キトー（6409） – Announcement of Position Statement on the Planned Commencement of the Tender Offer for Shares, etc. of KITO by Lifting Holdings BidCo, Inc. in Connect

News Release (6409 TSE) [Translation] May 16, 2022 To whom it may concern: Company Name: Representative: Code Number: Inquiries: KITO CORPORATION Yoshio Kito, President & CEO 6409 (Tokyo Stock Exchange Prime Market) Masafumi Kokubo Executive Officer GM, Corporate Planning Division TEL: 03‐5908‐0161 Announcement of Position Statement on the Planned Commencement of the Tender Offer for Shares, etc. of KITO by Lifting Holdings BidCo, Inc. in Connection With the Business Combination of KITO and Crosby Group in the Announcement Regarding As notified the Business Combination of KITO CORPORATION and Crosby Group announced on this day (“Business Combination Press Release”), KITO (the “Company”) has this day entered into a business combination agreement (the “Business Combination Agreement”) concerning a business combination of the Company and the Crosby Group (defined below; collectively with the Company, the “Companies”) that is based on a spirit of equality (the “Business Combination”) with Lifting Holdings Limited (“HoldCo”), which is the parent company holding all of the issued and outstanding shares of Lifting Holdings BidCo, Inc. (“Offeror”), Crosby US Acquisition Corp., which is a wholly owned subsidiary of HoldCo (“Crosby US”), and Crosby UK Acquisition Limited, which is a wholly owned subsidiary of HoldCo (“Crosby UK”, and HoldCo and its subsidiaries, including Crosby US and Crosby UK and The Crosby Group LLC, a corporation established under the laws of Delaware, United States, of which HoldCo indirectly through Crosby US and a number of its subsidiaries (collectively “Other Crosby US Subsidiaries”) holds all the issued shares (“Crosby”), collectively “Crosby Group”) (for details of the Business Combination Agreement, see “4. Matters Concerning Tendering in Response to the Tender Offer by the Company’s Shareholders and Material Agreements Pertaining to the Tender Offer”). Further, in relation to the tender offer (the “Tender Offer”) for the Company’s common stock (the “Company Shares”) and the Stock Acquisition Rights (as defined in “(2) Stock Acquisition Rights” under “2. Purchase, etc. Price”) by the Offeror whose shares are all directly held by HoldCo as part of the Business Combination, at the board of directors meeting held today, a resolution was made stating that if the Tender Offer commences, the position of the company 1 News Release (6409 TSE) as of this date is that it will declare a position in support of the Tender Offer and that it will recommend that the Company’s shareholders and stock acquisition right holders (the “Stock Acquisition Right Holders”) accept the Tender Offer. Having done so, the Company announces the following. According to the Offeror, because the procedures and steps required under competition laws in Japan, the U.S., China, Australia, Cyprus, and Serbia are expected to take time to complete, the Offeror plans to commence the Tender Offer on the date that the Tender Offer Conditions Precedent (Note 1), including the completion of such procedures and steps, are satisfied (or on a day that is within 10 business days from the day that they are waived with the consent of all of HoldCo, Crosby US, Crosby UK, and the Company (Note 2) that is a day separately agreed among HoldCo, Crosby US, Crosby UK, and the Company (the “Tender Offer Commencement Date”)). We are informed that as of today, the Offeror aims to complete procedures, etc. with regulatory authorities inside and outside Japan in mid-October, 2022, and to commence the Tender Offer in late October, 2022, but as it is difficult to accurately predict the time it will require to deal with regulatory authorities inside and outside Japan, they will provide notice of a more detailed schedule for the Tender Offer once clearances have been obtained from all regulatory authorities. (We are informed that any changes to the expected timing of the obtainment of regulatory authorities’ approval and commencement of the Tender Offer as stated above will be also announced promptly.) For these reasons, at the aforementioned board of directors meeting it was resolved to take the following steps pertaining to the position statement of the Company. As set out in the section below titled “(i) Establishment of an independent special committee at the Company” under “(6) Measures to ensure the fairness of the Tender Offer, such as measures to ensure fairness of the Tender Offer Price and measures to avoid a conflict of interest” of “3. Details of, Grounds, and Reasons for the Position Regarding the Relevant Tender Offer,” the Company’s board of directors additionally resolved that when the Tender Offer commences, the special committee established by the Company will be asked to review whether or not there is any change to the contents of the report (the “Report”) submitted this day by the special committee to the Company’s board of directors, and if there is no change, state this fact to the Company’s board of directors, and if there is a change, to state a position after the change, and based on such position, the Company will again publish its position on the Tender Offer when the Tender Offer commences. The above resolution of the board of directors is made on the premise that a series of transactions (the “Transactions”) to achieve the Business Combination, including transactions with the purpose of making the Offeror the only shareholder of the Company’s through the Tender Offer and the subsequent series of transactions is contemplated, and that the Company Shares are scheduled to be delisted. Note 1: The Business Combination Agreement provides that the commencement of the Tender Offer is subject to the following conditions precedent: (i) the clearances pursuant to competition laws (Note 3) required to execute the Business Combination shall have been obtained; (ii) the board of directors of the Company shall have adopted a resolution expressing its position in support of the Tender Offer and a recommendation that its shareholders 2 News Release (6409 TSE) and Stock Acquisition Right Holders accept the Tender Offer (collectively, the “Opinion to Support and Recommend to Tender in the Tender Offer”), and the Opinion to Support and Recommend to Tender in the Tender Offer shall remain in effect at the time the Tender Offer is commenced without amendment, supplement, or modification; (iii) the special committee of the Company reviewing the Business Combination shall have submitted to the board of directors of the Company an opinion that it is appropriate for the board of directors of the Company to issue the Opinion to Support and Recommend to Tender in the Tender offer, and such opinion shall remain in effect at the time the Tender Offer is commenced without amendment, supplement, or modification; (iv) the Company shall have performed and complied with, in all material respects, all obligations under the Business Combination Agreement (Note 4) that are required to be performed and complied with by it on or before the Tender Offer Commencement Date, and the representations and warranties of the Company set forth in the Business Combination Agreement (Note 5) shall be true