amount and payment timing of officer severance bonuses pursuant to the "Cutoff Payment in Connection with Abolition of Officer Severance Bonus System" approved at the 56th Ordinary General Meeting of Shareholders held on June 27, 2013. The Board of Directors entrusted the determination of those matters to the Representative Director and President because it determined that he is qualified to evaluate each individual Director while taking into account the overall performance of the Company and other such matters. To ensure that that authority is appropriately exercised by the Representative Director and President, the Board of Directors requests the Nomination and Compensation Advisory Committee to consider the above matters and receives a report therefrom, and the Representative Director and President, as entrusted above, must determine the above matters in accordance with that report. |

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(5) Matters relating to outside officers

(i) Significant concurrent positions at other corporations, etc. and relationships between the Company and
those corporations, etc.

There are no applicable matters.

(ii) Status of main activities during the business year under review

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp;Position | &nbsp;&nbsp;Name | &nbsp;&nbsp;Attendance, participation, and summary of duties performed in regard to roles expected of Outside Directors |
| &nbsp;&nbsp;Director | &nbsp;&nbsp;Shinichi Okamoto | &nbsp;&nbsp;Of the meetings held during the business year under review, Shinichi Okamoto attended all 17 Board of Directors meetings and all four Nomination and Compensation Advisory Committee meetings. At Board of Directors meetings, he actively expressed his opinions based on his experience as an engineer and his expert perspective as a research and development consultant. At Nomination and Compensation Advisory Committee meetings he provided comments from an objective viewpoint in regard to the matters being considered. He fulfills an appropriate role in advising and overseeing management as an Outside Director utilizing his abundant experience and deep insight. |
| &nbsp;&nbsp;Director | &nbsp;&nbsp;Kyoko Hayashi | &nbsp;&nbsp;Of the meetings held during the business year under review, Kyoko Hayashi attended all 17 Board of Directors meetings and all four Nomination and Compensation Advisory Committee meetings. At Board of Directors meetings, she actively expressed her opinions based on her abundant experience in areas such as diversity, working style reforms, digital transformation promotion, crisis management, and disaster prevention. At Nomination and Compensation Advisory Committee meetings, she provided comments from an objective viewpoint in regard to the matters being considered. She fulfills an appropriate role in advising and overseeing management as an Outside Director utilizing her abundant experience and deep insight. |
| &nbsp;&nbsp;Director (Audit and Supervisory Committee Member) | &nbsp;&nbsp;Hisashi Hayakawa | &nbsp;&nbsp;Of the meetings held during the business year under review, Hisashi Hayakawa attended 16 of 17 Board of Directors meetings, 13 of 14 Audit and Supervisory Committee meetings, and all four Nomination and Compensation Advisory Committee meetings. At Board of Directors meetings, he actively expressed his opinions mainly from his expert perspective as an attorney. At Audit and Supervisory Committee meetings, he exchanged opinions and provided comments from his expert perspective regarding audit results. At Nomination and Compensation Advisory Committee meetings, he provided comments from an objective viewpoint in regard to the matters being considered. He fulfills an appropriate role in ensuring the appropriateness and validity of decision-making by the Board of Directors through oversight and advice based on his expert knowledge and experience as an attorney. |
| &nbsp;&nbsp;Director (Audit and Supervisory Committee Member) | &nbsp;&nbsp;Sachiko Enomoto | &nbsp;&nbsp;Of the meetings held during the business year under review since Sachiko Enomoto assumed office on June 27, 2024, she attended all 13 Board of Directors meetings, all ten Audit and Supervisory Committee meetings, and all three Nomination and Compensation Advisory Committee meetings. At Board of Directors meetings, she actively expressed her opinions mainly from her expert perspective as a certified public accountant. At Audit and Supervisory Committee meetings, she exchanged opinions and provided comments from her expert perspective regarding audit results. At Nomination and Compensation Advisory Committee meetings, she provided comments from an objective viewpoint in regard to the matters being considered. She fulfills an appropriate role in ensuring the appropriateness and validity of decision-making by the Board of Directors through oversight and advice based on her expert knowledge and experience as a certified public accountant. |

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**5.** **Matters Relating to the Financial Auditor** 

(1) Name

KPMG AZSA LLC

(2) Amount of fees, etc.

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| | |
|:---|:---|
|  | &nbsp;&nbsp;Amount paid |
| (i) Amount of fees, etc. for the financial auditor for the business year under review | &nbsp;&nbsp;34,000,000 yen |
| (ii) Total amount of money and other economic benefits to be paid to the financial auditor by the Company and its subsidiaries | &nbsp;&nbsp;40,000,000 yen |

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| | |
|:---|:---|
| (Note 1) | Of the Company's significant subsidiaries, Singapore Hagiwara Pte. Ltd., Hagiwara America, Inc., Hagiwara Electric Korea Co., Ltd., Hagiwara (Shanghai) Co., Ltd., Hagiwara Electric Europe GmbH, Hagiwara Electric (Thailand) Co., Ltd., Hagiwara Electronics India Private Limited, Hagiwara Techno Solutions (Shanghai) Co., Ltd., Hagiwara Electronics Hong Kong Limited, and BellaDati Pte. Ltd. undergo audits by certified public accountants or audit corporations other than the Company's financial auditor. |

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| | |
|:---|:---|
| (Note 2) | The audit agreement between the Company and the financial auditor does not distinguish between the amounts of audit fees for audits under the Companies Act and for those under the Financial Instruments and Exchange Act, and therefore "(i) Amount of fees, etc. for the financial auditor for the business year under review" above includes the amount of fees, etc. for audits under the Financial Instruments and Exchange Act. |

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| | |
|:---|:---|
| (Note 3) | The Audit and Supervisory Committee performed the necessary verification of matters such as the details of the financial auditor's audit plans, the status of the performance of financial audits, and the basis for calculating the fee estimate, and it determined that the amount of fees, etc. is appropriate and gave its consent in regard thereto. |

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(3) Policy on determining to dismiss or not reappoint the financial auditor

The Audit and Supervisory Committee will determine the content of a proposal to dismiss or to not reappoint the financial auditor to be submitted to the general meeting of shareholders when determining it necessary to do so, such as in cases where there is an obstacle to the financial auditor performing its duties.

In addition, if the Audit and Supervisory Committee determines that the financial auditor has fallen under any item of Article 340, paragraph (1) of the Companies Act, it may dismiss the financial auditor with the consent of all of the Audit and Supervisory Committee Members. In this case, the Audit and Supervisory Committee Member chosen by the Audit and Supervisory Committee shall report the fact that the financial auditor has been dismissed and the reasons therefore at the first general meeting of shareholders convened after the dismissal of the financial auditor.

**6.** **Summary of Content of Resolutions Regarding Systems to Ensure the Appropriateness of Operations** 

The content of Board of Directors resolutions regarding systems for the Company to ensure the appropriateness of its operations is as follows.

(1) Systems to ensure that the performance of duties by Directors and employees complies with laws, regulations,
and the Articles of Incorporation

● In order to ensure that the performance of duties by the Directors and employees of the Company and its subsidiaries complies with laws, regulations, and the Articles of Incorporation, the Company has formulated and works to implement the "Hagiwara Electric Group Corporate Code of Conduct" and "Hagiwara Electric Group Corporate Code of Behavior," in addition to which it conducts ongoing compliance education and awareness activities.

● In order to regularly verify the appropriateness and effectiveness of compliance and internal control systems and to improve and correct problems, the Company has established the Sustainability Committee, which is chaired by the Representative Director and President Executive Officer, and it appropriately develops and operates overall internal controls.

● The Sustainability Committee coordinates and manages the Risk Management Committee, the Internal Control Committee, and the Sustainability Promotion Committee and gathers information within the Company Group through other committees, etc., through which it works to ensure the effectiveness of the internal control systems of the Company Group.

● The Company has established a corporate ethics hotline in order to strengthen its compliance systems.

(2) Regulations and other systems relating to managing the risk of loss

● In order to strengthen the corporate governance of the Company Group, the Board of Directors determines policies on issues to be addressed by the Company as a whole (such as social responsibility and risk measures).

● In accordance with those policies, the Risk Management Committee works to reinforce and strengthen the Company's risk management systems by means such as issuing instructions to the responsible departments and developing and implementing the Risk Management Regulations and other related regulations.

● The Company has established the Information Security Committee to establish and promote the information security systems of the Company Group, and the committee works to develop the Basic Information Security Regulations, the Information Security Operation Standards, and other related regulations, guidelines, and manuals, etc.

(3) Systems to ensure the appropriateness of operations in the corporate group consisting of the Company and
its subsidiaries

● In order to ensure that operations are performed in accordance with laws, regulations, and the Articles of Incorporation as well as to ensure the appropriateness and efficiency of operations, the Company conducts its operations after establishing internal regulations regarding matters such as organizations and the division of duties.

● Those regulations are reviewed whenever necessary, such as upon the amendment or abolition of laws or regulations or when reviewing operations.

● The Company has established an internal audit department independent from the operation execution departments and directly under the supervision of the Representative Director and President Executive Officer, and that department checks the operation processes, etc. of other departments and works to prevent misconduct and improve processes.

● The Company has formulated the Internal Control Regulations in order for related departments to take responsibility under the Internal Control Committee in smoothly and effectively promoting efforts to strengthen the governance of the Company Group, and the Company thereby works to develop and strengthen internal control systems.

● The Company has established various regulations on managing its subsidiaries and affiliates as well as the Overseas Operating Company Management Regulations, and it promotes the establishment of corporate governance systems and internal control systems equivalent to those of the Company in accordance with the size of each company's business, in addition to which it performs the necessary and appropriate management to ensure that the measures stated above function across the corporate group.

(4) Systems relating to retaining and managing information related to the Directors' performance of
their duties

● The Directors have established internal regulations regarding the handling of information and documents relating to the performance of their duties, and they appropriately retain and manage such information and documents pursuant to the provisions of those regulations. The internal regulations are reviewed whenever necessary, such as upon the amendment or abolition of laws or regulations.

(5) Systems to ensure the efficient performance of duties by Directors

● In order to ensure the reasonable and efficient performance of their duties, the Directors have determined the division of roles in relation to their duties, and they execute operations pursuant to the Board of Directors Regulations and their authority pertaining to their duties.

● The Company's monthly management meetings review matters relating to subsidiaries, such as the status of budgets compared to performance, the status of income and expenses, and the progress of significant business plans, and they ensure the efficient performance of duties by holding discussions with subsidiaries as necessary.

(6) Systems to ensure effective audits by the Audit and Supervisory Committee

● The Audit and Supervisory Committee may designate Directors and employees as necessary to assist with the duties of the Audit and Supervisory Committee. In that case, those Directors and employees do not receive instructions or orders from anyone other than Directors concurrently serving as Audit and Supervisory Committee Members.

● The Audit and Supervisory Committee is able to receive information from the internal audit department regarding the status of internal audits, in addition to which it receives reports on the details of significant meetings. Furthermore, Audit and Supervisory Committee Members selected by the Audit and Supervisory Committee may as necessary investigate the status of operations and assets.

● The Audit and Supervisory Committee has regular opportunities to exchange information with the Representative Director and President Executive Officer and the financial auditor.

● The Directors and employees of the Company and its subsidiaries promptly report to the Company's Audit and Supervisory Committee if they discover a violation of laws or regulations in regard to the execution of operations or a situation that risks significantly damaging the relevant company. Persons who make such reports are not subject to any detrimental treatment due to having done so.

● The Company bears any expenses arising in regard to the performance of the duties of the Audit and Supervisory Committee Members as requested thereby.

(7) Systems for excluding anti-social forces

● The Company and its subsidiaries have no business relationships or other relationships with anti-social forces, which threaten social order and sound corporate activities.

● In addition, the Company as a whole takes a firm stance against unjust demands, etc. from anti-social forces, and it gathers and stockpiles related information to develop a framework for excluding anti-social forces.

**7.** **Summary of Status of Operation of Systems to Ensure the Appropriateness of Operations** 

The status of the operation of internal control systems in the Company Group as carried out by the Company in the consolidated fiscal year under review based on the systems to ensure the appropriateness of operations stated in section 6 above is as follows.

(1) Efforts relating to compliance

In order to strengthen the Company's internal controls, it has established the Internal Control Committee, in addition to which it conducts group education for all employees (including internal control education and compliance education), regularly disseminates compliance information, and conducts education through e-learning for employees to gain knowledge on legal affairs relating to practical duties, such as in regard to copyrights and contracts. Furthermore, the Company strengthens internal controls within the group by enabling educational materials to be viewed by employees of overseas operating companies through the Company's internal network and other such means. The Company also holds group education on compliance for Directors and executive officers once per year.

In addition, the Company conducts a survey of all employees once every two years regarding awareness of the Corporate Code of Conduct and Corporate Code of Behavior, and it takes measures to promote and improve compliance.

Patent infringement risk surveys are regularly conducted in regard to technology development operations.

(2) Strengthening risk management systems

The Company has established the Risk Management Committee in order to enable it to precisely manage and respond to various risks surrounding the businesses of the Company Group, and it has developed risk management systems by formulating the Risk Management Regulations and the Business Continuity Plan.

As part of the Business Continuity Plan, the Company conducts safety confirmation tests and evacuation drills for all employees each year, and it conducts tabletop exercises and mobilization tests as needed for members of the Disaster Response Headquarters. In addition, the Risk Management Committee has identified key risks and initiated efforts to reduce them.

