Material event report (merger)

What happened

Material event report (decision on company merger) SJG Sejong Co., Ltd. Material event report / Matter subject to KRX reporting obligation To: Financial Services Commission / Korea Exchange August 19, 2026 Company name: SJG Sejong Co., Ltd. CEO: Ok Hyun-geun Head office location: 82 Hyoja-ro, Buk-gu, Ulsan (Hyomun-dong) Phone: 052-219-1699 Website: http://www.sjg-sejong.com Preparer: (Title) Managing Director (Name) Kim Yong-min (Phone) 031-219-9979

Decision on company merger 1. Merger method: SJG Sejong Co., Ltd. absorbs and merges SJG Central R&D Center Co., Ltd. (SJG CENTRAL R&D CENTER CO., LTD.) - Surviving company: SJG Sejong Co., Ltd. - Merged (dissolving) company: SJG Central R&D Center Co., Ltd. - Merger type: Small-scale merger 2. Purpose of merger: Enhancing management efficiency and strengthening business competitiveness through integration of R&D capabilities 3. Material impact and effect of the merger: 1) Effect on company management: As of the filing date, the merging company owns 100% of the merged company's shares; the merger ratio is 1:0, no new shares will be issued, the largest shareholder will not change, and the merging company will remain as the surviving company. 2) Effect on finances/operations: Not expected to have a material impact on the surviving company's management, finances or operations, though combining resources is expected to enhance management efficiency and competitiveness. 4. Merger ratio: SJG Sejong Co., Ltd. : SJG Central R&D Center Co., Ltd. = 1.0000000 : 0.0000000 - (Multiple relevant to a special purpose acquisition company's dissolution merger): Not applicable 5. Basis for calculating the merger ratio: As the merging company owns 100% of the merged company and issues no new shares in the merger, the merger ratio was calculated as 1.0000000 : 0.0000000. - Corporate value: surviving company -; dissolving company - 6. External valuation: Not applicable - Basis and reason: Under the proviso to Article 176-5(8)(2)(b) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act, an external valuation is not required where a company owning the total issued shares of another company merges with it without issuing new shares; this merger falls under that provision. External valuation institution: -; period: -; opinion: - 7. Type and number of new merger shares: common stock -; special class shares - 8. Merger counterparty company: Company name: SJG Central R&D Center Co., Ltd. (SJG CENTRAL R&D CENTER CO., LTD.); Main business: automotive parts design and machine manufacturing design; Relationship with company: Subsidiary Financial details for the most recent fiscal year (KRW): total assets 21,759,485,431; capital stock 2,000,000,000; total liabilities 14,756,783,592; revenue 22,123,495,067; total equity 7,002,701,839; net income -1,934,679,554 External audit: Anjin Accounting Corporation; Audit opinion: Unqualified 9. Newly established merger company: Not applicable (company name -, financial details at establishment: all -) 10. Merger schedule: Merger agreement date: August 24, 2026; Record date for shareholders: September 4, 2026; shareholder register closure: start -, end -; Period for objection notices: start September 7, 2026, end September 21, 2026; General shareholders' meeting: -; Appraisal rights exercise period: start -, end -; Old share certificate submission: start -, end -; Expected trading suspension: start -, end -; Creditor objection filing period: start September 23, 2026, end October 23, 2026; Merger effective date: October 30, 2026; Closing report meeting date: October 30, 2026; Expected merger registration date: November 2, 2026; New share certificate delivery date -; New share listing date - 11. Backdoor listing: Not applicable 12. Whether the issuing company meets backdoor-listing requirements: Not applicable 13. Appraisal rights: Not recognized, as this is a small-scale merger under Article 527-3 of the Commercial Act; merger approval is by board resolution. Expected purchase price -; exercise procedure -; payment timing/method -; restriction details -; effect on contract - 14. Date of board resolution (decision date): August 19, 2026; attendance of independent (outside) directors*: attended 2, absent -; attendance of auditor: attended 15. Put option or other agreement: No; contract details: - 16. Subject to securities registration statement filing: No - Reason for exemption: As this is a non-capital-increase merger issuing no new shares, no offering or sale of securities requiring a registration statement occurs. * Independent director for listed companies, outside director for unlisted companies 17. Future plans for corporate restructuring: No finalized plans as of the filing date. 18. Other material matters relevant to investment judgment: 1) As a small-scale merger under Article 527-3 of the Commercial Act, appraisal rights are not recognized; board approval replaces shareholders' meeting approval. 2) Under Article 527-3(4), if shareholders holding 20% or more of the surviving company's total issued shares notify written objection within 2 weeks of the merger public notice, the merger cannot proceed as a small-scale merger. 3) As the merging company owns the merged company's entire issued shares, the merged company qualifies for a simplified merger under Article 527-2, with board approval replacing shareholders' meeting approval. 4) The merger counterparty's financial details in item 8 are based on fiscal year 2025 year-end financial statements. 5) The merger agreement may be amended or terminated if grounds arise between the agreement date and the merger effective date. 6) The above schedule is as of the disclosure date and may change depending on consultation with relevant institutions. 7) The closing report general meeting will be replaced by a board public notice under Article 526(3) of the Commercial Act. ※ Related disclosures: None.