and correct in all material respects as of the date of the Business Combination Agreement and the Tender Offer Commencement Date; (v) HoldCo, Crosby US, and Crosby UK shall have performed and complied with, in all material respects, all obligations under the Business Combination Agreement (Note 6) that are required to be performed and complied with by it on or before the Tender Offer Commencement Date, and the representations and warranties of HoldCo, Crosby US and Crosby UK set forth in the Business Combination Agreement (Note 7) shall be true and correct in all material respects as of the date of the Business Combination Agreement and the Tender Offer Commencement Date; (vi) no governmental authority of any competent jurisdiction shall have enacted, issued, promulgated, enforced, or entered any law or made any final and binding request of a party or injunction, that is in effect and has the effect of making the Business Combination the consummation of the Business Combination; (vii) there shall be no “material fact pertaining to the business” (Article 166, Paragraph 2 of the Financial Instruments and Exchange Act (Act No. 25 of 1948; as amended; the “Act”) of the Company that has not been “publicized” (Article 166, Paragraph 4 of the Act) by the Company; (viii) no event or circumstance shall have occurred since the date of the Business Combination Agreement that would be a withdrawal event under Article 27-11, Paragraph 1 of the Act with respect to the Tender Offer should the Tender Offer commence; and (ix) the Business Combination Agreement has not been terminated and remains in full force and effect (collectively, “Tender Offer Conditions Precedent”). illegal or otherwise prohibiting or preventing Note 2: Under the Business Combination Agreement, it is stipulated that, among the Tender Offer Conditions Precedent, (i) to (iii) and (vi), (vii), and (ix) may be waived by the agreement of all four of HoldCo, Crosby US, Crosby UK, and the Company if permitted under applicable laws and regulations , 3 News Release (6409 TSE) (v) may be waived by sole discretion of the Company, and (iv) and (viii) are be waived by sole discretion of HoldCo, Crosby US, or Crosby UK. Note that, regarding (i), if it is reasonably anticipated that the necessary regulatory clearances will be obtained during the period for the Tender Offer purchase, etc. (the “Tender Offer Period”), when it is permitted under applicable laws and regulations, it is possible that the Tender Offer may start early upon waiving the relevant preconditions, by agreement of all for of HoldCo, Crosby US, Crosby UK and the Company, for the purposes of providing the Company’s shareholders with an early opportunity to tender in response to the Tender Offer and moving forward swiftly with the Business Combination. Note 3: This means notification under competition laws in Japan, The United States, China, Austria, Cyprus and Serbia. Note 4: Please refer to the section below titled “4. Matters Concerning Tendering in Response to the Tender Offer by the Company’s Shareholders and Material Agreements Pertaining to the Tender Offer” for details of the obligations of the Company provided in the Business Combination Agreement. Note 5: Please refer to the section below titled “4. Matters Concerning Tendering in Response to the Tender Offer by the Company’s Shareholders and the Material Agreements Pertaining representations and warranties of the Company provided in the Business Combination Agreement. the Tender Offer” for to Note 6: Please refer to the section below titled “4. Matters Concerning Tendering in Response to the Tender Offer by the Company’s Shareholders and Material Agreements Pertaining to the Tender Offer” for details of the obligations of HoldCo, Crosby US, and Crosby UK provided in the Business Combination Agreement. Note 7: Please refer to the section below titled “4. Matters Concerning Tendering in Response to the Tender Offer by the Company’s Shareholders and Material Agreements Pertaining the representations and warranties of the HoldCo, Crosby US, and Crosby UK provided in the Business Combination Agreement. the Tender Offer” for to 1. Outline of Offeror (1) (2) (3) (4) (5) (6) Name Location Position, name of representative Business details Capital Incorporation date 4 Lifting Holdings BidCo, Inc. Pacific Century Place Marunouchi 11-1 Marunouchi 1-chome, Chiyoda-ku, Tokyo Robert Desel, Representative Director Brandon Brahm Representative Director (1) Trading (2) All businesses related or incidental to the preceding item 5,000 yen April 28, 2022 News Release (6409 TSE) (7) Major shareholders and shareholding ratio (as of May 16, 2022) Relationship between the Company and Offeror Capital ties Personal ties Business ties Circumstances relevant to related parties Not applicable. Not applicable. Not applicable. (8) Not applicable. 2. Purchase, etc. Price (1) Company Shares 2,725 yen per one share of common stock (2) Stock acquisition rights Lifting Holdings Limited 100％ (a) Stock acquisition rights issued pursuant to the resolution at the ordinary general meeting of shareholders held on June 22, 2012 and the resolution at the board of directors meeting held on May 28, 2013 (the “Tenth Series Stock Acquisition Rights”) (the exercise period is from May 29, 2015 to May 28, 2023): 374,400 yen per stock acquisition right (b) Stock acquisition rights issued pursuant to the resolution at the ordinary general meeting of shareholders held on June 20, 2013 and the resolution at the board of directors meeting held on May 27, 2014 (the “Eleventh Series Stock Acquisition Rights”) (the exercise period is from May 28, 2016 to May 27, 2024): 317,000 yen per stock acquisition right (c) Stock acquisition rights issued pursuant to the resolution at the ordinary general meeting of shareholders held on June 23, 2015 and the resolution at the board of directors meeting held on May 31, 2016 (the “Thirteenth Series Stock Acquisition Rights”) (the exercise period is from June 1, 2018 to May 31, 2026): 366,800 yen per stock acquisition right (d) Stock acquisition rights issued pursuant to the resolution at the ordinary general meeting of shareholders held on June 21, 2016 and the resolution at the board of directors meeting held on May 30, 2017 (the “Fourteenth Series Stock Acquisition Rights”) (the exercise period is from May 31, 2019 to May 30, 2027): 303,800 yen per stock acquisition right (e) Stock acquisition rights issued pursuant to the resolution at the ordinary general meeting of shareholders held on June 21, 2017 and the resolution at the board of directors meeting held on May 29, 2018 (the “Fifteenth Series Stock Acquisition Rights”) (the exercise period is from May 30, 2020 to May 29, 2028): 66,200 yen per stock acquisition right (The Tenth Series Stock Acquisition Rights, the Eleventh Series Stock Acquisition Rights, the Thirteenth Series Stock Acquisition Rights, the 5 News Release (6409 TSE) Fourteenth Series Stock Acquisition Rights, and the Fifteenth Series Stock Acquisition Rights are hereinafter collectively referred to as the “Stock Acquisition Rights.”) 