リテールパートナーズ（8167） – NOTICE OF THE 69TH ANNUAL GENERAL MEETING OF SHAREHOLDERS

TO SHAREHOLDERS: Securities Code: 8167 May 11, 2022 1936, Edomari, Hofu-shi, Yamaguchi RETAIL PARTNERS CO., LTD. Yasuo Tanaka President and Representative Director NOTICE OF THE 69TH ANNUAL GENERAL MEETING OF SHAREHOLDERS Dear Shareholders, We would like to take this opportunity to express our sincere gratitude for your continued support and business. You are cordially invited to attend the 69th Annual General Meeting of Shareholders of RETAIL PARTNERS CO., LTD. (the “Company”). The meeting will be held as follows. From the perspective of COVID-19 prevention of infection outbreak, shareholders are requested to refrain from attending the meeting and exercise their voting rights in writing or via the internet, etc., regardless of their health condition. Please review the attached Reference Documents for the General Meeting of Shareholders and exercise your voting rights by 6:00 p.m. on Wednesday, May 25, 2022, in accordance with the “Guide to Exercising Voting Rights” on pages 3 to 4. 1. Date and time 2. Location 3. Meeting Agenda: Thursday, May 26, 2022 at 10:00 a.m. (Tokyo Time) 1-1 Ogori Koganemachi, Yamaguchi-shi, Yamaguchi “Houou and Tsuruno-ma” on the second floor of Yamaguchi Grand Hotel (Please refer to the venue map at the end of this document) Matters to be reported 1. The 69th Fiscal Year (from March 1, 2021 to February 28, 2022) Business Report, Consolidated Financial Statements and reports on the results of audits of the Consolidated Financial Statements by the Accounting Auditor and the Audit & Supervisory Committee. 2. The 69th Fiscal Year (from March 1, 2021 to February 28, 2022) Non-consolidated Financial Statements Proposals to be resolved Proposal 1 Proposal 2 Partial Amendments to the Articles of Incorporation Director (excluding Director who is an Audit & Supervisory Committee Member) Election of Ten (10) Directors Notice Concerning Prevention of Spread of COVID-19 ■ In order to prevent the spread of COVID-19, and in consideration of the safety of our shareholders as our first priority, we strongly recommend that you refrain from attending the General Meeting of Shareholders as much as possible and exercise your voting rights in advance in writing or via the internet, etc. – 1 – Response to Prevent the Spread of COVID-19 Infections ◼ Shareholders attending the General Meeting of Shareholders are requested to check their physical condition and take precaution against infections, such as wearing masks. ◼ On the day of the event, we ask for your cooperation in taking your temperature and disinfecting with alcohol before entering the venue, and we may ask those with a fever or who are not feeling well to refrain from entering the site. ◼ The number of seats available is limited due to the increased space between seats. We would appreciate your understanding that admission may be denied even if you show up on the day of the event. ◼ In order to shorten the time of the meeting, the detailed explanation of the matters to be reported and the proposals at the meeting will be omitted. Shareholders are requested to read the notice of convocation in advance. (Notes) 1. When attending this General Meeting of Shareholders, please submit the enclosed Voting Rights Exercise Form at the reception desk. 2. Among the documents attached to this Notice of Convocation, the “Notes to the Consolidated Financial Statements” of the Consolidated Financial Statements and “Notes to the Non-consolidated Financial Statements” of the Non-consolidated Financial Statements are not included in the attached documents of this Notice because they are posted on the Company’s website (http://www.retailpartners.co.jp/) online in accordance with laws and regulations and Article 16 of the Articles of Incorporation of the Company. Accordingly, the Consolidated Financial Statements and the Non-consolidated Financial Statements attached to this Notice are part of the Consolidated Financial Statements and the Non-consolidated Financial Statements audited by the Accounting Auditor and the Audit & Supervisory Committee in preparing the audit report. 3. If there are any revisions to the contents of the Business Report, the Consolidated Financial Statements, the Non-consolidated Financial Statements and the Reference Documents for the General Meeting of Shareholders, the Company will announce such revisions on its website (http://www.retailpartners.co.jp/). 4. For various reasons, we have discontinued the use of souvenirs. We appreciate your understanding. – 2 – Exercise of Voting Rights The right to vote at the General Meeting of Shareholders is an important right for shareholders. Please review the attached Reference Documents for the General Meeting of Shareholders and exercise your voting rights. There are three ways to exercise your voting rights. When attending the General Meeting of Shareholders Please submit the enclosed Voting Rights Exercise Form at the reception desk. Date and time Thursday, May 26, 2022 10 a.m. When exercising voting rights in writing (by mail) Please indicate your approval or disapproval of the proposals on the enclosed Voting Rights Exercise Form and return it to us. Wednesday, May 25, 2022 Exercise period Up to 6:00 p.m. arrival When exercising voting rights via the Internet, etc. Please follow the instructions on the next page and enter your vote for or against the proposal. Exercise period Wednesday, May 25, 2022 Until 6:00 p.m. input completion Instructions for Exercising Voting Rights If you exercise your voting rights both in writing (by mail) and via the internet, etc., the vote exercised via the internet, etc. will be treated as valid exercise of voting rights. If you exercise your voting rights multiple times via the internet, etc., the last exercise of your voting rights will be treated as the valid exercise of your voting rights. – 3 – Exercise of Voting Rights via the Internet, etc. How to read QR codes “Smart Exercise” With the Voting Rights Exercise Code and password How to enter You can log in to the website for exercising voting rights without entering your voting code and password. Website for Exercising voting rights https://www.web54.net By exercising voting rights via the Internet How to use your computer, your smartphone, your mobile phone If you have any questions, please contact the right. Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Trust Bank, Limited Phone: 0120-652-031 (toll free) (Hours: 9:00 – 21:00) Institutional investors may use the electronic voting rights exercise platform for institutional investors operated by ICJ, Inc. – 4 – Attachments Business Report ( From March 1, 2021 To February 28, 2022 ) 1. Matters regarding the Current Status of the Corporate Group (1) Progress and Results of the Business During the consolidated fiscal year under review, the Japanese economy continued to be in a state of uncertainty. While expectations for the normalization of socio-economic activities increased due to the spread of COVID-19 vaccine and the development of therapeutic drugs, the outlook remained uncertain due to the re-spread of COVID-19 by the Omicron variant throughout Japan as the sixth wave, as well as concerns over the impact of rising electricity and delivery rates due to soaring crude oil prices. In the food retail industry, sales trends changed in line with the increase and decrease in the number of people infected with COVID-19, and despite continued consumption trends such as increased stay-at-home demand, the increase in demand for food and daily necessities was moderate compared to the same