Avant : Convocation Notice of the 25th Annual General Meeting of Shareholders

The 26th Annual General Meeting of Shareholders

Notice of Convocation

Date

September 27, 2022 (Tuesday) 10:00 a.m. (doors open at 9:30 a.m.)

Place

1-3-2, Otemachi, Chiyoda-ku, TOKYO

Keidanren Hall, 2F, Keidanren Kaikan

Matters to be resolved

Proposal 1 Appropriation of surplus

Proposal 2 Partial amendment to the Articles of Incorporation

Proposal 3 Election of four Directors (excluding Directors who are members of Audit Committee)

Proposal 4 Election of Three Directors as members of Audit Committee

Proposal 5 To set the amount of remuneration for directors (excluding directors who are members of the Audit Committee) and to determine remuneration related to performance-linked stock compensation

Proposal 6 To set the amount of remuneration for directors who are members of the Audit Committee

AVANT Corporation (Security code: 3836)

This is an unofficial translation. In case of any difference in meaning between the original Japanese text and the English translation, Japanese text shall prevail.

To Our Shareholders

We would like to thank our shareholders for their continued understanding and support of our company. We hereby present the Notice of the 26th Ordinary General Meeting of Shareholders.

Founded in May 1997 as DIVA Corporation, we began by developing a system to produce consolidated accounting information, the basic language for companies to interact with their stakeholders, and as of May 2022, we celebrate our 25th anniversary. We would like to thank our shareholders for their support of the Group's development to date.

The idea that "a company is a public institution of society" is the starting point of my business foundation.

If a company is a public institution, we would like to contribute to society by helping many companies improve their "public power" using IT. This is the basic philosophy of the Avant Group, which is celebrating its 25th anniversary.

What does it mean to improve the power of public institutions? The first is to determine the company's public power based on a variety of information, including financial as well as non-financial information, and to put a value on it. I call it "pricing". The other is "dialogue". By improving the quality of our creative dialogue with various stakeholders, we will hone our ability to identify and solve problems for the company's growth, and improve our public organ capabilities. This is the essence of "Spreading Accountability" that the Avant Group has been promoting, or to put it simply, "management DX.

In order to become a group that contributes to the enhancement of corporate value through "Management DX," it is necessary to shift to a new organizational and governance structure. We ask for the understanding and support of our shareholders regarding our reorganization and transition to a company with an Audit Committee. On October 1, we will launch the New Avant Corporation Group. New Diva will be responsible for the "Consolidated Financial Disclosure DX" to promote creative disclosure. New Avant for "Management Information DX" to visualize corporate value. New Zeal is responsible for "DX of data utilization infrastructure" to accelerate data-driven management. These three companies aim to accelerate the growth of existing businesses and create new growth businesses. We would like to ask our shareholders to take care of their health and to continue to support the Avant Group.

Tetsuji Morikawa,

President and Group CEO,

Avant Corporation

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Avant Group's Philosophy and Materiality

Based on the corporate philosophy of "creating a company that will last 100 years," all member of the Avant Group is striving to realize its founding mission of "spreading accountability." Our goal is to "Be Global". Our goal is to "Be Global," We will evolve into a world-class software company and contribute to the development of society and the economy.

＜VISION＞

Be Global

～A World-class Software Company～

＜MISSION＞

Spreading Accountability

～Transforming management information into a map of the future～

＜PHILOSOPHY＞

A 100-year Company

～A company where everyone is passionate about value creation ～

OPENVALUE STRETCH

Values that support our corporate philosophy

While pursuing growth opportunities in Japan, the Group aims to establish itself as a world- class software company, using world-class SaaS companies as benchmarks.

Our group's corporate mission is to build a management information system that enables many companies to create sustainable corporate value for the future by realizing the "spreading accountability" and, by extension, to spread "best management" widely throughout society.

The Group's corporate philosophy is to be a company that lasts 100 years as a result of all its members being passionate about providing value to society in a free and creative manner, passing on its transparency and management philosophy as a public institution from generation to generation.

The following values are important to the employees of our group.

OPEN: Based on an open spirit

VALUE: Foster a passion for value creation

STRETCH: Challenge to be the best

ー Materiality (Strategy) of Avant Group ー

Be a software company that helps increase corporate value

◆ Background ◆

Since its establishment, the Avant Group has been striving for the creation of high-quality management and employment with the mission of "spreading accountability. In particular, in the field of consolidated accounting systems that support consolidated management, the company has gained a high reputation in the market and has demonstrated an overwhelming presence. On the other hand, the business environment surrounding companies has changed drastically in recent years, and it has become important for management information to be used not only for operations and disclosure obligations, but also to enhance corporate value.

The background to this is the expansion of ESG investment and society's demand for sustainable corporate management; there is no future for the Avant Group without adapting to these changing needs, and we cannot be useful to society and customers if we remain complacent about the status quo. To move to the next stage of growth, the most important task of the Avant Group is to "become a software company that helps increase corporate value.

◆ Strategic Approach ◆

The target customers for the promotion of this materiality are "any company that is expected to increase its corporate value. In response to these customers, we will shift the core business model of the Group to "software-based BPO that helps improve corporate value," and at the same time, we will develop killer software that support numerous customers.

◆ Our Goal ◆

The Avant Group aims to establish a world-class software business based on the concept of "Software as a BPO" by addressing this materiality. In order to contribute to the enhancement of corporate value of many customers, it is essential to convert services into software. By promoting the "spreading accountability" and becoming an entity that has an impact not only on corporate management but also on capital markets and society, we will take a big step toward realizing our vision of "becoming a world-class software company.