3. Details of, Grounds, and Reasons for the Position Regarding the Relevant Tender Offer (1) Details of the position regarding the Tender Offer At the board of directors meeting held today, a resolution was made stating that based on the grounds and reasons set out in the section below titled “(2) Grounds and reasons for the position regarding the Tender Offer”, if the Tender Offer is commenced, the position of the company as of this date is that it will declare a position in support of the Tender Offer and that it will recommend that all of the Company’s shareholders and Stock Acquisition Right Holders accept the Tender Offer. As set forth above, according to the Offeror, it plans to commence the Tender Offer promptly upon satisfaction of the Tender Offer Conditions Precedent (or the same are waived with the consent of all four of HoldCo, Crosby US, Crosby UK, and the Company). We are informed that as of today, the Offeror is targeting late October 2022 for commencement of the Tender Offer, but as it is difficult to accurately predict the time it will require to deal with competition authorities inside and outside Japan, it will provide notice of a more detailed schedule for the Tender Offer once all regulatory clearances have been obtained and decided. For these reasons, at the aforementioned board of directors meeting it was resolved to take the following steps pertaining to the position statement of the Company. As set out in the section below titled “(i) Establishment of an independent special committee at the Company” under “(6) Measures to ensure the fairness of the Tender Offer, such as measures to ensure fairness of the Tender Offer Price and measures to avoid a conflict of interest,” the Company’s board of directors additionally resolved that when the Tender Offer commences, the special committee established by the Company will be asked to review whether or not there is any change to the contents of the Report, and if there is no change, state this fact to the Company’s board of directors, and if there is a change, to state a position after the change, and based on such position, the Company will again publish its position on the Tender Offer when the Tender Offer commences. The aforementioned board of directors resolution was resolved in the manner set out in the section below titled “(v) Approval of all directors and opinion of all auditors that there is no objection at the Company” under “(6) Measures to ensure the fairness of the Tender Offer, such as measures to ensure fairness of the Tender Offer Price and measures to avoid a conflict of interest” (2) Grounds and reasons for the position regarding the Tender Offer 6 Statements concerning the Offerors (defined below) that are the grounds and reasons for the position regarding the Tender Offer are based on explanations received from the Offerors. (i) Summary of the Tender Offer News Release (6409 TSE) We are informed that the Offeror was established on April 28 2022 for the primary purpose of controlling and managing the business activities of the Company through the acquisition of and holding of the Company Shares after the completion of the Tender Offer, and, as of today, is a wholly owned subsidiary of HoldCo, established under the laws of England and Wales with its business purposes of holding subsidiary shares and managing its subsidiaries. We are informed that Ascend Overseas Limited (“Ascend”), established under the laws of England and Wales, with its business purpose of holding shares of HoldCo, holds approximately 96.7% of the shares of HoldCo (and that the management of HoldCo holds the remainder), and that funds, investment vehicles and/or separately managed accounts (Note 1) (“KKR Advised Entities”) advised by Kohlberg Kravis Roberts & Co. L.P. (together with its affiliates and other related funds, “KKR”), an investment advisory company established under the laws of Delaware, the United States, directly or indirectly hold a 100% stake in Ascend. We are informed that HoldCo directly holds a 100% stake in Crosby US, and Crosby UK, established under the laws of England and Wales, and indirectly holds a 100% stake in Crosby, established under the laws of Delaware, United States (“Crosby, Crosby US, Crosby UK, HoldCo, and the Offeror collectively the “Offerors”).We are informed that as of today, the Offerors and KKR do not hold any Company Shares. Note 1: “Separately managed accounts” are entities structured for investment by one investor or related investors whereby KKR earns management and incentive fees, pursuant to a single management agreement between KKR and the investor(s) that are party to that account. We are informed that the KKR Advised Entities acquired the subsidiaries of Crosby US and Cosby UK from Melrose Industries Plc through Ascend. Crosby US and Crosby UK were used as acquisition vehicles in such acquisition, with the current Crosby Group being formed from such acquisition. We are informed that Crosby Group was founded in 1836 and is headquartered in the United States, and has been engaged in the lifting and securement hardware (Note 2) industry for nearly two centuries with a focus on safety, quality, training and engineering leadership. We are informed that Crosby Group maintains a global presence, with manufacturing and commercial operations across 16 manufacturing sites and 10 distribution centers in North America, Europe, Brazil, and Australia. We are informed that with an international network of approximately 3,000 authorized distributors, Crosby Group provides a broad range of products used in a wide variety of industries and applications. We are informed that given its focus on being highly responsive to customer needs, Crosby Group has prioritized investment in 7 News Release (6409 TSE) innovation and new product development in lifting and securement hardware and related technology. Additionally, we are informed that it is making significant investments into the operations of the business, including an investment in a Longview, Texas, manufacturing facility with the aim of improving employee safety, increasing output, and bolstering efficiency. Moreover, we are informed that Crosby Group has also made acquisitions of companies that are complementary with Crosby Group’s business to support the company’s continued growth and customer value proposition. Note 2: “Lifting and securement hardware” are accessories and hardware used to secure, lift or move equipment, construction components or other assets usually in conjunction with lifting hardware. We are informed that KKR is a leading global investment firm that offers alternative asset management for its investors as well as capital markets and insurance solutions. We are informed that KKR sponsors investment funds that invest in private equity, credit, and real assets and has strategic partners that manage hedge funds of which KKR is a minority shareholder. We are informed that since the opening of its Tokyo office in 2006, KKR has actively expanded its investment activities in the Japanese market, with investment professionals possessing a thorough understanding of Japanese business practices. We are informed that since 2010, the KKR Advised Entities have invested in ten companies headquartered in Japan, including three take-private transactions of Japanese publicly-listed companies. We are informed that, most recently, examples of KKR’s main investments targets in Japan include Hitachi Koki Co., Ltd. (2017), Hitachi Kokusai Electric Inc. (2017), Seiyu