クレスコ（4674） – ［Delayed］Notice Concerning Restructuring of Consolidated Subsidiaries (Merger Among Wholly Owned Subsidiaries)

Translation To whom it may concern: Notice: This document is a translation of the original Japanese document and is only for reference purposes. In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail. March 28, 2022 Company name: CRESCO LTD. Representative: Inquiries: Hiroyuki Nemoto President, Executive Officer (Stock code: 4674 Tokyo Stock Exchange, First Section) Director, Managing Executive Officer, and General Manager, Corporate Supervisory Unit TEL +81-3-5769-8011 Kazuo Sugiyama Notice Concerning Restructuring of Consolidated Subsidiaries (Merger Among Wholly Owned Subsidiaries) CRESCO LTD. (the “Company”) hereby announces that the Company’s subsidiaries have determined the schedule, merger method and other details regarding the merger announced in the “Notice Concerning Agreement to Planned Merger Among Consolidated Subsidiaries” on January 31, 2022. Details are set forth below. This reorganization is a merger among wholly owned subsidiaries; therefore, some disclosure items and their content have been omitted. 1. Purpose and details of the reorganization Purpose: The purpose of this merger is to respond to the expected changes in the business environment and intensifying competition in the future and consolidate the know-how and resources of the three companies, and also to promote business expansion by effectively utilizing personnel and management resources, taking on large-scale projects and providing new services and to maintain and improve the Group’s competitive advantages in the industry. Details: This merger is a merger in which ARS Corporation Ltd. is the surviving company and N-System Corporation and Nexus Corporation are the absorbed companies. 2. Outline of the merger (1) Merger schedule (of companies involved in the merger) • Date of execution of merger contract: Scheduled on Monday, March 28, 2022 • General meeting of shareholders for approval of merger: Scheduled on Wednesday, April 13, 2022 • Date of merger (effective date): Scheduled on Friday, July 1, 2022 (2) Form of the merger The companies plan to conduct an absorption-type merger in which ARS Corporation Ltd. is the surviving company and N-System Corporation and Nexus Corporation are the absorbed companies. (3) Details of share allocation pursuant to the merger There will be no issuance of new shares due to the merger or payment of consideration for the merger. (4) Notice concerning share acquisition rights and bonds with share acquisition rights of the absorbed companies Share acquisition rights and bonds with share acquisition rights will not be issued. 1 (2) Major line of business (4) Location of head office (5) Title and name of representative (6) Capital (7) Number of issued shares (8) Net assets (9) Total assets (11) Major shareholder and shareholding ratio Net sales Operating profit Ordinary profit Profit Net assets per share Earnings per share 3. Summary of companies involved in the merger (as of March 31, 2021) (1) Trade name ARS Corporation Ltd. N-System Corporation Nexus Corporation (Unit: Amounts less than one million yen are rounded down) (3) Date of establishment March 8, 1988 April 14, 1982 February 25, 1998 Human resources, payroll and workflows Consulting, proposals, system development, implementation and operation support for facility maintenance PMO Gotanda Building 8th-9th Floor, 8-1-3, Nishi-Gotanda, Shinagawa-ku, Tokyo Representative Director and President Jun Fukai 40 million yen 800 shares 459 million yen 586 million yen System development Operation maintenance Product development Solution service System development Server infrastructure architecture 1-16-8, Sotokanda, Chiyoda-ku, Tokyo Representative Director and President Naoki Nakamura 100 million yen 200,000 shares 267 million yen 492 million yen KDX Shin-Nihonbashi Ekimae Building 8th Floor, 4-8-16, Nihonbashi-Honcho, Chuo-ku, Tokyo Representative Director and President Chihiro Sugawara 35 million yen 640 shares 303 million yen 566 million yen (10) Fiscal year-end March 31 March 31 March 31 CRESCO LTD. 100% CRESCO LTD. 100% CRESCO LTD. 100% Note: The information in (6) to (9) is as of March 31, 2021. (12) Operating results of the most recent fiscal year (Fiscal year ended March 31, 2021) (Unit: Amounts less than one million yen are rounded down) 596 million yen 837 million yen 717 million yen 53 million yen 70 million yen 45 million yen 574,905.26 yen 56,761.67 yen 82 million yen 92 million yen 77 million yen 1,339.19 yen 386.39 yen 18 million yen 25 million yen 12 million yen 474,956.37 yen 20,222.30 yen 4. Post-merger status (1) Trade name ARS Corporation Ltd.* (2) Major line of business Human resources, payroll and workflows Consulting, proposals, system development, implementation and operation support for (3) Title and name of representative Representative Director and President Jun Fukai facility maintenance (4) Location of head office PMO Gotanda Building 8th-9th Floor, 8-1-3, Nishi-Gotanda, Shinagawa-ku, Tokyo (5) Capital 40 million yen (6) Fiscal year-end March 31 (7) Major shareholder and shareholding ratio CRESCO LTD. 100% of the merger. 5. Future outlook * The company plans to change its trade name to CRESCO J CUBE CO.,LTD after July 1, 2022, which is the effective date This merger will only have a minor impact on the Company’s consolidated financial results because it is a merger among wholly owned subsidiaries of the Company. 2