Material event report (merger)

What happened

Material event report / Matters subject to KRX reporting obligation To: Financial Services Commission / Korea Exchange Date: July 27, 2026

Company name: KR Motors Co., Ltd. CEO: Jung Jae-kyung Head office: 28 Wanam-ro, Seongsan-gu, Changwon-si, Gyeongsangnam-do Phone: 055-282-7011 Website: http://www.krmotors.com Preparer: (Title) Executive Vice President (Name) Han Chang-su (Phone) 055-269-7388

Decision on company merger

1. Merger method KR Motors Co., Ltd. will absorb-merge its subsidiary KR Trading Co., Ltd. - Surviving company: KR Motors Co., Ltd. (KOSPI-listed company) - Dissolving company: KR Trading Co., Ltd. ※ Trade name of the surviving company after the merger: KR Motors Co., Ltd. - Merger type: Small-scale merger

2. Purpose of the merger The company aims to absorb-merge its wholly owned subsidiary KR Trading, with the goal of enhancing management efficiency and strengthening business competitiveness through business integration. By integrating organization and operations, the company aims to speed up decision-making and reduce costs through integrated purchasing, minimizing unnecessary expenses, thereby expanding competitiveness in domestic and overseas markets, improving responsiveness to potential customers, and ultimately maximizing corporate value.

3. Material impact and effects of the merger (1) Effect on the company's management: As of the filing date of this material event report, the company owns 100% of the equity of KR Trading, the company being merged. The company will absorb-merge the merged company at a merger ratio of 1:0, and no new shares will be issued as a result of this merger. There will be no change in the company's largest shareholder, and KR Motors, the merging company, will remain as the surviving company. (2) Effect on the company's finances/operations: Through this merger, integrating the human and material resources of both companies is expected to reduce redundant costs and simplify the decision-making structure, maximizing management efficiency. Through the organic combination of capabilities between the motorcycle and automobile parts businesses, the merger is expected to further strengthen competitiveness in the mobility market and, based on a stable business foundation, ultimately enhance corporate value.

4. Merger ratio KR Motors Co., Ltd. : KR Trading Co., Ltd. = 1.0000000 : 0.0000000 (For a merger involving the dissolution of a special purpose acquisition company: the multiple of the base price on the listing date of merger-issued new shares relative to the SPAC's closing price on its last trading day: -)

5. Basis for calculating the merger ratio The merging company, KR Motors Co., Ltd., holds 100% of the shares of the merged company, KR Trading Co., Ltd., and since the merging company will not issue new shares for the shares of the merged company upon the merger, the merger ratio was calculated as 1:0. Corporate value: surviving company -; dissolving company -

6. Matters relating to external valuation Whether external valuation was conducted: Not applicable Basis and reason: Under the proviso to Article 176-5, Paragraph 8, Item 2(b) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act, where a company that owns the total number of issued shares of another company merges with that other company without issuing new shares, an external valuation institution's assessment of the appropriateness of the merger value is not required; as this merger falls under that provision, it was not subject to assessment by an external valuation institution. Name of external valuation institution: -; external valuation period: -; external valuation opinion: -

7. Type and number of new shares to be issued in the merger (shares): common shares -; class shares -

8. Merger counterparty company Company name: KR Trading Co., Ltd. Main business: Import/export agency business Relationship with the company: Subsidiary Financial details for the most recent fiscal year (KRW): total assets 280,268,009; capital stock 10,000,000; total liabilities 112,919,063; revenue 36,000,000; total equity 167,348,946; net income 32,794,747 Whether subject to external audit: institution name -; audit opinion - (For a merger involving the dissolution of a SPAC: CEO -; date of incorporation -; head office location -; expected securities registration statement filing date -)

9. Newly incorporated merger company: company name -; financial details at incorporation (KRW): total assets -; total liabilities -; total equity -; capital stock - Current-basis newly incorporated business segment: revenue for the most recent fiscal year (KRW) -; main business - Whether a re-listing application will be filed: Not applicable

10. Merger schedule Merger agreement date: July 29, 2026 Shareholder record date: August 11, 2026 Shareholder register closure period: start date -; end date - Period for receiving notices of objection to the merger: start date August 11, 2026; end date August 25, 2026 Expected date of shareholders' meeting: - Appraisal rights exercise period: start date -; end date - Old share certificate submission period: start date -; end date - Expected trading suspension period: start date -; end date - Creditor objection filing period: start date August 27, 2026; end date September 29, 2026 Merger effective date: September 30, 2026 Merger closing report general meeting date: September 30, 2026 Expected merger registration date: October 1, 2026 Expected date of delivery of new share certificates: - Expected listing date of new shares: -

