Kushim <2345> announced on December 24, "Announcements of individual stocks regarding the company's board of directors' opposition to the shareholder proposal." Following the announcement on November 25 regarding the resignation recommendation resolution for one director (Mr. Hiroki Tahara, a director of Kushim) and the establishment of an internal investigation committee, Mr. Tahara opened a special website advocating for improvements in Kushim's governance, and this press release serves as a rebuttal to the content on that site. Additionally, opposition to all proposals in the shareholder proposal has also been expressed.

This press release conveys the background of Mr. Tahara's shareholder proposal, summarizing its content as follows: (1) Most of the directors nominated in Mr. Tahara's shareholder proposal have declined, (2) Mr. Tahara is determined to lack the qualifications of a director due to compliance awareness (handling of insider information, etc.), (3) Mr. Tahara is determined to lack the qualifications of a director due to management capabilities, (4) Rebuttal part 1 against the reasons for Mr. Tahara's shareholder proposal, (5) Rebuttal part 2 against the reasons for Mr. Tahara's shareholder proposal. This article states that (1) most of the directors nominated in Mr. Tahara's shareholder proposal have declined.

Mr. Tahara's shareholder proposal consists of the following two points.

(1) Election of 4 directors (excluding audit committee directors), namely Mr. Hiroki Tahara, Mr. Takuya Oshima (President of Zaif Co., Ltd.), Mr. Ryo Tanaka (President of Churingham Co., Ltd.), and Mr. Toshiyuki Watanabe (President of Kuramoto Manufacturing Co., Ltd.).

(2) Election of 2 directors who are audit committee members (Mr. Yoshihiro Enami, auditor of Churingham, and Mr. Hisao Araki, certified public accountant).

The candidates for directors in this shareholder proposal include Mr. Takuya Oshima (President of Zaif Co., Ltd., a core subsidiary of Kushim), Mr. Ryo Tanaka (President of Churingham Co., Ltd.), and Mr. Yoshihiro Enami, who is an auditor of Churingham.

Regarding Mr. Oshima, Mr. Tanaka, and Mr. Enami, it is noted that they had not previously agreed to be nominated as directors in Mr. Tahara's shareholder proposal. Mr. Oshima wishes to decline becoming a candidate for director in this shareholder proposal, Mr. Tanaka prefers to wait for the outcome to avoid further confusion while clarifying his position (notably, like Mr. Oshima, he intends to fulfill his duties as the representative director of Churingham regardless of the outcome after this regular shareholders' meeting), and Mr. Enami, who does not execute business and serves as an impartial auditor of Churingham, wishes to maintain neutrality without siding with either Kushim or Mr. Tahara regarding this shareholder proposal, as he is in a position to audit the appropriateness and legality of Churingham's operations.

Additionally, regarding Mr. Toshiyuki Watanabe (who will acquire shares of our company and become a shareholder in October 2024), he has expressed his intention to decline from being a candidate for director to Mr. Tahara, and this was publicly accepted by Mr. Tahara.

Since the shareholder proposal was revealed, Mr. Oshima, Mr. Tanaka, and Mr. Enami have consistently expressed their intention to work alongside the current management of Kushim for the management of our group. Additionally, following Mr. Watanabe's withdrawal from the director candidate list, most of the shareholder proposal Company Executives proposed by Mr. Tanaka have also withdrawn.