Co., Ltd. (2021), and Yayoi Co., Ltd. (2022). We are informed that through these transactions, KKR has worked and is working to support investment into and acceleration of growth for Japanese companies in various industry sectors, which are expected to achieve high growth in the future through KKR’s capital, resources, and network with such companies. We are informed that KKR’s investment activities in the Japanese market are further supported by its global capabilities, with KKR having offices in 21 cities and 109 private equity portfolio companies as of December 31, 2021. More broadly, we are informed that KKR has a deep history in the industrial machinery sector as evidenced by the investments in Gardner Denver Inc., a US corporation providing compressors, blowers, and vacuum pumps (2013), Capital Safety Ltd., a UK corporation manufacturing fall protection equipment (2011), and Crosby (2013), etc. We are informed that in total, KKR had a total of US$471 billion in assets under management as of December 31, 2021. the Business Combination Agreement regarding We are informed that today, HoldCo, Crosby US, Crosby UK, and the Company entered into the Business Combination between Crosby Group and the Company, and on the condition that the Tender Offer Conditions Precedent are satisfied or waived, decided that the Offeror will conduct the Tender Offer for the purpose of acquiring all of the Company Shares listed on the Prime Market of Tokyo Stock Exchange, 8 News Release (6409 TSE) the Offeror, after the Business Combination Inc. (“TSE”) as of today and Stock Acquisition Rights (excluding treasury shares owned by the Company; the same applies hereinafter) as part of the Transactions. (defined in (iii) In deciding “Management policy after the Tender Offer”; hereinafter the same), Crosby US and Crosby UK would become sister companies of the Company, and, in order to enable the Company Group (27 companies in total, composed of the Company, 25 consolidated subsidiaries, and a non-consolidated subsidiary which is not an affiliate to which the equity method is applicable; hereinafter the same) and Crosby Group to enact a smooth business combination and conduct operations in a spirit of equality to maximize the corporate value of the Combined Group (defined below), the Offeror is conducting the Tender Offer, rather than subsidiaries including Crosby US and Crosby UK acting as the tender offeror. If the total number of share certificates, etc. tendered in response to the Tender Offer (the “Tendered Share Certificates, Etc.”) is less than the minimum number of share certificates, etc. to be purchased (13,817,400 shares, ownership percentage (Note 3): 66.67%) (Note 4), then the Offeror has informed us that they will not purchase any of the Tendered Share Certificates, Etc. However, we have been informed that because the purpose is to acquire all of the Company Shares and the Stock Acquisition Rights, the Offeror has not set a limit on the maximum number of share certificates, etc. to be purchased, and if the total number of Tendered Share Certificates, Etc. is equal to or greater than this minimum number of the share certificates, etc. (13,817,400 shares), then the Offeror will purchase all of the Tendered Share Certificates, Etc. We are informed that the minimum number of share certificates, etc. to be purchased (13,817,400 shares) is to be the product of two thirds of the number of voting rights relating to the Total Number of Shares After Considering Potential Shares (defined below) (207,260 voting rights) (this amounts to 138,174 voting rights; rounded up to the nearest whole number), multiplied by 100 (13,817,400 shares), which is the share unit number of the Company. We are informed that because the purpose is to acquire all of the Company Shares and the Stock Acquisition Rights as part of the Transactions, the minimum number has been set to ensure that the Transactions will be carried out given that a special resolution in the shareholders’ meeting as provided for in Article 309, Paragraph 2 of the Companies Act (Act No. 86 of 2005; as amended; the same applies hereinafter) is required for carrying out the procedures for the Share Consolidation as described in the section below titled “(5) Policy for organizationa l restructuring after the Tender Offer (matters relating the “Two-Step Acquisition”)”). Note 3: “Ownership percentage” means the percentage ratio (rounded to two decimal places) of the number of shares (20,726,019 shares) (the “Total Number of Shares After Considering Potential Shares”) equal to the sum (21,196,200 shares) of the total number of issued shares of the Company as of March 31, 2022 (21,048,200 shares) as stated in the “Business Results for the Fiscal Year Ended March 31, 2022 [Japanese GAAP] to 9 News Release (6409 TSE) (Consolidated)” submitted by the Company on May 16, 2022 (the “Company’s Business Results”) and (i) the Company Shares (20,000 shares) underlying the Tenth Series Stock Acquisition Rights (100 stock acquisition rights), (ii) the Company Shares (17,000 shares) underlying the Eleventh Series Stock Acquisition Rights (85 stock acquisition rights), (iii) the Company Shares (20,000 shares) underlying the Thirteenth Series Stock Acquisition Rights remaining (100 stock acquisition rights), (iv) the Company Shares (51,000 shares) underlying the Fourteenth Series Stock Acquisition Rights (255 stock acquisition rights), and (v) the Company Shares (40,000 shares) underlying the Fifteenth Series Stock Acquisition Rights (200 stock acquisition rights), in each case remaining as of today and as reported by the Company, less the treasury shares (470,181 shares) owned by the Company as of today. This applies hereinafter in the calculation of the ownership percentage. Note 4: We are informed that the minimum number of share certificates, etc. to be purchased is provisional and depends on the information as of today, and the actual minimum number of share certificates, etc. to be purchased in the Tender Offer may differ from the number above due to a change of situation occurring hereafter. We are informed that the final minimum number of share certificates, etc. to be purchased is planned to be determined before the commencement of the Tender Offer, based on the latest number of treasury shares owned by the Company available as of the commencement of the Tender Offer. We are informed that if the Tender Offer has been successfully completed, but the Offeror is unable to acquire all of the Company Shares and all of the Stock Acquisition Rights in the Tender Offer, then the Offeror intends to carry out the Squeeze-Out Procedures (meaning a series of procedures described in the section below titled “(5) Policy for organizational restructuring after the Tender Offer (matters relating to the “Two-Step Acquisition”)”, hereinafter the “Squeeze-Out Procedures”) in order for the Offeror to make the Company a wholly-owned subsidiary of the Offeror after the Tender Offer is concluded. We are informed that the Offeror intends to cover the funds required for the settlement of the Tender Offer by equity contributions by HoldCo (the “Contribution”) and by an intercompany loan from Crosby US, a wholly-owned subsidiary of HoldCo. We are informed that Crosby US intends to borrow the funds necessary