period of the previous year. In addition, changes in consumer purchasing behavior due to the impact of the spread of infectious diseases, such as a decline in the frequency of store visits and an increase in online purchases, are continuing. Competition among companies across industries and business categories, including e-commerce companies handling food and drug stores, is becoming increasingly intense. Under this environment, the Company launched its second medium-term management plan for the three years from the fiscal year ended in February 2022 to the fiscal year ending in February 2024 under the slogan “Accelerate organizational and management reforms to enhance sustainable corporate value, strengthen the earnings structure, and promote integrated group management.” The Group has established eight basic strategies: Growth strategy, Strengthening competitiveness, Strengthening profitability, Strengthening group collaboration, Strengthening human resources, Promotion of Digital Transformation (DX), ESG management, and Capital policy. The Group is working to realize its long-term management vision. With regard to the “Growth strategy,” we have been expanding our market share by opening new stores and renovating existing stores in a planned manner. In addition to five new stores in supermarket and discount store businesses and 17 remodeled stores, we added six new stores through share and business acquisitions. In the Other business segment, we also established one new sports club. As part of our efforts regarding “Strengthening competitiveness,” we are expanding product development and joint procurement, as well as remodeling our stores through the development of fresh-food-oriented stores. As for “Strengthening profitability,” the Company is working to improve the gross profit margin, reviewing logistics efficiency through the operation of a new chilled center, and implementing initiatives to build a group logistics system. Regarding “Strengthening group collaboration,” the Company has worked to increase profits by joint procurement, joint product development, and – 5 – cost reductions in order to create further synergies and improve management efficiency. For the “Promotion of DX,” we are working to improve operational efficiency through the introduction of year-end adjustment systems using workflows and the web, and to develop smart stores using shopping carts with cash registers. Regarding “ESG management,” we are working to reduce food losses through the optimization of the number of products manufactured and the support for local food bank activities. We are also working to reduce CO2 emissions through the installation of environment-friendly refrigeration cases and energy-saving measures. In addition, we are promoting recycling activities for PET bottles and food trays to reduce plastic waste. As an example of our efforts during the consolidated fiscal year under review, Marukyu Co., Ltd., participated in the “ONE FOR OCEAN – Marine Plastic Waste Up Cycle Project -” sponsored by Yamaguchi Prefecture and private companies. In addition to cleaning up marine plastic waste that has drifted ashore, we have been promoting social contribution and environmental conservation activities, such as introducing shopping baskets made from collected plastic waste at three stores of the company since December 2021. As part of efforts to build new sales channels, in the mobile sales business, we have been gradually switching from 12 mobile sales vehicles operated by Marukyu Co., Ltd. to the “TOKUSHIMARU” from the current consolidated fiscal year. As of the end of February 2022, six TOKUSHIMARU were in operation. In the future, we plan to increase the number of vehicles in operation in Yamaguchi Prefecture and expand the business area with the participation of Marumiya Store Co., Ltd. In addition, in the Internet Supermarket Business, the “Marukyu Rakuraku-bin,” in which Marukyu Co., Ltd. delivers merchandise from fresh foods to general foods and miscellaneous goods to customers’ homes,in all areas of Yamaguchi Prefecture. and some areas of Hiroshima Prefecture. Marukyu Rakuraku-bin is supported by customers, mainly elderly people, as a local shopping support service. We are making efforts in cooperation with the local government and welfare councils to spread the service and we plan to expand these activities to the entire Kyushu area. The “New Japan Supermarket Union,” formed among ARCS GROUP Co., Ltd., Valor Holdings Co., Ltd. and the Company, has been working to realize specific synergies through four subcommittees. In addition to continuing to work on joint procurement, joint sales promotion, joint sales and reduction of costs for consumable materials and fixtures and fittings, the Union has initiated to share information among the members to promote DX to improve operational efficiency and to promote SDGs. For details, please refer to “Notice Concerning Progress of Alliance with the New Japan Supermarket Union” released on March 9, 2022. As a result, operating results for the consolidated fiscal year under review were as follows. Operating revenue was ¥239,519 million (down 1.0% year on year), operating profit was ¥5,372 million (down 35.9% year on year), and ordinary profit was ¥6,215 million (down 33.0% year on year). In addition, extraordinary income of ¥350 million including gain on sale of non-current assets and extraordinary losses of ¥1,490 million including impairment losses and loss on retirement of non-current assets resulted in profit attributable to owners of parent being ¥3,371 million (down 31.7% year on year). – 6 – Operating results by segment are as follows. 1) Supermarket business (Business policies) Marukyu Co., Ltd. worked on to ensure to prevent the spread of COVID-19, and at the same time, in order to meet customers’ diversifying needs, the Company thoroughly reviewed its product line-up. In addition, with the start of operations at the newly established Marukyu Process Center in October 2020, store operations have become more efficient through labor and headcount savings at stores, and food defense has been strengthened through the renovation of facilities and equipment, providing even more secure and safer products. Moreover, since the previous consolidated fiscal year, we have been replacing refrigeration/freezing equipment and cases, and are working to reduce electricity consumption to reduce CO2 emissions by updating store facilities. Marumiya Store Co., Ltd. has implemented a variety of initiatives based on the following four pillars: “Increase market share in the commercial area,” “Human resource development and productivity improvement,” “Promotion of ESG management,” and “Group collaboration and resource sharing.” To further expand our business, in March 2021 we received business transfer for two supermarkets from Ono Shoten Co., Ltd. (Usa-shi, Oita), and in March of the same year we acquired shares in Tomura Meat Honten Co., Ltd. (Nichinan-shi, Miyazaki), making Tomura Meat Honten Co., Ltd. and Tomura Foods Co., Ltd. consolidated subsidiaries. As a result, the Group accomplished opening of four new stores in Nichinan-shi, Miyazaki for the first time, strengthening its management base by becoming a dominant player in Southern Kyushu. In September of the same year, Tomura Meat Honten Co., Ltd. acquired shares in Tomura Ranch Co., Ltd and made the company a consolidated subsidiary. Under the slogan of “No. 1 supermarket specializing in fresh foods in Oita Prefecture”, Shinsen Market Co., Ltd., has been continuing to increase the number of products sold. Efforts were made to improve