Nidec : Letter of Intent on Management Integration Aimed at Maximization of Corporate Value

July 13, 2023

To: The Board of Directors of Takisawa Machine Tool Co., Ltd.

NIDEC CORPORATION

President and Chief Executive Officer Hiroshi Kobe

Executive Vice President Tatsuya Nishimoto

Letter of Intent

on Management Integration Aimed at Maximization of Corporate Value

Thank you very much for your kind attention.

Between January and March last year, NIDEC CORPORATION (hereinafter referred to as "us") proposed a capital and business alliance between you and our subsidiary NIDEC DRIVE TECHNOLOGY CORPORATION (formerly known as NIDEC SHIMPO CORPORATION). Now, as part of a series of transactions (hereinafter referred to as the "Transaction") to make you our wholly-owned subsidiary, we hereby officially propose to implement a tender offer (hereinafter referred to as the "Tender Offer") for your shares with us as a tender offeror (such proposal set forth in this Statement of Intent hereinafter referred to as the "Proposal").

We have not been clearly informed of the reasons why you have rejected our proposal last year. In light of this, we request the members of your special committee based on the Board of Directors of your company and the Large-scale Purchase Rule in which you have introduced (which was approved by the Board of Directors of your company by resolution dated May 14, 2021 and approved at your 91st Ordinary General Meeting of Shareholders held on June 25, 2021, hereinafter referred to as the "Large-Scale Purchase Rule") to have an opportunity to explain the contents of this Proposal and our intentions as soon as possible from today onward so that you will be able to understand our proposal correctly and agree to this tender offer.

As for the details of this proposal, we would like you to refer to the contents below, but we believe that (i) by making your company a wholly owned subsidiary, the synergy between the two companies is highly likely to maximize corporate value, and (ii) the price of the Tender Offer (hereinafter referred to as the "TOB Price") is also set at 2,600 yen per share, with a premium of 104.89%, 104.40%, and 112.94%, respectively, relative to the average closing price of the shares of your company for the past month, 3 months, and 6 months, setting yesterday as the base date. As a result, we believe that the "benefits that should be shared by the shareholders" referred to in the Guidelines for Corporate Takeovers (Draft) (hereinafter referred to as the "Guidelines for Corporate Takeovers (Draft)")

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announced by the Ministry of Economy, Trade and Industry on June 8, 2023, namely the "value that can be realized without the acquisition" can be sufficiently offered to your shareholders. We believe that our Proposal is very attractive to your shareholders as well, and the Transaction, as a whole, is a "desirable acquisition" as recommended in the Guidelines for Corporate Takeovers (Draft).

Based on the belief that the Transaction will enhance the corporate value of your company and appropriately secure the shareholder value that are beneficial not only to your company and your shareholders, but also to the Japanese economy and society as a whole, as mentioned below, we are designing in detail the process for complying with the Guidelines for Corporate Takeovers throughout the whole Transaction, and we are fully compliant with all the processes required by the Guidelines. Furthermore, as mentioned above, it is anticipated that at the time when this Tender Offer commences, an official guideline based on the Guidelines will have been determined. Considering your company's status as a listed company and a participant in the securities market, we also assume that your company will naturally undertake measures in accordance with the Guidelines.

1. About Our Group

Since our founding in July 1973, we have set the goal of becoming a world-class company representing Japan. We have used the name of ''Nihon Densan Kabushiki-gaisha ''to date, but in celebrating our 50th anniversary, we have changed our name to ''NIDEC Kabushiki-gaisha''. For the time being, our group (collectively, us, our subsidiaries and affiliates, hereinafter the same) have continued to grow rapidly. In the fiscal year ended March 31, 2023, we recorded consolidated net sales of 2,242.8 billion yen, operating income of 100.1 billion yen, capital investment of 137.8 billion yen, and R&D expenditure of 81.3 billion yen. At the same time, we continued to achieve dramatic growth in the Group's total of 347 Group companies including 343 consolidated subsidiaries and 4 equity method affiliates in 46 countries worldwide, including 106,592 employees. In the stock market, the market value is 4,392.2 billion yen (based on the closing price yesterday).

This growth was impossible without the participation of companies with high precision and high efficiency technologies in our group. Since our founding, we have actively engaged in M&A on a global scale, and 71 companies have joined the Group. After joining the Group, such companies have achieved steady growth by incorporating our Group's management methods and realizing synergies with other Group companies. For example, as a result of thorough PMI (Post Merger Integration) activities, NIDEC ADVANCE TECHNOLOGY CORPORATION (formerly NIDEC READ CORPORATION), which develops, manufactures and sells inspection equipment products that

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joined our group in 1997, achieved approximately 36 times higher sales and 121 times higher operating income than before joining the Group, making it an exceptionally rapid growth among our group companies. In 2003, NIDEC INSTRUMENTS CORPORATION joined our Group (formerly NIDEC SANKYO CORPORATION), which was founded in 1946 and was temporarily in a slump. As a result, NIDEC INSTRUMENTS CORPORATION joined the Group to overcome this situation. Since joining the Group, NIDEC INSTRUMENTS CORPORATION have expanded the scope of business to include motors, motor drive units, card readers, and industrial robots, which are highly compatible with the company's existing technologies and are capable of making use of the technology and management know-how we have accumulated in the Group. While continuing the production of music box movement, which is their original business and a symbol of the company's corporate culture, NIDEC INSTRUMENTS CORPORATION have reformed the profit structure of their existing businesses and became profitable through organic growth by introducing our Group's management methods that our Group has cultivated through the business operations of other Group companies. In addition, NIDEC INSTRUMENTS CORPORATION have grown into a company that engages proactively in M&As of NIDEC MATERIAL CORPORATION, TOKYO MARUZEN INDUSTRY CO., LTD., NIDEC GENMARK AUTOMATION, INC. in the U.S., and other companies, as well as PMI thereafter. Together with our group companies, we will continue to grow over the next 100 years as a group of companies that combine our technological capabilities to become the world's No.1 solution company that solves many issues faced by humankind.