11. Whether this constitutes a backdoor listing: Not applicable 12. Whether the requirements for another company's backdoor listing are met: Not applicable

13. Matters relating to appraisal rights Exercise requirements: As this merger proceeds as a small-scale merger under Article 527-3 of the Commercial Act, KR Motors Co., Ltd. does not grant appraisal rights to its shareholders. Expected purchase price: -; exercise procedure, method, period, place: -; expected payment timing, payment method: -; matters relating to restrictions on appraisal rights: -; effect on the agreement: -

14. Board resolution date (decision date): July 27, 2026 Independent (outside) director* attendance: attended 1; did not attend - Auditor (audit committee members who are not independent (outside) directors*) attendance: -

15. Whether a put option or similar agreement was concluded: No; contract details: -

16. Whether subject to securities registration statement filing: No Reason for exemption from filing: As this merger proceeds as a non-capital-increase merger in which no new merger shares are issued, no offering or sale of securities requiring the filing of a securities registration statement occurs in the course of this merger. (* Independent director applies to listed companies; outside director applies to unlisted companies.)

17. Future plans for company restructuring As of the filing date of this report, there are no finalized matters regarding company restructuring being pursued or planned following completion of the merger.

18. Other material matters relevant to investment decisions 1) As this merger is a small-scale merger under Article 527-3 of the Commercial Act, appraisal rights are not recognized, and merger approval is substituted by board approval. 2) Although this merger is being pursued as a small-scale merger, under Article 527-3, Paragraph 4 of the Commercial Act, if a shareholder holding 20% or more of the total issued shares of the surviving company notifies in writing its opposition to the merger within two weeks from the date of the merger public notice, this merger cannot proceed as a small-scale merger. 3) The financial details of the merger counterparty company for the most recent fiscal year in Item 8 above are based on the financial statements as of the end of 2025. 4) If, between the date of execution of the merger agreement and the merger effective date (or the deadline set in the merger agreement), grounds for termination or loss of effect under the merger agreement arise -- such as required permits/approvals under relevant laws, consultations with or requests from relevant authorities, unforeseeable force majeure events, sudden changes in economic conditions, material changes in management status, or other circumstances necessitating a change to the merger agreement -- the merger agreement may be amended or terminated. 5) The above merger schedule is the expected schedule as of the time of this material event report's disclosure and may change depending on consultations and approval processes with relevant authorities and the circumstances of the merging companies. 6) The merger closing report general meeting in the above schedule is expected to be substituted by a board resolution and public notice pursuant to Article 526, Paragraph 3 of the Commercial Act. ※ Related disclosures: Not applicable

[DETAILED DESCRIPTION OF MATERIAL MERGER MATTERS]

1. Overview of the merger 1) Basic matters relating to the merger (a) Purpose of the merger (1) Merger counterparty Surviving company (merging company) after the merger: trade name KR Motors Co., Ltd.; location 28 Wanam-ro, Seongsan-gu, Changwon-si, Gyeongnam; CEO Jung Jae-kyung; legal classification KOSPI-listed company Dissolving company (merged company) after the merger: trade name KR Trading Co., Ltd.; location 28 Wanam-ro, Seongsan-gu, Changwon-si, Gyeongnam; representative Jung Jae-kyung; legal classification Unlisted company

(2) Background to the merger: This is to concentrate business capabilities, reduce costs, and enhance management efficiency through efficient resource management, by having KR Motors Co., Ltd., the surviving company, absorb-merge its wholly owned subsidiary KR Trading Co., Ltd.

(3) Material impact and effects on the company's management, finances, operations, etc.: This merger will not result in any change to the largest shareholder, board composition, or organizational structure. Integrating human and material resources through this merger is expected to reduce redundant costs and simplify the decision-making structure, maximizing management efficiency.

(4) Future plans for company restructuring: As of the filing date of this report, there are no finalized matters regarding company restructuring being pursued or planned following completion of the merger.

(5) Overview of the counterparty company: Please refer to "2. Matters relating to the merger counterparty company" below.

(6) Form of the merger 1) Method of merger: The merging company, KR Motors Co., Ltd., will absorb-merge the merged company, KR Trading Co., Ltd.; KR Motors Co., Ltd. will survive and KR Trading Co., Ltd. will be dissolved. 2) Whether this is a small-scale or simplified merger, and the basis: As the merged company, KR Trading Co., Ltd., is a wholly owned subsidiary of the merging company, KR Motors Co., Ltd., this merger proceeds as a non-capital-increase merger in which no new merger shares are issued. It therefore constitutes a small-scale merger under Article 527-3 of the Commercial Act, and merger approval is substituted by board approval. 3) Notable matters regarding the method of the merger: Although this merger is being pursued as a small-scale merger, under Article 527-3, Paragraph 4 of the Commercial Act, if a shareholder holding 20% or more of the total issued shares of the surviving company, KR Motors Co., Ltd., notifies the company in writing of its opposition to the merger within two weeks from the date of the merger public notice, this merger cannot proceed by way of small-scale merger. In addition, as this is a small-scale merger under Article 527-3 of the Commercial Act, appraisal rights are not granted to the shareholders of the merging company.