In regard to information security measures, the Company conducts countermeasure training for cyberattacks such as targeted email attacks, and it has strengthened its security measures in connection with the introduction of a remote work system.

(3) Enhancing the appropriateness and efficiency of the execution of operations

The Company holds monthly management meetings to consider and provide reports on matters for the purpose of achieving effective corporate management, thereby increasing the effectiveness of discussions at Board of Directors meetings. The Company believes that these activities enhance the appropriateness and efficiency of the execution of operations.

(4) Ensuring the appropriateness of operations in the Company Group

The Company has established various necessary regulations for the purpose of ensuring the appropriateness and efficiency of operations, in addition to which it has established various regulations applicable to all companies of the Company Group as well as the Overseas Operating Company Management Regulations and Overseas Operating Company Management Standards, under which the Company Group endeavors to ensure the appropriateness of its operations. The Company conducts reviews of the standards and procedures for decision-making by overseas operating companies based on factors such as the details and sizes of their businesses, thereby promoting the establishment of internal control systems. The Company has also introduced a whistleblowing system.

(5) Ensuring that audits by the Audit and Supervisory Committee are conducted effectively

The Company's Audit and Supervisory Committee works to enhance the effectiveness of its audits by holding monthly meetings to exchange information and through the Full-time Audit and Supervisory Committee Member gathering necessary information by means such as attending management meetings and other important meetings and regularly viewing approval requests and other such documents. The Audit and Supervisory Committee ensures the effectiveness of audits in regard to matters such as compliance and the development status of internal controls by sharing audit details with the internal audit department and holding meetings as necessary with the Internal Control Committee.

In addition, the Audit and Supervisory Committee holds regular meetings with the Representative Director and the financial auditor and exchanges information as necessary for audits.

The Company has not assigned any Directors or employees to assist with the duties of the Audit and Supervisory Committee.

**8.** **Policy on Determining Dividends of Surplus, etc.** 

The Company positions the return of profits to shareholders as a key management policy, and it has set a basic policy of profit distribution backed by performance.

Specifically, the Company aims to pay stable dividends of profit to shareholders based on the Company's performance while taking into account the ratio of dividends to consolidated net assets, and it has set a target consolidated dividend payout ratio of 30% to 40%.

Share buybacks are conducted as appropriate while taking into account factors such as the Company's financial status and share price trends in order to implement a flexible capital policy in response to changes in the business environment.

In addition, the Company will use internal reserves to actively gain knowledge on new products and technologies in order to respond to sudden technological innovations in the industry, as well as to maintain and strengthen the Company's competitiveness and further enhance its corporate character, thereby achieving the return of profits to shareholders through improved future performance.

The Company may pay dividends of surplus by a resolution of the Board of Directors twice per year as interim dividends and year-end dividends.

For this fiscal year, taking into account the above policy and the Company's recent performance, the Company paid a year-end dividend of 95 yen, resulting in an annual dividend amount of 185 yen when added to the interim dividend.

\*Monetary amounts stated in this Business Report are rounded down to the nearest unit in which they are presented.

**Consolidated Balance Sheets**

(As of March 31, 2025)

---

| | |
|:---|:---|
|  | &nbsp;&nbsp;(Millions of yen) |
| &nbsp;&nbsp;Assets |  |
| &nbsp;&nbsp;&nbsp;Current assets |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and deposits | &nbsp;&nbsp;13534 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notes receivable - trade | &nbsp;&nbsp;114 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable - trade | &nbsp;&nbsp;37873 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract assets | &nbsp;&nbsp;1949 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Electronically recorded monetary claims - operating | &nbsp;&nbsp;7608 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Merchandise and finished goods | &nbsp;&nbsp;48362 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Work in process | &nbsp;&nbsp;1318 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Raw materials and supplies | &nbsp;&nbsp;1472 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp;6102 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance for doubtful accounts | &nbsp;&nbsp;(13) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets | &nbsp;&nbsp; 118323 |
| &nbsp;&nbsp;&nbsp;Non-current assets |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property, plant and equipment |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Buildings and structures | &nbsp;&nbsp;1158 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Machinery, equipment and vehicles | &nbsp;&nbsp;17 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Land | &nbsp;&nbsp;2870 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Leased assets | &nbsp;&nbsp;225 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Construction in progress | &nbsp;&nbsp;79 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp; 297 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total property, plant and equipment | &nbsp;&nbsp; 4649 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intangible assets |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Goodwill | &nbsp;&nbsp;2643 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp; 1026 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total intangible assets | &nbsp;&nbsp; 3669 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments and other assets |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investment securities | &nbsp;&nbsp;1284 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term loans receivable | &nbsp;&nbsp;31 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Retirement benefit assets | &nbsp;&nbsp;613 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred tax assets | &nbsp;&nbsp;702 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp;917 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance for doubtful accounts | &nbsp;&nbsp; (29) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total investments and other assets | &nbsp;&nbsp;3519 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-current assets | &nbsp;&nbsp; 11837 |
| &nbsp;&nbsp;&nbsp;Total assets | &nbsp;&nbsp; 130161 |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;Liabilities |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current liabilities |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notes and accounts payable - trade | &nbsp;&nbsp;20116 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Electronically recorded obligations - operating | &nbsp;&nbsp;3446 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Short-term borrowings | &nbsp;&nbsp;8681 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current portion of long-term borrowings | &nbsp;&nbsp;6052 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lease liabilities | &nbsp;&nbsp;111 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes payable | &nbsp;&nbsp;1097 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract liabilities | &nbsp;&nbsp;2240 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision for product warranties | &nbsp;&nbsp;11 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision for bonuses for directors (and other officers) | &nbsp;&nbsp;89 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision for loss on orders received | &nbsp;&nbsp;9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp; 5941 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | &nbsp;&nbsp; 47795 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-current liabilities |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bonds payable | &nbsp;&nbsp;10000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term borrowings | &nbsp;&nbsp;18665 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lease liabilities | &nbsp;&nbsp;129 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred tax liabilities | &nbsp;&nbsp;409 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Asset retirement obligations | &nbsp;&nbsp;163 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp; 19 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-current liabilities | &nbsp;&nbsp;29387 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | &nbsp;&nbsp; 77183 |
| &nbsp;&nbsp;Net assets |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shareholders' equity |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share capital | &nbsp;&nbsp;6099 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capital surplus | &nbsp;&nbsp;6621 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Retained earnings | &nbsp;&nbsp;36074 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Treasury shares | &nbsp;&nbsp;(280) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total shareholders' equity | &nbsp;&nbsp;48514 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accumulated other comprehensive income |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Valuation difference on available-for-sale securities | &nbsp;&nbsp;475 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred gains or losses on hedges | &nbsp;&nbsp;(0) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign currency translation adjustment | &nbsp;&nbsp;1725 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Remeasurements of defined benefit plans | &nbsp;&nbsp; 99 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total accumulated other comprehensive income | &nbsp;&nbsp; 2299 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-controlling interests | &nbsp;&nbsp; 2164 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total net assets | &nbsp;&nbsp; 52978 |
| &nbsp;&nbsp;Total liabilities and net assets | &nbsp;&nbsp; 130161 |

---

(Note) The above amounts are rounded down to the nearest million yen.

**Consolidated Statements of Income**

(April 1, 2024 to March 31, 2025)

---

| | |
|:---|:---|
|  | &nbsp;&nbsp;(Millions of yen) |
| &nbsp;&nbsp;Net sales | &nbsp;&nbsp;258742 |
| &nbsp;&nbsp;Cost of sales | &nbsp;&nbsp; 237375 |
| &nbsp;&nbsp;Gross profit | &nbsp;&nbsp; 21367 |
| &nbsp;&nbsp;Selling, general and administrative expenses | &nbsp;&nbsp; 14255 |
| &nbsp;&nbsp;Operating profit | &nbsp;&nbsp; 7112 |
| &nbsp;&nbsp;Non-operating income |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest income | &nbsp;&nbsp;4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividend income | &nbsp;&nbsp;27 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Insurance claim income | &nbsp;&nbsp;10 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Compensation income | &nbsp;&nbsp;52 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp; 102 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-operating income | &nbsp;&nbsp;198 |
| &nbsp;&nbsp;Non-operating expenses |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest expenses | &nbsp;&nbsp;380 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest expenses on bonds | &nbsp;&nbsp;42 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on redemption of securities | &nbsp;&nbsp;5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange losses | &nbsp;&nbsp;631 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on sale of trade receivables | &nbsp;&nbsp;24 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Commission expenses | &nbsp;&nbsp;11 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp; 5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-operating expenses | &nbsp;&nbsp; 1100 |
| &nbsp;&nbsp;Ordinary profit | &nbsp;&nbsp; 6210 |
| &nbsp;&nbsp;Extraordinary income |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of non-current assets | &nbsp;&nbsp;125 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of investment securities | &nbsp;&nbsp; 23 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total extraordinary income | &nbsp;&nbsp; 149 |
| &nbsp;&nbsp;Extraordinary losses |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Impairment losses | &nbsp;&nbsp;105 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on disposal of non-current assets | &nbsp;&nbsp;20 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on valuation of investment securities | &nbsp;&nbsp;310 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total extraordinary losses | &nbsp;&nbsp; 436 |
| &nbsp;&nbsp;Profit before income taxes | &nbsp;&nbsp;5922 |
| &nbsp;&nbsp;Income taxes - current | &nbsp;&nbsp;2236 |
| &nbsp;&nbsp;Income taxes - deferred | &nbsp;&nbsp;(68) |
| &nbsp;&nbsp;Total income taxes | &nbsp;&nbsp; 2168 |
| &nbsp;&nbsp;Profit | &nbsp;&nbsp;3754 |
| &nbsp;&nbsp;Profit attributable to non-controlling interests | &nbsp;&nbsp; 54 |
| &nbsp;&nbsp;Profit attributable to owners of parent | &nbsp;&nbsp; 3699 |

---

(Note) The above amounts are rounded down to the nearest million yen.

**Consolidated Statements of Changes in Equity**

(April 1, 2024 to March 31, 2025)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp;(Millions of yen) | &nbsp;&nbsp;(Millions of yen) | &nbsp;&nbsp;(Millions of yen) | &nbsp;&nbsp;(Millions of yen) | &nbsp;&nbsp;(Millions of yen) |
|  | &nbsp;&nbsp;Shareholders' equity | &nbsp;&nbsp;Shareholders' equity | &nbsp;&nbsp;Shareholders' equity | &nbsp;&nbsp;Shareholders' equity | &nbsp;&nbsp;Shareholders' equity |
| &nbsp;&nbsp;Balance and reason for change | &nbsp;&nbsp;Share capital | &nbsp;&nbsp;Capital surplus | &nbsp;&nbsp;Retained earnings | &nbsp;&nbsp;Treasury shares | &nbsp;&nbsp;Total shareholders' equity |
| &nbsp;&nbsp;Balance at beginning of period | &nbsp;&nbsp;6099 | &nbsp;&nbsp;6616 | &nbsp;&nbsp;34168 | &nbsp;&nbsp;(284) | &nbsp;&nbsp;46598 |
| &nbsp;&nbsp;Changes during period |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividends of surplus |  |  | &nbsp;&nbsp;(1793) |  | &nbsp;&nbsp;(1793) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Profit attributable to owners of parent |  |  | &nbsp;&nbsp;3699 |  | &nbsp;&nbsp;3699 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Disposal of treasury shares |  | &nbsp;&nbsp;5 |  | &nbsp;&nbsp;4 | &nbsp;&nbsp;9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net changes in items other than shareholders' equity |  |  |  |  | &nbsp;&nbsp;- |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total changes during period | &nbsp;&nbsp;- | &nbsp;&nbsp;5 | &nbsp;&nbsp;1906 | &nbsp;&nbsp;4 | &nbsp;&nbsp;1915 |
| &nbsp;&nbsp;Balance at end of period | &nbsp;&nbsp;6099 | &nbsp;&nbsp;6621 | &nbsp;&nbsp;36074 | &nbsp;&nbsp;(280) | &nbsp;&nbsp;48514 |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp;Accumulated other comprehensive income | &nbsp;&nbsp;Accumulated other comprehensive income | &nbsp;&nbsp;Accumulated other comprehensive income | &nbsp;&nbsp;Accumulated other comprehensive income | &nbsp;&nbsp;Accumulated other comprehensive income |  |  |
| &nbsp;&nbsp;Balance and reason for change | &nbsp;&nbsp;Valuation difference on available-for- sale securities | &nbsp;&nbsp;Deferred gains or losses on hedges | &nbsp;&nbsp;Foreign currency translation adjustment | &nbsp;&nbsp;Remeasurements of defined benefit plans | &nbsp;&nbsp;Total accumulated other comprehensive income | &nbsp;&nbsp;Non-controlling interests | &nbsp;&nbsp;Total net assets |
| &nbsp;&nbsp;Balance at beginning of period | &nbsp;&nbsp;500 | &nbsp;&nbsp;- | &nbsp;&nbsp;1117 | &nbsp;&nbsp;0 | &nbsp;&nbsp;1618 | &nbsp;&nbsp;2143 | &nbsp;&nbsp;50361 |
| &nbsp;&nbsp;Changes during period |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Dividends of surplus |  |  |  |  | &nbsp;&nbsp;- |  | &nbsp;&nbsp;(1793) |
| &nbsp;&nbsp;&nbsp;Profit attributable to owners of parent |  |  |  |  | &nbsp;&nbsp;- |  | &nbsp;&nbsp;3699 |
| &nbsp;&nbsp;&nbsp;Disposal of treasury shares |  |  |  |  | &nbsp;&nbsp;- |  | &nbsp;&nbsp;9 |
| &nbsp;&nbsp;&nbsp;Net changes in items other than shareholders' equity | &nbsp;&nbsp;(25) | &nbsp;&nbsp;(0) | &nbsp;&nbsp;608 | &nbsp;&nbsp;98 | &nbsp;&nbsp;681 | &nbsp;&nbsp;20 | &nbsp;&nbsp;701 |
| &nbsp;&nbsp;&nbsp;Total changes during period | &nbsp;&nbsp;(25) | &nbsp;&nbsp;(0) | &nbsp;&nbsp;608 | &nbsp;&nbsp;98 | &nbsp;&nbsp;681 | &nbsp;&nbsp;20 | &nbsp;&nbsp;2617 |
| &nbsp;&nbsp;Balance at end of period | &nbsp;&nbsp;475 | &nbsp;&nbsp;(0) | &nbsp;&nbsp;1725 | &nbsp;&nbsp;99 | &nbsp;&nbsp;2299 | &nbsp;&nbsp;2164 | &nbsp;&nbsp;52978 |

---

(Note) The above amounts are rounded down to the nearest million yen.