freshness and quality by optimizing fresh inventory, improving profit margins by reducing waste losses, raising employee awareness of SDGs, and improving the number of purchases and sales by refining the sales floor at opening on weekdays (Monday, Wednesday and Friday). Marukyo Corporation has been operating its stores by strengthening the development of value-added categories and products, especially fresh products, to meet the diversifying needs of consumers under the slogans of “tasty products at lower prices,” “food design,” and “food premiumization.” In the Fresh Fish Division, we developed “Uoya-san no Souzai (fishmonger’s prepared dishes)” and “Uoya-san no Sushi – 7 – (fishmonger’s sushi)”; in the Fresh Meat Division, we expanded brand meats and improved cutting technology; in the Fruit and Vegetable Division, we strengthened lineup of cut fruits and developed fruit-based sweets ; and in the Delicatessen and Sushi Division, we increased the development of handmade products. In the Processed Foods Division, which accounts for a high percentage of sales, we have been creating stores that satisfy customers by strengthening sales promotions for individual products and categories to meet diversifying needs. (Store openings) Marukyu Co., Ltd. opened Aruk Yahatanishi store (Yahatanishi-ku, Kitakyushu-shi, Fukuoka) in April 2021 and Marukyu Takachiho (Sanyo-Onoda City, Yamaguchi) in December of the same year. We also rebuilt the Picross Tabuse store (Tabuse-cho, Yamaguchi), which was closed in January 2021, as a new small format Marukyu Tabuse store (Tabuse-cho, Yamaguchi Prefecture). in March of the same year. Then, Sunmart Miwa store (Iwakuni-shi, Yamaguchi) was opened in August of the same year, followed by Aruk Mitsui store (Hikari-shi, Yamaguchi) and Marukyu Kume store (Shunan-shi, Yamaguchi) in September of the same year, Aruk Nishiube store (Ube-shi, Yamaguchi) and Aruk Mitsui store (Hikari-shi, Yamaguchi, Yamaguchi) in October of the same year, Marukyu Oshima Komatsu Store (Suooshima-cho, Yamaguchi) and Marukyu Tokuchi Store (Yamaguchi-shi, Yamaguchi) in November of the same year, Sunmart Hitomaru Store (Nagatoshi, Yamaguchi) and Marukyu Kamikibe store (Hofu-shi, Yamaguchi) in January 2022, and Marukyu Atsusa store (Sanyoonoda City, Yamaguchi) in February of the same year. In November of the same year, Aruk Hofu store (Hofu-shi, Yamaguchi) was closed for renovation. As of the end of the consolidated fiscal year under review, the Company operated 88 stores (including 43 Aruk stores). Marumiya Store Co., Ltd. opened two supermarkets in March 2021 that it took over from Ono Shoten Co. as Marumiya Store Ajim Store (Usa City, Oita Prefecture) and Innai Store (Usa City, Oita Prefecture), respectively. In addition, the Company opened Mie store (Bungoono-shi, Oita) in October of the same year, which had been closed since August of the same year for renovations, and closed the Tsurumachi Store (Hyugashi, Miyazaki Prefecture) in February 2022. As of the end of the consolidated fiscal year under review, there were 43 stores in operation. Moreover, the number of shinsen market Co., Ltd. branch is 14. Tomura Meat Honten Co., Ltd., which became a consolidated subsidiary in the current consolidated fiscal year, operates Supermarket Tomura Aburatsu store, Agata store, Obi store and Hoshikura store (all in Nichinan-shi, Miyazaki). As of the end of the current consolidated fiscal year, the number of stores in operation is 4. Marukyo Corporation refurbished Marukyo Kuko-dori Yutaka store (Hakata-ku, Fukuoka-shi, Fukuoka) in March 2021, Haki store (Asakura-shi, Fukuoka) in April of the same year, Ogori store (Ogori-shi, Fukuoka) in July of the same year, Asakura store (Chikuzen-machi, Fukuoka) in August of the same year, Kuyamadai store (Isahaya-shi, Nagasaki) in September of the same year, and Takada store (Itoshi-machi, Fukuoka) in – 8 – November of the same year. In December of the same year, the Omura Matsunami Store (Omura-shi, Nagasaki) was newly established. In November of the same year, Omura store (Omura-shi, Nagasaki) and Isahaya store (Isahaya-shi, Nagasaki) were closed, bringing the number of stores in operation to 84 as of the end of the consolidated fiscal year under review. In consequence of these initiatives, the number of supermarket business stores operating at the end of the consolidated fiscal year under review was 233. As a result of the above, sales in supermarket business were ¥ 218,950 million in operating revenue (down 1.4% year on year) and ¥ 5,374 million in operating profit (down 34.9% year on year). 2) Discount store business (Business policies) Amid the continued emphasis on saving, Attacks Mart Co., Ltd… has been working to improve its operating results under the slogan of “We will answer with sincere and reasonable prices,” focusing on the dominant strategy in the Kyushu area and pricing strategy based on EDLP (Everyday Low Price). (Store openings) In May 2021, Attacks Mart Co., Ltd.. opened a new store in Kousa-machi, Kumamoto called Attack Susaera. In consequence, the number of stores in discount store business at the end of the consolidated fiscal year under review was 32. As a result of the above, sales in discount store business were ¥ 20,258 million in operating revenue (up 1.8% year on year) and ¥ 286 million in operating profit (down 33.2% year on year). 3) Other business RPG Insurance Service Co., Ltd., an insurance agency, focused on strengthening sales capabilities and thorough compliance to increase customer satisfaction and trust. In addition, the Group is working to strengthen its management base and to improve the quality of its operations by expanding sales channels and closely sharing information within the Group. In April 2021, Marukyu Co., Ltd., which conducts sports club business, opened Actos Will_G Kurosaki (Yahatanishi-ku, Kitakyushu-shi, Fukuoka), its second sports club store. Even under the Declaration of a State of Emergency in response to the spread of COVID-19, the store continues to operate with thorough measures against infectious diseases, and has steadily gained membership. Tomura Foods Co., Ltd. and Tomura Ranch Co., Ltd., both of which are engaged in the food manufacturing business, became consolidated subsidiaries of the Group from the current consolidated fiscal year, and the – 9 – operating results of these companies are included in the Other business segment. As a result of the above, in the Other business segment, operating revenue was ¥ 565 million (¥ 88 million in operating revenue in the same period of the previous fiscal year) and operating profit was ¥ 96 million (¥ 3 million in operating profit in the same period of the previous fiscal year). The results by business segment are as follows. Consolidated Fiscal year under review Net sales Change against Previous consolidated fiscal year (Unit : thousand yen) 103,058,920 121,820,666 8,683,670 3,219,363 236,782,622 1.2 % (2.2) (5.1) (7.4) (0.9) Department Fresh foods Processed food Housing related goods Clothing and other Total (2) Capital Expenditures The total amount of Capital Expenditures during the consolidated fiscal year under review was 5,943 million yen, mainly due to the opening of new stores and the remodeling of existing stores in the Supermarket business, the opening of new stores in the Discount store business, and the open of new stores in sports club business in the Other businesses. (3) Financing During the consolidated fiscal year under review, the Company procured financing through its own funds, borrowings and lease agreements. (4) Transfers of business, split offs or spin-offs Not