to permit such intercompany loan through incremental borrowings from financial institutions under its existing credit facilities (the “Debt Financing”) in order to ensure maximum flexibility for the business operations of the Company Group and reduce transaction costs by securing financing on more favorable terms that place fewer obligations on the business operations of the Company Group than financing secured by Offeror itself. We are informed that, with respect to the Debt Financing, it is possible that a security will be established over part of the Company Shares or the assets of the Company Group or that the Company Group will provide 10 News Release (6409 TSE) a joint guarantee. HoldCo also intends to cover a part of the Contribution through an equity financing by KKR North America Fund XI L.P., a limited partnership affiliated with KKR established under the laws of the U.S. The Transactions, including the Tender Offer, are conducted as part of the Business Combination, and the Offerors and the Company plan to change the trade name of the HoldCo promptly after the Squeeze-Out Procedures to Kito | Crosby. As a result of this series of transactions Kito | Crosby will indirectly hold all of the shares or equity in the Company, Crosby US, and Crosby UK (Kito | Crosby after the completion of the Business Combination is hereinafter referred to as the “Combined Company” and the Combined Company and its subsidiaries (i.e., the Company Group and the Crosby Group) are collectively referred to as the “Combined Group”). Please refer to the Business Combination Press Release for details regarding the Business Combination. The following is the broad outline of the Transaction in diagram form. I. Before Tender Offer implementation (current state) 11 News Release (6409 TSE) KKR Advised Entities HoldCo management team Approx. 96.7% Approx. 3.3% HoldCo Other Crosby US Subsidiaries Offeror Company shareholders Company II. After Tender Offer and Squeeze Out procedure 12 News Release (6409 TSE) KKR Advised Entities HoldCo management team Approx. 96.7% Approx. 3.3% HoldCo Offeror Company Other Crosby US Subsidiaries (Note 5: The values in the diagrams are the direct or indirect holding ratios) (ii) Background, purpose, and decision-making process leading to the decision by Offerors to conduct the Tender Offer We have been informed that Crosby has had a highly informed admiration for the Company’s brands, product innovation, product quality, company leadership, and market reputation. We have been informed that it was the 2014 acquisition by the Company’s US subsidiary KITO Americas, Inc. of Peerless Industrial Group, Inc. (“Peerless”), which supplied products to Crosby, in which Peerless introduced Crosby to the Company, that led to Crosby’s admiration for the Company described above. Beyond information gathered through these former supply relationships, we have been informed that Crosby has deepened its understanding of the business of the Company since November 2016 industry information and insights gathered from trade shows and industry conferences, and regular interaction with the Company’s management, as part of its efforts to identify potential partners for M&A transactions or other strategic alliances. Also, we have been informed that Crosby has confirmed the Company’s positive reputation in the through publicly available 13 News Release (6409 TSE) industry through the appraisals of reputation by channel participants such as distributors, end users, and suppliers. We have been informed that, with this kind of positive reputation of the Company in the background, Crosby understood that there is favorable demand globally for the products of the Company Group as manufacturing and other industries continue to recover from the impacts of the pandemic of COVID-19 in 2020 and 2021. Furthermore, we have been informed that Crosby believes that the Company and Crosby face similar challenges of, lower capital expenditure in infrastructure and construction-related industries, etc. due to the spread of COVID-19, and navigating material shortages such as steel, and inflationary challenges leading to increased raw material costs, repair componentry costs, and freight and packaging costs amid higher costs from the impact of current inflation on personnel costs, raw material prices and transport costs in the current supply chain environment, and that the Company also understands the importance of overcoming these issues. We have been informed that Crosby believes the combination of the Crosby Group and the Company Group would provide more stable operational resources and flexibility to help manage these dynamic headwinds in the form of capital to invest in the business after the Business Combination, sharing practices from Crosby Group and the companies in the Company Group to ensure even better safety practices, and product innovation and sharing of ideas by employees, positioning the combined company to be better equipped to serve customers, employees, and communities in the face of supply chain challenges and inflationary pressures. As a result, we are informed that Crosby believes that the Combined Group would be able to maintain better quality created from sharing manufacturing practices, and achieve better customer service from sharing talent and greater combined experience with servicing customers than either Crosby Group or the Company Group could achieve on their own. Additionally, we are informed that it their is believed that the Combined Group would likely be able to utilize complementary capabilities in new product development to create innovations for new and existing customers of each of the Crosby Group and the Company Group. Specifically, we are informed that the Company Group has expertise in crane applications and Crosby Group has expertise in rigging hardware applications (meaning hardware attached to items used for ensuring safety, lifting, and hosting), which are complementary product areas within the lifting and securement hardware industry. Moreover, we are informed that it is believed that the Combined Group can also use their complementary geographic presences such as Crosby Group being headquartered in the U.S. and the Company Group being headquartered in Japan, giving the Combined Group better presence globally to service customers across the globe to add further value to employees, customers, suppliers and communities, and to promote sales of the products across a broader geographic landscape to better serve customers. We are informed that since the acquisition of Crosby in 2013, KKR has closely assisted Crosby in its strategic decision-making processes, including providing advice on Crosby’s acquisition strategy. We are informed that KKR’s three senior investment professionals and two senior advisors are members of 14 News Release (6409 TSE) Crosby’s board of directors. We are informed that KKR and Crosby US entered into a monitoring agreement, and as part of the services under this agreement, that KKR provides Crosby with (i) identification, support, negotiations, and analysis of acquisition targets and sales targets, and (ii) support for financing and strategic support for negotiations and analysis, not limited to those entailed by acquisitions. We are informed that KKR is in regular discussion