**Non-consolidated Balance Sheets**

(As of March 31, 2025)

---

| | |
|:---|:---|
|  | &nbsp;&nbsp;(Millions of yen) |
| &nbsp;&nbsp;Assets |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current assets |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and deposits | &nbsp;&nbsp;7528 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable - other | &nbsp;&nbsp;531 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Advances received | &nbsp;&nbsp;0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Short-term loans receivable from affiliated companies | &nbsp;&nbsp;50729 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses | &nbsp;&nbsp;112 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp;7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets | &nbsp;&nbsp; 58909 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-current assets |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property, plant and equipment |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Buildings | &nbsp;&nbsp;579 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Structures | &nbsp;&nbsp;21 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Machinery and equipment | &nbsp;&nbsp;2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Vehicles | &nbsp;&nbsp;0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tools, furniture and fixtures | &nbsp;&nbsp;123 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Land | &nbsp;&nbsp;1903 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Leased assets | &nbsp;&nbsp;32 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Construction in progress | &nbsp;&nbsp; 28 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total property, plant and equipment | &nbsp;&nbsp;2691 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intangible assets |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Software | &nbsp;&nbsp;144 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Software in progress | &nbsp;&nbsp;7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp;1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total intangible assets | &nbsp;&nbsp; 153 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments and other assets |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investment securities | &nbsp;&nbsp;1257 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Affiliated company shares | &nbsp;&nbsp;9627 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term prepaid expenses | &nbsp;&nbsp;245 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid pension expenses | &nbsp;&nbsp;468 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp; 560 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total investments and other assets | &nbsp;&nbsp;12159 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-current assets | &nbsp;&nbsp; 15005 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | &nbsp;&nbsp; 73914 |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;Liabilities |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current liabilities |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Short-term borrowings | &nbsp;&nbsp;2000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current portion of long-term borrowings | &nbsp;&nbsp;6052 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lease liabilities | &nbsp;&nbsp;16 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable - other | &nbsp;&nbsp;357 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses | &nbsp;&nbsp;219 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes payable | &nbsp;&nbsp;635 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consumption taxes payable | &nbsp;&nbsp;129 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deposits received | &nbsp;&nbsp;35 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision for bonuses for directors (and other officers) | &nbsp;&nbsp;26 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp;11 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | &nbsp;&nbsp; 9482 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-current liabilities |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bonds payable | &nbsp;&nbsp;10000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term borrowings | &nbsp;&nbsp;18665 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lease liabilities | &nbsp;&nbsp;19 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred tax liabilities | &nbsp;&nbsp;249 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Asset retirement obligations | &nbsp;&nbsp; 163 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-current liabilities | &nbsp;&nbsp;29097 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | &nbsp;&nbsp; 38580 |
| &nbsp;&nbsp;Net assets |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shareholders' equity |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share capital | &nbsp;&nbsp;6099 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capital surplus |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capital reserve | &nbsp;&nbsp;4874 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other capital surplus | &nbsp;&nbsp; 1747 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total capital surplus | &nbsp;&nbsp;6621 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Retained earnings |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other retained earnings |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other reserve | &nbsp;&nbsp;9000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Retained earnings carried forward | &nbsp;&nbsp; 13417 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other retained earnings | &nbsp;&nbsp; 22417 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total retained earnings | &nbsp;&nbsp; 22417 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Treasury shares | &nbsp;&nbsp; (280) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total shareholders' equity | &nbsp;&nbsp; 34858 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Valuation difference and foreign currency translation adjustment |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Valuation difference on available-for-sale securities | &nbsp;&nbsp;475 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total valuation difference and foreign currency translation adjustment | &nbsp;&nbsp; 475 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total net assets | &nbsp;&nbsp;35333 |
| &nbsp;&nbsp;Total liabilities and net assets | &nbsp;&nbsp; 73914 |

---

(Note) The above amounts are rounded down to the nearest million yen.

**Non-consolidated Statements of Income**

(April 1, 2024 to March 31, 2025)

---

| | |
|:---|:---|
|  | &nbsp;&nbsp;(Millions of yen) |
| &nbsp;&nbsp;Operating income | &nbsp;&nbsp;6987 |
| &nbsp;&nbsp;Operating expenses | &nbsp;&nbsp; 3616 |
| &nbsp;&nbsp;Operating profit | &nbsp;&nbsp; 3371 |
| &nbsp;&nbsp;Non-operating income |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest income | &nbsp;&nbsp;266 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest on securities | &nbsp;&nbsp;0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividend income | &nbsp;&nbsp;27 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp;26 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-operating income | &nbsp;&nbsp; 321 |
| &nbsp;&nbsp;Non-operating expenses |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest expenses | &nbsp;&nbsp;110 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest expenses on bonds | &nbsp;&nbsp;42 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Commission expenses | &nbsp;&nbsp;11 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | &nbsp;&nbsp;7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-operating expenses | &nbsp;&nbsp; 172 |
| &nbsp;&nbsp;Ordinary profit | &nbsp;&nbsp;3520 |
| &nbsp;&nbsp;Extraordinary income |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of investment securities | &nbsp;&nbsp;23 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total extraordinary income | &nbsp;&nbsp;23 |
| &nbsp;&nbsp;Extraordinary losses |  |
| &nbsp;&nbsp;Loss on disposal of non-current assets | &nbsp;&nbsp; 6 |
| &nbsp;&nbsp;Total extraordinary losses | &nbsp;&nbsp;6 |
| &nbsp;&nbsp;Profit before income taxes | &nbsp;&nbsp; 3537 |
| &nbsp;&nbsp;Income taxes - current | &nbsp;&nbsp;646 |
| &nbsp;&nbsp;Income taxes - deferred | &nbsp;&nbsp; 22 |
| &nbsp;&nbsp;Total income taxes | &nbsp;&nbsp;669 |
| &nbsp;&nbsp;Profit | &nbsp;&nbsp; 2867 |

---

(Note) The above amounts are rounded down to the nearest million yen.

**Non-consolidated Statements of Changes in Equity**

(April 1, 2024 to March 31, 2025)

(Millions of yen)

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp;Shareholders' equity | &nbsp;&nbsp;Shareholders' equity | &nbsp;&nbsp;Shareholders' equity | &nbsp;&nbsp;Shareholders' equity | &nbsp;&nbsp;Shareholders' equity | &nbsp;&nbsp;Shareholders' equity | &nbsp;&nbsp;Shareholders' equity |
|  |  | &nbsp;&nbsp;Capital surplus | &nbsp;&nbsp;Capital surplus | &nbsp;&nbsp;Capital surplus | &nbsp;&nbsp;Retained earnings | &nbsp;&nbsp;Retained earnings | &nbsp;&nbsp;Retained earnings |
|  |  |  |  |  | &nbsp;&nbsp;Other retained earnings | &nbsp;&nbsp;Other retained earnings |  |
| &nbsp;&nbsp;Balance and reason for change | &nbsp;&nbsp;Share capital | &nbsp;&nbsp;Capital reserve | &nbsp;&nbsp;Other capital surplus | &nbsp;&nbsp;Total capital surplus | &nbsp;&nbsp;Other reserve | &nbsp;&nbsp;Retained earnings carried forward | &nbsp;&nbsp;Total retained earnings |
| &nbsp;&nbsp;Balance at beginning of period | &nbsp;&nbsp;6099 | &nbsp;&nbsp;4874 | &nbsp;&nbsp;1742 | &nbsp;&nbsp;6616 | &nbsp;&nbsp;9000 | &nbsp;&nbsp;12343 | &nbsp;&nbsp;21343 |
| &nbsp;&nbsp;Changes during period |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Dividends of surplus |  |  |  | &nbsp;&nbsp;- |  | &nbsp;&nbsp;(1793) | &nbsp;&nbsp;(1793) |
| &nbsp;&nbsp;&nbsp;Profit |  |  |  | &nbsp;&nbsp;- |  | &nbsp;&nbsp;2867 | &nbsp;&nbsp;2867 |
| &nbsp;&nbsp;&nbsp;Disposal of treasury shares |  |  | &nbsp;&nbsp;5 | &nbsp;&nbsp;5 |  |  | &nbsp;&nbsp;- |
| &nbsp;&nbsp;&nbsp;Net changes in items other than shareholders' equity |  |  |  | &nbsp;&nbsp;- |  |  | &nbsp;&nbsp;- |
| &nbsp;&nbsp;&nbsp;Total changes during period | &nbsp;&nbsp;- | &nbsp;&nbsp;- | &nbsp;&nbsp;5 | &nbsp;&nbsp;5 | &nbsp;&nbsp;- | &nbsp;&nbsp;1074 | &nbsp;&nbsp;1074 |
| &nbsp;&nbsp;Balance at end of period | &nbsp;&nbsp;6099 | &nbsp;&nbsp;4874 | &nbsp;&nbsp;1747 | &nbsp;&nbsp;6621 | &nbsp;&nbsp;9000 | &nbsp;&nbsp;13417 | &nbsp;&nbsp;22417 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp;Shareholders' equity | &nbsp;&nbsp;Shareholders' equity | &nbsp;&nbsp;Valuation difference and foreign currency translation adjustment | &nbsp;&nbsp;Valuation difference and foreign currency translation adjustment |  |
| &nbsp;&nbsp;Balance and reason for change | &nbsp;&nbsp;Treasury shares | &nbsp;&nbsp;Total shareholders' equity | &nbsp;&nbsp;Valuation difference on available-for-sale securities | &nbsp;&nbsp;Total valuation difference and foreign currency translation adjustment | &nbsp;&nbsp;Total net assets |
| &nbsp;&nbsp;Balance at beginning of period | &nbsp;&nbsp;(284) | &nbsp;&nbsp;33774 | &nbsp;&nbsp;500 | &nbsp;&nbsp;500 | &nbsp;&nbsp;34274 |
| &nbsp;&nbsp;Changes during period |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividends of surplus |  | &nbsp;&nbsp;(1793) |  | &nbsp;&nbsp;- | &nbsp;&nbsp;(1793) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Profit |  | &nbsp;&nbsp;2867 |  | &nbsp;&nbsp;- | &nbsp;&nbsp;2867 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Disposal of treasury shares | &nbsp;&nbsp;4 | &nbsp;&nbsp;9 |  | &nbsp;&nbsp;- | &nbsp;&nbsp;9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net changes in items other than shareholders' equity |  | &nbsp;&nbsp;- | &nbsp;&nbsp;(25) | &nbsp;&nbsp;(25) | &nbsp;&nbsp;(25) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total changes during period | &nbsp;&nbsp;4 | &nbsp;&nbsp;1084 | &nbsp;&nbsp;(25) | &nbsp;&nbsp;(25) | &nbsp;&nbsp;1058 |
| &nbsp;&nbsp;Balance at end of period | &nbsp;&nbsp;(280) | &nbsp;&nbsp;34858 | &nbsp;&nbsp;475 | &nbsp;&nbsp;475 | &nbsp;&nbsp;35333 |

---

(Note) The above amounts are rounded down to the nearest million yen.

**Financial Auditor Audit Report on Consolidated Financial Statements**

**Independent Auditor's Audit Report**

May 14, 2025

To: Hagiwara Electric Holdings Co., Ltd., Board of Directors

---

| |
|:---|
| &nbsp;&nbsp;KPMG AZSA LLC, Nagoya Office |
| &nbsp;&nbsp; Hisashi Ohkita<br> Designated Partner, Engagement Partner,<br> and Certified Public Accountant |
| &nbsp;&nbsp; Tadashi Ikegaya<br> Designated Partner, Engagement Partner,<br> and Certified Public Accountant |

---

**Audit Opinion**

Pursuant to Article 444, paragraph (4) of the Companies Act, we have audited the consolidated financial statements, which consist of the consolidated balance sheets, consolidated statements of income, consolidated statements of changes in equity, and notes to consolidated financial statements, of Hagiwara Electric Holdings Co., Ltd. for the consolidated fiscal year from April 1, 2024 to March 31, 2025.