applicable. – 10 – (5) Acquisition of business from other companies Marumiya Store Co., Ltd., a consolidated subsidiary of the Company, acquired two supermarkets operated by Ono Shoten Co., Ltd. on March 25, 2021. (6) Succession to the rights and responsibilities of other companies through mergers and acquisitions Not applicable. (7) Acquisition or disposal of shares or other equities or warrants of other companies Marumiya Store Co., Ltd., a consolidated subsidiary of the Company, acquired shares in Tomura Meat Honten Co., Ltd. on March 23, 2021, making the company and its consolidated subsidiary, Tomura Foods Co., Ltd., consolidated subsidiaries of the company. Tomura Meat Honten Co., Ltd. acquired Tomura Ranch Co., Ltd.’s shares on September 28, 2021, making the company a consolidated subsidiary. (8) Historical data of assets and income KPI Fiscal Year 66th Fiscal Year (February 2019) 67th Fiscal Year (February 2020) 68th Fiscal Year (February 2021) 69th Fiscal Year (February 2022) (Current Consolidated Fiscal Year) Operating revenue (thousand yen) 229,066,699 228,814,782 241,844,142 239,519,703 Net sales (thousand yen) 226,428,420 226,154,516 239,044,351 236,782,622 Ordinary profit (thousand yen) 5,574,164 5,216,071 9,279,437 6,215,046 Profit attributable to owners of parent (thousand yen) 3,194,834 2,240,481 4,932,657 3,371,025 Profit per share (yen) 77.32 50.04 112.53 76.89 Total assets (thousand yen) 104,691,550 104,801,951 114,331,344 114,377,276 Net assets (thousand yen) 70,745,691 65,705,935 71,538,223 74,114,771 Equity ratio (%) 67.6 62.7 62.6 (Notes) 1. Profit per share is calculated based on the average number of shares outstanding during the period. 2.The Company has applied the “Partial Amendments to Accounting Standard for Tax Effect Accounting” (Accounting Standards Board of Japan (ASBJ) Statement No. 28, February 16, 2018), etc. since the beginning of the 67th fiscal year. The status of assets and profit and loss for the 66th fiscal year is the figure after retroactive application of the accounting standards, etc. 64.8 – 11 – (9) Issues to be addressed Regarding the outlook for the future, although expectations for the resolution of COVID-19 are expected to increase slightly, we expect the situation to remain unclear due to factors such as the depreciation of the yen against the dollar and heightened geopolitical risks. We are concerned about the soaring crude oil and distribution costs that will continue to affect the Group’s business activities through such factors as rising prices for food and electricity. In addition, given the uncertain future of society, we must strengthen our ability to respond to the changing lifestyles and purchasing behavior of consumers. In response to this situation, the Company has formulated the Second Medium-Term Management Plan with the fiscal year ended February 2022 as the first year and the fiscal year ending February 2024 as the last year. Under the slogan of “Rapidly reform the organization and management to enhance sustainable corporate value and promote the strengthening of the profit structure and integrated management of the Group,” the Company has established the following priority strategies. (i) Growth Strategy The Company will expand its market share and develop peripheral businesses through the planned opening of new stores and remodeling of existing stores, mainly in the Chugoku and Kyushu areas. (ii) Strengthening profitability We will strengthen our supply system by utilizing the Group’s strengths, such as joint purchasing, and invest in equipment and systems to improve productivity. (iii) Strengthening group collaboration We aim to make effective use of Group resources such as logistics and systems, as well as to realize the unification of accounting systems and the integration of core systems in the final year of the project. We will also enhance management efficiency through centralized management of group funds. (iv) Promotion of digital transformation (DX) We will promote the use of data by building our own platform, promote cashless payments (such as smart cash registers), and enhance sales by using ID-POS data and applications. (v) ESG Management We will actively promote food loss, CO2 reduction and recycling activities to achieve the SDGs target. In addition, the Company will strive to strengthen its governance structure, including organizational structure and risk management. Consolidated forecasts for the fiscal year ending February 28, 2023 are as follows: Operating revenue 232,000 million yen (note) ; Operating profit 5,400 million yen (up 0.5% year on year) ; Ordinary profit 6,300 million yen (up 1.4% year on year) ; and Profit attributable to owners of parent 3,400 million yen (up 0.9% year on year). – 12 – (Note) As “The Accounting Standard for Revenue Recognition etc.” (Accounting Standards Board of Japan (ASBJ) Statement No. 29, March 31, 2020) will be applied from the beginning of the fiscal year ended February 28, 2023, the operating revenue forecast is the amount calculated by applying such Accounting Standard. However, since the accounting methods to be compared are different, year-on-year comparisons are not shown. (10) Major business lines (as of February 28, 2022) Business segment Business Supermarket business Supermarket business centered on food products Discount store business Discount store business focusing on food and daily sundries Other businesses Insurance agency, sports club business, food manufacturing, etc. – 13 – Storehouse location Yamaguchi, Hiroshima, Shimane and Fukuoka Prefectures Oita, Miyazaki, Kumamoto and Fukuoka Prefectures Fukuoka, Oita, Nagasaki, Kumamoto Saga Prefectures Oita Prefectures (11) Major Business Offices (as of February 28, 2022) The Company: 1936, Edomari, Hofu-shi, Yamaguchi (i) Supermarket business Name of company Marukyu Co., Ltd. Location of the head office Hofu-shi, Yamaguchi Number of stores 88 stores Marumiya Store Co., Ltd. Saiki-shi Oita 43 stores Marukyo Corporation shinsen market Co., Ltd. Onojo-shi, Fukuoka Oita-shi, Oita Nichinan-shi, Miyazaki 84 stores 14 stores Tomura Meat Honten Co., Ltd. 4 stores Miyazaki Prefecture (ii) Discount store business Name of company Location of the head office Number of stores Attacks Mart Co., Ltd.. Saiki-shi Oita 32 stores Storehouse location Oita, Miyazaki, Kumamoto, Kagoshima Fukuoka (iii) Other businesses Name of company RPG Insurance Service Co., Ltd. 1 Number of business offices Location of the head office Hofu-shi, Yamaguchi – 14 – (12) Employees (as of February 28, 2022) Business segment Number of employees Supermarket business Discount store business Other business Total 1,787 150 17 1,954 (7,075) (303) (16) (7,394) Change from the end of the previous consolidated fiscal year (Number of Employees) 109 8 13 130 (116) (20) (11) (147) (Notes) The number of employees is the number of full-time employees, and the average number of temporary employees (converted to 8 hours per day) during the period is shown in parentheses. (13) Major Borrowings (as of February 28, 2022) Amount 4,606,250 Thousand yen 1,915,929 1,379,105 1,111,250 939,024 735,587 714,951 400,000 298,356 264,114 Lender The Yamaguchi Bank,Ltd. THE NISHI-NIPPON CITY BANK, LTD. Mizuho Bank, Ltd. The Hiroshima Bank, Ltd. Sumitomo Mitsui Banking Corporation The Miyazaki Bank, Ltd. THE OITA BANK, LTD. MUFG Bank, Ltd. Sumitomo Mitsui Trust Bank, Limited THE KITAKYUSHU BANK, Ltd. – 15 – (14) Items of the principal parent companies and subsidiaries (i) Relationship with Parent company There is no parent company applicable to our company. (ii) Major subsidiaries Name of company