with the management team of Crosby to assist in identifying and evaluating acquisition targets, assisting in due diligence, and assisting in the integration of acquisition targets into Crosby, as with other investment targets. We are informed that through such discussions, KKR and Crosby have identified several potential strategic partners including the Company. We are informed that through the process of due diligence on the Company, KKR assisted Crosby in its evaluation of the Company and ultimately is providing support for the Transactions given the strategic merits of the Combined Group. Informed by the information gathered through research on the Company using publicly available information and insights gathered from trade shows and industry conferences as part of its general research to identify potential partners for M&A integration or other strategic alliances and transactions including business impressed by its strong franchise and operating performance, we are informed that Crosby, as one of the specific strategy partner candidates, initiated a dialog with the Company’s senior management team starting in early June 2021 for the purpose of seeking possibilities of M&A or other business alliances. On Crosby initially introducing KKR to the Company, KKR agreed with Crosby’s idea of holding dialogue with the Company. These conversations involved provisional strategic discussion on the respective businesses and on the structure of an alliance, including a strategic alliance, minority investments, joint venture and business combination , which we are informed allowed Crosby to further hone its appreciation for the Company’s business and how a business combination of Crosby and the Company would maximize corporate value of both companies and benefit customers and suppliers by expanding high quality product offerings, increasing service levels for distributors, and realizing procurement and manufacturing efficiencies. On the basis of discussions relating to those initial strategies, Crosby decided to start talks relating to a potential business combination with the Company. Thereafter, through a series of touchpoints and check-ins by Crosby with the Company’s senior team over the subsequent months (early June 2021 to mid-February 2022), we are informed that Crosby came to gain a strong conviction regarding the strategic merits of a business combination between the Company and Crosby as Crosby was able to understand and appreciate the Company’s management philosophy, corporate culture, business operation focusing on the quality and safety of its products and deepened discussions regarding the viability of synergy creation opportunities , and that it would unlock significant value for all stakeholders in a way that is materially different from alternative partners which Crosby considered and examined as potential partners or standalone options by expanding high-quality products, to distributors and streamlining procurement and improving production. We are informed that Crosby examined transaction schemes to achieve the Business Combination with advisors. We are informed that Crosby sought the service levels 15 News Release (6409 TSE) advice of KKR as KKR has experience of multiple transactions, KKR provided business management strategy to Crosby, and senior investment professionals and senior advisors of KKR were members of the board of directors of Crosby. We are informed that, based on advice from experts and KKR, Crosby reached a conclusion that a tender offer followed by squeeze-out procedures would be the most appropriate structure to choose for the Transactions, considering that (i) the Offeror can make the Company its wholly-owned company and conduct the Business Combination between the Company Group and Crosby Group, (ii) the structure and procedure of the transaction are simple compared to conducting a corporate reorganization under the Companies Act of Japan or other transactions, given that the Offerors are foreign entities and have no existing capital relationship with the Company, (iii) the transaction could offer the shareholders of the Company an opportunity to sell their shares with premiums if the transaction terms are appropriate, and (iv) it is a common method of taking a Japanese listed company private. We are informed that KKR supported the selection of this structure for the same reasons. We are informed that it was concluded that after the Business Combination, as stated in (i) “Outline of the Tender Offer”, Crosby US and Crosby UK would become sister companies of the Company, and that, in order to enable the Combined Group and Crosby Group to enact a smooth business combination and conduct operations in a spirit of equality to maximize the corporate value of the Combined Company group, the Offeror would conduct the Tender Offer, rather than subsidiaries including Crosby US and Crosby UK acting as the tender offeror. Ultimately, we are informed that Crosby submitted a legally non-binding letter of intent to the Company on February 14, 2022 proposing a business integration of the Company Group and the Crosby Group through a Tender Offer for Company Shares followed by a squeeze out (the “Letter of Intent”). We are informed that the timing of the submission of the Letter of Intent to the Company was motivated by the current macroeconomic environment such as material shortages and inflationary pressures described above, which we are informed that Crosby believes to be well-suited to bring together the Companies because the Combined Group will have access to more resources to solve these challenges. Specifically, we are informed that Crosby believes the increased focus on infrastructure spending and safety – as demonstrated by the passing in the U.S. of the $550 billion Infrastructure Investment and Jobs Act signed on November 15, 2021 – highlights the need for the Combined Group to invest in innovation, quality, and customer service for the Company Group and Crosby Group product categories. As described previously, we are informed that Crosby believes the combined businesses will be better able to support customers in the global infrastructure, wind energy, and entertainment industries through enhanced investment in new products, a more responsive supply chain and product delivery mechanism, and broader access to end-user training. We are informed that these initiatives would be lesser served by Crosby Group and the Company Group separately because the individual entities would have fewer resources, in the form of capital for investment, people engaged in research and development, and ideas for improving safety, and thus would not be able to expand the product portfolio and develop a stronger supply chain. We are informed that this 16 News Release (6409 TSE) is viewed as particularly important given the difficult supply chain environment businesses are currently facing, making the benefits of a combination compelling at this time. The Company responded to the Letter of Intent on February 25, 2022, allowing Crosby to initiate due diligence. Also, in this response, it was stated that the board of directors of the Company discussed the Letter of Intent, including the strategic merit presented by Crosby, and approved establishing a special committee to evaluate the proposal. Crosby