DyDo Group Holdings

Purpose of the Plan

The purpose of this plan is to establish rules beforehand regarding the large-scale acquisition of stock, to prevent our company's financial and business policy decisions from being dominated by a person or entity with a risk of taking actions contrary to our corporate philosophy of striving for harmonious coexistence and mutual prosperity with all stakeholders, harming the good relations we have with people connected with our company, and consequently having a major adverse impact contrary to the joint interests of shareholders. More specifically, for persons who attempt large-scale acquisition, without the prior agreement of the Board of Directors, and with the purpose of increasing voting rights to 20% or more, our company shall:

• 1) Require the submission of necessary and sufficient information before execution;
• 2) Secure time for information gathering, review, and similar tasks relating to the large-scale acquisition, and;
• 3) On that basis, present the plan of our company's management or an alternative plan to all shareholders, and conduct negotiations with the large-scale purchaser if necessary.

Through these efforts we will provide necessary and sufficient information and time to all shareholders, with the aim of enabling them to make a proper decision regarding whether or not to respond to the pertinent large-scale acquisition.

Reasons for Continuing with the Plan

In terms of whether we should accept a bid by a large-scale purchaser for large-scale acquisition of our Company’s stock, bearing in mind that the final decision should be left to the shareholders, with regard to acquisition attempts that would seek to contribute to the management of the Company, the Company shall not categorically reject all such acquisition attempts if they would greatly increase the corporate value of the Company.
The purpose of the large-scale acquisition rules laid out in the Plan regarding the large-scale acquisition of our Company’s stock is to provide to you, our shareholders, the information that you need to determine whether or not a large-scale acquisition bid should be accepted, and to advise you of the opinions of the members of the Board of Directors who are presently engaged in the management of the Company, in order to ensure that you have the opportunity to learn about any alternate plans. Currently, although there are some measures in place to control the abusive acquisition of stocks under the Financial Instruments and Exchange Act, it is conceivable that there are cases in which the law is not always effective. For example, when it is not possible to legally secure the time to submit and consider information prior to the commencement of a takeover bid or to restrict buying-up in the market. Therefore, we believe that establishing large-scale acquisition rules will form the basis on which you, our shareholders and investors, can make appropriate investment decisions, and that securing adequate time can be an effective means of facilitating constructive dialogue between shareholders and prospective large-scale purchasers who have the potential to improve corporate value.
The economic environment surrounding our domestic beverage business, which is our Group’s core business, remains harsh, and in order to improve mid-to-long term corporate value, we are in a situation that requires us to constantly modify our earnings structure to be able to more flexibly cope with the changing times.
The Group formulated the Group Mission 2030 by incorporating issues previously identified and analyzing changes to domestic population trends and other medium- and long-term changes in the business environment as either risks or business opportunities that will exert a serious impact on its business model. The mission provides a vision for the Group as it moves toward and beyond 2030 and looks to achieve sustainable growth and an enhancement in the corporate value of the Company over the medium and long term. In order to continue to create value for customers and society by tapping the potential of these medium- and long-term changes in the business environment and transforming risks into business opportunities, the Group believes that it will be necessary to adopt highly competitive business models in an age of uncertainty by embracing discontinuous innovation while taking advantage of its strengths, including the vending machine business. However, there are concerns that if 20% or more of the Company’s issued shares were acquired, it would have a major impact on the Company’s management and make it impossible to implement corporate measures aimed at achieving sustainable growth and enhancing corporate value over the medium and long term in a timely manner. This could also have a marked impact on the special resolutions at a General Meeting of Shareholders if one considers factors such as quorum and percentage of voting rights exercised.

It was determined that reapproving the large-scale acquisition rules is essential in order to maintain continuous growth and enhance mid-to-long term corporate value, and to be able to respond quickly to changes that are expected to occur in the industry at an ever-increasing pace, and that it is the duty of the Board of Directors to be constantly ready for any unexpected events by continuing with the Plan based on the essence of our Group’s proprietary vending machine business model.

Overview of Rules for Large-Scale Acquisition

Note. The aim of this diagram is to help you to understand the Plan. As such, although it depicts an outline of typical procedures, it should by no means be considered as showing all procedures that can be taken. For further details, please refer to the following.