Capital stock Thousand yen Ownership Ordinary Operating profit revenue Thousand yen Thousand yen Thousand yen Profit % Major business Marukyu Co., Ltd. 1,000,000 100.0 96,318,381 3,128,938 1,335,159 Supermarket business Marukyo Corporation 5,996,200 100.0 81,638,496 1,771,175 1,301,646 Supermarket business Marumiya Store Co., Ltd. 808,289 100.0 27,418,933 674,167 502,045 Supermarket business Attacks Mart Co., Ltd.. 20,258,508 284,309 128,590 Discount store business shinsen market Co., Ltd. 11,373,115 288,611 173,892 Supermarket business Aoki Shoji Co.,Ltd. 8,449,185 158,640 104,403 Supermarket business Tomura Meat Honten Co., Ltd. 5,000 2,334,675 (1,497) (783) Supermarket business Marumiya Suisan Co., Ltd. 50,000 1,491,237 31,253 20,000 (Note) Figures in parentheses in the “Ownership” column are indirect ownership ratios and are included in the number.. Purchase and sale of marine products 50,000 50,000 10,000 100.0 (100.0) 100.0 (100.0) 100.0 (100.0) 100.0 (100.0) 100.0 (100.0) (iii) Wholly-owned specified subsidiaries (as of February 28, 2022) Name of company Address Marukyo Corporation 5-3-1, Yamada, Onojo-shi, Fukuoka 1936, Edomari, Hofu-shi, Yamaguchi Marukyu Co., Ltd. (iv) Results of business combination Total book value Thousand yen Our total assets value Thousand yen 17,182,884 16,289,474 44,898,955 The number of consolidated subsidiaries of the Company is 11, including 8 companies listed in the major subsidiaries above. For the consolidated fiscal year under review, Operating revenue was 239,519 million yen (down 1.0% year on year) and Profit attributable to owners of parent was 3,371 million yen (down 31.7% year on year). (15) Significant matters concerning the current status of the other Corporate Group Not applicable. – 16 – 2. Matters regarding shares of the Company (1) Total number of shares authorized (2) Total number of shares issued and outstanding (3) Number of shareholders (4) Major shareholders (top 10) 80,000,000 shares 46,646,059 shares 21,661 persons Name of shareholder Number of shares held Shareholding ratio Stock % ARCS GROUP Co.,Ltd. Valor Holdings Co., Ltd. The Master Trust Bank of Japan ,Ltd. (trust account) Ikedakousann Corporation Marukyu Kyoeikai Kimiyo Saita The Yamaguchi Bank,Ltd. YAMAEHISANO Co.,Ltd Miyoko Miyano THE NISHI-NIPPON CITY BANK, LTD. 3,136,400 3,136,400 2,507,800 2,259,100 2,258,540 1,468,000 1,411,165 1,215,000 1,000,000 955,067 7.15 7.15 5.71 5.15 5.15 3.34 3.21 2.77 2.28 2.17 (Note) Shareholding ratio is calculated by deducting Treasury shares (2,802,727 shares). (5) Status of shares delivered to officers of the Company as consideration for execution of duties during the fiscal year under review Number of shares Number of recipients Director (excluding Audit & Supervisory Committee Members and Outside directors) (Note) Details of the Company’s stock compensation are described in “4. (2) Amount of Director’s compensation, etc.” of Persons Stock 8,293 8 the Business Report. 3. Matters regarding the Company’s stock acquisition rights Not applicable. – 17 – 4. Matters regarding Directors, Audit & Supervisory Committee Members and executive officers of the Company (1) Director and Audit & Supervisory Committee Member Status Name Significant concurrent positions * President Yasuo Tanaka * Vice President Yasuyuki Ikebe Chairman of Board of * Directors Toshio Saita Senior Managing Director Minoru Shimizu Director Tomohisa Kawano Director Director Director Director Hiroyuki Usagawa Tamotsu Aoki Mamoru Sakamoto Takeshi Yoshimura Akio Kawaguchi Director Full-time Audit & Supervisory Committee Member Director Audit & Supervisory Committee Member Kazuyoshi Ueda President and Representative Director, Marukyu Co., Ltd President and Representative Director, Marumiya Store Co., Ltd. Chairman and Representative Director, Attacks Mart Co., Ltd.. Chairman and Representative Director, Marumiya Suisan Co., Ltd. Chairman and Representative Director, Marukyo Corporation. Chairman and Representative Director, Aoki Shoji Co., Ltd. Executive Vice President and Representative Director, General Manager of Administration Division, and Manager of Group Administration Division, Marukyu Co., Ltd. President and Representative Director, RPG Insurance Service Co., Ltd. Managing Director and General Manager of Administration Division, Marumiya Store Co., Ltd. Director, Attacks Mart Co., Ltd.. Audit & Supervisory Board Member, Marumiya Suisan Co., Ltd. Managing Director and General Manager of Corporate Planning Office, Marukyu Co., Ltd. Director, RPG Insurance Service Co., Ltd. President and Representative Director, Marukyo Corporation. Audit & Supervisory Board Member, Marukyu Co., Ltd. Audit & Supervisory Board Member, RPG Insurance Service Co., Ltd. Representative, Ueda Fujii Sogo Law Office – 18 – Director Audit & Supervisory Committee Member Toshio Shibao Director Audit & Supervisory Committee Member Tomoyuki Fujii (Notes) 1. * Indicates representative director. Audit & Supervisory Board Member, shinsen market Co., Ltd. Full-time Audit & Supervisory Board Member, Marukyo Corporation. Audit & Supervisory Board Member, Aoki Shoji Co. 2. The Company has appointed Mr. Akio Kawaguchi as a full-time Audit & Supervisory Committee Member in order to enhance information collection, the effectiveness of audits through sufficient collaboration with internal audit departments, etc., and strengthen audit and supervisory functions. 3. Out of the Directors, Mr. Takeshi Yoshimura, Mr. Kazuyoshi Ueda, Mr. Toshio Shibao and Mr. Tomoyuki Fujii are Outside directors. 4. The Company has registered Mr. Kazuyoshi Ueda, Mr. Toshio Shibao and Mr. Tomoyuki Fujii, Members of the Audit & Supervisory Committee, with the Financial Instruments Exchange as independent officers as stipulated by the said exchange. 5. The Company has entered into a liability insurance contract with an insurance company, pursuant to Article 430, Paragraph 3, Item 1 of the Companies Act. All Directors, executive officers and Audit & Supervisory Committee of the Company and its subsidiaries are covered under the policy. The Company pays all insurance premiums including the special provisions, and there is no substantial insurance premium burden for the insured person. Under the insurance contract, the Company compensates for any damage arising from the fact that an officer, etc., who is an insured person, is responsible for the execution of his / her duties or is requested to pursue such responsibility. However, there are certain exclusions, such as the fact that the damage caused by the act of recognizing the violation of law is not covered. In addition, there is a provision for a deductible amount in the insurance contract, and the damage up to the deductible amount is not subject to compensation. – 19 – (2) Amount of remuneration for Directors Category Director (excluding Audit & Supervisory Committee Members) (Outside directors) Director Audit & Supervisory Committee Member (Outside directors) Total (Outside officers) Total amount of remuneration (thousand yen) Total amount of remuneration by type (thousand yen) Performance linkage Remuneration, etc. Nonmonetary Remuneration, etc. Basic remuneration Eligible number of officers (persons) 98,185 2,400 88,632 7,153 (2,400) 11,400 (7,200) 109,585 (9,600) (2,400) 11,400 (7,200) 13,800 (9,600) (-) – (-) (-) 88,632 (-) – (-) 7,153 (-) 10 (1) 5 (3) 15 (4) (Notes) 1. The table above includes one Director (excluding Audit & Supervisory Committee Member) and one Director Audit & Supervisory Committee Member who retired at the conclusion of the 68th Ordinary General Meeting of Shareholders held on May 25, 2021. 