Tokuyama Corporation decided at a Board of Directors' meeting held on July 27, 2023 to prepay an existing subordinated loan (hereinafter the "Existing Subordinated Loan") totaling ¥60 billion procured on September 20, 2018. The Company took out the Existing Subordinated Loan to fund the early repayment of the Subordinated Loan procured on March 20, 2014 in an effort to maintain its financial soundness, increase the agility and flexibility of its financial strategy by diversifying its refinancing instruments, and reduce financial expenses. The Company formulated its Medium-Term Management Plan 2025 in February 2021, and has been working to improve its financial position, and build and grow new businesses.

As a result, the criteria for exceptions (i) and (ii) set out in "Replacement Clause" in "3. Loan will be repaid early using cash on hand and borrowings. Of note, the impact of this prepayment on the Company's consolidated earnings for the fiscal year ending March 31, 2024 will be minor.