JTOWER : Notice of changes in the equity-method affiliate (transfer of shares), recording of extraordinary gain and revision of financial forecasts

March 15, 2022

Company name: ＪＴＯＷＥＲ Inc.

Representative: Representative Director Atsushi Tanaka

（TSE Mothers Code No. 4485）

Contact:Ryosuke Nakamura

Managing Director, CFO

Notice of changes in the equity-method affiliate (transfer of shares), recording of

extraordinary gain and revision of financial forecasts

At the meeting of the Board of Directors held today, JTOWER has resolved to transfer all the shares we own of our equity method affiliate Nabiq Inc. ("Nabiq") to MOST Investment Limited Partnership. As a result, Nabiq is excluded from our equity method affiliate.

In addition, as a consequence of this transfer, we expect to record extraordinary gain for Q4 FY03/2022 and revise the financial forecast announced on February 8, 2022. The details are as follows.

１．Changes in equity-method affiliates and recording of extraordinary gain

（１）Reason for transfer

Nabiq provides wireless broadband outsourcing services using Wi-Fi system. In addition, Nabiq aims to provide Local 5G solutions by leveraging its strengths in LAN Management, including Wi-Fi. JTOWER has been considering to sale shares in Nabiq in order to concentrate our management resources on IBS and Tower businesses and we received an offer from MOST Investment Limited Partnership operated by FGI Capital Partners, Inc., the subsidiary of FinTech Global Incorporated, and decided to transfer shares after consideration.

（２）Overview of the transferred equity-method affiliate

(1)	Name	Nabiq, Inc.
(2)	Address	11 Iwata Building 5F, Kanda Konoya-cho,Chiyoda-ku, Tokyo, Japan
(3)	Name and Title of	Tomohito Takatsu, Representative Director
Representative
(4)	Summary of Business	Provision of wireless broadband outsourcing services using Wi-Fi system
(5)	Capital Stock	350 million yen
(6)	Date of	August 8, 2013
Establishment
	Major Shareholders	JTOWER Inc. 43.4%
(7)	and their	MIC Innovation V Limited Liability Fund 9.0%
Shareholding	Tamagawa Holdings Co., Ltd. 9.0%
	Ratio	Tomohito Takatsu 8.7%
		Capital	We hold 43.4% of Nabiq's voting rights.
		Relationship
	Our Relationship with	Personnel	Our representative directors and president also served
(8)	as Nabiq's director, but the person has resigned as of
the Company	Relationship
	today upon this transfer.
		Business	We have business relations with Nabiq, such as the
		Relationship	purchase of Wi-Fi related equipment.

(9)	Financial Position and Operating Results of Nabiq in the Past 3 years
	Fiscal year ended	March 31, 2019	March 31, 2020	March 31, 2021
Net assets	(4) million yen	(76) million yen	(27) million yen
Total assets	199 million yen	124 million yen	156 million yen
Net assets per share	(141.09) yen	(2,490.16) yen	(741.48) yen
Net sales	139 million yen	225 million yen	210 million yen
Operating income	(131) million yen	(71) million yen	(49) million yen
Ordinary income	(131) million yen	(71) million yen	(51) million yen
Net income	(131) million yen	(72) million yen	(51) million yen
Earnings Per Share	(4,727.49) yen	(2,349.07) yen	(1,373.07) yen

（３）Overview of the counterparty of share transfer

(1)	Name	MOST Investment Limited Partnership
(2)	Address	1-1-5, Kaneda East, Kisarazu city, Chiba
(3)	Date of	January 27, 2022
establishment
		Name	General Partner SHIBA G.K.
		Address	1-1-5, Kaneda East, Kisarazu city, Chiba
		Name and
(4)	Outline of general	Title of	Representative Member Taishi Okuda
partner	Representative
		Summary of	Trading in securities
		Business
		Capital Stock	100,000 yen
		Capital	Not applicable.
		Relationship
(5)	Our Relationship with	Personnel	Not applicable.
the Fund	Relationship
		Business	Not applicable.
		Relationship

Note: The purpose of formation, the total amount of investment, investor, investment ratio, and the outline of investor are not disclosed due to the intention of the counterparty based on the confidentiality obligation in the share transfer agreement between the parties.

（４）Number of shares and percentage of shareholding before and after the transfer

（1）	Shares owned before	16,249 shares (Voting rights ownership percentage: 43.4％）
change
（2）	Number of shares to	16,249 shares
be transferred
（3） Transfer price	240 million yen
（4）	Shares owned after	0 shares (Voting rights ownership percentage: 0.0％）
change

（５）Schedule

（1）	Resolution of the	March 15, 2022
Board of Directors
（2）	Date of share	March 15, 2022
transfer agreement
（3）	Date of share transfer	March 16, 2022 (tentative)

（６）Future Outlook

The transfer of shares is expected to result in the extraordinary gain of approximately 240 million yen in the consolidated financial statements for the year ending March 31, 2022.

２．Revision of full year forecast

（１）Revision of full year forecast for the FY03/2022 (April 1, 2021-March 31, 2022)

					Profit	Basic
			Operating	Ordinary	attributable
	Revenue	（For reference）	earnings per
	EBITDA*¹	Profit	Profit	to owners of
		share
					parent
Previously	In JPY MN	In JPY MN	In JPY MN	In JPY MN	In JPY MN	In JPY
announced
4,200	1,670	520	490	280	12.85
forecast (A)
Revised forecast	4,200	1,670	520	490	520	23.63
(B)
Difference (B-A)	－	－	－	－	240	－
Difference in	－	－	－	－	85.7	－
percentage (%)
（For reference）
Actual result from	3,501	1,349	418	178	506	24.58
FY03/2021

*1: EBITDA=Operating Profit + Depreciation＋Amortization of Goodwill + Amortization of long-term prepaid expenses

（２）Reason for the revision of the forecasts

As described in 1. above, we expect to record approximately 240 million yen in gain on sales of shares of subsidiaries and affiliates as extraordinary gain due to the transfer of Nabiq's shares.

NOTE: The forecasts presented are based on the information currently available to JTOWER. Actual results may differ depending on a range of factors.