2. The amount of remuneration, etc. for Director does not include the amount of employee salaries of Directors concurrently serving as employees. 3. In addition to the above, the total amount of remuneration, etc. received by two Outside Directors from the Company’s subsidiaries, etc. during the fiscal year under review was 10,350,000 yen. 4. The Group’s performance indicator for performance-linked remuneration is the consolidated ordinary profit, with actual results of ¥ 9,279 million. The reason for selecting this indicator is that it is an important indicator in the Medium-Term Management Plan to improve our profit structure, which is also one of the most important management issues for the Group. Performance-linked remuneration for the Company is calculated by multiplying the Basic remuneration amount, which is 90% of the base remuneration amount, by the annual salary payment rate based on the Group’s consolidated ordinary profit budget achievement rate for the previous fiscal year. 5. The content of non-monetary remuneration is the Company’s shares with restriction on transfer, and the terms and conditions of allotment are as described in “4. (3) Policy on Determination of Amount of Remuneration for Director and Director Audit & Supervisory Committee Members or Calculation Method Thereof.” The status of delivery during the fiscal year under review is as described in “2. (5) Status of shares delivered to officers of the Company as consideration for execution of duties during the fiscal year under review.” 6. At the 64th Ordinary General Meeting of Shareholders held on May 25, 2017, the amount of remuneration, etc. for Director (excluding Audit & Supervisory Committee Members) was resolved to be no more than 180 million yen per year (including no more than 30 million yen per year for Outside directors, excluding employee salaries for Director who also serve as employees). At the time of resolution of the General Meeting of Shareholders, the number of Director (excluding Audit & Supervisory Committee Members) Shareholders is eight (including one Outside director). Furthermore, at the 68th Ordinary General Meeting of Shareholders held on May 25, 2021, it was resolved that the total amount of the Company’s ordinary shares to be issued or disposed of for the purpose of granting Restricted Shares to Director (excluding Audit & Supervisory Committee Members and Outside directors) within the above amount of remuneration, etc. shall be no more than 30 million yen per year, and that no payment of money shall be required in exchange for such shares. In addition, it has been resolved that the total number of restricted shares, – 20 – which are the ordinary shares of the Company to be allotted, shall not exceed 60 thousand shares per year. At the time of resolution of the General Meeting of Shareholders, the number of Director (excluding Audit & Supervisory Committee Members and Outside directors) eligible for payment is eight. 7. At the 64th Ordinary General Meeting of Shareholders held on May 25, 2017, it was resolved that the amount of remuneration, etc. for Director (Audit & Supervisory Committee Member) should be no more than 30 million yen per year. At the time of resolution of the General Meeting of Shareholders, the number of Director (Audit & Supervisory Committee Members) eligible for payment is four (including three Outside directors). – 21 – (3) Policy regarding the determination of the amount of remuneration, etc. for Director and Director Audit & Supervisory Committee Members and the calculation methods thereof (i) Basic Policy As for the composition of remuneration for directors (and other officers), etc., the Group Remuneration for directors (and other officers) Standards have been established according to the internal Director and Outside directors of each Group company, Audit & Supervisory Committee Members, and Audit & Supervisory Board Members. A. The remuneration for the internal Director is determined based on the Group’s performance-linked remuneration standards, and the amount is determined based on performance. B. Remuneration for Outside directors and Director Audit & Supervisory Committee Members and Audit & Supervisory Board Members is determined in the Group Remuneration for directors (and other officers) Standards from the perspective of their roles and independency. C. In principle, the Company determined so that excellent human resources can be promoted (hired) as managers, based on a comprehensive evaluation of the Company’s performance, the state of business execution in each Director, achievements, contributions, etc. D. Remuneration for the employee portion of a Director who also serves as an employee is provided based on the employee’s wage regulations. (ii) Procedures The total amount of remuneration for directors (and other officers) is presented to the General Meeting of Shareholders and set within the range decided. In order to enhance transparency and objectivity, the Nomination and Remuneration Committee, which consists of one internal Director and three members of the Director Audit & Supervisory Committee, has been established as an advisory body to the Board of Directors. The amount of remuneration for the Board of Directors will be determined by the Board of Directors after the Nomination and Remuneration Committee’s consideration is reported to the Board of Directors. (iii) Policy and procedures for determining Director and Director compensation with special titles Remuneration for Director and Director with titles (excluding Director who is an Audit & Supervisory Committee Member) is based on the Group Remuneration for directors (and other officers) Standards and the Group Performance-linked Compensation Standards established by the Company. The Nomination and Compensation Committee deliberates on individual compensation linked to the performance of each company, and after reporting its opinions to the Board of Directors, the amount of compensation, etc. is determined by resolution of the Board of Directors. (iv) Policy for determining the ratio of the amount of basic remuneration, the amount of performance-linked remuneration, or the amount of non-monetary remuneration to the amount of individual remuneration, etc. Remuneration, etc. for Director of the Company (excluding Director and Outside directors who are Audit & Supervisory Committee Members) consists of monetary remuneration in performance-linked remuneration and stock remuneration in non-monetary remuneration (restricted shares), and the base remuneration amount for the Audit & Supervisory Committee Members and Outside directors is limited to monetary remuneration. The amount of remuneration, etc. for Directors (excluding Directors who are members of the Audit & Supervisory Committee and Outside Directors) with the exception of full-time directors, for each position is determined by the Board of Directors at a ratio of 2 for the President and Representative Director, 1.5 for – 22 – the Chairman and Representative Director and Vice President, and 1.25 for the Senior Managing Director, and the performance-linked remuneration portion is determined by multiplying the base remuneration amount by 90% of the base remuneration amount by the annual salary payment ratio based on the percentage of the Group’s consolidated ordinary profit budget achieved in the previous fiscal year. In addition, the restricted stock compensation portion is determined at 10% of the base compensation amount. (v) Policy regarding timing and conditions for granting remuneration, etc. Monetary compensation for basic remuneration and