and the Company commenced due diligence mutually from around early March 2022 and we are informed that Crosby focused on developing a deeper understanding of the Company’s mid-term financial plan as well as confirmatory due diligence concerning areas such as accounting, tax, legal, information technology, benefits, insurance, and environmental topics. Through discussions with Company related to its mid-term financial plan, we are informed that Crosby developed a deeper understanding of the standalone objectives of the Company, which further affirmed the potential for value creation of the combined entity. We are informed that through such diligence and various analysis and discussions, Crosby reconfirmed its belief that the Business Combination would unlock significant value for all stakeholders in a way that is materially different from alternative partners which Crosby considered and examined as potential partners or standalone options by expanding high-quality products, improving service levels to distributors and streamlining procurement and production. We are informed that Crosby believes that the Business Combination would result in strong value delivered to both companies’ end-users, employees, channel partners, suppliers, and shareholders. We are informed that based on having completed the majority of due diligence in mid-April 2022, Crosby is convinced that the Company Group and Capella Group, through the Business Combination, will be best positioned to deliver increased value across a wide range of areas and generate synergies, including the matters stated below. • Higher investment in areas such as product development, market research, and expertise in core areas such as metallurgy, additive manufacturing, and technology to drive continued leadership in innovation and safety. Superior product innovation will, we are informed, be driven by the ability to enhance investment in engineering and product design, yielding benefits across a larger portfolio of products to best serve the joint end-user base of the Company Group and Crosby Group. In addition, we are informed that the Company Group and Crosby Group can bring complementary engineering and product capabilities to this combination; specifically, the Company Group’s core capability being in mechanical and electro-mechanical disciplines while Crosby Group brings in metallurgy and metal forming technologies and products, together these areas of competencies will enable new and innovative products that blend both disciplines. We are informed that the Company Group and Crosby Group each contribute mutually to the profitability that enables efficient investments in product development and market research, which can be shared across both teams. its capabilities 17 News Release (6409 TSE) • • Continued advancements in the safety culture shared by the Parties by implementation of a global safety council, leveraging best practices and increased financial resources for greater investment in safety initiatives. We are informed that the Company Group and Crosby Group both have a safety mindset, which is evidenced by the fact that both companies received the Associated Wire Rope Fabricators (AWRF) Safety Award in North America in 2020 and will share such mindset in the combined business. We are told that while the Companies each have some unique core manufacturing processes (e.g., forging for Crosby Group, machining and robotics for the Company Group), their somewhat different sets of safety practices can be shared across the combined business to create a single set of best practices, which will ultimately drive increased worker safety. Increase in opportunities for all employees through expanded and diverse career and development paths which would be achieved through more diverse international rotational assignments, as well as the overall increased size and scope of activities that allow for new opportunities within local regions. We have been informed that broader and more diversified career paths in the Combined Group will enable attraction and retention of the best available talent in the market driving innovation and productivity. We are informed that the Company Group and Crosby Group both equally bring a focus on the treatment of team members to the Business Combination. We are informed that the increased size and scope of the combined business allows for team members from both businesses to have an opportunity for larger roles in the combined business. We are informed that it is considered that the Company Group and Crosby Group each contributing mutually to profitability will enable efficient investments in training, development of rotational programs or temporary overseas assignments. Improved ability to invest in and deliver on ESG (Environment, Social, and Governance) metrics such as environmental stewardship, a diverse and engaged workforce, and a strong focus on governance and corporate social that examples of Crosby Group’s responsibility. We are at of LED environmental manufacturing facilities, inclusion of EVs in the corporate leasing program, and EV charging stations at select locations, we are informed. We are informed that Crosby is in the process of creating an environmental CAPEX sub-committee to prioritize further investments in ESG, irrespective of short-term financial returns. We are informed that Crosby Group has also focused its M&A strategy on the renewable energy market, such as the 2021 acquisition of Airpes Sistemas Integrales de Manutencion Y Pesaje S.L., established in Spain and a leader in lifting tools used during the erection of wind turbines, and that for every transaction completed, a comprehensive environmental audit is conducted by third parties. We are informed that the Companies value ESG initiatives, as further evidenced by Crosby’s provision of the UpLift Women’s network, which is an internal organization to connect the female officers and employees of Crosby through regular meetings and speaker series that provide stewardship installation informed lighting include • 18 News Release (6409 TSE) leadership and developmental training; investment in the community through partnerships with Children of Fallen Patriots, a foundation in the United States that provides college scholarships and educational counseling to military children who have lost a parent in the line of duty, investments in local society through Bridges to Prosperity, a nonprofit organization in the United States that works to eliminate rural isolation through the building of bridges, and investments in improving the work environment and worker welfare, and by the Company’s “A” rating for ESG Management by Mitsubishi UFJ Research and Consulting, supported by the Japan Credit Agency, introduction of facilities effective zero CO2 energy at the Company’s manufacturing (announced March 31, 2022), provision of products for wind power generators, and disabled employee ratio of close to 7%, well above and beyond the statutory rate of 2.2%. We are informed that the Company Group and Crosby Group bring complementary areas of focus for investing in the communities in which they operate. We are informed that the Company Group’s higher level of focus and experience in areas such as environmental issues and employment of disabled persons is complementary