In our opinion, based on accounting principles generally accepted as fair and appropriate in Japan, the consolidated financial statements referred to above present fairly, in all material respects, the status of the assets, profits, and losses of the corporate group consisting of Hagiwara Electric Holdings Co., Ltd. and its consolidated subsidiaries for the period regarding which the consolidated financial statements were prepared.

**Basis for the Audit Opinion**

We conducted our audit based on auditing standards generally accepted as fair and appropriate in Japan. Our responsibilities under the auditing standards are stated in "Responsibilities of the Auditor for the Audit of the Consolidated Financial Statements." In accordance with regulations regarding professional ethics in Japan, we are independent from the company and its consolidated subsidiaries, and we have fulfilled all other ethical responsibilities as an auditor. We have judged that we obtained sufficient and appropriate audit evidence on which to base our opinion.

**Additional Information**

Additional information consists of the business report and the supplementary schedules thereto. The management is responsible for the preparation and disclosure of the additional information. The audit and supervisory committee is responsible for overseeing the directors' performance of their duties in developing and implementing the reporting process for additional information.

Our audit opinion on the consolidated financial statements does not cover additional information, and we do not provide any opinion with respect thereto.

In connection with our audit of the consolidated financial statements, our responsibility is to read through the additional information and, in doing so, to consider whether the additional information is materially inconsistent with the consolidated financial statements or any information we have obtained in the course of auditing and to pay attention to whether there are any indications of material misstatements in the additional information other than such material inconsistencies.

If we conclude that there is a material misstatement with respect to the additional information based on the auditing we performed, we are required to report to that effect.

We have nothing to report in regard to the additional information.

**Responsibilities of the Management and the Audit and Supervisory Committee for the Consolidated Financial Statements**

The management is responsible for preparing and fairly presenting the consolidated financial statements based on accounting principles generally accepted as fair and appropriate in Japan. This includes developing and implementing the internal controls that the management determines to be necessary in order to prepare and fairly present the consolidated financial statements without any material misstatement due to fraud or error.

In preparing the consolidated financial statements, the management is responsible for assessing whether or not it is appropriate to prepare the statements on a going concern basis and, if it is necessary to disclose matters relating to a going concern under accounting principles generally accepted as fair and appropriate in Japan, to disclose those matters.

The audit and supervisory committee is responsible for overseeing the directors' performance of their duties in developing and implementing the financial reporting process.

**Responsibilities of the Auditor for the Audit of the Consolidated Financial Statements**

The responsibility of the auditor is to obtain, through the audit performed by the auditor, a reasonable assurance regarding whether or not there is any material misstatement due to fraud or error in the consolidated financial statements as a whole and to express an opinion regarding the consolidated financial statements from an independent position in the audit report. Misstatements may occur due to fraud or error and are judged to be material if, whether individually or in total, they are reasonably expected to influence the decisions made by the users of the consolidated financial statements.

In accordance with auditing standards generally accepted as fair and appropriate in Japan, throughout the auditing process, the auditor makes professional judgments and maintains professional skepticism while implementing the following procedures.

● The auditor identifies and assesses the risk of material misstatements due to fraud or error and develops and implements audit procedures in response to the risk of material misstatements. Audit procedures are chosen and applied at the discretion of the auditor. Additionally, the auditor obtains sufficient and appropriate audit evidence on which to base its opinion.

● The purpose of the audit of the consolidated financial statements is not to express an opinion on the effectiveness of internal controls, but when assessing risks, the auditor considers internal controls relevant to the audit in order to develop appropriate audit procedures that suit the circumstances.

● The auditor assesses the appropriateness of the accounting policies adopted by the management, the appropriateness of the method of the application of those policies, the reasonableness of the accounting estimates made by the management, and the appropriateness of the notes related to those estimates.

● The auditor concludes whether or not it is appropriate for the management to prepare the consolidated financial statements on a going concern basis and, based on the audit evidence obtained, whether or not any material uncertainty is found regarding events or circumstances that would cause a material doubt regarding the assumption of the company being a going concern. If a material doubt regarding the assumption of the company being a going concern is found, it is necessary to call attention in the audit report to the notes to the consolidated financial statements, and if the notes to the consolidated financial statements regarding the material uncertainty are not appropriate, it is necessary to express a qualified opinion on the consolidated financial statements. The conclusion of the auditor is based on the audit evidence obtained up to the date of the audit report, but it is possible that the company will cease to be a going concern due to future events or circumstances.

● The auditor assesses whether or not the statements in and notes to the consolidated financial statements are in compliance with accounting principles generally accepted as fair and appropriate in Japan; assesses the presentation, composition, and details of the consolidated financial statements, including the related notes; and assesses whether or not the consolidated financial statements fairly present the transactions and accounting events on which they are based.

● The auditor plans and conducts an audit of the consolidated financial statements in order to obtain sufficient and appropriate audit evidence regarding the financial information of the company and its consolidated subsidiaries on which to base its opinion on the consolidated financial statements. The auditor is responsible for the direction, supervision, and inspections relating to the audit of the consolidated financial statements. The auditor is solely responsible for the audit opinion.

The auditor reports to the audit and supervisory committee regarding the scope of the planned audit, when it will be implemented, material matters discovered during the audit (including material deficiencies in internal controls identified in the audit process), and other matters required by auditing standards.

The auditor reports to the audit and supervisory committee regarding the fact that the auditor complied with regulations on professional ethics in Japan in regard to its independence, any matters that can reasonably be considered to affect the independence of the auditor, and, if any measures or safeguards have been implemented in order to eliminate impediments to the audit or reduce them to an acceptable level, the details thereof.

**Interests**

Neither KPMG AZSA LLC nor any of the engagement partners have any interests in the company or its consolidated subsidiaries that should be stated pursuant to the Certified Public Accountants Act.

End

**Financial Auditor Audit Report**

**Independent Auditor's Audit Report**

May 14, 2025

To: Hagiwara Electric Holdings Co., Ltd., Board of Directors

---

| |
|:---|
| &nbsp;&nbsp;KPMG AZSA LLC, Nagoya Office |
| &nbsp;&nbsp; Hisashi Ohkita<br> Designated Partner, Engagement Partner,<br> and Certified Public Accountant |
| &nbsp;&nbsp; Tadashi Ikegaya<br> Designated Partner, Engagement Partner,<br> and Certified Public Accountant |

---

**Audit Opinion**

Pursuant to Article 436, paragraph (2), item (i) of the Companies Act, we have audited the non-consolidated financial statements, which consist of the non-consolidated balance sheets, non-consolidated statements of income, non-consolidated statements of changes in equity, notes to non-consolidated financial statements, and supplementary schedules (the "Non-consolidated Financial Statements, Etc."), of Hagiwara Electric Holdings Co., Ltd. for the 68th business year from April 1, 2024 to March 31, 2025.

In our opinion, based on accounting principles generally accepted as fair and appropriate in Japan, the Non-consolidated Financial Statements, Etc. referred to above present fairly, in all material respects, the status of the assets, profits, and losses of Hagiwara Electric Holdings Co., Ltd. for the period regarding which the Non-consolidated Financial Statements, Etc. were prepared.

**Basis for the Audit Opinion**

We conducted our audit based on auditing standards generally accepted as fair and appropriate in Japan. Our responsibilities under the auditing standards are stated in "Responsibilities of the Auditor for the Audit of the Non-consolidated Financial Statements, Etc." In accordance with regulations regarding professional ethics in Japan, we are independent from the company, and we have fulfilled all other ethical responsibilities as an auditor. We have judged that we obtained sufficient and appropriate audit evidence on which to base our opinion.

**Additional Information**

Additional information consists of the business report and the supplementary schedules thereto. The management is responsible for the preparation and disclosure of the additional information. The audit and supervisory committee is responsible for overseeing the directors' performance of their duties in developing and implementing the reporting process for additional information.

Our audit opinion on the Non-consolidated Financial Statements, Etc. does not cover additional information, and we do not provide any opinion with respect thereto.

In connection with our audit of the Non-consolidated Financial Statements, Etc., our responsibility is to read through the additional information and, in doing so, to consider whether the additional information is materially inconsistent with the Non-consolidated Financial Statements, Etc. or any information we have obtained in the course of auditing and to pay attention to whether there are any indications of material misstatements in the additional information other than such material inconsistencies.

If we conclude that there is a material misstatement with respect to the additional information based on the auditing we performed, we are required to report to that effect.

We have nothing to report in regard to the additional information.

**Responsibilities of the Management and the Audit and Supervisory Committee for the Non-consolidated Financial Statements, Etc.**

The management is responsible for preparing and fairly presenting the Non-consolidated Financial Statements, Etc. based on accounting principles generally accepted as fair and appropriate in Japan. This includes developing and implementing the internal controls that the management determines to be necessary in order to prepare and fairly present the Non-consolidated Financial Statements, Etc. without any material misstatement due to fraud or error.

In preparing the Non-consolidated Financial Statements, Etc., the management is responsible for assessing whether or not it is appropriate to prepare the statements on a going concern basis and, if it is necessary to disclose matters relating to a going concern under accounting principles generally accepted as fair and appropriate in Japan, to disclose those matters.

The audit and supervisory committee is responsible for overseeing the directors' performance of their duties in developing and implementing the financial reporting process.

**Responsibilities of the Auditor for the Audit of the Non-consolidated Financial Statements, Etc.**

The responsibility of the auditor is to obtain, through the audit performed by the auditor, a reasonable assurance regarding whether or not there is any material misstatement due to fraud or error in the Non-consolidated Financial Statements, Etc. as a whole and to express an opinion regarding the Non-consolidated Financial Statements, Etc. from an independent position in the audit report. Misstatements may occur due to fraud or error and are judged to be material if, whether individually or in total, they are reasonably expected to influence the decisions made by the users of the Non-consolidated Financial Statements, Etc.

In accordance with auditing standards generally accepted as fair and appropriate in Japan, throughout the auditing process, the auditor makes professional judgments and maintains professional skepticism while implementing the following procedures.

● The auditor identifies and assesses the risk of material misstatements due to fraud or error and develops and implements audit procedures in response to the risk of material misstatements. Audit procedures are chosen and applied at the discretion of the auditor. Additionally, the auditor obtains sufficient and appropriate audit evidence on which to base its opinion.

● The purpose of the audit of the Non-consolidated Financial Statements, Etc. is not to express an opinion on the effectiveness of internal controls, but when assessing risks, the auditor considers internal controls relevant to the audit in order to develop appropriate audit procedures that suit the circumstances.

● The auditor assesses the appropriateness of the accounting policies adopted by the management, the appropriateness of the method of the application of those policies, the reasonableness of the accounting estimates made by the management, and the appropriateness of the notes related to those estimates.

● The auditor concludes whether or not it is appropriate for the management to prepare the Non-consolidated Financial Statements, Etc. on a going concern basis and, based on the audit evidence obtained, whether or not any material uncertainty is found regarding events or circumstances that would cause a material doubt regarding the assumption of the company being a going concern. If a material doubt regarding the assumption of the company being a going concern is found, it is necessary to call attention in the audit report to the notes to the Non-consolidated Financial Statements, Etc., and if the notes to the Non-consolidated Financial Statements, Etc. regarding the material uncertainty are not appropriate, it is necessary to express a qualified opinion on the Non-consolidated Financial Statements, Etc. The conclusion of the auditor is based on the audit evidence obtained up to the date of the audit report, but it is possible that the company will cease to be a going concern due to future events or circumstances.

● The auditor assesses whether or not the statements in and notes to the Non-consolidated Financial Statements, Etc. are in compliance with accounting principles generally accepted as fair and appropriate in Japan; assesses the presentation, composition, and details of the Non-consolidated Financial Statements, Etc., including the related notes; and assesses whether or not the Non-consolidated Financial Statements, Etc. fairly present the transactions and accounting events on which they are based.

The auditor reports to the audit and supervisory committee regarding the scope of the planned audit, when it will be implemented, material matters discovered during the audit (including material deficiencies in internal controls identified in the audit process), and other matters required by auditing standards.

The auditor reports to the audit and supervisory committee regarding the fact that the auditor complied with regulations on professional ethics in Japan in regard to its independence, any matters that can reasonably be considered to affect the independence of the auditor, and, if any measures or safeguards have been implemented in order to eliminate impediments to the audit or reduce them to an acceptable level, the details thereof.

**Interests**

Neither KPMG AZSA LLC nor any of the engagement partners have any interests in the company that should be stated pursuant to the Certified Public Accountants Act.

End

**Audit Report of the Audit and Supervisory Committee**

**Audit Report**

We, the Audit and Supervisory Committee, have audited the Directors' performance of their duties during the 68th business year from April 1, 2024 to March 31, 2025 and report on the method and results of the audit as follows.

1. Method and Details of Audit

In regard to the content of resolutions of the Board of Directors on the matters stated in Article 399-13, paragraph (1), items (i)(b) and (i)(c) of the Companies Act and the systems established based on those resolutions (internal control systems), we received periodic reports from Directors and employees, etc. regarding the status of the establishment and operation of those systems, requested explanations as necessary, expressed opinions, and conducted audits using the following methods.