performance-linked remuneration will be paid monthly based on the content resolved at the Director meeting held in April each year, and non-monetary remuneration will be paid collectively in July based on the content resolved at the Director meeting held in June each year. (vi) The reason why the Board of Directors determined that the details of individual directors’ remuneration, etc. for the current business year is consistent with the Decision Policy. In determining individual compensation, etc., the Company has confirmed that the method of determining the details of compensation, etc. and the content of determined compensation, etc. are consistent with the determination policy, and that the report from the voluntary Nomination and Compensation Committee is respected, and the Company believes that the Company is in compliance with such determination policy. – 23 – (4) Outside Officers (i) Director Takeshi Yoshimura A. Significant concurrent positions held by other corporations, etc. Executive director, etc. and the relationship between the Company and such other corporations, etc. Not applicable. B. Major activities during the fiscal year under review Attended 12 of the 14 Director meetings held during the fiscal year under review. He has expressed his opinions and recommendations actively by leveraging his extensive experience and knowledge in corporate management. C. Outline of liability limitation agreement The Company has concluded a liability limitation agreement pursuant to Article 427, Paragraph 1 of the Companies Act. The maximum amount of liability for damages under the agreement is the minimum liability amount stipulated in Article 425, Paragraph 1 of the Companies Act. (ii) Director Audit & Supervisory Committee Member Kazuyoshi Ueda A. Significant concurrent positions held by other corporations, etc. Executive director, etc. and the relationship between the Company and such other corporations, etc. He is the representative of Ueda & Fujii Law Office. B. Major activities during the fiscal year under review Attended 14 of the 14 Director meetings held during the fiscal year under review. Attended 14 of the 14 meetings of the Audit & Supervisory Committee. Provides opinions and advice on legal affairs and compliance from his professional perspective as an attorney. In addition, as Chairman of the Nomination and Compensation Committee, he leads the supervisory function in the selection of candidates for Director of the Company and the decision-making process of remuneration for directors (and other officers), etc. from an objective and neutral standpoint. C. Outline of liability limitation agreement The Company has concluded a liability limitation agreement pursuant to Article 427, Paragraph 1 of the Companies Act. The maximum amount of liability for damages under the agreement is the minimum liability amount stipulated in Article 425, Paragraph 1 of the Companies Act. (iii) Director Audit & Supervisory Committee Member Toshio Shibao A. Significant concurrent positions held by other corporations, etc. Executive director, etc. and the relationship between the Company and such other corporations, etc. Not applicable. B. Major activities during the fiscal year under review Attended 14 of the 14 Director meetings held during the fiscal year under review. Attended 14 of the 14 meetings of the Audit & Supervisory Committee. He has expressed opinions making use of his wealth of experience and deep insight regarding overall management. In addition, as a member of the – 24 – Nomination and Compensation Committee, he has a supervisory function in the process of selecting candidates for the Company’s the decision-making process of remuneration for directors (and other officers), etc. from an objective and neutral standpoint. C. Outline of liability limitation agreement The Company has concluded a liability limitation agreement pursuant to Article 427, Paragraph 1 of the Companies Act. The maximum amount of liability for damages under the agreement is the minimum liability amount stipulated in Article 425, Paragraph 1 of the Companies Act. (iv) Director Audit & Supervisory Committee Member Tomoyuki Fujii A. Significant concurrent positions held by other corporations, etc. Executive director, etc. and the relationship between the Company and such other corporations, etc. Not applicable. B. Major activities during the fiscal year under review Attended 14 of the 14 Director meetings held during the fiscal year under review. Attended 14 of the 14 meetings of the Audit & Supervisory Committee. He provides opinions and advice based on his insight and experience in accounting and corporate management in general. In addition, as a member of the Nomination and Compensation Committee, he has a supervisory function in the process of selecting candidates for the Company’s the decision-making process of remuneration for directors (and other officers), etc. from an objective and neutral standpoint. C. Outline of liability limitation agreement The Company has concluded a liability limitation agreement pursuant to Article 427, Paragraph 1 of the Companies Act. The maximum amount of liability for damages under the agreement is the minimum liability amount stipulated in Article 425, Paragraph 1 of the Companies Act. 5. Accounting Auditor (1) Name of Accounting Auditor Ernst & Young ShinNihon LLC (2) Amount of remuneration, etc. paid as Accounting Auditor for the fiscal year (i) Amount of remuneration, etc. as Accounting Auditor for the fiscal year under review (ii) Other monetary assets to be paid by the Company and its subsidiaries 60,200,000 yen 103,200,000 yen (Notes) 1. In the audit agreement between the Company and the Accounting Auditor, the amount of audit fees, etc. for audits based on the Companies Act and audits based on the Financial Instruments and Exchange Act are not distinguished and cannot be practically distinguished. Therefore, the above amount is the total of these amounts. 2. The Audit & Supervisory Committee obtained necessary materials and received reports from the Director, relevant departments within the Company, and the Accounting Auditor. After confirming and deliberating the content of the audit plan by the Accounting Auditor, the status of the performance of duties by the Accounting Auditor, and the basis for calculating the compensation estimates, the Committee determined that these are appropriate and agreed on the amount of compensation, etc. – 25 – (3) Non-audit services The Company has entrusted the Accounting Auditor with services other than those stipulated in Article 2, Paragraph 1 of the Certified Public Accountants Act (non-audit services), including services to support the introduction of revenue recognition standards and services to support the improvement of the efficiency of settlement services. (4) Policy for determining dismissal or non-reappointment of Accounting Auditor The Audit & Supervisory Committee of the Company shall dismiss the Accounting Auditor based on the consent of all Audit & Supervisory Committee Members if the Accounting Auditor is found to fall under any of the items set forth in Article 340, Paragraph 1 of the Companies Act. In addition, if the Audit & Supervisory Committee determines that it is necessary to do so, for example, if the Accounting Auditor is unable to perform his/her duties, the Audit & Supervisory Committee will determine the content of the proposal for dismissal or non-reappointment of the Accounting Auditor to be submitted to the General Meeting of Shareholders. (5) Outline of the liability limitation agreement concluded with the Accounting Auditor There are no individual liability limitation agreements with the Accounting Auditor. (6) Status of resignation or dismissal during the year Not applicable. 