On December 11, 2023, Gakujo Co., Ltd, announced in its press release that it had decided to oppose the shareholder proposals by LIM Japan Event Master Fund. The proposals submitted were as follows, (i) Dismissal of 1 Director: Dismissal of Mr. Kiyokazu Nakai, (ii) Partial Amendment to the Articles of Incorporation (individual disclosure of director compensation), (iii) Acquisition of Treasury Stock, (iv) Appropriation of Surplus, (v) Partial Amendment to the Articles of Incorporation (Disclosure of Capital Cost), (vi) Partial Amendment to the Articles of Incorporation (Cancellation of Treasury Stock), (vii) Cancellation of Treasury Stock. The company opposes the proposals for the following reasons, (i) The company believes that Mr. Nakai is a necessary personnel for the maintenance and improvement of the company?s corporate value and that his dismissal is unnecessary., (ii) Remuneration of each director is determined through a transparent and objective process, in accordance with laws and regulations.

A provision requiring disclosure of the amount of remuneration, is not appropriate to be stipulated in the Articles of Incorporation, (iii) The company believes it is important to strike an optimal balance between investment in business development and business continuity that leads to sustainable growth and returning profits to shareholders. However, the shareholders proposal which is intended to cause an outflow of more than 10% of the capital allocation in 1 year, will significantly reduce the company?s room for business expansion and continuity, (iv) The company believes that the proposal is not in the best interests of the shareholders and does not enhance its corporate value over the medium to long term, (v) A provision requiring disclosure of cost of capital, is not appropriate to be stipulated in the Articles of Incorporation as it is a fundamental code of the company, (vi) The company believes that it is appropriate for the Board of Directors to pass a resolution on the cancellation of treasury stock in accordance with the provisions of the Companies Act, rather than stipulating it in the Articles of Incorporation, (vii) The company will make timely and appropriate decisions regarding the cancellation of treasury stock in light of its medium to long term capital policy and when deemed necessary, will implement the same through a resolution of the Board of Directors. Hence, the company opposes this proposal.