Agenda Items of Extraordinary General Meeting of Shareholders (“GMS”) of Sajo Industries Co., Ltd. (the “Company”) to be Held on September 14 pursuant to Minority Shareholders’ Application to Convene GMS

Greetings, shareholders.

I am aware that you are all experiencing much hardship and difficulties due to the COVID-19 crisis and the heat wave.I sincerely hope you will overcome this difficult time and wish for the health and well-being of your families.

On July 26, 2021, minority shareholders including Jong-Guk Song (the “Minority Shareholders”) requested the Company to convene the GMS to present and deliberate upon the below agenda items.

Item 1: Matter of electing Jong-Suk Song as an audit committee member who is also an outside director (subject to separate election)

Item 2: Matter of dismissing Jin-Woo Joo as director

Item 3: Matter of dismissing Gil-Soo Park, Sang-Gyun Han and Hak-Soo Jeong as audit committee members who are outside directors

Item 4: Matter of electing Won-Mo Kang, Jae-Sik Shim, Hyeon-Chun Seol and Seong-Geun Im as outside directors

Item 5: Matter of electing the outside directors elected under agenda item 4 as audit committee members

Item 6: Matter of revaluating the shares of Castlex Co., Ltd., a subsidiary of the Company

Item 7: Matter of distribution of interim dividends of KRW 1,000 per share

Thereafter, the Minority Shareholders requested on August 5 that the agenda item of a resolution to acquire 200,000 shares of treasury stock for profit redemption be added.On August 13, the Minority Shareholders further requested us to present agenda items to adopt a resolution introducing an electronic voting system and a resolution on the amendment of the articles of incorporation to allow the exercise of voting rights by written ballots.

The Company is always appreciative of our shareholders’ interest in increasing our corporate value and enhancing shareholder value.We recognize the importance of promoting the interests of our shareholders as a whole including the Minority Shareholders, as well as how vital constructive and smooth communications are to such end.We are constantly striving to actively respond to sound inquiries and suggestions from the shareholders.

Based on maximum respect for the wishes and rights of the Minority Shareholders, we promptly convened a meeting of the board of directors to convene the GMS and publicly disclosed the foregoing on August 2, one week after the Minority Shareholders first requested the convening of a general meeting of shareholders.Following an additional board resolution on August 27 on the additional agenda items requested by the Minority Shareholders, a notice to convene the GMS was publicly disclosed on August 30.Accordingly, we provide the following information so that the shareholders can understand the details of the agenda items of the GMS scheduled to be held on Tuesday, September 14, 2021 at 09:00. In addition, GMSplease refer to the disclosure for soliciting the exercise of voting rights by proxy dated August 27, 2021, where the Company discloses the board of directors’ position on each agenda item of the GMS.

1.Company’s convening of the GMS in response to the Minority Shareholders’ application to convene the GMS

The agenda for the GMS are as follows.

lReport item

-Auditors’ audit report of agenda items

lMatters for resolution

○Item 1: Matter of partial amendments to the Articles of Incorporation, including composition of the audit committee (proposal by the board of directors)

- Item 1-1: Matter of partial amendments to the Articles of Incorporation, including composition of the audit committee (proposal by the board of directors)

- Item 1-2: Matter of partial amendments to the Articles of Incorporation, including introduction of written ballots (proposal by shareholders)

○Item 2: Matter of voting method for election of directors as members of the audit committee

○Item 3: Matter of electing one member of the audit committee who is to be separately elected under the proviso of Article 542-12(2) of the Commercial Code
§ Item 3-1: Matter of electing a non-standing director as a member of the audit committee (proposal by shareholders/candidate: Jong-Guk Song)

§ Item 3-2: Matter of electing outside directors as members of the audit committee

- Item 3-2-1: Matter of electing an outside director as a member of the audit committee (proposal by the board of directors/candidate: Young-Sik Ahn)

- Item 3-2-2: Matter of electing an outside director as a member of the audit committee (proposal by shareholders/candidate: Jong-Guk Song)

○Item 4: Matter of dismissing Jin-Woo Joo as director (proposal by shareholders)