(i) In accordance with the audit policies and division of duties, etc. that we established, and in cooperation
with the Company's internal control department and other departments, we attended important meetings, received reports from Directors
and employees, etc. on matters related to the performance of their duties, requested explanations as necessary, viewed important decision-making
documents, etc., and investigated the status of operations and assets at the headquarters and the main business locations of operating
subsidiaries. Regarding the Company's operating subsidiaries, we communicated and shared information with the Directors and Audit
and Supervisory Board Members, etc. of the operating subsidiaries, and we received reports from operating subsidiaries regarding their
business as necessary.

(ii) We oversaw and verified whether the financial auditor maintained an independent position and conducted
an appropriate audit, received reports from the financial auditor on the status of the performance of its duties, and requested explanations
as necessary. Additionally, we received notification from the financial auditor that, in accordance with standards such as the "Quality
Control Standards for Auditing" (established by the Business Accounting Council), it had developed systems in order to ensure that
its duties are appropriately performed (as set out in the items of Article 131 of the Regulations for Corporate Accounting), and we requested
explanations as necessary.

Using the methods above, we examined the business report, the supplementary schedules thereto, the non-consolidated financial statements (i.e., the non-consolidated balance sheets, non-consolidated statements of income, non-consolidated statements of changes in equity, and notes to non-consolidated financial statements), the supplementary schedules to the non-consolidated financial statements, and the consolidated financial statements (i.e., the consolidated balance sheets, consolidated statements of income, consolidated statements of changes in equity, and notes to consolidated financial statements) for the business year.

2. Audit Results

(1) Results of audit of business report, etc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) We find that the business report and the supplementary schedules thereto correctly present the status
of the company in accordance with laws, regulations, and the Articles of Incorporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) We do not find any misconduct in relation to the Directors' performance of their duties nor any
material fact in violation of laws or regulations or in breach of the Articles of Incorporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) We find the content of the resolutions of the Board of Directors regarding internal control systems to
be reasonable. Additionally, we do not find any matters that should be commented upon in regard to the statements in the business report
or the Directors' performance of their duties relating to the internal control systems.

(2) Results of audit of non-consolidated financial statements and supplementary schedules thereto

We find the methods and results of the audit by the financial auditor, KPMG AZSA LLC, to be reasonable.

(3) Results of audit of consolidated financial statements

We find the methods and results of the audit by the financial auditor, KPMG AZSA LLC, to be reasonable.

May 14, 2025

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;Hagiwara Electric Holdings Co., Ltd. Audit and Supervisory Committee | &nbsp;&nbsp;Hagiwara Electric Holdings Co., Ltd. Audit and Supervisory Committee | &nbsp;&nbsp;Hagiwara Electric Holdings Co., Ltd. Audit and Supervisory Committee |
| &nbsp;&nbsp;Noriaki | &nbsp;&nbsp;Inoue | &nbsp;&nbsp;[seal] |
| &nbsp;&nbsp;Full-time Audit and Supervisory Committee Member | &nbsp;&nbsp;Full-time Audit and Supervisory Committee Member | &nbsp;&nbsp;Full-time Audit and Supervisory Committee Member |
| &nbsp;&nbsp;Hisashi | &nbsp;&nbsp;Hayakawa | &nbsp;&nbsp;[seal] |
| &nbsp;&nbsp;Audit and Supervisory Committee Member | &nbsp;&nbsp;Audit and Supervisory Committee Member | &nbsp;&nbsp;Audit and Supervisory Committee Member |
| &nbsp;&nbsp;Sachiko | &nbsp;&nbsp;Enomoto | &nbsp;&nbsp;[seal] |
| &nbsp;&nbsp;Audit and Supervisory Committee Member | &nbsp;&nbsp;Audit and Supervisory Committee Member | &nbsp;&nbsp;Audit and Supervisory Committee Member |

---

(Note) Audit and Supervisory Committee Members Hisashi Hayakawa and Sachiko Enomoto are Outside Directors as set out in Article 2, item (xv)
and Article 331, paragraph (6) of the Companies Act.

End

The business combination described in this document involves securities of Japanese companies. The business combination is subject to disclosure requirements of Japan that are different from those of the United States. Financial information included in this document, if any, was excerpted from financial statements prepared in accordance with foreign accounting standards that may not be comparable to the financial statements of United States companies.

It may be difficult for you to enforce your rights and any claim you may have arising under the U.S. federal securities laws, since the issuers are located in Japan and some or all of their officers and directors reside outside of the United States. You may not be able to sue a Japanese company or its officers or directors in a Japanese court for violations of the U.S. securities laws.

It may be difficult to compel a Japanese company and its affiliates to subject themselves to a U.S. court's judgment. You should be aware that the issuer may purchase securities otherwise than under the business combination, such as in the open market or through privately negotiated purchases.

To Our Shareholders

**Materials for the 68th Ordinary General Meeting of Shareholders**

**(Matters to Be Provided Electronically and**

**Not Stated in Documents Delivered Pursuant to**

**Requests Under Laws, Regulations, and the Articles of Incorporation)**

Notes to Consolidated Financial Statements

Notes to Non-consolidated Financial Statements

(April 1, 2024 to March 31, 2025)

**Hagiwara Electric Holdings Co., Ltd.**

Pursuant to the provisions of laws, regulations, and Article 15 of the Articles of Incorporation, the above matters are not stated in documents delivered to shareholders who requested delivery thereof.

**Notes to Consolidated Financial Statements**

**Notes Regarding Significant Matters Based on Which the Consolidated Financial Statements Were Prepared**

1. Matters relating to the scope of consolidation

Number and names of consolidated subsidiaries

Number of consolidated subsidiaries: 16

Names of consolidated subsidiaries:

Hagiwara Electronics Co., Ltd.

Hagiwara Techno Solutions Co., Ltd.

Hagiwara Engineering Co., Ltd.

Hagiwara Hokuto Techno Co., Ltd.

Singapore Hagiwara Pte. Ltd.

Hagiwara America, Inc.

Hagiwara Electric Korea Co., Ltd.

Hagiwara (Shanghai) Co., Ltd.

Hagiwara Electric Europe GmbH

Hagiwara Electric (Thailand) Co., Ltd.

Hagiwara Electronics India Private Limited

Hagiwara Techno Solutions (Shanghai) Co., Ltd.

Hagiwara Electronics Hong Kong Limited

BellaDati Pte. Ltd.

BellaDati G.K.

BellaDati s.r.o.

Changes to scope of consolidation:

The Company acquired all of the shares of BellaDati Pte. Ltd. on July 26, 2024, due to which it has included BellaDati Pte. Ltd. and its subsidiaries, BellaDati G.K. and BellaDati s.r.o., in the scope of consolidation from the consolidated fiscal year under review.

2. Matters relating to the business years, etc. of consolidated subsidiaries

Of the Company's consolidated subsidiaries, the closing date for the business years of Singapore Hagiwara Pte. Ltd., Hagiwara America, Inc., Hagiwara (Shanghai) Co., Ltd., Hagiwara Techno Solutions (Shanghai) Co., Ltd., Hagiwara Electronics Hong Kong Limited, BellaDati Pte. Ltd., BellaDati G.K., and BellaDati s.r.o. is December 31. When preparing the consolidated financial statements, the Company has used the financial statements of those consolidated subsidiaries as of that date, but in regard to significant transactions arising between that date and the consolidated closing date, it has performed any adjustments necessary in relation to consolidation.

3. Matters relating to accounting policies

(1) Valuation basis and methods for significant assets

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Available-for-sale securities

Bonds to be held until maturity: Stated using the amortized cost method (straight-line method).

Other available-for-sale securities

Securities other than shares, etc. without a market price: Stated using the market value method based on market prices, etc. (valuation differences are reflected directly in net assets, and cost of sales is calculated using the moving average method).

Shares, etc. without a market price: Stated using the cost method based on the moving average method.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Inventory assets: Stated mainly using the cost method based on the moving average method (method of writing
down the book value based on declining profitability).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Derivatives: Stated using the market value method.

(2) Depreciation methods for significant depreciable assets

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Property, plant and equipment (excluding leased assets): Stated mainly using the declining balance method.

However, buildings (excluding facilities attached to buildings) acquired on or after April 1, 1998 and facilities attached to buildings and structures acquired on or after April 1, 2016 are stated using the straight-line method.

The useful lives of the main assets are as follows.

Buildings and structures: 31 to 50 years

Machinery, equipment and vehicles: 4 to 17 years

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Intangible assets (excluding leased assets): Stated mainly using the straight-line method.

The useful life of intangible assets is based on the same standards as the method set out in the Corporation Tax Act.

However, software to be used internally is stated using the straight-line method based on the estimated period that the software will be usable internally (mainly five years).

In addition, customer-related intangible assets are stated using the straight-line method based on the period during which those assets will generate effects.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Leased assets: Stated using the straight-line method with the useful life set equal to the lease period
and the residual value set at zero.

(3) Standards for recording significant provisions

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Allowance for doubtful accounts: This allowance is provided for possible losses on unrecoverable receivables.
For ordinary receivables, the amount of the allowance is based on the historical rate of loss. For certain receivables such as those from
debtors at risk of bankruptcy, the amount of the allowance is based on individually estimated unrecoverable amounts taking into account
the likelihood of recovery.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Provision for bonuses for directors (and other officers): This provision for expenditures for bonuses
to be paid to directors and other officers is recorded based on the estimated amounts to be paid for the consolidated fiscal year under
review.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Provision for loss on orders received: This provision for loss on orders received is recorded based on
the estimated amount of loss for orders under contracting agreements for which a future loss is expected and for which the amount of loss
can be reasonably estimated as of the end of the consolidated fiscal year under review.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Provision for product warranties: This provision for expenditures for compensation costs relating to products
sold is recorded based on the amount of future expenditures anticipated.

(4) Standards for recording revenue and expenses

The Company Group recognizes revenue based on the following five-step approach.

Step 1: Identify contracts with customers.

Step 2: Identify performance obligations under contracts.

Step 3: Calculate transaction value.

Step 4: Distribute transaction value across individual performance obligations under contracts.

Step 5: Recognize revenue when (or as) the performance obligations are fulfilled.

The Company Group recognizes the total amount of consideration received from a transaction as revenue in cases where the Company Group controls the goods or services before being transferred to the customer (a principal transaction), and in cases where the Company Group arranges for goods or services to be provided to a customer, the Company Group recognizes as revenue the net amount calculated by deducting the amount paid to third parties from the total amount of consideration received from the transaction. When considering whether the Company Group acts as principal or agent, the Company Group comprehensively takes into account the following.

● Does the Company Group bear the main responsibility for performing the promise to provide the specified goods or services?

● Does the Company Group bear inventory risk before the specified goods or services are transferred to the customer, or after they are transferred to control of the customer?

● Does the Company Group have discretion to set the price of the specified goods or services?

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Sale of merchandise and finished goods

In the electronic devices business, the Company Group is engaged in the sale, etc. of semiconductors and electronic components mainly to automobile related companies, and in the technology solutions business, it is engaged in the sale of IT equipment, embedded devices, and measuring devices and in the development, manufacture, and sale of industrial software and hardware.

In regard to the sale of merchandise, the Company Group's main performance obligations are the provision of purchased merchandise to customers. For domestic transactions, the amount of time from the shipment of merchandise until control of the merchandise transfers to the customer is an ordinary amount of time, so the Company Group deems that control has transferred to the customer and the performance obligation has been fulfilled upon shipment of merchandise, and it recognizes revenue at that time. For foreign transactions, the Company Group deems that control has transferred to the customer and the performance obligation has been fulfilled upon the inspection and receipt of merchandise, and it recognizes revenue at that time.

In regard to the sale of finished goods, the Company Group deems that the customer has gained control of the finished goods and the performance obligation has been fulfilled upon inspection and receipt in the case mainly of finished goods requiring installation when delivered to the customer and upon shipment in the case of finished goods not requiring installation, and it recognizes revenue at those times.

The Company Group recognizes revenue from the sale of merchandise and finished goods based on transaction value under contracts with customers, and as the consideration for transactions is mainly received within one year of fulfilling the performance obligations, it does not contain any significant elements of financing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Maintenance and other services

Mainly in the technology solutions business, the Company Group bears performance obligations to provide services, etc. over certain periods pursuant to system maintenance agreements, software license subscription agreements, and long-term contracting agreements, etc. In regard to maintenance and other services, the Company Group deems that the performance obligations are fulfilled over a certain period, and it recognizes revenue at a fixed rate over the service provision period or based on progress. The Company Group recognizes revenue from maintenance and other services based on transaction value under contracts with customers, and as the consideration for transactions is mainly received within one year of fulfilling the performance obligations, it does not contain any significant elements of financing.

(5) Standards for recording retirement benefit assets and obligations

The Company records the amount of retirement benefit obligations minus pension assets based on the estimated amounts as of the end of the consolidated fiscal year under review to provide for employee retirement benefits.

Past service costs are recognized as costs in their entirety in the consolidated fiscal year in which they arise.

Actuarial gains and losses are recognized as costs from the consolidated fiscal year following the year in which the gain or loss arises and are amortized proportionally on a straight-line basis over a certain period (13 years) that is within the average remaining period of service of employees when the gain or loss arises each consolidated fiscal year.

Unrecognized actuarial gains and losses are recorded as "Remeasurements of defined benefit plans" under "Accumulated other comprehensive income" under net assets after performing tax effect adjustments.