[Detailed statement of material merger matters] 1. Overview of the merger a. Basic matters 1) Counterparty to the merger: Surviving company: SJG Sejong Co., Ltd.; location 82 Hyoja-ro, Buk-gu, Ulsan (Hyomun-dong); CEOs Lee Dong-won, Ok Hyun-geun; classification: KOSPI-listed. Dissolving company: SJG Central R&D Center Co., Ltd.; location 20 Hyosan 1-gil, Buk-gu, Ulsan (Hyomun-dong); CEO Yoon Chang-seop; classification: Unlisted. 2) Background: Integrating R&D and business divisions, reducing unnecessary operating costs, and enhancing management efficiency and competitiveness. 3) Backdoor listing: Not applicable. 4) Major impact on management/finance/operations: As the merging company owns 100% of the merged company and issues no new shares, no material impact on the surviving company is expected, though efficiency gains are expected from merging a wholly owned subsidiary. 5) Future restructuring plans: None finalized as of the filing date. 6) Overview of the counterparty: see "2. Matters concerning the merger counterparty company" below. 7) Form of the merger: ① Method: the merging company absorbs the merged company, which is dissolved. ② Small-scale/simplified merger basis: qualifies as a small-scale merger under Article 527-3 (no new shares, treasury shares, or cash consideration to the dissolving company's shareholders) and as a simplified merger under Article 527-2 (surviving company owns all shares of the dissolving company); both companies plan board approval. ③ Surviving company's listing: remains KOSPI-listed after the merger. ④ Notable matters: objection rights under Article 527-3 as described above; no appraisal rights for shareholders of the surviving company given the small-scale merger. 8) Progress and schedule: ① Key dates: Merger board resolution: August 19, 2026; Material event report filing: August 19, 2026; Record-date public notice: August 19, 2026 (company website); Merger agreement date: August 24, 2026; Record date: September 4, 2026; Small-scale merger public notice: September 7, 2026 (company website); Objection notice period: September 7-21, 2026; Board resolution approving merger: September 22, 2026 (in lieu of shareholders' meeting); Creditor objection public notice: September 23, 2026 (company website); Creditor objection period: September 23 - October 23, 2026; Merger effective date: October 30, 2026; Merger closing report board meeting: October 30, 2026 (in lieu of shareholders' meeting); Closing report public notice: October 30, 2026; Expected merger registration date: November 2, 2026. ② Securities registration statement: Not applicable; no offering or sale of securities requiring a registration statement occurs as this is a non-capital-increase merger. 9) Conditions for consummation: Under Article 527-3(4), if shareholders holding 20% or more of the surviving company's issued shares notify written objection within 2 weeks of the small-scale-merger public notice, the small-scale merger cannot proceed, and the board will later decide whether to proceed by another method. 10) Regulations/special provisions: Creditor protection procedures under Article 527-5 of the Commercial Act and other requirements under the Commercial Act, the KOSPI Market Listing Regulations, and the merger agreement apply. b. Merger price and basis for calculation 1) Merger ratio and basis: 1.0000000 : 0.0000000, as described above. 2) External valuation: None obtained, under the proviso to Article 176-5(8)(2)(b) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act. c. Investment risk factors 1) Risk factors: ① The merger agreement may be amended or terminated if a material change occurs in either party's property or management status due to force majeure or other causes between the agreement date and the effective date. ② If shareholders holding 20% or more of SJG Sejong's issued shares object under Article 527-3(4), the merger method and schedule will change. 2) Listing/delisting possibility of allotted new shares: No new merger shares are issued; the merger is not a backdoor listing and creates no delisting risk. 3) Risk factors for investing in related securities if the merger is consummated: As this is a small-scale merger of a wholly owned subsidiary with no securities offered or sold, and consolidated financial statements are unaffected, risk factors are limited. 4) Option agreements related to the merger: Not applicable. d. Appraisal rights: Not recognized, as described above; merger approval is by board resolution. e. Interests between the merging companies 1) Relationship with the counterparty: SJG Central R&D Center Co., Ltd. is a wholly owned subsidiary of SJG Sejong Co., Ltd. as of the filing date. 2) Interlocking officers: Kim Yong-min: unregistered officer at SJG Sejong Co., Ltd.; registered auditor at SJG Central R&D Center Co., Ltd. 3) Special-related-party status: As SJG Sejong Co., Ltd. is the 100%-owning largest shareholder of SJG Central R&D Center Co., Ltd., the major shareholder and special related parties of one party are special related parties of the other. 4) Competitive/complementary business relationships: Not applicable. 5) Transaction details between the merging companies: ① Equity investment: SJG Sejong Co., Ltd. holds a 100.00% equity stake (400,000 shares) in SJG Central R&D Center Co., Ltd., recorded as investment in subsidiary. ② Debt guarantee: Not applicable. ③ Collateral: Not applicable. ④ Purchase and sales transactions (Unit: KRW thousand): SJG Sejong Co., Ltd. / SJG Central R&D Center Co., Ltd.: 2025 sales 7,492,463 / purchases 4,865,599; 2024 sales 7,170,606 / purchases 5,564,177; 2023 sales 8,259,171 / purchases 3,683,596. ⑤ Operating receivables/payables (Unit: KRW thousand): 2025: trade receivables 8,209,040, other receivables 4,971, trade payables -, other payables 2,315,616; 2024: 12,981,965 / 4,678 / - / 2,951,851; 2023: 10,661,304 / 505,211 / - / 2,212,245. 6) Transactions with the major shareholder of the merging companies: ① Credit extension: Not applicable. ② Asset transfers: Not applicable. ③ Business transactions with SJG Holdings Co., Ltd. (Unit: KRW thousand): 2025 sales 50,040 / purchases 1,499,134; 2024 sales 15,942 / purchases 498,060; 2023 sales - / purchases 448,000.