○Item 5: Matter of dismissing three audit committee members who are also outside directors (proposal by shareholders)

- Item 5-1: Matter of dismissing Gil-Soo Park, an audit committee member who is also an outside director (proposal by shareholders)

- Item 5-2: Matter of dismissing Sang-Gyun Han, an audit committee member who is also an outside director (proposal by shareholders)

- Item 5-3: Matter of dismissing Hak-Soo Jeong, an audit committee member who is an also outside director (proposal by shareholders)

○Item 6: Matter of electing four outside directors (proposal by shareholders)

- Item 6-1: Matter of electing Won-Mo Kang as an outside director (proposal by shareholders)

- Item 6-2: Matter of electing Jae-Sik Shim as an outside director (proposal by shareholders)

- Item 6-3: Matter of electing Hyeon-Chun Seol as an outside director (proposal by shareholders)

- Item 6-4: Matter of electing Seong-Geun Im as an outside director (proposal by shareholders)

○Item 7: Matter of electing four audit committee members who are also outside directors pursuant to agenda item 6 (proposal by shareholders)

- Item 7-1: Matter of electing Won-Mo Kang who is an outside director as a member of the audit committee (proposal by shareholders)

- Item 7-2: Matter of electing Jae-Sik Shim who is an outside director as a member of the audit committee (proposal by shareholders)

- Item 7-3: Matter of appointing Hyeon-Chun Seol who is an outside director as a member of the audit committee (proposal by shareholders)

- Item 7-4: Matter of electing Seong-Geun Im who is an outside director as a member of the audit committee (proposal by shareholders)

○Item 8: Matter of resolving on the acquisition of treasury stocks (200,000 shares) using the distributable profits for the purpose of cancellation of stocks (proposal by shareholders)

※ If Item 1-1 is passed as per the original agenda (or where it is passed after amendment, if Article 39 on composition of the audit committee among the draft amendments to the Articles of Incorporation in Item 1-1 is amended as per the original agenda), Items 2 and 3-1 lose their effect and are automatically discarded. If Item 1-1 is rejected (or where it is passed after amendment, if Article 39 on composition of the audit committee among the draft amendments to the Articles of Incorporation in Item 1-1 is not amended per the original agenda), and (a) Item 2 is passed as per the original agenda, then Item 3-1 loses its effect and is automatically discarded.Alternatively, if (b) Item 2 is rejected, then the agenda item concerning the candidates recommended by the minority shareholders under Item 3-2 loses its effect and is automatically discarded.If Item 6 is rejected, then Item 7 is automatically discarded.

※ In preparation for unavoidable situations due to COVID-19, the representative director has been delegated the authority to change the date, time and venue to convene the GMS, and we will issue another disclosure should related matters arise.

2.Explanation of Company’s Agenda for GMS

(1)Item 1-1: Matter of partial amendments to the Articles of Incorporation, including composition of the audit committee

The Company’s board of directors has proposed GMSchanges to the Articles of Incorporation, including changing the entire composition of the audit committee to be constituted of outside directors, and establishing an ESG committee, etc. in the board of directors, as an agenda item for this GMS.We believe that requiring the entire composition of the audit committee to be constituted of outside directors is an agenda item to enhance our audit committee’s independence and fairness in the execution of its duties and to improve corporate governance.As this reflects the policy direction currently considered positively and recommended by most listed companies, institutional investors and supervisory authorities, etc., we believe it would also benefit the minority shareholders.In addition, the establishment of the ESG committee would also reinforce corporate social responsibility and ESG management, thereby enhancing the interests of all stakeholders and shareholders in the Company and enabling sustainable management.As such, it is difficult to argue against the proposal in itself.

As the aforementioned amendments to the Articles of Incorporation also affect the agenda items on electing directors and audit committee members at this GMS, the Company seeks to clarify the eligibility as directors, etc. of the candidates for audit committee members, by proposing the above agenda item on amending the Articles of Incorporation, before proposing the agenda item on electing officers at this GMS.Should the GMS pass the above agenda item on amending the Articles of Incorporation, there will be deliberation on the agenda item presenting candidate Jong-Guk Song proposed by the Minority Shareholders as a candidate for an outside director and audit committee members, in accordance with the amended Articles of Incorporation, based on a favorable interpretation of its purport.

