Re: Execution of Letter of Commitment Concerning Investment Agreement and Class A Shares

(NOTE) This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the Japanese original shall prevail.

Date: June 27, 2024

Company Name: Akebono Brake Industry Co., Ltd.

Representative: Yasuhiro Miyaji, President & CEO

(Securities Code: 7238 TSE Prime Market)

Re: Execution of Letter of Commitment Concerning

Investment Agreement and Class A Shares

As announced in the notice "Announcement Regarding Borrowing for Refinancing, Full Repayment of Claims after Support, and Completion of the Business Turnaround Plan Period" as of June 14, 2024, Akebono Brake Industry Co., Ltd. (hereinafter the "Company") has resolved that it enters into a refinancing loan agreement (hereinafter the "Loan Agreement") with Deutsche Bank AG, Tokyo Branch as arranger with a drawdown date of June 28, 2024 and repay the remaining balance of existing loans due on June 30, 2024 as set forth in the Business Turnaround Plan in a lump sum with these borrowings (hereinafter the "Refinancing"), and executed the Loan Agreement as of June 14, 2024. In connection therewith, as of June 26, 2024, the Company executed a letter of commitment with Japan Industrial Solutions Fund II (hereinafter "JIS Fund") regarding the Investment Agreement and the Class A Shares (hereinafter the "Letter of Commitment").

As announced in the notice "Re: Issuance of Class Shares through Third-Party Allotment, Partial Amendments to the Articles of Incorporation, and Reduction of Amounts of Capital Stock and Legal Capital Surplus" as of July 18, 2019 (update and progress thereof were disclosed as of August 16, 2019) and the notice "Re: Completion of Payment With Respect to Issuance of Class Shares through Third-Party Allotment, Reduction of Amounts of Capital Stock and Legal Capital Surplus, and Change in Representative Directors" (hereinafter, collectively, the "2019 Releases"), the Company entered into an investment agreement with JIS Fund as of July 18, 2019 (hereinafter the "Investment Agreement," as amended) based on the Business Turnaround Plan, under which the Company has issued total JPY20,000,000,000 of the Class A Shares through a third-party allotment to JIS Fund as of September 30, 2019.

In connection with the Refinancing, the Company and JIS Fund executed the Letter of Commitment regarding the following matters concerning the Investment Agreement and the Class A Shares. The terms defined in the 2019 Releases have the same meaning in this announcement.

(Matters related to Preferred Dividends)

• JIS waives its right to receive a dividend of surplus concerning an amount equivalent to the Class A Preferred Dividend and the Class A Cumulative Accrued Dividend for the period from April 1, 2020 to the repayment date (in principle, June 30, 2029, the last day of the loan period under the Loan Agreement; hereinafter the "Repayment Date")(hereinafter the "Covenant Period").
• The Company shall not make any dividend of surplus to JIS Fund from the execution date of the Letter of Commitment to the end of the Covenant Period.
• JIS Fund shall not allow the Company to make any dividend of surplus to JIS Fund from the execution date of the Letter of Commitment to the end of the Covenant Period.

(Matters related to Request for Acquisition in Exchange for Money)

• JIS Fund shall not make any Request for Acquisition in Exchange for Money during the Covenant Period.
• If JIS Fund makes a Request for Acquisition in Exchange for Money after the end of the Covenant Period, it shall waive its monetary claims concerning the amount obtained by multiplying the number of the Class A Shares concerning such Request for Acquisition in Exchange for Money by (i) the amount obtained by multiplying the Amount Equivalent to the Paid-in Amount per Class A Shares by the value obtained by deducting one (1) from the Premium for Acquisition in Exchange for Money and (ii) the sum of the Amount Equivalent to Class A Cumulative Accrued Dividends and the Daily Prorated Accrued Preferred Dividend Amount during the Covenant Period.

(Matters related to Call Option for Money)

• The Company shall not exercise its Call Option for Money (i,e., the Company's rights to redeem the Class Shares for money) during the Covenant Period.
• JIS Fund shall not request the Company to exercise its Call Option for Money during the Covenant Period.
• If the Company exercises its Call Option for Money after the end of the Covenant Period, JIS Fund shall waive its monetary claims concerning the amount obtained by multiplying the number of the Class A Shares concerning such Call Option for Money by (i) the amount obtained by multiplying the Amount Equivalent to the Paid-in Amount per Class A Shares by the value obtained by deducting one (1) from the Redemption Factor and (ii) the sum of the Amount Equivalent to Class A Cumulative Accrued Dividends and the Daily Prorated Accrued Preferred Dividend Amount during the Covenant Period.

(Condition Precedent)

• The Letter of Commitment becomes effective upon the completion of utilization of the loan under the Loan Agreement.

In addition to the Letter of Commitment, JIS Fund agreed not to dispose the Class A Shares, or exercise its rights to request the redemption of the Class A Shares or other relevant rights (excluding Rights to Request Acquisition in Exchange for Common Shares) until the Repayment Date in the relevant agreement concerning the Refinancing with the lender etc.