(2) Reasons for the transfer of the subsidiary's operations to The company
The first NATURAL LAWSON store was opened in July 2001 based on health as its key word. Thereafter, this trial format was developed around the themes of "beauty," "health" and "convenience," to attract more women who were not traditional customers of convenience stores (CVS). In order to establish a new brand under a different concept from that of the conventional CVS format, NATURAL LAWSON was separated from LAWSON in 2004 and planning and business development of these stores was conducted by a separate company. This move enabled NATURAL LAWSON to carry out strategies that broke the conventional CVS mold, leading to the establishment of a new brand, LAWSON's original goal.
Aiming for further growth, LAWSON has decided to absorb NATURAL LAWSON in order to carry out operations more efficiently and accelerate the franchising of stores.

(3) Liquidation schedule
Mid-November 2007: Resolution to dissolve the subsidiary
February 2008: Completion of liquidation (planned)

(4) Outlook
As a next step, LAWSON will vigorously promote the franchising of NATURAL LAWSON stores, centered on the Tokyo metropolitan area. Furthermore, integration of both companies' product divisions due to today's move will bring in expertise accumulated through the development of NATURAL LAWSON stores. Amid increasing health consciousness among customers, LAWSON will use this knowledge to strengthen product development to cater to these needs.

(5) Impact on LAWSON's operating results
The impact of the liquidation of NATURAL LAWSON, Inc. on LAWSON's operating results has been factored into the interim business results released today.