2. Matters concerning the merger counterparty company a. Overview: Company name: SJG Central R&D Center Co., Ltd.; CEO: Yoon Chang-seop; Business registration number: 358-86-02444; Address: 20 Hyosan 1-gil, Buk-gu, Ulsan; Website: http://www.sjrnd.com/; SME status: Applicable; Fiscal year-end: December; Industry: Automotive parts design and machine manufacturing design; Date of establishment: July 2, 2021 b. Business description: Established July 2, 2021 through a physical spin-off of SJG Sejong Co., Ltd.'s R&D division; main business is automotive parts design and machine manufacturing design. c. Financial matters 1) Summary balance sheet, most recent 3 years (Unit: KRW thousand) Item | 2025 | 2024 | 2023 Current assets: 16,788,322 / 21,589,352 / 18,387,303 Non-current assets: 4,971,164 / 5,695,199 / 5,852,025 Total assets: 21,759,486 / 27,284,551 / 24,239,328 Current liabilities: 10,390,232 / 14,882,570 / 13,050,654 Non-current liabilities: 4,366,552 / 3,522,888 / 3,977,693 Total liabilities: 14,756,784 / 18,405,458 / 17,028,347 Capital stock: 2,000,000 / 2,000,000 / 2,000,000 Capital surplus: 6,797,377 / 6,797,377 / 6,797,377 Retained earnings: (1,794,675) / 81,717 / (1,586,397) Total equity: 7,002,702 / 8,879,094 / 7,210,980 2) Summary income statement, most recent 3 years (Unit: KRW thousand) Operating revenue: 22,123,495 / 22,528,554 / 20,002,263 Operating expenses: 21,629,820 / 20,248,097 / 22,732,233 Operating income: 493,675 / 2,280,457 / (2,729,971) Net income before tax: 417,711 / 3,737,194 / (2,416,355) Net income (loss): (1,934,680) / 1,994,349 / (3,818,244) Total comprehensive income (loss): (1,876,392) / 1,668,114 / (4,309,648) Basic EPS: (4,837) / 4,170 / (10,774) 3) Restatement of financial statements: Not applicable. 4) SPAC-related financial regulation/costs: Not applicable. 5) Dividends: Not applicable. d. External auditor's audit opinion: 2025 Anjin Accounting Corporation (Unqualified); 2024 Yoonsol Accounting Corporation (Unqualified); 2023 Yoonsol Accounting Corporation (Unqualified) e. Board and corporate bodies: 3 directors and 1 auditor as of the filing date; no board committees. f. Shareholders: SJG Sejong Co., Ltd., 400,000 shares, 100.00%. g. Officers and employees: 3 registered directors, 1 auditor, plus 73 officers and employees. h. Affiliated companies: Same as SJG Sejong Co., Ltd.'s; see SJG Sejong Co., Ltd.'s business report for details. i. Other investor-protection matters: 1) Material litigation: Not applicable. 2) Other contingent liabilities: Not applicable. 3) Sanctions status: Not applicable.