(2)Item 1-2: Matter of partial amendments to the Articles of Incorporation, including the introduction of written ballots (proposal by shareholders)

The Company is considering various ways to activate participation in the GMS and the exercise of shareholder rights.It would be hasty to introduce written ballots right away, due to the financial burden of sending out ballot papers separately and low utilization of written ballots due to the recent vitalization of the Internet.As such, a long-term and comprehensive consideration of the utility of written ballots would be necessary.

(3)Item 2: Matter of voting method for election of directors as members of the audit committee

First, by operation of Articles 542-11(3) and 542-10(2) of the Commercial Code, an inside director engaged in the ordinary business affairs of the Company cannot become a member of an audit committee.Therefore, Item 1 among the claims in this case on electing Jong-Guk Song, as an inside director who is also a member of audit committee is unlawful in and of itself.However, the Company’s board of directors did not discard Item 1 among the claims in this case out of respect for the rights of minority shareholders.After explaining and discussing the above legal principle with the Minority Shareholders, and based on a favorable interpretation of the above proposal, we have proposed the matter of electing an outside director or a non-standing director who is also an audit committee member (the part proposing separate election was accepted) as an agenda item for the GMS.

In this regard, however, should the above item on amending the Articles of Incorporation pass, the item of electing candidate Jong-Guk Song as an audit committee member who is an outside director will be presented.Even if the item on amending the Articles of Incorporation is rejected, it is a matter to be decided by the consensus of the shareholders at the GMS whether to have candidate Jong-Guk Song serve the audit committee as an outside director or a non-standing director.

Applicability of the provision on aggregation of specially-related parties under Article 542-12(4) of the Commercial Code when applying the 3% limit on voting rights with respect to the agenda item of electing the director as an audit committee member in question depends on whether the candidate is elected as a non-standing director or outside director.As this will affect the resolution of the GMS, this should be decided according to the consensus of all shareholders, not by some minority shareholders only.

Furthermore, considering that the order of agenda or voting method can be decided by a resolution of the GMS in the event of any disagreement thereto among the shareholders, the Company has come to a decision to propose the agenda item

Therefore, the Company is proposing the agenda item to determine that the position of an audit committee member to be elected through a separate election would be an outside director (not a non-standing director), and present the candidates recommended by the shareholder-proposer and by the board of directors as a single package, as an agenda item preceding the separate election of a director as an audit committee member, so that the decision thereon would be based on the consensus of all of the shareholders. The foregoing is an issue arising in the interpretation and application of Article 542-12 of the Commercial Code on the restriction of voting rights in the separate election of a director as a member of audit committee.This is not only the Company’s problem, and there are precedents where other companies have dealt with this issue in the aforementioned way, as set out in Eusu Holdings Co., Ltd.’s notice convening the shareholder’s meeting publicly disclosed on March 21, 2021.As such, we have followed such market practice.The Minority Shareholders claim that the Company presented such agenda item to avoid the 3% limit on voting rights in aggregation of specially-related parties, but this is completely untrue.

Further, the fact that Mr. Song, who claims to be independent from the controlling shareholders and insists on checking and monitoring the controlling shareholders, is attempting to become a candidate for a non-standing director rather than an outside director, is against the fundamental nature of the regime of outside directors, and this may even be deemed an abuse of the regime of a 3% limit on voting rights in aggregation of specially-related parties.

Therefore, in order to faithfully fulfill its responsibilities for the fair and lawful proceedings of the GMS, the Company seeks to clarify this point through a resolution of the GMS.