(7) Progress and schedule 1) Key schedule: merger decision board resolution date July 27, 2026; merger agreement date July 29, 2026; shareholder record date August 11, 2026; period for receiving notices of objection to the merger August 11, 2026 to August 25, 2026; merger approval board resolution date August 26, 2026; creditor objection filing period August 27, 2026 to September 29, 2026; merger effective date September 30, 2026; closing report board public notice September 30, 2026; expected date of merger registration filing October 1, 2026. 2) Whether a securities registration statement will be filed: Not applicable. Reason for exemption from filing: This merger proceeds as a small-scale merger in which the merging company owns 100% of the shares of the merged company, and because the merging company will not issue new shares in the merger, it does not constitute an offering or sale of securities under Article 119 of the Financial Investment Services and Capital Markets Act, and there is no obligation to file a securities registration statement.

(b) Merger value and basis for calculation (1) Merger value and basis for calculation: As the surviving company, KR Motors Co., Ltd., owns all of the issued shares of the dissolving company, KR Trading Co., Ltd., this merger proceeds as a non-capital-increase merger with a merger ratio of 1:0, in which no new merger shares are issued. (2) Whether external valuation was conducted: The proviso to Article 176-5, Paragraph 8, Item 2(b) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act provides that where a company that owns the total number of issued shares of another company merges with that other company without issuing new shares, an external valuation institution's assessment is not required; as this merger falls under that provision, it was not subject to assessment by an external valuation institution.

(c) Investment risk factors (1) Investment risk factors relating to the merger 1) Termination conditions in the merger agreement: (i) The surviving company and the dissolving company may terminate this agreement at any time between its execution and the merger effective date by written agreement. (ii) If any of the following events occurs, either party to this agreement may terminate this agreement by written notice to the other party: a. the conditions precedent to the merger under Article 13 are not satisfied by the merger effective date; b. a shareholder holding 20% or more of the total issued shares of the surviving company notifies its opposition to substituting shareholders' meeting approval of this agreement with board approval; c. between the execution date of this agreement and the merger effective date, a material change or unforeseeable material defect arises in the assets, liabilities, or management condition held by the surviving company or the dissolving company due to force majeure or other causes; d. the surviving company or the dissolving company breaches this agreement and fails to remedy it within 10 business days despite having received a request for correction from the other party. (iii) Upon a party's receipt of a notice under (ii) of this clause, this agreement shall immediately and automatically lose effect without any further action. 2) Matters relating to the listing of merger-issued new shares and the possibility of delisting: As the company owns 100% of the issued shares of KR Trading Co., Ltd., and this is a non-capital-increase merger in which no new merger shares are issued, this matter is not applicable. This merger does not constitute a backdoor listing, so there is no possibility of delisting resulting from this merger. 3) Matters relating to option agreements concluded in connection with the merger: Not applicable.

(d) Matters relating to appraisal rights: As the merger procedure proceeds as a small-scale merger under Article 527-3 of the Commercial Act, the company does not grant appraisal rights to shareholders. In addition, with the consent of the company, the sole shareholder of the merged company, KR Trading Co., Ltd., appraisal rights are not granted. However, under Article 527-3, Paragraph 4 of the Commercial Act, if a shareholder holding 20% or more of the total issued shares of the company notifies the company in writing of its opposition to the small-scale merger, the small-scale merger cannot proceed.

(e) Relationships between the companies, etc. (a) Relationship between the companies (1) Affiliate or subsidiary relationship, if any: KR Trading Co., Ltd. is a wholly owned subsidiary in which KR Motors Co., Ltd. holds a 100% equity stake. (2) Concurrent officer positions: Jung Jae-kyung is CEO/registered officer of KR Motors Co., Ltd. and CEO/registered officer of KR Trading Co., Ltd. (3) Related parties: As KR Trading Co., Ltd. is a subsidiary of KR Motors Co., Ltd., the largest shareholder and related parties of KR Motors Co., Ltd. constitute related parties of KR Trading Co., Ltd.

(1) Equity investment: As of the filing date of this report, KR Motors Co., Ltd. owns 100% of the equity of KR Trading Co., Ltd. (unit: KRW million) KR Motors Co., Ltd., account: subsidiary; number of shares (shares) 20,000; equity ratio 100; acquisition cost 10 *The acquisition cost is stated at book value as of the filing date of this disclosure.