(6) Standards for converting significant assets or liabilities denominated in foreign currencies to yen used
when preparing the financial statements of consolidated companies based on which the consolidated financial statements were prepared

For overseas subsidiaries, assets and liabilities have been converted to yen using the spot exchange rate on the closing date of the subsidiary, and income and expenses have been converted to yen using the average exchange rate during the fiscal year. Translation differences have been recorded by including them in "Foreign currency translation adjustment" under net assets.

(7) Significant hedge accounting methods

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Hedge accounting methods

The Company uses deferred hedge accounting. However, the Company uses forward price conversion to account for monetary claims and obligations denominated in foreign currencies with forward exchange contracts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Hedging instruments and hedged items

Hedging instruments: Forward exchange contracts and currency option transactions

Hedged items: Monetary claims and obligations denominated in foreign currencies and transactions planned to be conducted in foreign currencies

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Hedging policies

The Company hedges the risk of changes in exchange rates in relation to monetary claims and obligations denominated in foreign currencies in accordance with the derivative management standards it has established.

The Company does not engage in derivative transactions for speculative purposes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Method of assessing the effectiveness of hedging

The Company finds the hedged items and hedging instruments to be highly correlated as the significant terms and conditions thereof, such as currencies, maturation dates, and amounts, are identical, and therefore the Company forgoes the assessment of effectiveness.

(8) Goodwill amortization method and period

Goodwill is amortized via the straight-line method over the period during which the effect of the goodwill will arise, up to a maximum of 20 years.

**Notes Regarding Changes in Accounting Policies**

<u>Application of "Accounting Standard for Current Income Taxes," etc.</u>

The Company has applied "Accounting Standard for Current Income Taxes" (ASBJ Statement No. 27; October 28, 2022), "Accounting Standard for Presentation of Comprehensive Income" (ASBJ Statement No. 25; October 28, 2022), and "Guidance on Accounting Standard for Tax Effect Accounting" (ASBJ Guidance No. 28; October 28, 2022) from the start of the consolidated fiscal year under review. This change in accounting policies has no effect on the consolidated financial statements.

<u>Application of "Accounting for and Disclosure of Current Taxes Related to the Global Minimum Tax Rules"</u>

The Company has applied "Accounting for and Disclosure of Current Taxes Related to the Global Minimum Tax Rules" (ASBJ Practical Solution No. 46; March 22, 2024) from the start of the consolidated fiscal year under review. This change in accounting policies has no effect on the consolidated financial statements.

**Notes Regarding Revenue Recognition**

(1) Information on disaggregation of revenue from contracts with customers

The Company Group disaggregates revenue from contracts with customers by region (based on customer location). Revenue by region is disaggregated by reportable segment. The disaggregated revenue and segment revenue are as follows.

(Millions of yen)

---

| | | | |
|:---|:---|:---|:---|
|  | &nbsp;&nbsp;Reportable segment | &nbsp;&nbsp;Reportable segment | |
|  | &nbsp;&nbsp;Electronic devices business | &nbsp;&nbsp;Technology solutions business | <br>&nbsp;&nbsp;Total |
| &nbsp;&nbsp;Region |  |  |  |
| &nbsp;&nbsp;&nbsp;Japan | &nbsp;&nbsp;159244 | &nbsp;&nbsp;32242 | &nbsp;&nbsp;191487 |
| &nbsp;&nbsp;&nbsp;Asia | &nbsp;&nbsp;28450 | &nbsp;&nbsp;172 | &nbsp;&nbsp;28623 |
| &nbsp;&nbsp;&nbsp;North America | &nbsp;&nbsp;32249 | &nbsp;&nbsp;4 | &nbsp;&nbsp;32254 |
| &nbsp;&nbsp;&nbsp;South America | &nbsp;&nbsp;83 | &nbsp;&nbsp;- | &nbsp;&nbsp;83 |
| &nbsp;&nbsp;&nbsp;Europe | &nbsp;&nbsp;6291 | &nbsp;&nbsp;3 | &nbsp;&nbsp;6294 |
| &nbsp;&nbsp;Total | &nbsp;&nbsp;226319 | &nbsp;&nbsp;32423 | &nbsp;&nbsp;258742 |

---

(2) Underlying information for understanding revenue from contracts with customers

The underlying information for understanding revenue from contracts with customers is omitted here as it is the same as that stated in "(4) Standards for recording revenue and expenses" under "3. Matters relating to accounting policies" in "Notes Regarding Significant Matters Based on Which the Consolidated Financial Statements Were Prepared" of these Notes to Consolidated Financial Statements.

(3) Relationship between fulfillment of performance obligations under contracts with customers and cash flows arising from such contracts;
information relating to amounts and timing of recognition of revenue from contracts with customers that exist as of the end of the consolidated
fiscal year under review that is expected to be recognized in or after the following consolidated fiscal year

Balance, etc. of contract assets and contract liabilities

---

| | |
|:---|:---|
|  | &nbsp;&nbsp;(Millions of yen) |
|  | &nbsp;&nbsp;Consolidated fiscal year under review<br> (March 31, 2025) |
| &nbsp;&nbsp;Contract assets (balance at start of year) | &nbsp;&nbsp;940 |
| &nbsp;&nbsp;Contract assets (balance at end of year) | &nbsp;&nbsp;1949 |
| &nbsp;&nbsp;Contract liabilities (balance at start of year) | &nbsp;&nbsp;1836 |
| &nbsp;&nbsp;Contract liabilities (balance at end of year) | &nbsp;&nbsp;2240 |
| &nbsp;&nbsp;Merchandise return assets (balance at start of year) | &nbsp;&nbsp;- |
| &nbsp;&nbsp;Merchandise return assets (balance at end of year) | &nbsp;&nbsp;2372 |
| &nbsp;&nbsp;Refund liabilities (balance at start of year) | &nbsp;&nbsp;- |
| &nbsp;&nbsp;Refund liabilities (balance at end of year) | &nbsp;&nbsp;2463 |

---

Contract assets are mainly unclaimed accounts receivable relating to revenue recognized based on the measurement of progress under long-term contracting agreements, etc.

Contract liabilities are mainly advances received from customers for maintenance and other services.

Merchandise return assets are assets recognized as rights to recover merchandise from customers.

Refund liabilities are the amounts of consideration for merchandise expected to be returned.

The amount of revenue recognized in the consolidated fiscal year under review that is included in the balance of contract liabilities at the start of the year or that was recognized from performance obligations fulfilled in past periods is not significant.

In addition, there are no significant changes in regard to contract assets and contract liabilities in the consolidated fiscal year under review.

**Notes Regarding Accounting Estimates**

<u>Significant accounting estimates</u>

Merchandise

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Amounts recorded in the consolidated financial statements of the consolidated fiscal year under review

Merchandise: 47,759 million yen

Inventory asset valuation loss: 552 million yen (included in cost of sales)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Information on details of significant accounting estimates relating to identified items

The Company Group calculates balance sheet value by writing down the book value based on declining profitability.

The specific method of writing down book value based on declining profitability for inventory assets that are merchandise with particularly high significance is based on a combination of the following three types of methods.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Comparing the net realizable value and the book value, and if the net realizable value is lower than the
book value, writing down the book value to the net realizable value.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Writing down the book value to a certain amount calculated using the historical rate, etc. based on the
holding period of the merchandise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) For inventory assets pertaining to finished goods from suppliers that are no longer in production, estimating
the possibility of future sales and writing down the book value of portions not expected to be sold.

The possibility of future sales are estimated based on factors such as the quantities required by customers and the status of orders received from customers, but as such estimates contain uncertainties, there may be an effect on the consolidated financial statements of the following year in cases where demand from customers differs from estimates due to sudden changes in the future market environment.

**Additional Information**

<u>Possibility of purchase of preferred shares with cumulative dividends</u>

In regard to 2,000 million yen in preferred shares with cumulative dividends issued on January 30, 2019 by Hagiwara Electronics Co., Ltd., if certain events such as a delay in Hagiwara Electronics Co., Ltd. performing its obligations occur, or if the Company or Hagiwara Electronics Co., Ltd. has not acquired those shares as of January 29, 2026, it is possible that the Company will be obligated to acquire those shares for the sum of the paid-in amount and the amount of unpaid cumulative dividends.

**Notes Regarding Consolidated Balance Sheets**

Cumulative amounts of depreciation directly deducted from assets

---

| | |
|:---|:---|
| &nbsp;&nbsp;Non-current assets |  |
| &nbsp;&nbsp;&nbsp;Property, plant and equipment |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Buildings and structures: | &nbsp;&nbsp;2,027 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Machinery, equipment and vehicles: | &nbsp;&nbsp;76 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Leased assets: | &nbsp;&nbsp;404 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other: | &nbsp;&nbsp;928 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total property, plant and equipment: | &nbsp;&nbsp;3,436 million yen |

---

**Notes Regarding Consolidated Statements of Income**

Amounts written down based on declining profitability of inventory assets held for the purpose of ordinary sales

Cost of sales: 647 million yen

**Notes Regarding Consolidated Statements of Changes in Equity**

1. Class and total number of issued shares as of the end of the consolidated fiscal year under review

Share class <u>Start of consolidated fiscal year under review</u> <u>Increase</u> <u>Decrease</u> <u>End of consolidated fiscal year under review</u> <br> <u>Common shares</u> <u>10,118,000 shares</u> <u>-</u> <u>-</u> <u>10,118,000 shares</u>

2. Matters relating to class and number of treasury shares

Share class <u>Start of consolidated fiscal year under review</u> <u>Increase</u> <u>Decrease</u> <u>End of consolidated fiscal year under review</u> <br> <u>Common shares</u> <u>155,505 shares</u> <u>-</u> <u>2,461 shares</u> <u>153,044 shares</u>

(Note) A breakdown of the decrease is as follows.

Decrease due to disposal of treasury shares as restricted stock compensation: 2,461 shares

3. Matters relating to dividends of surplus paid during the consolidated fiscal year under review

(1) Amounts of dividends paid

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;Resolution | &nbsp;&nbsp;Share class | &nbsp;&nbsp;Total dividend amount (millions of yen) | &nbsp;&nbsp;Dividends per share (yen) | &nbsp;&nbsp;Record date | &nbsp;&nbsp;Effective date |
| &nbsp;&nbsp;May 14, 2024, Board of Directors | &nbsp;&nbsp;Common shares | &nbsp;&nbsp;896 | &nbsp;&nbsp;90.00 | &nbsp;&nbsp;March 31, 2024 | &nbsp;&nbsp;June 6, 2024 |
| &nbsp;&nbsp;November 8, 2024, Board of Directors | &nbsp;&nbsp;Common shares | &nbsp;&nbsp;896 | &nbsp;&nbsp;90.00 | &nbsp;&nbsp;September 30, 2024 | &nbsp;&nbsp;December 6, 2024 |
| &nbsp;&nbsp;Total |  | &nbsp;&nbsp;1793 |  |  |  |

---

(2) Dividends for which the record dates are in the consolidated fiscal year under review but the effective
dates are in the following consolidated fiscal year

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;Resolution | &nbsp;&nbsp;Share class | &nbsp;&nbsp;Dividend source | &nbsp;&nbsp;Total dividend amount (millions of yen) | &nbsp;&nbsp;Dividends per share (yen) | &nbsp;&nbsp;Record date | &nbsp;&nbsp;Effective date |
| &nbsp;&nbsp;May 14, 2025, Board of Directors | &nbsp;&nbsp;Common shares | &nbsp;&nbsp;Retained earnings | &nbsp;&nbsp;946 | &nbsp;&nbsp;95.00 | &nbsp;&nbsp;March 31, 2025 | &nbsp;&nbsp;June 6, 2025 |

---

**Notes Regarding Financial Instruments**

1. Matters relating to status of financial instruments

(1) Policy on use of financial instruments

The Company Group obtains short-term working capital, funds for equipment, and other such funds as necessary mainly through bank loans. In addition, temporary surplus funds are managed through highly liquid and highly safe financial assets. The Company Group has set a policy of using derivatives to avoid risk and of not engaging in speculative derivative transactions.

(2) Details of financial instruments, risks associated therewith, and risk management systems

Notes receivable, accounts receivable, and electronically recorded monetary claims, which are trade receivables, are exposed to customer credit risks. In regard to those risks, the accounting department manages payment due dates and balances for each transaction partner independently, and it monitors the credit status of its major transaction partners in accordance with the Company Group's credit management standards.

Investment securities are mainly shares of corporations relating to business relationships with transaction partners or to capital alliances, etc., and those securities are exposed to the risk of changes in market prices. In regard to those risks, the accounting department regularly monitors market prices, the financial status of the issuers of the shares, and other such matters.

Most notes payable, accounts payable, and electronically recorded obligations, which are trade payables, are due for payment within three months.

Derivative transactions consist of (a) forward exchange contracts for the purpose of hedging the risk of changes in exchange rates relating to loans in foreign currencies within the Company Group and (b) forward exchange contracts and currency option transactions for the purpose of hedging the risk of changes in exchange rates relating to trade receivables and payables denominated in foreign currencies, and those transactions are managed in accordance with the Company Group's derivative management regulations.

Hedging instruments, hedged items, hedging policies, the method of assessing the effectiveness of hedging, and other such matters relating to hedge accounting are stated above in "(7) Significant hedge accounting methods" under "3. Matters relating to accounting policies" in "Notes Regarding Significant Matters Based on Which the Consolidated Financial Statements Were Prepared."

