FinTech Global Incorporated : Notice regarding transfer and lease back of Moominvalley Park fixed assets

UNOFFICIAL TRANSLATION The official press release is in Japanese.

Company Name:	FinTech Global Incorporated
Representative:	Nobumitsu Tamai, President and CEO
Stock Listing:	Tokyo Stock Exchange Mothers Section
Stock Code:	8789
Inquiries:	Takashi Senda, Member of the Board,
Senior Executive Officer
Tel:	[phone]

Notice regarding transfer and lease back of Moominvalley Park fixed assets

September 19, 2018-At its meeting today, the Board of Directors at FinTech Global Incorporated (hereafter, "FGI" and "the Company) approved the transfer of Moominvalley fixed assets (audio equipment, fittings, and store fixtures) by consolidated subsidiary Moomin Monogatari Ltd. (hereafter, "Moomin Monogatari") as well as the lease back of said assets. Details are provided below.

Details

1. Reason for transfer and lease back

The FGI Group is moving forward on preparations for the opening of Moominvalley Park on March 16, 2019. As described in the press release "(Progress on Disclosed Item) Notice regarding construction contract on work related to special interior and exterior features at Moominvalley Park," dated February 9, 2018, Moomin Monogatari and Hanno Local Resource Utilization LLC each signed a contract with Nomura Co., Ltd., for interior and exterior feature-related construction work. The contract signed with Moomin Monogatari, which is the likely operator of the main buildings at Moominvalley Park, is for work on movable property. The one signed with Hanno Local Resource Utilization is related to real estate. Construction work is moving toward planned completion and delivery on January 31, 2019.

Based on the transfer contract and lease back contract about to be signed, Moomin Monogatari will transfer interior and exterior feature-related movable property (audio equipment, fittings and store fixtures) on March 18, 2019, after Moominvalley Park has opened, and then lease it back (sell-and-lease-back method). The purpose of this business transaction is to raise funds for the opening of Moominvalley Park, and the capital from the transfer will, as a condition for this transfer contract and the leasing contract, be applied toward repayment of funds to be borrowed from financial institutions to pay for construction work on interior and exterior features.

IBJ Leasing Company, Limited, which is expected to sign the transfer and leasing contracts, looked at Moomin Monogatari from the perspective of business pursuits as well as its impact on local renaissance, including efforts to promote local industry and create jobs, and gave the company high marks. This led to a decision to sign the transfer and leasing contracts.

2. Assets to be transferred and leased back

Name	Moominvalley Park building interior and exterior features
Address	Miyazawa, Hanno, in Saitama Prefecture
Summary of assets	Audio equipment, fittings and store fixtures
Book value of transferred assets	¥942 million (planned)
Transfer price	¥942 million
Acquisition cost of leased assets	¥942 million
Term of lease	60 months from March 18, 2019 (planned start date)

3. Counterparty to transfer and lease back contracts (planned)

（As of June 30, 2018）

Name	IBJ Leasing Company, Limited
Address	2-6 Toranomon 1-chome, Minato-ku, Tokyo
Name and title of representative	Hiroshi Motoyama, President and CEO
Business activities	Leasing transactions for industrial machine tools, transportation equipment and information-related equipment as well as installment sales and financial services
Paid-in capital	¥17,874 million
Date of establishment	December 1969
Net assets	¥155,591 million (consolidated)
Total assets	¥1,953,072 million (consolidated)
Major shareholders and shareholding ratios	The Dai-ichi Life Insurance Company, Limited: 6.87% NISSAN MOTOR CO.,LTD. Retirement Benefit Trust Account: 4.10％ Mizuho Bank, Ltd.: 3.81％ (As of March 31, 2018)
Relationships with FGI	Capital relationship	There is no relevant information
	Personnel relationship	There is no relevant information
	Business relationship	There is no relevant information
	Relevant items to related party	There is no relevant information

4. Schedule for transfer and lease back

Resolution by FGI Board of Directors	September 19, 2018
Resolution by Moomin Monogatari Board of Directors	September 19, 2018
Transfer contract and leasing contract signing	September 20, 2018 (planned)
Transfer date and start of leasing	March 18, 2019 (planned)

5. Outlook

Fund procurement through property transfer and lease back will meet demand for capital at the opening of Moominvalley Park.

The period of depreciation on the assets subject to leasing will decreases from 10 years to five years, causing depreciation costs to rise over the five years from March 2019 and also lead to interest expense. Consequently, ordinary income for fiscal 2019, ending September 30, 2019, may drop ¥76 million.

FGI expects to announce its consolidated performance forecast for fiscal 2019 when results for fiscal 2018 are disclosed in November 2018.

END