Notice Regarding Share Buyback, Purchase of Treasury Stock through Off-Auction Own Share Repurchase Trading (ToSTNeT-3), and Cancellation of Treasury Stock (Share Buyback Based on the Provisions of Article 165, Paragraph 2 of the Companies Act)

Overview of Capital Policy

Hokuetsu Corporation has decided to execute a share buyback to mitigate market impact related to the sale of shares by major shareholder Daio Kaiun Co., Ltd., and to improve capital efficiency as part of building a capital relationship with Daio Paper Corporation, with whom it is deepening strategic business alliances. The buyback will be conducted on March 19, 2026, through the Tokyo Stock Exchange’s off-auction own share repurchase trading platform (ToSTNeT-3) with an upper limit of 10,000,000 shares and a maximum purchase price of 10.7 billion yen. Furthermore, it plans to cancel 15,000,000 shares of treasury stock it currently holds in addition to shares acquired through this repurchase on March 26, 2026.

Impact on Shareholders and Future Outlook

By repurchasing approximately 5.92% of the total issued shares from the market, the number of shares outstanding will decrease, which is expected to enhance capital efficiency. Daio Kaiun may continue to hold a portion of its shares, and there is also a plan to transfer shares to Daio Paper. These actions contribute to establishing an equitable capital relationship between the two companies and are positioned as a capital policy to flexibly respond to changes in the management environment.