On May 10, 2024, Yodogawa Steel Works, Ltd. reported in its press release that it had received a shareholder proposal from Strategic Capital Inc. for its 125th Ordinary General Meeting of Shareholders. The proposals are as follows, i) Amend the Articles of Incorporation (regarding the decision making body for determining the distribution of surplus), ii) Amend the Articles of Incorporation (Appropriation of surplus), iii) Amend the Articles of Incorporation (Establishment and disclosure of a plan to achieve a P/B ratio of 1x or more), iv) Amendment to the Articles of Incorporation in (Policy on Large-Scale Purchases (Takeover Defense Measures), v) Abolition of the Policy on Large-Scale Purchases (Takeover Defense Measures), vi) Amendment to the Articles of Incorporation regarding the Shareholder Special Benefit Plan, vii) Abolition of the shareholder special benefit plan, viii) Amendment to the Articles of Incorporation regarding cancellation of treasury stock, ix) Cancellation of treasury stock. The company has opposed the proposals for the following reasons, i) The company?s Board of Directors believes that it is reasonable for the Board of Directors to determine policies regarding shareholder returns, including specific dividend amounts for each fiscal year, based on the Company's medium- to long-term management policy, taking into consideration the business environment surrounding the Company and its business characteristics, ii) The Shareholder Proposal does not contribute to the enhancement of the Company's corporate value and the common interests of shareholders over the medium to long term, as it is intended to reduce shareholders' equity through short-term shareholder returns and formally improve ROE by utilizing financial leverage, without considering the Company's medium- to long-term growth investment and other needs.

This will not contribute to the enhancement of the Company's corporate value and common interest of shareholders in the medium to long term, iii) The Company believes that it is not appropriate to include the content of the Shareholder's Proposal in the Articles of Incorporation, which sets forth the fundamental norms of the Company, as it is a matter of management judgment that should be determined on a case-by-case basis, taking into account the highly fluid nature of the business environment and other factors, iv) The Company believes that it is important to be able to respond to any Large-Scale Purchase that would damage corporate value or the common interests of shareholders, and that it is not appropriate to stipulate the contents of the Shareholder Proposal in the Articles of Incorporation, which are the fundamental rules of the Company, v) The Company has resolved and announced that the Plan will be abolished pending the conclusion of the 127th Ordinary General Meeting of Shareholders to be held in 2026. Accordingly, the Shareholder's Proposal lacks the precondition to be submitted to this Ordinary General Meeting of Shareholders because the Plan, which should have been the subject of the Proposal, has been abolished. The Company plans to discuss the handling of the Shareholder's Proposal with the proposing shareholder, vi) The Company believes that the shareholder special benefit plan is intended to encourage and motivate people to recognize the Company, understand its business activities, and become shareholders, and that shareholder returns should be judged comprehensively in conjunction with dividend payments and share repurchases.

The company further believe that it is appropriate to leave the details of individual specific business operations, such as this shareholder proposal, to the decision of the Board of Directors, and that it is not appropriate to include such details in the Articles of Incorporation, which sets forth the fundamental norms of the Company, vii) The purpose of the shareholder special benefit program is to thank the shareholders for their daily support, to increase the attractiveness of investment in shares, and to encourage shareholders to continue to hold shares over the medium to long term. The Company has decided on the content of the shareholder special benefit plan for fiscal year 2023 after careful consideration of various shareholder requests, including the pros and cons of continuing the plan, and has received favorable feedback from many of its shareholders, viii) The Shareholder's Proposal will limit the range of options and mobility of the company and that there may be cases in which it does not contribute to the interests of shareholders. The company also believe that it is appropriate to leave the details of specific business operations such as the Shareholder's Proposal to the Board of Directors to be decided by the Board of Directors, and that it is not appropriate to include such details in the Articles of Incorporation, which sets forth the fundamental norms of the Company, ix) The Company has carefully considered the timing of the rcancellation of treasury stock and the number of treasury stock to be retired, and as a result, plans to retire 3 million shares of treasury stock (8.61% of the total number of outstanding shares before retirement) on May 31, 2024.

The Company does not believe that it is appropriate to cancel all of its treasury stock at this time.