POSCO : Decision on Issuance of Exchangeable Bonds (Form 6-K)

Decision on Issuance of Exchangeable Bonds

1. Type of bonds		Series No.		-		Type		Foreign currency denominated exchangeable bonds
2. Total face value of bonds (or electronically registered bonds) (KRW)		1,449,965,088,000
2-1 (Overseas issuance of convertible bonds)		Total face value of bonds (or electronically registered bonds) (currency unit)		1,065,900,000		EUR : Euro
	Basic exchange rate, etc.		1,360.32
	Region of issuance		Financial markets in Asia and Europe
	Name of exchange (if overseas listing)		Singapore Stock Exchange
3. Purpose of financing		Facility investment (KRW)		1,014,975,561,600
	Business acquisition (KRW)		-
	Operating capital (KRW)		-
	Debt repayment (KRW)		144,996,508,800
	Acquisition of securities issued by other corporations (KRW)		289,993,017,600
	Other purposes (KRW)		-
4. Interest rate		Coupon rate (%)		0
	Yield to maturity (%)		-0.78
5. Maturity date of bonds		2026-09-01
6. Method of interest payment		No interest payment
7. Method of principal repayment		1. Repayment at maturity: Repayment will be made early before reaching maturity or it will be made at once at maturity for the remaining principal of the bonds whose exchange rights have not been exercised. 2. Early repayment: The Company has the right to make an early repayment ('Call Option') and bondholders have the right to claim an early repayment ('Put Option')
8. Method of bond issuance		Private offering

9. Details of exchange		Exchange ratio (%)		100
	Exchange price (KRW/share)		494,450
	Calculation of exchange price		Considering the exchange premium, the exchange price has been determined as approximately 145% of the closing price of the listed stocks on the Korea Exchange.
	Object of exchange		Class of shares		Registered common stocks issued by the Company (treasury stocks)
	Number of shares		2,932,480
	Ratio to total number of shares (%)		3.4
	Exchange period		Start date		2021-10-11
	End date		2026-08-22
	Details on exchange price adjustment		In the event of any reasons for adjustment of the exchange price, such as capital increase without consideration, stock split, reverse stock split, change of stock class, issuance of options or warrants to shareholders, stock dividends, cash dividends, issuance of new shares below market price, etc., the exchange price will be adjusted according to the relevant bond conditions.
9-1. Details of option		a. The bondholder may exercise the right to claim an early repayment ('Put Option') -   After three years from the date of payment (September 1, 2024); -   In case change of control of the Company occurs; or -   When the Company-issued stocks are delisted (or suspended from trading for 30 or more consecutive trading days) b. The issuer may exercise the right to make an early repayment ('Call Option'): -   When the share price (based on the closing price) of 20 trading days out of 30 consecutive trading days during the 3 years from the date of payment (September 1, 2024) until 30 business days before the maturity of the bonds is 130% or more of the exchange price;

		-   When the outstanding balance of bonds is less than 10% of the total issue amount (clean up call); or -   When reasons for additional tax burden occur due to amendment of related laws and regulations
10. Date of subscription		2021-08-13
11. Date of payment		2021-09-01
12. Lead underwriter		J.P. Morgan Securities BNP Paribas HSBC
13. Guarantor		-
14. Date of board resolution (decision date)		2021-08-13
- Attendance of outside directors		Present(No.)				7
	Absent(No.)				0
- Attendance of auditors (members of Audit Committee)		Present
15. Subject to filing of securities registration statement?		No
16. Reasons for exemption from filing securities registration statement, if exempted		-   Subject to exemption from filing: Yes -   Reason for exemption: In accordance with subparagraph 5, paragraph 2, Article 2-2-2 of Regulation on Securities Issuance and Disclosures, residents are prohibited from acquiring relevant securities within one year from the date of issuance
17. Details of securities lending & borrowing related to overseas issuance of bonds - purpose, number of securities, information of lenders & borrowers, scheduled date of disposal, terms of lending & borrowing (lending period, terms of repayment, interest), repayment method, linkage to issuance of the concerned EBs, fees, etc.		-
18. Subject to reporting to the Fair Trade Commission?		No
19. Other matters to be factored into investment decisions		a. The above '2. Total face value of bonds (or electronically registered bonds) (KRW)' is determined at EUR 1,065,900,000 through investor subscription following resolution by the board of directors.

		b. These bonds are those denominated in foreign currency by applying the basic exchange rate (basic exchange rate (EUR/KRW 1,360.32) at Seoul Money Brokerage Services on August 13, 2021) and converted from EUR into KRW to fill above '2. Total face value of bonds (or electronically registered bonds) (KRW). c. The interest rate of these bonds at maturity is determined at -0.78% through investor subscription following the board of directors resolution. d. Above '3. Purpose of financing' of these bonds is to make an ESG investment, etc. including investment in equity and facilities. e. The 'Exchange price (KRW/share)' under '9. Details of exchange' of these bonds is determined at 145% of the closing price of the shares listed on the Korea Exchange through investor subscription following resolution by the board of directors. f. Above 'Object of exchange' under '9. Details of exchange' is determined at 2,932,480 shares through investor subscription following a resolution by the board of directors. g. Matters regarding exchange rights: (a) Exchange rights exercise period: From the 41st day from the payment date to 10 days before reaching the bond maturity date

		(b) Adjustment of exchange price: In the event of any reasons for adjustment of the exchange price, such as capital increase without consideration, stock split, reverse stock split, change of stock class, issuance of options or warrants to shareholders, stock dividends, cash dividends, other asset dividends, issuance of new shares below market price, etc., the exchange price will be adjusted according to the relevant bond conditions. However, if the adjustment amount of the exchange price is less than 1% of the existing exchange price, it will be carried over to when the next adjustment reason occurs rather than adjusting the exchange price. h. Under the conditions of issuance of the bonds, residents are prohibited from acquiring them for one year from the issuance date in accordance with the Foreign Exchange Transactions Act.

[Details of Issuance to Designated Purchasers]

Name		Relationship to company or the largest shareholder		Total face value of bonds (or electronically registered bonds) (KRW)
-		-		-

[Intended Use of Funds]

The Company aims to diversify its business into the secondary battery and hydrogen field and intends to commercialize them as its core business, and as part of such efforts, it is executing and planning investments overseas. In relation to the above, the funds raised from issuing these exchangeable bonds are scheduled to be used for investing in secondary battery material facilities & equity, hydrogen facilities, and green hydrogen-related equity, etc.