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Avant Group's Medium-Term Management Plan

What we aim for in our mid-term management plan

In September 2018, the Group formulated "BE GLOBAL 2023," a five-yearmedium-term management plan through the fiscal year ending June 30, 2023, with the goal of "becoming a world- class software company. Under the medium-term management plan "BE GLOBAL 2023," we are pursuing business development based on three key strategies: (1) pursuing further sales growth and high profitability through the collective strength of the Group, (2) M&A to accelerate growth, and (3) changing our business model. As KPIs to measure progress, we have set targets for net sales, stock sales ratio, operating income, sales growth rate + operating income ratio, ROE, and dividends.

Progress of Medium-Term Management Plan

Currently, "BE GLOBAL 2023" has approximately one year remaining. Looking back at progress to date, financial KPIs such as net sales, operating income, ROE, and dividends are generally at achievable levels. In January 2021, we entered into a capital and business alliance with Metapraxis in the U.K., making the company an equity-method affiliate. However, the transformation of the business model has not yielded significant results, as the development of software, the axis of future growth, has not been realized and the stock sales ratio is well below the target of 70%.

		FY19		FY20		FY21		FY22		FY23
		Actual		Actual		Actual		Actual		Target
Net Sales（¥B）		14.07		15.69		16.23		18.70		18～22
Recurring Sales		31.4		32.7		36.0		34.6		70
Ratios（%）
OP Income（¥B）		1.96		2.27		2.79		3.24		3.1～3.8
Sales Growth + OP		30.2		26.0		20.7		32.6		40or more
Margins（Pt）
ROE（%）		24.6		23.5		23.6		21.1		20or more
Dividends（¥）		7.5		9.0		11.0		13.0		15以上

For this reason, we began formulating the next medium-term management plan as early as the second half of 2021. Together with the Group management strategy executive team, we started by reconfirming the Group's management philosophy and summarized what the Group should do to realize its vision as the Avant Group's materiality (see page 3). Through discussions by the Group management strategy executive team and the Board of Directors on specific measures to realize this materiality, we have come to the conclusion that it would be effective to reorganize and implement the acceleration of growth in existing businesses and the creation of new growth businesses in separate organizations.

The outline of the reorganization is as follows DIVA CORPORATION will enter into an absorption- type demerger agreement with FIELTE CORPORATION for the DivaSystem and related products development business, and with ZEAL CORPORATION for the corporate performance management ("CPM") for the system development business, respectively. DIVA CORPORATION will split its DivaSystem and related product development business to FIERTE CORPORATION, which will take over the CPM system development business of ZEAL CORPORATION, and further change its trade name to AVANT CORPORATION. FIERTE CORPORATION will take over the business of

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developing DivaSystem and related products from DIVA CORPORATION and change its name to DIVA CORPORATION. The holding company overseeing the execution of the group's strategy, AVANT CORPORATION will change its name to AVANT GROUP CORPORATION. Taking advantage of this reorganization, we have also concluded that it is appropriate to shift to a company with an audit committee system in order to realize prompt and decisive management decision-making and execution under the appropriate supervision of the Board of Directors by enabling the Board of Directors to broadly delegate its authority to make business execution decisions to the directors.

(Present)		Avant
Group Governance Business		Outsourcing Business
Software implementation consulting business specializing in consolidated accounting	BPO business specializing in consolidated financial
and group management		statements and disclosure
• Consolidated disclosure support system "DivaSystem", "FBX", "Dx-3", etc. ①		• Non-consolidated and consolidated financial closing
• Group management support systems "DivaSystem SMD", "Compass", "Empower", etc. ②	operations BPO ④
• Timely Disclosure Information Search Service ③		• Cash Management Solution BPO ⑤

DX Promotion

Business

SI business specializing in BI and data utilization

• Data platform ⑥
• Business Intelligence ⑦
• CPM ⑧

Internet Disclosure		Diva		Fierte			Zeal
		Split ①	Split	⑧
		trade	trade
		name	name
		change	change
		Inherit ①	Inherit ⑧

Internet Disclosure		Diva

Consolidated accounting and disclosure software and BPO to support creative disclosure

• Disclosure support system "DivaSystem", "FBX", "Dx-3", etc.
• Non-consolidatedand consolidated financial closing operations ④, cash management solutions and other BPO ⑤.
• Timely Disclosure Information Search Service ③

Avant

Implementation and operation of management content to help increase corporate value

• Group management support systems "DivaSystem SMD", "Compass", "Empower" ②, CPM ⑧, etc.
• System implementation consulting ⑨

Zeal

Development and operation of management information DX infrastructure

• Data platform ⑥
• Business Intelligence ⑦

(October 1)

Avant Group

Group companies are wholly owned subsidiaries of the holding company

Direction of the Next Medium-Term Management Plan

The market environment surrounding each company is very favorable. Under the new organization, we will improve profitability by increasing sales per existing customer and developing new customers through strengthening existing products, developing new products, and providing new solutions. Against this backdrop, in the next mid-term management plan, we aim to achieve at least 20% CAGR in net sales, and in the second half of the mid-term management plan, we aim to achieve a combined EBITDA margin (Growth and Profit Point, or GPP) of at least 40 points. We also aim to maintain ROE at 20% or higher and increase DOE from the current 5% level to 8% as shareholder return.

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