6. Systems to ensure the appropriateness of operations The following is the content of the resolution of the Board of Directors regarding the development of systems to ensure the appropriateness of the operations of the Company and its subsidiaries as the basic policy for building an internal control system. ⑴ System to ensure that the execution of Director duties complies with laws and regulations and the Articles of Incorporation System to ensure the appropriateness of operations (i) System to ensure that the execution of duties by the Director, etc. and employees of the Company and its subsidiaries complies with laws and regulations and the Articles of Incorporation A. The Company, as a holding company, holds a meeting of the Compliance Committee once a month, in principle, in which persons related to internal control of Director and the Company and its subsidiaries attend, in order to ensure that the basic matters concerning corporate governance and compliance of the Group as a whole are well known and thoroughly implemented. At the same time, the Company, in – 26 – cooperation with the Compliance Committee of its subsidiaries, conducts audits on the appropriateness of business execution, and strives to build, maintain and improve the compliance system. The Group Internal Control Office serves as the secretariat. B. The Group Internal Control Office shall report the results to the Board of Directors and the Audit & Supervisory Committee of the Company as necessary. C. The Group Whistleblower Protection Regulations shall be established, and whistleblower handling system shall be developed and operated. D. In the event that the Audit & Supervisory Committee receives the following reports, it shall conduct necessary investigations and take appropriate measures depending on the circumstances. (a) Reports from Director regarding the discovery of facts that may cause substantial damage to the (b) Report from the Accounting Auditor to the effect that the Accounting Auditor has discovered misconduct or material facts in violation of laws and regulations or the Articles of Incorporation in connection with the execution of Director’s duties (c) Reports from the Director or employees on matters determined through consultation with the Director Company in advance (ii) System for the storage and management of information pertaining to the execution of Director duties A. The Company shall record the minutes of the General Meeting of Shareholders, the minutes of the Board of Directors, and the information pertaining to the execution of the duties of Other Director in documents or electromagnetic media, and appropriately store and manage them. B. Director and Director Audit & Supervisory Committee Members shall be able to inspect as necessary. (iii) Regulations etc. concerning the management of risk of loss for the Company and its subsidiaries system A. The Group General Affairs Department will take the lead in managing risks in normal times throughout the Group, and each operating company will prepare manuals and provide education. B. The Company shall establish a Response Headquarters for the entire Group to respond appropriately and promptly to unforeseen circumstances and highly influential risks and establish a system to prevent the expansion of damage. (iv) System to ensure efficient execution of duties of the Director, etc. of the Company and its subsidiaries A. The Company and its subsidiaries hold the Board of Directors once a month in principle, and hold extraordinary meetings as necessary to make decisions on important matters and report on the status of business execution in each Director. B. In order to discuss the matters to be submitted to the Board of Directors and the implementation of – 27 – operations based on the matters decided by the Board of Directors, the Group Corporate Planning Office and the Group General Affairs Department shall consult with the relevant departments and propose proposals, and shall make the decided matters known to the public. C. The Management Committee, consisting of the Company and its subsidiaries’ Representative directors and the designated Directors, shall meet once a month in principle to exchange reports and opinions on management policies and other important institutional decisions. D. In order to solve specific issues, a project team will be formed in a timely manner, and the responsible Director will supervise the team. E. The Company has formulated a Group medium-term management plan covering three fiscal years, and has set numerical targets for the performance of the entire Group for each fiscal year in order to materialize the plan. (v) System for reporting matters related to the execution of duties of the Director, etc. of the Company’s subsidiaries for ensuring the appropriateness of business operations in the corporate group consisting of the Company and its subsidiaries A. The Company shall respect management autonomy and share the basic concept of compliance and risk management throughout the Group. B. Important decisions of subsidiaries shall require approval at the Company’s Board of Directors, and the progress of the management plan shall be reported at the Company’s Board of Directors. C. The Group Internal Control Office shall audit the appropriateness of the execution of operations of the Company and its subsidiaries. D. The scope of the reporting system shall be the entire Group. (vi) Matters concerning the Director and employee in cases where the Audit & Supervisory Committee requests the Director and employee to assist the duties of the Audit & Supervisory Committee The Company shall appoint a Director and an employee to assist the duties of the Audit & Supervisory Committee when the Audit & Supervisory Committee deems it necessary. (vii) Matters concerning the independence of the Director and employees who are to assist in the duties of the Audit & Supervisory Committee from other Director (excluding Director who is an Audit & Supervisory Committee Member) and ensuring the effectiveness of instructions given by the Audit & Supervisory Committee to the Director and employees A. The Company requires the consent of the Audit & Supervisory Committee for the appointment and transfer of employees who are to assist the duties of the Audit & Supervisory Committee. B. The Director or employee who is to assist the duties of the Audit & Supervisory Committee shall be another – 28 – Director (excluding a Director who is an Audit & Supervisory Committee Member). Opinions of the Audit & Supervisory Committee shall be heard regarding the evaluation of duties of employees. (viii) System for reporting to the Audit & Supervisory Committee of the Company by the Director and employees of the Company and subsidiaries or persons who have received report from them and Other System for reporting to the Audit & Supervisory Committee A. Director (excluding Director who is an Audit & Supervisory Committee Member) and employees of the Company, Director, Audit and Supervisory Board Members and employees of the Company’s subsidiaries or persons who have received reports from these persons shall immediately report to the Audit & Supervisory Committee of the Company regarding any violation of laws and regulations, etc. or any other event that may cause substantial damage to the Company as soon as it is discovered. In addition, in accordance with the Audit & Supervisory Committee Rules, necessary reports and information shall be provided