(2) Debt guarantees: Not applicable.

(3) Collateral provided Collateral provided by KR Motors Co., Ltd.: land, buildings, investment real estate; collateral/guarantee amount USD 400,000; recipient IM Bank Collateral provided by KR Motors Co., Ltd.: time deposit; collateral/guarantee amount KRW 513,828 thousand; recipient IM Bank

(4) Purchase and sales transactions: Not applicable

(5) Operating receivables/payables and accrued expenses/receivables (unit: KRW thousand) KR Motors Co., Ltd. with counterparty KR Trading Co., Ltd., lease deposit: 2025 3,000; 2024 3,000; 2023 3,000 KR Motors Co., Ltd. with counterparty KR Trading Co., Ltd., accrued expenses: 2025 155,416; 2024 119,718; 2023 79,767

(6) Loans: Not applicable (7) Details of transactions with the company's largest shareholder: Not applicable

(f) Other matters necessary for investor protection 1) Changes in the company's capital following the merger: As this merger is a non-capital-increase merger in which no new merger shares are issued, there will be no change to the total number of issued shares or capital stock of KR Motors Co., Ltd. following the merger. 2) Management policy and officer composition after the merger: Notwithstanding Article 527-4, Paragraph 1 of the Commercial Act, pursuant to the agreement between the two companies, the directors and auditors of KR Motors Co., Ltd. will retain their positions as directors and auditors of the surviving company for the remainder of their terms after this merger, unless grounds for the termination of their terms arise. The directors of the merged company, KR Trading Co., Ltd., will lose their positions on the date of merger registration.

2. Matters relating to the merger counterparty company (a) Company overview Legal and commercial name of the company: KR Trading Co., Ltd. Date of incorporation: June 15, 2020 Head office address: 28 Wanam-ro, Seongsan-gu, Changwon-si, Gyeongnam Representative: Jung Jae-kyung Main business: Import/export agency business Fiscal year-end month: December Whether classified as a small/medium-sized enterprise: Small/medium-sized enterprise Credit rating, matters relating to irregular incorporation: Not applicable

(b) Description of business: KR Trading Co., Ltd.'s main business is the import/export agency business.

(c) Financial matters 1) Summary statement of financial position (most recent 3 years) (unit: KRW) Current assets: 6th fiscal year (2025) 277,268,009; 5th fiscal year (2024) 1,031,934,798; 4th fiscal year (2023) 315,303,484 Non-current assets: 2025 3,000,000; 2024 3,000,000; 2023 3,000,000 Total assets: 2025 280,268,009; 2024 1,034,934,798; 2023 318,303,484 Current liabilities: 2025 112,919,063; 2024 900,380,599; 2023 216,227,517 Non-current liabilities: 2025 0; 2024 0; 2023 0 Total liabilities: 2025 112,919,063; 2024 900,380,599; 2023 216,227,517 Total equity: 2025 167,348,946; 2024 134,554,199; 2023 102,075,967 Total liabilities and equity: 2025 280,268,009; 2024 1,034,934,798; 2023 318,303,484

2) Summary income statement (most recent 3 years) (unit: KRW) Revenue: 2025 36,000,000; 2024 36,000,000; 2023 36,000,000 Cost of sales: 2025 0; 2024 0; 2023 14,102,002 Gross profit: 2025 36,000,000; 2024 36,000,000; 2023 21,897,998 Selling, general and administrative expenses: 2025 3,225,300; 2024 3,537,480; 2023 10,007,670 Operating income: 2025 32,774,700; 2024 32,462,520; 2023 11,890,328 Non-operating income: 2025 20,047; 2024 16,262; 2023 3,640,101 Non-operating expenses: 2025 0; 2024 540; 2023 800,309 Income before income tax: 2025 32,794,747; 2024 32,478,232; 2023 14,730,120 Income tax expense: 2025 0; 2024 0; 2023 0 Net income: 2025 32,794,747; 2024 32,478,232; 2023 14,730,120

(d) External auditor's audit opinion: KR Trading Co., Ltd. is not subject to mandatory external audit and is therefore not audited by an external auditor.

(e) Matters relating to the board of directors and other company bodies: KR Trading Co., Ltd. is an unlisted company with total capital stock below KRW 1 billion, does not have a board of directors, and has only one in-house director; there are no committees within a board.

(f) Matters relating to shareholders: As of the filing date of this report, KR Motors Co., Ltd. owns 100% of the equity of KR Trading Co., Ltd.

(g) Matters relating to officers and employees: As of the filing date of this report, KR Trading Co., Ltd. has one in-house director in office.

(h) Other matters necessary for investor protection: Not applicable.