In regard to trade receivables and payables denominated in foreign currencies, the Company Group uses forward exchange contracts to hedge the risk of changes in exchanges rates identified for each currency each month. In addition, for planned transactions, the Company Group uses forward exchange contracts and currency option transactions to hedge the risk of changes in exchange rates for trade receivables denominated in foreign currencies that are expected to arise with a high degree of certainty.

The counterparties to those derivative transactions are all financial institutions with a high level of creditworthiness, and therefore the Company judges the risk of nonperformance by those counterparties to be negligible.

Short-term borrowings are mainly for funding (six months or less) relating to operating transactions, and long-term borrowings are for funding (generally five years or less) relating to long-term working capital or capital investments.

The Company has also entered into a committed line of credit agreement with its main financial institution in order to secure a flexible and stable means of funding in preparation for unforeseen circumstances.

(3) Supplementary explanation of matters regarding market values, etc. of financial instruments

As the calculation of the market value of financial instruments includes factors that cause changes in value, the use of different underlying assumptions may result in changes in those values.

2. Matters regarding market values, etc. of financial instruments

The amounts recorded in the consolidated balance sheets as of March 31, 2025, the market values of those items, and the differences between those amounts are as follows.

---

| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;(Millions of yen) | &nbsp;&nbsp;(Millions of yen) | &nbsp;&nbsp;(Millions of yen) | &nbsp;&nbsp;(Millions of yen) |
|  | &nbsp;&nbsp;Amount recorded in consolidated balance sheets | &nbsp;&nbsp;Market value (\*) | &nbsp;&nbsp;Difference |
| (1) Investment securities |  |  |  |
| (i) Bonds to be held until maturity | &nbsp;&nbsp;300 | &nbsp;&nbsp;297 | &nbsp;&nbsp;(3) |
| (ii) Other available-for-sale securities | &nbsp;&nbsp;952 | &nbsp;&nbsp;952 | &nbsp;&nbsp;- |
| &nbsp;&nbsp;Total assets | &nbsp;&nbsp;1253 | &nbsp;&nbsp;1249 | &nbsp;&nbsp;(3) |

---

---

| | | | |
|:---|:---|:---|:---|
| (1) Bonds payable | &nbsp;&nbsp;10000 | &nbsp;&nbsp;9620 | &nbsp;&nbsp;(379) |
| (2) Long-term borrowings | &nbsp;&nbsp;24717 | &nbsp;&nbsp;24301 | &nbsp;&nbsp;(415) |
| (3) Lease liabilities (\*3) | &nbsp;&nbsp;240 | &nbsp;&nbsp;240 | &nbsp;&nbsp;(0) |
| &nbsp;&nbsp;Total liabilities | &nbsp;&nbsp;34958 | &nbsp;&nbsp;34162 | &nbsp;&nbsp;(795) |

---

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;Derivative transactions (\*4) |  |  |
| (1) Transactions to which hedge accounting is not applied | &nbsp;&nbsp;69 | &nbsp;&nbsp;- |
| (2) Transactions to which hedge accounting is applied | &nbsp;&nbsp;(1) | &nbsp;&nbsp;- |
| &nbsp;&nbsp;Total derivative transactions | &nbsp;&nbsp;68 | &nbsp;&nbsp;- |

---

---

| | |
|:---|:---|
| (\*1) | "Cash and deposits," "Notes receivable - trade," "Accounts receivable - trade," "Electronically recorded monetary claims - operating," "Notes and accounts payable - trade," "Electronically recorded obligations - operating," and "Short-term borrowings" are omitted here as their market value and book value are highly similar because they are settled in the short term. |

---

(\*2) Shares, etc. without a market price are not included in "Securities and investment securities."

The value of those financial instruments recorded in the consolidated balance sheets is as stated below.

(Millions of yen)

Unlisted shares <u>31</u> <u>In accordance with section 5 of the "Guidance on Disclosures about Fair Value of Financial Instruments," the Company does not disclose the market value of unlisted shares.</u>

(\*3) "Lease liabilities" includes the current portion thereof.

---

| | |
|:---|:---|
| (\*4) | Claims or liabilities arising from derivative transactions are stated as net amounts, and the amounts of items for which there is a total net liability are stated in parentheses. |

---

3. Matters regarding breakdown, etc. for each level of market value of financial instruments

The Company classifies the market values of financial instruments into the following three levels based on the observability and significance of the inputs used in calculating market value.

Level 1 market value: Of the observable inputs for calculating market value, market value is calculated using the trading price of the asset or liability for which market value is being calculated as formed on active markets.

Level 2 market value: Of the observable inputs for calculating market value, the market value is calculated using inputs other than those in level 1.

Level 3 market value: Market value is calculated using unobservable inputs.

If multiple inputs that have a material effect on the calculation of market value are used, of the levels to which those inputs belong, the market value is classified as the level with the lowest priority when calculating market value.

(1) Financial instruments for which the market value is the amount recorded in the consolidated balance sheets

(Millions of yen)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp;Market value | &nbsp;&nbsp;Market value | &nbsp;&nbsp;Market value | &nbsp;&nbsp;Market value |
| &nbsp;&nbsp;Category | &nbsp;&nbsp;Level 1 | &nbsp;&nbsp;Level 2 | &nbsp;&nbsp;Level 3 | &nbsp;&nbsp;Total |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Investment securities<br> Other available-for-sale securities<br> Shares | &nbsp;&nbsp;950 | &nbsp;&nbsp;- | &nbsp;&nbsp;- | &nbsp;&nbsp;950 |
| &nbsp;&nbsp;Total assets | &nbsp;&nbsp;950 | &nbsp;&nbsp;- | &nbsp;&nbsp;- | &nbsp;&nbsp;950 |
| &nbsp;&nbsp;Derivative transactions |  |  |  |  |
| &nbsp;&nbsp;Currency-related derivatives | &nbsp;&nbsp;- | &nbsp;&nbsp;68 | &nbsp;&nbsp;- | &nbsp;&nbsp;68 |
| &nbsp;&nbsp;Total liabilities | &nbsp;&nbsp;- | &nbsp;&nbsp;68 | &nbsp;&nbsp;- | &nbsp;&nbsp;68 |

---

---

| | |
|:---|:---|
| (\*) | Claims or liabilities arising from derivative transactions are stated as net amounts, and the amounts of items for which there is a total net liability are stated in parentheses. |

---

(2) Financial instruments for which the market value is not the amount recorded in the consolidated balance sheets

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp;(Millions of yen) | &nbsp;&nbsp;(Millions of yen) | &nbsp;&nbsp;(Millions of yen) | &nbsp;&nbsp;(Millions of yen) |
|  | &nbsp;&nbsp;Market value | &nbsp;&nbsp;Market value | &nbsp;&nbsp;Market value | &nbsp;&nbsp;Market value |
| &nbsp;&nbsp;Category | &nbsp;&nbsp;Level 1 | &nbsp;&nbsp;Level 2 | &nbsp;&nbsp;Level 3 | &nbsp;&nbsp;Total |
| &nbsp;&nbsp;Investment securities |  |  |  |  |
| &nbsp;&nbsp;Other available-for-sale securities |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Golf membership rights | &nbsp;&nbsp;- | &nbsp;&nbsp;1 | &nbsp;&nbsp;- | &nbsp;&nbsp;1 |
| &nbsp;&nbsp;Bonds to be held until maturity |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bonds | &nbsp;&nbsp;- | &nbsp;&nbsp;297 | &nbsp;&nbsp;- | &nbsp;&nbsp;297 |
| &nbsp;&nbsp;Total assets | &nbsp;&nbsp;- | &nbsp;&nbsp;298 | &nbsp;&nbsp;- | &nbsp;&nbsp;298 |
| &nbsp;&nbsp;Bonds | &nbsp;&nbsp;- | &nbsp;&nbsp;9620 | &nbsp;&nbsp;- | &nbsp;&nbsp;9620 |
| &nbsp;&nbsp;Long-term borrowings | &nbsp;&nbsp;- | &nbsp;&nbsp;24301 | &nbsp;&nbsp;- | &nbsp;&nbsp;24301 |
| &nbsp;&nbsp;Lease liabilities | &nbsp;&nbsp;- | &nbsp;&nbsp;240 | &nbsp;&nbsp;- | &nbsp;&nbsp;240 |
| &nbsp;&nbsp;Total liabilities | &nbsp;&nbsp;- | &nbsp;&nbsp;34162 | &nbsp;&nbsp;- | &nbsp;&nbsp;34162 |

---

(Note) Explanation of valuation techniques and inputs used in calculating market value

Investment securities:

Listed shares are valued using their trading price. As listed shares are traded on active markets, their market value is classified as level 1.

However, as bonds and golf membership rights held by the Company are not frequently traded on markets and cannot be found to have a trading price on an active market, their market value is classified as level 2.

Derivative transactions:

The market value of these transactions is calculated based on the prices set out by the relevant financial institutions and is therefore classified as level 2.

Bonds and long-term borrowings:

The market value is calculated by discounting the total principal and interest to the current value at the estimated interest rate if the Company were to obtain similar new borrowings and is therefore classified as level 2.

Lease liabilities:

The market value is calculated by discounting the total principal and interest to the current value at the estimated interest rate if the Company were to obtain similar new leases and is therefore classified as level 2.

**Notes Regarding Per-share Information**

1. Net assets per share: 5,099.30 yen

2. Earnings per share: 371.30 yen

**Other Notes**

<u>Notes regarding business combinations, etc.</u>

Business combination through acquisition

The Company resolved at its Board of Directors meeting held on June 26, 2024 for Hagiwara Techno Solutions Co., Ltd., the Company's consolidated subsidiary, to acquire all of the issued shares of BellaDati Pte. Ltd. and make it a subsidiary, and a share transfer agreement was executed on the same date.

1. Summary of business combination

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Name and business details of acquired company Name of acquired company: BellaDati Pte. Ltd.

Business details: Development and provision of BellaDati IoT Advanced Analytics Framework products

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Main reasons for business combination

The Company believes that it will be possible to enter new markets and strengthen competitiveness in existing markets by sharing resources such as customer bases and brand power and by establishing integrated businesses using the strengths of existing businesses, thereby leading to the enhancement of the corporate value of the Company Group.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Business combination date

July 16, 2024 (share acquisition date)

September 30, 2024 (deemed acquisition date)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Legal format of business combination

Acquisition of shares for cash consideration

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Acquired voting rights ratio

100%

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) Main grounds leading to determination of acquiring company

This is because the Company acquires the shares for cash consideration.

2. Period of business performance of acquired company included in consolidated financial statements

October 1, 2024 to December 31, 2024

3. Cost of acquiring the acquired company and breakdown by type of consideration

<u>Acquisition consideration</u> <u>Cash</u> <u>3,000 million yen</u> <br> Acquisition cost 3,000 million yen

4. Details and amounts of main costs related to acquisition

Fees and commissions, etc. to advisors: 73 million yen

5. Amount of goodwill arising, cause, amortization method, and amortization period

(1) Amount of goodwill arising<br>
2,578 million yen

(2) Cause<br>
Goodwill arose due to the acquisition cost exceeding the net amounts distributed to assets received and liabilities assumed.

(3) Amortization method and amortization period<br>
Goodwill will be amortized on a straight-line basis across the period during which the effect of the goodwill will occur.

6. Amounts of assets received and liabilities assumed on the business combination date and breakdown of main
items

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| | |
|:---|:---|
| Current assets | &nbsp;&nbsp;109 million yen |
| Non-current assets | &nbsp;&nbsp;0 million yen |
| Total assets | &nbsp;&nbsp;109 million yen |

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| | |
|:---|:---|
| Current liabilities | &nbsp;&nbsp;51 million yen |
| Total liabilities | &nbsp;&nbsp;51 million yen |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. Amounts distributed to intangible assets other than goodwill and amortization period thereof

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| | | |
|:---|:---|:---|
| Type | &nbsp;&nbsp;Amount | &nbsp;&nbsp;Amortization period |
| Customer-related intangible assets | &nbsp;&nbsp;437 million yen | &nbsp;&nbsp;9 years |

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**Notes to Non-consolidated Financial Statements**

**Matters Relating to Significant Accounting Policies**

1. Valuation basis and methods for assets

(1) Valuation basis and methods for available-for-sale securities

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Bonds to be held until maturity: Stated using the amortized cost method (straight-line method).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Subsidiary shares: Stated using the cost method based on the moving average method.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Other available-for-sale securities

Securities other than shares, etc. without a market price: Stated using the market value method based on market prices, etc. (valuation differences are reflected directly in net assets, and cost of sales is calculated using the moving average method).

Shares, etc. without a market price: Stated using the cost method based on the moving average method.

(2) Derivatives: Stated using the market value method.

2. Depreciation methods for non-current assets

(1) Property, plant and equipment (excluding leased assets): Stated using the declining balance method.

However, buildings (excluding facilities attached to buildings) acquired on or after April 1, 1998 and facilities attached to buildings and structures acquired on or after April 1, 2016 are stated using the straight-line method.

The useful lives of the main assets are as follows.

Buildings: 31 to 50 years

(2) Intangible assets (excluding leased assets): Stated using the straight-line method.

The useful life of intangible assets is based on the same standards as the method set out in the Corporation Tax Act.

However, software to be used internally is stated using the straight-line method based on the estimated period that the software will be usable internally (mainly five years).