Against this backdrop, in recent years, we have positioned the Machine Tool Business as a new business pillar and welcomed MITSUBISHI HEAVY INDUSTRIES MACHINE TOOL CO., LTD. (currently NIDEC MACHINE TOOL CORPORATION) in 2021, OKK CORPORATION (currently NIDEC OKK CORPORATIONW) in 2022, and Italian machine tool manufacturer PAMA S.P.A. and its affiliates in 2023. Before joining our Group, NIDEC MACHINE TOOL CORPORATION had an operating loss for 16 consecutive months. However, in just 2 months after joining the Group, NIDEC MACHINE TOOL CORPORATION achieved a single-month profit, and in the fiscal year ended March 2023, NIDEC MACHINE TOOL CORPORATION achieved a double-digit operating profit margin. In the year ended March 31, 2022, when NIDEC OKK CORPORATION joined our Group, NIDEC OKK CORPORATION posted an operating loss, but in the first quarter of the following fiscal year NIDEC OKK CORPORATION posted a profit. All of these companies have succeeded in reforming their business structure since joining the Group, and are steadily growing as a new pillar of the Group's business. When the above three companies joined our Group, as in the case of M&A that we have conducted in the past, we continue to strengthen profitability, growth, and competitiveness through PMI activities that combine our principles

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and management policies since our founding, while taking advantage of the advantages of the corporate culture cultivated by each of our newly joined companies.

2. Reasons why we place importance on machine tool business as a new business pillar

Initially, the main objective of the acquisition of NIDEC MACHINE TOOL CORPORATION was to generate synergies with other businesses of the Group. However, as we conducted PMI activities and deepened our knowledge of the machine tool industry, in early November, 2021, we decided that the machine tool business is the business that we should focus on as a new business pillar for the future of the Group for the following reasons.

In other words, machine tools have been one of the important industries supporting Japan's manufacturing industry for a long time. Especially recently, the Ministry of Economy, Trade and Industry announced the "Policy on Measures to Ensure a Stable Supply of Machine Tools and Industrial Robots" (hereinafter referred to as the "Policy of METI") on January 19, 2023. It is envisaged that the roles required of machine tools at domestic and overseas production sites will expand in both quality and quantity in the medium to long term irreversibly due to the promotion of digital transformation following the global spread of new coronavirus infections and the growing demand for the production of a wide range of industrial products that contribute to the realization of carbon neutrality, including electric vehicles. In particular, the importance of machine tools that contribute to the sophistication and automation of manufacturing processes is important in Japan's manufacturing industry, in view of the fact that Japan is facing a population decline and the aging of skilled workers and the growing shortage of labor is becoming more pronounced at manufacturing sites.

However, according to our understanding, the Japanese machine tool industry is home to more than 100 manufacturers in the 1.0 trillion yen plus market, leading to fierce price competition during the recession. In anticipation of such a situation, the profits accumulated during the boom period are accumulated internally without being appropriated for growth investment, and there is a tendency to spill out the profits reserved during the recession. Accordingly, with the exception of some major manufacturers, there has been no continuous growth investment based on long-term strategies, and many of the Japanese machine tool manufacturers are suffering from a lack of competitiveness and falling into a low-growth cycle.

In light of the current state of the Japanese machine tool industry, if European manufacturers with high international competitiveness in the expanding international market actively enter the

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Japanese market, or if manufacturers in China and other emerging countries, which outpace growth in the future, become more powerful, as seen in other industries, Japanese companies with world-class competitiveness may be deprived of their market share by European, Chinese and other emerging country manufacturers without having any solutions. Furthermore, as pointed out by Policy of METI, if the international competitiveness of Japan's machine tool industry continues to deteriorate and a disruption in supply by domestic companies occurs in the future, the business base of Japan's manufacturing industry itself could be shaken, and it is clear that this could directly affect the competitiveness of Japan's manufacturing industry as a whole. As a world-class manufacturer representing Japan, we cannot overlook this crisis in the Japanese manufacturing industry.

Based on this sense of crisis, our group, which has a global perspective, aggressive investment strategy, and extensive experience in acquiring companies, desire to contribute to maintaining and improving the global competitiveness of Japan's machine tool industry as well as Japan's manufacturing industry by becoming the world's leading manufacturer of machine tools and lead the machine tool industry, and we have decided to place the machine tool business as a new pillar of our business in early November, 2021.

In light of the current situation described above, we have continued to think about what we need to do in order for our group to demonstrate a strong presence in the machine tool market and acquire international competitiveness. One of the conclusions was that as a step toward gaining a strong position in the machine tool industry, we considered an alliance with your company, which is expected to generate significant synergy with our group.

When you join our group, with the goal of becoming the world's leading machine tool manufacturer group, you can utilize all of the resources we have cultivated in the global business operations, including know-how, financial resources, human resources, and technological capabilities, while making the most of our past efforts, as well as our M&A activities. This will enable you to achieve rapid growth, which is difficult to achieve by continuing the measures that you have taken independently. Through these measures, we are confident that, together with the three machine tools companies that joined our group, you will be a world leader in machine tool manufacturing, and will be able to achieve significant growth and sustainable development with strong competitiveness.

3. Our view on your current business operations

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