On May 21, 2024, Nippo Ltd., announced in its press release that it had received a shareholder proposal form Global ESG Strategy for its 73rd Annual General Meeting of Shareholders. The proposals are as follows, i) Appropriation of Surplus, ii) Partial amendment to the Articles of Incorporation (regarding the dividend policy for retained earnings), iii) Abolition of anti-takeover measures, iv) Partial amendment to the Articles of Incorporation (regarding the handling of meetings with shareholders by directors). The company has opposed the proposals for the following reasons, i) The Board of Directors has adopted the basic policy of increasing dividends in line with sustainable profit growth as the basis for shareholder returns, and recognises and is committed to the sustainable improvement of both the total dividend amount and the dividend payout ratio as a key management issue.

On the other hand, the proposal states that priority should be given to returning profits to shareholders in the short term, rather than investing in businesses that will lead to future profit growth and achieving both sustained profit growth and a sustained increase in shareholder returns, ii) The content of the proposal states that, the amount of dividends will be determined using a uniform calculation method, regardless of the state of the Company's performance and the need for funds to be used for business investment, etc., which would clearly undermine the mobility and flexibility for determining effective investment plans and other uses of funds that will lead to future profit growth, iii) If a large-scale purchase is made against the Company without sufficient consideration and a change of control happens, coupled with the possibility of confidential information being leaked then the possibility that the corporate value of the Group and the common interests of its shareholders may not be secured is undeniable. In light of this situation, the Board of Directors of the Company has decided that, it is necessary to continue the "Takeover Response Policy" in order to request information from the large-scale acquirer and to ensure that the Board of Directors of the Company has a process to examine and evaluate the information provided by the acquirer, iv) As the Company's resources for responding to dialogue with shareholders are limited, this may affect the implementation of constructive dialogue with other shareholders and the implementation of dialogue other than individual meetings (such as briefings and investor relations activities), which in turn may affect the sustainable enhancement of the Company's corporate value and ultimately the common interests of its shareholders.