(3) Leased assets: Stated using the straight-line method with the useful life set equal to the lease period
and the residual value set at zero.

3. Standards for recording provisions

(1) Allowance for doubtful accounts: This allowance is provided for possible losses on unrecoverable receivables.
For ordinary receivables, the amount of the allowance is based on the historical rate of loss. For certain receivables such as those from
debtors at risk of bankruptcy, the amount of the allowance is based on individually estimated unrecoverable amounts taking into account
the likelihood of recovery.

(2) Provision for bonuses for directors (and other officers): This provision for expenditures for bonuses
to be paid to directors and other officers is recorded based on the estimated amounts to be paid for the business year under review.

(3) Provision for retirement benefits: Based on the estimated amounts of retirement benefit obligations and
pension assets as of the end of the business year under review, the amounts found to have arisen as of the end of the business year under
review are recorded as a provision for retirement benefits or prepaid pension expenses to provide for employee retirement benefits.

Past service costs are recognized as costs in their entirety in the business year in which they arise.

Actuarial gains and losses are recognized as costs from the business year following the year in which the gain or loss arises and are amortized proportionally on a straight-line basis over a certain period (13 years) that is within the average remaining period of service of employees when the gain or loss arises.

4. Accounting for retirement benefits

The method of accounting for unaccounted amounts of unrecognized actuarial gains and losses relating to retirement benefits differs from the method used in the consolidated financial statements.

5. Standards for recording revenue and expenses

The Company recognizes revenue based on the following five-step approach.

Step 1: Identify contracts with customers.

Step 2: Identify performance obligations under contracts.

Step 3: Calculate transaction value.

Step 4: Distribute transaction value across individual performance obligations under contracts.

Step 5: Recognize revenue when (or as) the performance obligations are fulfilled.

The Company's revenue consists of service contracting fees such as management consultancy fees from subsidiaries, real estate usage fees, and dividend income. In regard to service contracting fees, the Company's performance obligations are the provision of contracted services based on contracts with subsidiaries and are fulfilled when the Company provides those services, and therefore the Company recognizes revenue at that time. In regard to real estate usage fees, the Company's performance obligations are to provide services based on contracts with subsidiaries and are fulfilled across a certain period of time as the contract period progresses, and therefore the Company recognizes revenue at that time. Dividend income is recognized on the effective date of the dividends.

**Notes Regarding Changes in Accounting Policies**

<u>Application of "Accounting Standard for Current Income Taxes," etc.</u>

The Company has applied "Accounting Standard for Current Income Taxes" (ASBJ Statement No. 27; October 28, 2022), "Accounting Standard for Presentation of Comprehensive Income" (ASBJ Statement No. 25; October 28, 2022), and "Guidance on Accounting Standard for Tax Effect Accounting" (ASBJ Guidance No. 28; October 28, 2022) from the start of the business year under review. This change in accounting policies has no effect on the financial statements.

<u>Application of "Accounting for and Disclosure of Current Taxes Related to the Global Minimum Tax Rules"</u>

The Company has applied "Accounting for and Disclosure of Current Taxes Related to the Global Minimum Tax Rules" (ASBJ Practical Solution No. 46; March 22, 2024) from the start of the business year under review. This change in accounting policies has no effect on the financial statements.

**Additional Information**

<u>Possibility of purchase of preferred shares with cumulative dividends</u>

In regard to 2,000 million yen in preferred shares with cumulative dividends issued on January 30, 2019 by Hagiwara Electronics Co., Ltd., if certain events such as a delay in Hagiwara Electronics Co., Ltd. performing its obligations occur, or if the Company or Hagiwara Electronics Co., Ltd. has not acquired those shares as of January 29, 2026, it is possible that the Company will be obligated to acquire those shares for the sum of the paid-in amount and the amount of unpaid cumulative dividends.

**Notes Regarding Non-consolidated Balance Sheets**

1. Cumulative amounts of depreciation directly deducted from assets

---

| | |
|:---|:---|
| &nbsp;&nbsp;Non-current assets |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Property, plant and equipment |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Buildings: | &nbsp;&nbsp;1,085 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Structures: | &nbsp;&nbsp;55 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Machinery and equipment: | &nbsp;&nbsp;4 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Vehicles: | &nbsp;&nbsp;1 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tools, furniture and fixtures: | &nbsp;&nbsp;185 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Leased assets: | &nbsp;&nbsp;207 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total property, plant and equipment: | &nbsp;&nbsp;1,539 million yen |

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2. Guarantee obligations

The Company guarantees the following obligations for bank transactions by the following affiliated companies.

---

| | |
|:---|:---|
| Hagiwara Electronics Co., Ltd.: | &nbsp;&nbsp;3,331 million yen |
| Hagiwara Techno Solutions Co., Ltd.: | &nbsp;&nbsp;1,766 million yen |
| Other companies: | &nbsp;&nbsp;5,145 million yen |
| Total: | &nbsp;&nbsp;10,243 million yen |

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3. Monetary claims and monetary obligations pertaining to affiliated companies

Accounts receivable - other: 530 million yen <br> Short-term loans receivable from affiliated companies: 50,729 million yen <br> Accounts payable - other: 126 million yen

**Notes Regarding Non-consolidated Statements of Income**

Revenue from contracts with customers: 5,141 million yen

Balances of transactions with affiliated companies

Operating revenues: 6,987 million yen <br> Other operating transactions: 11 million yen <br> Non-operating transactions: 281 million yen

**Notes Regarding Non-consolidated Statements of Changes in Equity**<br> Matters relating to class and number of treasury shares

Share class <u>Start of business year under review</u> <u>Increase</u> <u>Decrease</u> <u>End of business year under review</u> <br> <u>Common shares</u> <u>155,505 shares</u> <u>-</u> <u>2,461 shares</u> <u>153,044 shares</u>

(Note) A breakdown of the decrease is as follows.

Decrease due to disposal of treasury shares as restricted stock compensation: 2,461 shares

**Notes Regarding Tax Effect Accounting**

1. Breakdown of deferred tax assets and deferred tax liabilities by main causes thereof

---

| | |
|:---|:---|
| Deferred tax assets |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bonuses payable: | &nbsp;&nbsp;45 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Business taxes payable: | &nbsp;&nbsp;34 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on valuation of investment securities: | &nbsp;&nbsp;9 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Impairment losses: | &nbsp;&nbsp;41 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other: | &nbsp;&nbsp;<u>96 million yen</u> |
| Subtotal of deferred tax assets: | &nbsp;&nbsp;227 million yen |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Valuation allowance relating to total of future deductible temporary differences, etc.: | &nbsp;&nbsp;<u>(98 million yen)</u> |
| Subtotal of valuation allowances: | &nbsp;&nbsp;<u>(98 million yen)</u> |
| Total deferred tax assets: | &nbsp;&nbsp;129 million yen |

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---

| | |
|:---|:---|
| Deferred tax liabilities |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Valuation difference on available-for-sale securities: | &nbsp;&nbsp;(205 million yen) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other: | &nbsp;&nbsp;<u>(172 million yen)</u> |
| Total deferred tax liabilities: | &nbsp;&nbsp;<u>(378 million yen)</u> |
| Net amount of deferred tax liabilities: | &nbsp;&nbsp;(249 million yen) |

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2. Breakdown of main items causing significant differences between statutory effective tax rate and rate of burden of corporation taxes,
etc. after application of tax effect accounting

---

| | |
|:---|:---|
| &nbsp;&nbsp;Breakdown of main items |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Statutory effective tax rate: | &nbsp;&nbsp;30.6% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Adjustments) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Items that will never be included in losses (entertainment expenses, etc.): | &nbsp;&nbsp;0.3% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Items that will never be included in gains (dividend income, etc.): | &nbsp;&nbsp;(11.3%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Per capita residence tax: | &nbsp;&nbsp;0.1% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in valuation allowances: | &nbsp;&nbsp;0.1% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reduction of year-end deferred tax assets due to changes in tax rates: | &nbsp;&nbsp;0.1% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tax deduction under tax system to promote increased wages: | &nbsp;&nbsp;(1.1%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other: | &nbsp;&nbsp;<u>(0.0%)</u> |
| &nbsp;&nbsp;&nbsp;&nbsp;Rate of burden of corporation taxes, etc. after application of tax effect accounting: | &nbsp;&nbsp;18.9% |

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**Notes Regarding Transactions with Related Parties**

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;Type | &nbsp;&nbsp;Name of company, etc. | &nbsp;&nbsp;Ratio of voting rights, etc. held in (or by) related party | &nbsp;&nbsp;Relationship with related party | &nbsp;&nbsp;Transaction details | &nbsp;&nbsp;Transaction amount (millions of yen) | &nbsp;&nbsp;Accounting item | &nbsp;&nbsp;End of year balance (millions of yen) |
|  |  |  |  | &nbsp;&nbsp;Management service fee income (\*1) | &nbsp;&nbsp;1849 | &nbsp;&nbsp;Accounts receivable – other | &nbsp;&nbsp;145 |
|  |  |  |  | &nbsp;&nbsp;Real estate, etc. rent income (\*2) | &nbsp;&nbsp;266 | &nbsp;&nbsp;Accounts receivable – other | &nbsp;&nbsp;24 |
|  |  |  |  | &nbsp;&nbsp;Dividend income (\*3) | &nbsp;&nbsp;732 | &nbsp;&nbsp;- | &nbsp;&nbsp;- |
| &nbsp;&nbsp;Subsidiary | &nbsp;&nbsp;Hagiwara Electronics Co., Ltd. | &nbsp;&nbsp;100% directly held in related party | &nbsp;&nbsp;Business management loans; and borrowings; guarantees of obligations | &nbsp;&nbsp;Business support fee income (\*4) | &nbsp;&nbsp;2403 | &nbsp;&nbsp;Accounts receivable – other | &nbsp;&nbsp;220 |
|  |  |  |  | &nbsp;&nbsp;Loan interest income (\*5) | &nbsp;&nbsp;233 | &nbsp;&nbsp;- | &nbsp;&nbsp;- |
|  |  |  |  | &nbsp;&nbsp;Monetary loans (\*6) | &nbsp;&nbsp;7631 | &nbsp;&nbsp;Short-term loans receivable from affiliated companies | &nbsp;&nbsp;43696 |
|  |  |  |  | &nbsp;&nbsp;Obligation guarantees (\*7) | &nbsp;&nbsp;3331 | &nbsp;&nbsp;- | &nbsp;&nbsp;- |
|  |  |  |  | &nbsp;&nbsp;Management service fee income (\*1) | &nbsp;&nbsp;461 | &nbsp;&nbsp;Accounts receivable – other | &nbsp;&nbsp;52 |
|  |  |  |  | &nbsp;&nbsp;Real estate, etc. rent income (\*2) | &nbsp;&nbsp;247 | &nbsp;&nbsp;Accounts receivable – other | &nbsp;&nbsp;20 |
|  |  |  |  | &nbsp;&nbsp;Dividend income (\*3) | &nbsp;&nbsp;579 | &nbsp;&nbsp;- | &nbsp;&nbsp;- |
| &nbsp;&nbsp;Subsidiary | &nbsp;&nbsp;Hagiwara Techno Solutions Co., Ltd. | &nbsp;&nbsp;100% directly held in related party | &nbsp;&nbsp;Business management; loans and borrowings; guarantees of obligations | &nbsp;&nbsp;Business support fee income (\*4) | &nbsp;&nbsp;386 | &nbsp;&nbsp;Accounts receivable – other | &nbsp;&nbsp;35 |
|  |  |  |  | &nbsp;&nbsp;Loan interest income (\*5) | &nbsp;&nbsp;31 | &nbsp;&nbsp;- | &nbsp;&nbsp;- |
|  |  |  |  | &nbsp;&nbsp;Monetary loans (\*6) | &nbsp;&nbsp;2900 | &nbsp;&nbsp;Short-term loans receivable from affiliated companies | &nbsp;&nbsp;6729 |
|  |  |  |  | &nbsp;&nbsp;Obligation guarantees (\*7) | &nbsp;&nbsp;1766 | &nbsp;&nbsp;- | &nbsp;&nbsp;- |

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Transaction terms and methods for determination thereof

(\*1) Management service fee income is determined pursuant to a "Service Agreement" and "Memorandum of Understanding on Service Fees."

(\*2) Real estate, etc. rent income is reasonably determined based on market prices and the rents of neighboring properties.

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| | |
|:---|:---|
| (\*3) | Dividend income is reasonably determined using certain standards based on the distributable amount of surplus. |

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(\*4) Business support fee income is determined pursuant to a "Business Support Agreement."

(\*5) Loan interest is reasonably determined based on market interest rates.

---

| | |
|:---|:---|
| (\*6) | Monetary loans are repeatedly conducted, and therefore the net amount of change for the business year under review is stated. |

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(\*7) The Company guarantees obligations for bank transactions by subsidiaries.

**Notes Regarding Revenue Recognition**

<u>Underlying information for understanding revenue from contracts with customers</u>

The underlying information for understanding revenue from contracts with customers is omitted here as it is the same as that stated in "5. Standards for recording revenue and expenses" in "Matters Relating to Significant Accounting Policies" of these Notes to Non-consolidated Financial Statements.

**Notes Regarding Per-share Information**

1. Net assets per share: 3,545.79 yen <br> 2. Earnings per share: 287.81 yen