In consideration of the precedents set by other companies in the same situation as in this case, we will present Item 2 as an agenda item preceding Item 3, to decide whether to elect the above audit committee member candidates as outside directors or a non-standing directors according to the consensus of the shareholders, and then deliberate and vote on the item on electing directors as audit committee members accordingly.Furthermore, as there are two candidates for the director as an audit committee member to be elected separately due to the proposal pursuant to the minority shareholders’ application to convene the GMS, we seek approval for the voting method to elect the person with the most votes in straight voting.The shareholders are to exercise one vote per share to indicate “yes,” “no” or “I abstain” to each candidate in Item 3, and the Company intends to elect the person with the most votes among those who satisfy the requirements for a resolution, by counting the votes in favor of each candidate.

(4)Item 3-1: Matter of electing a non-standing director as a member of the audit committee (candidate: Jong-Guk Song); Item 3-2-1: Matter of electing an outside director as a member of the audit committee (candidate: Young-Sik Ahn, proposal by the board of directors); and Item 3-2-2: Matter of electing an outside director as a member of the audit committee (candidate: Jong-Guk Song, proposal by shareholders)

The Company recommends candidates based on strict and fair management of the candidate group and verification of expertise and competency, etc.As such, we have faith in the talent and capacity of candidate Young-Sik Ahn recommended by the board of directors, and are confident that he will contribute to enhancing shareholder value.

In contrast, the Company is opposed to Items 3-1 and 3-2-2, having determined that it is undesirable to elect the candidates recommended by the minority shareholders who have not undergone the management and verification procedures for the current candidate group, which we have successfully established while harmonizing the efficient operation and diverse composition of the board of directors and audit committee.

(5)Items 4 and 5: Matter of dismissing Jin-Woo Joo as director and dismissing audit committee members who are outside directors

The above directors have faithfully performed their duties for the Company and contributed to the Company’s development and increase in shareholder value.We are opposed to the above agenda item, since dismissing them in the absence of any clarification as to the justifiable reasons for their dismissal would cause confusion in business continuity and business process, and contradict shareholders’ interests.

(6)Items 6 and 7: Matter of electing outside directors and audit committee members recommended by minority shareholders

We are opposed to the above agenda items for the same reasons as Items 3-1 and 3-2-2.

Moreover, the eligibility and work experience of candidates for executive positions are the most important matters, and the board of directors must faithfully verify the accuracy thereof and the eligibility and experience requirements of audit committee members as accounting and financial experts under the Commercial Code.Even though the Company requested objective evidentiary materials on experience and qualifications, some candidates of the minority shareholders failed to properly submit certificates on details of their work experience.Please note that the Company received confirmation letters from individual candidates – according to the minority shareholders’ request – that there was no falsehood regarding the facts concerning their work experience for some unsubstantiated details of their work experience, and finally proposed the agenda item of electing the candidates on such basis, proceeded with the resolution on the convening of the GMS, and disclosed.

(7)Agenda Item 8: Matter of a resolution on the acquisition of treasury stock

Since the Company has established a comprehensive policy on shareholder returns in consideration of our financial situation and management, as well as investment-related fund requirements, etc., any acquisition of a significant amount of treasury stock that does not take this into consideration may worsen our liquidity and financial situation.Accordingly, the Company opposes the above agenda item.

On the other hand, Item 6 on the matter of revaluating the stake held by Castlex Seoul Co., Ltd., a subsidiary, proposed by the Minority Shareholders is not a matter for resolution of the GMS under the Commercial Code.Item 7 on the matter of resolving on interim dividends of KRW 1,000 per share cannot be implemented under Article 462-3 of the Commercial Code, as there is no basis for interim dividends in the Articles of Incorporation of the Company.Therefore, the Company has fully explained to the Minority Shareholders that each of the above Items is in violation of the Commercial Code or the Articles of Incorporation, and did not present them to this GMS.Furthermore, since the Minority Shareholders corrected the agenda item on a resolution using the electronic voting system in the application dated August 13, 2021 in the course of sending specific draft amendments to the Articles of Incorporation to the Company, stating that only the exercise of voting rights by written ballot was to be included and the exercise of voting rights through the electronic voting system excluded, we have reflected this accordingly.

Chang-Joo Lee, Representative Director

Sajo Industries Co., Ltd.