with Crosby Group’s historical focus on higher education and hands on building and construction for underprivileged communities. We are informed that, through cooperation by both companies, there is the potential to enhance their communities in a broader array of areas than either company could on its own. • • Expansion of high-quality products and solutions to efficiently allow end-users and channel partners to procure from a trusted provider. We are informed that it is considered that end-users will be able to experience higher levels of efficiency and safety in their organizations through better technical, application, and training support from the Combined Group, as well as through increased product innovation. Increase in commitment to the local communities in which the Company Group and Crosby Group operate by expanding opportunities for community service, engagement, and support of causes important to local populations. We are informed that both the Company Group and Crosby Group independently have volunteering and community outreach programs that it is considered can be expanded through the Business Combination due to increased availability of resources. We are informed that Crosby Group’s community involvement includes a partnership with Bridges to Prosperity, an organization that works to eliminate rural isolation through the building of pedestrian bridges. We are informed that Crosby Group donates products and provides training and expertise required for the construction of pedestrian bridges throughout Eastern Africa, and sends team members to Uganda to assist in the construction of pedestrian bridges. We are informed that in order to achieve the above, Crosby believes that it is essential to privatize the Company through the Business Combination. We are told that the reason is that Crosby believes that by privatizing the Company, it will become possible to create an environment in which the management will have the 19 News Release (6409 TSE) flexibility to make decisions and investments that will yield long-term benefits for the business, customers, team members, and communities. We are informed that the Company because Crosby also believes that it is necessary to privatize frictionless exchange of information and ideas would not be possible in a minority investment or making the Company a subsidiary whose shares remain listed, given the practical and legal limitations on integration of teams and business strategy for public companies with minority shareholders, as well as deployment communication channels and day-to-day cooperation that are limited from the perspective of confidentiality, and potential conflicts of interests with minority shareholders that can occur even with optimized decision making as the Combined Group. We are informed that by making the Company a wholly owned subsidiary of the Tender Offeror and creating an integrated group, the Combined Group would be able to have management team members and the broader employee base move freely between organizations to openly share best practices, support investment in product innovation and intellectual property development, and invest in growth without practical and legal hindrance or conflicts of interest. We are informed that since it will become easier to communicate without conflicts of interest and interests will become aligned after making the Company a wholly-owned subsidiary, this type of open exchange of information without restriction and support of investment in product innovation and intellectual property development would be extremely difficult in a minority investment or making the Company a subsidiary whose shares remain listed. We are informed that, based on the review process above and consultation and negotiation with the Company, KKR decided to support Crosby in its decision to pursue the Transactions, and that Crosby has been in discussions and negotiations with the Company and the special committee regarding whether to implement the Transactions and the terms and conditions including the details of the transaction structure, as well as the management and operational plans after the Business Combination, and Crosby submitted a non-binding proposal on April 27, 2022 regarding the tender offer price in the Tender Offer (the “Tender Offer Price”) (the “First Proposal”). We are informed that Crosby conducted a comprehensive and multifaceted analysis of the Company’s business, financial status, and future plan, and made the Tender Offer Price in the First Proposal JPY 2,400, considering that (i) Crosby believed the price would not cause any disadvantages to the shareholders of the Company, given the premiums of the Tender Offer Price to market prices of the Company Shares as of April 26, 2022 were (a) 39.70% to the simple average closing prices of the Company Shares over the preceding one-month period of JPY 1,718, (b) 41.34% to the simple average closing prices of the Company Shares over the preceding three-month period of JPY 1,698, and (c) 36.21% to the simple average closing prices of the Company Shares over the preceding six-month period of JPY 1,762, and (ii) Crosby could provide the shareholders that purchased the Company Shares at a higher price than the current price over the past three years with an opportunity to sell the Company Shares at a higher price than the purchase prices for such shareholders, given the highest closing price of the Company Shares over 20 News Release (6409 TSE) the past three years was JPY 2,055. We are informed that there was no specific proposal for the purchase price of the stock acquisition rights of the Company (“Stock Acquisition Rights Tender Offer Price”) in the First Proposal because the Tender Offer Price was proposed on a fully diluted basis assuming all Stock Acquisition Rights have been fully exercised (i.e., the total number of shares is 20,724,019 shares (note)). Note: Based on information obtained by Crosby as of the submission date of the First Proposal (April 27, 2022), the sum of the total number of issued shares of the Company as of December 31, 2021 (21,048,200 shares) as stated in the “Business Results for the Third Quarter For the Year Ending March 31, 2022 [Japanese GAAP] (Consolidated)” submitted by the Company on February 8, 2022 and (i) the Company Shares (20,000 shares) underlying the Tenth Series Stock Acquisition Rights (100 stock acquisition rights), (ii) the Company Shares (17,000 shares) underlying the Eleventh Series Stock Acquisition Rights (85 stock acquisition rights), (iii) the Company Shares (20,000 shares) underlying the Thirteenth Series Stock Acquisition Rights remaining (100 stock acquisition rights), (iv) the Company Shares (51,000 shares) underlying the Fourteenth Series Stock Acquisition Rights (255 stock acquisition rights), and (v) the Company Shares (40,000 shares) underlying the Fifteenth Series Stock Acquisition Rights (200 stock acquisition in each case remaining as of February 28, 2022 and as reported by the Company, less the treasury shares (472,181 shares) owned by the Company as of December 31, 2021. rights), On May 2, 2022 after the submission of the First Proposal, Crosby received a request from the Company to raise the Tender Offer Price to JPY 3,000 on the basis that the Tender Offer Price did not sufficiently refl