Our Apologies and Countermeasures for Violation of the Prize Labeling Law

In relation to the fact that Akindo Sushiro Co., Ltd. (hereinafter “Sushiro”), a subsidiary of FOOD & LIFE COMPANIES LTD. (hereinafter “F&LC”), received a corrective order (hereinafter “this matter”) from the Consumer Affairs Agency based on the Unfair Premiums and Misrepresentations Prevention Act (hereinafter “Premiums and Misrepresentations Act”) on June 9, 2022, we would like to deeply apologize to customers who came to our stores looking forward to the campaign for the inconvenience caused by our inability to provide the relevant products, despite the fact that they were promoted in commercials and other advertisements. We would also like to deeply apologize to all involved parties for the inconvenience and concern caused.
In order to prevent similar incidents from occurring in the future, the Audit and Supervisory Committee, which is composed only of outside directors, conducted an investigation with external experts to determine the cause and propose measures to prevent recurrence. We have now received the investigation report from the committee, which contains the results of the investigation and measures to prevent recurrence as attached. We would like to inform you of the measures that have already been implemented and the measures for each issue pointed out in the investigation report, as follows.

1. 1. Measures to prevent recurrence
      1. Already underway: Improving campaign products
         1. We have submitted an improvement plan to the Consumer Affairs Agency and are taking the following measures in sequence.
            1. Campaign products in commercials and other promotions are planned and sold so that they can be sold throughout the entire period.
            2. The legal department participates in meetings to decide the campaign contents and checks them from a legal perspective.
            3. We have also changed the system so that when making changes to advertising wording for existing products, we also obtain prior confirmation from the legal department.
         2. We provide training on the Act against Unjustifiable Premiums and Misleading Representations to our management team and all employees in advertising-related departments.
         3. If the limited quantity campaign items sold on a given day are sold out, we will announce this in-store.
      2. In response to this investigation report, we will further implement the following measures:
         1. Raising awareness of compliance and thoroughly incorporating it into daily work
            1. Raise awareness of compliance through compliance education for management and other parties (thorough education on relevant laws and regulations such as the Act against Unjustifiable Premiums and Misleading Representations)
            2. By having the management team continuously disseminate information regarding compliance within the company, we will foster a company-wide awareness of compliance and ensure that it is reflected in each employee’s work.
         2. Reorganization of the advertising production and review system
            1. Creating guidelines for proper advertising production and enforcing them
            2. Clarify the person responsible for managing advertising content and placement
         3. Establishing a management system after the campaign starts
            1. In the event that we are unable to deliver the products as advertised to customers due to shortages or other circumstances, we will thoroughly monitor sales and share information with relevant departments in order to cancel or change advertisements in a timely manner.
            2. Establish a system to consider changes to campaign content and the associated changes to advertising content
         4. Establishing a system for dealing with the discovery of inappropriate advertising, etc.
            1. Establish a system to immediately halt use of inappropriate advertising, etc. (clarification of the person responsible and their authority)
            2. Establish a system, including an internal reporting system, to ensure that when inappropriate advertising, etc. is noticed, information is delivered to the person in charge mentioned above
         5. Rethinking the Campaign
            1. Consideration of timeframes, mechanisms and methods to provide products that meet customer expectations as much as possible
            2. Consider sales methods that allow us to provide products that satisfy customers while protecting limited resources and not causing food waste.
            3. More accurate sales forecasts and food procurement accordingly

            *We will continue to try out various methods for designing specific campaigns and notifying customers, and will continue to implement improvement activities.

1. Clarification of management responsibility
   In response to this matter, three individuals have offered to forgo part of their executive compensation, etc., and we have decided to accept these offers.
   1. Period: 3 months from July this year
   2. Eligible participants:
      Koichi Mizutome (President and CEO of F&LC): 30% of basic monthly salary
      You Horie (F&LC Managing Executive Officer, President and CEO of Sushiro at the time of this transaction) 20% of basic monthly salary
      Tomoko Fukuyama (F&LC Executive Officer, in charge of communication planning at the time of this transaction) 10% of basic monthly salary