Notice Regarding Disposal of Treasury Stock in Connection with Continuation of the Performance-Linked Stock Compensation Plan

At the meeting of the Board of Directors held on May 12, 2026 and the 42nd Annual Shareholders Meeting held on June 17, 2026, KDDI resolved to continue and partially revise the BIP Trust for Directors and Other Executives with the objective of further clarifying the linkage between the compensation of Directors and Other Executives and the Company's business performance and share value, thereby enhancing incentives to contribute to improving medium- to long-term business performance and increasing corporate value. For an overview of the plan, please refer to "Notice Regarding the Continuation of and Partial Revision to the Performance-Linked Stock Compensation Plan for Directors and Other Executives" announced on May 12, 2026.

The Disposal of Treasury Stock will be made, in connection with the continuation of the BIP Trust, to The Master Trust Bank of Japan, Ltd. (Executive Compensation BIP Trust Account), which is the co-trustee of the executive compensation BIP trust agreement to be entered into between KDDI and Mitsubishi UFJ Trust and Banking Corporation (hereinafter the "Trust Agreement"; the trust established under the Trust Agreement shall hereinafter be referred to as the "Trust").

The number of shares to be disposed of is the number of shares expected to be delivered to Directors and Other Executives during the trust period in accordance with the Share Grant Regulations of the BIP Trust. The resulting dilution is limited in scale, representing 0.03% of the total number of issued shares as of March 31, 2026, which was 4,187,847,474 shares (rounded to two decimal places), and 0.03% of the total number of voting rights as of March 31, 2026, which was 38,055,178 voting rights.

The KDDI shares allotted through the Disposal of Treasury Stock will be delivered to Directors and Other Executives in accordance with the Share Grant Regulations of the BIP Trust. As the shares subject to the Disposal of Treasury Stock are not expected to be released into the stock market all at once, KDDI believes that the impact on the secondary market will be minimal and that the number of shares to be disposed of and the scale of dilution are reasonable.

Considering the recent changes in the Company's share price, in order to ensure that the disposal price is free from arbitrariness, the disposal price has been set at JPY 2,886 (fractions of one yen rounded down), which is the average closing price of the Company's shares on the Tokyo Stock Exchange during the one-month period immediately preceding the resolution of the Board of Directors pertaining to the Disposal of Treasury Stock (from July 7, 2026 to August 6, 2026).

It was determined that employing a standardized value, such as the average share price over a certain period, would better eliminate the effects of share price fluctuations than using only a single point in time as the basis for calculation. Therefore, the Company determined that using the average closing price of the Company's shares during the one-month period immediately preceding the relevant Board of Directors resolution as the basis for calculation is more objective and reasonable.

The disposal price represents 99.48% of the closing price of the Company's shares on the Tokyo Stock Exchange on the business day immediately preceding the date of the Board of Directors resolution (JPY 2,901 on August 6, 2026, fractions of one yen rounded down), corresponding to a discount rate of 0.52%. It also represents 104.91% of the average closing price during the three-month period immediately preceding the date of the Board of Directors resolution (JPY 2,751 for the period from May 7, 2026 to August 6, 2026, fractions of one yen rounded down), corresponding to a premium rate of 4.91%, and 106.69% of the average closing price during the six-month period immediately preceding the date of the Board of Directors resolution (JPY 2,705 for the period from February 7, 2026 to August 6, 2026, fractions of one yen rounded down), corresponding to a premium rate of 6.69%. All of the above conform to the Japan Securities Dealers Association's Guidelines Concerning the Handling of Third-Party Allotments, and thus the Company believes that the disposal price does not constitute a particularly favorable disposal price.

All of the Audit & Supervisory Board Members who attended the Board of Directors meeting (five members, including three Outside Audit & Supervisory Board Members) expressed the opinion that the basis for calculating the disposal price is reasonable and that the disposal price does not constitute a particularly favorable disposal price for the planned allottee.

As the dilution rate of shares in this matter is less than 25% and this matter does not involve a change in controlling shareholder, the procedures for obtaining an opinion from an independent third party and confirming the intent of shareholders, as provided for in Article 432 of the Securities Listing Regulations established by the Tokyo Stock Exchange, are not required.