東芝（6502） – Notice Regarding Transfer of Shares of Toshiba’s Consolidated Subsidiaries in the Air-Conditioner Business

February 7, 2022 Toshiba Corporation FOR IMMEDIATE RELEASE Notice Regarding Transfer of Shares of Toshiba’s Consolidated Subsidiaries in the Air-Conditioner Business TOKYO—Toshiba Corporation (TOKYO: 6502, Toshiba) today announced its intent to transfer 55% of the outstanding shares of Toshiba Carrier Corporation (TCC) held by Toshiba to US-based Carrier Corporation, a subsidiary of US-based Carrier Global Corporation (together, Carrier). TCC is majority owned and consolidated by Toshiba and is a heating, ventilating and air conditioning joint venture with Carrier. Toshiba and Carrier today signed a share purchase agreement that anticipates completion of the transfer by September 30, 2022, subject to customary closing conditions such as regulatory approvals. Toshiba currently holds 60% of TCC’s shares, but that will change to 5% as the result of the share transfer, and TCC will be deconsolidated from Toshiba Group. 1. Reason for the Transfer TCC is a joint venture established in a strategic alliance with Carrier, a leading global provider of building and cold chain solutions. With its affiliated companies, TCC has operated as Toshiba Group’s air-conditioner business. TCC has developed HVAC products that utilize TCC’s heat pump, inverter and compressor technologies, including high energy-saving Variable Refrigerant Flow (VRF) air-conditioning systems for buildings and heat source systems. TCC has realized strong domestic sales and an increase in overseas sales in collaboration with Carrier. In the course of considering the business portfolio based on Toshiba’s new management policy and business plan, announced in “Notice Regarding Toshiba’s Transformation to Enhance Shareholder Value,” dated November 12, 2021, Toshiba concluded that the best way for Toshiba to realize the full potential and value of its air-conditioner business would be to reorganize it with strong partners able to realize its full growth potential. Based on these above considerations, and in light of the expected growth of global demand for air conditioning equipment, Toshiba decided that the clear and best option is to reorganize TCC in way that strengthens its links with Carrier, with which TCC has had a close and cooperative relationship for over 20 years, and which has global sales channels. Today Toshiba determined to transfer 55% of the outstanding shares of TCC to Carrier. As a result of this transaction, TCC will be deconsolidated from Toshiba Group. 1 On completion of the transfer, Toshiba will grant TCC a license for use of the Toshiba brand in respect of the development, manufacture and sale of air-conditioning systems, ensuring that TCC is able to continue its operations. The air-conditioning business for railways is operated by Toshiba Infrastructure Systems & Solutions Corporation, a Toshiba’s group company. It is outside of the scope of the transfer, and it will continue to be operated within Toshiba Group. 2. Transfer Method (1) Outline of Subsidiaries to be transferred (1) Name (2) Address (3) Name and Title of Representative (4) Business Outline (5) Capital Stock (6) Established (7) Major Shareholders and Shareholding Ratios (8) Relationship between Toshiba and TCC Toshiba Carrier Corporation (TCC) 72-34 Horikawa-Cho, Saiwai-ku, Kawasaki-shi, Kanagawa, Japan Toru Kubo, President and Representative Director Development, manufacture and sale of air-conditioners, water heaters, etc. 11,510 million yen December 3, 1966* Toshiba Corporation 60% Carrier HVACR Investments B.V. 40% Capital Personnel Business Toshiba’s consolidated subsidiary Toshiba employees are assigned to TCC and TCC employees are assigned to Toshiba. Toshiba and its subsidiaries have business transactions with TCC in the air-conditioner business, including related materials. Toshiba and its subsidiaries provide TCC with shared services in certain areas of its business operations. (9) Operating Performance and Financial Condition in the Last Three Fiscal Years (Non-consolidated) Fiscal Years FY2018 FY 2019 FY2020 (ending 2019/03) (ending 2020/03) (ending 2021/03) 2 Net Assets (Equity) Total Assets BPS Sales Operating Income Recurring Profit Net Income EPS Dividend per Share 34,847 million yen 75,135 million yen 316,792,834 yen 100,995 million yen -1,094 million yen 6,239 million yen 5,757 million yen 52,343,215 yen 31,627 million yen 79,873 million yen 287,526,126 yen 101,818 million yen -419 million yen 6,802 million yen 1,348 million yen 12,254,763 yen 32,098 million yen 80,198 million yen 291,803,116 yen 90,843 million yen -3,118 million yen 9,341 million yen 2,115 million yen 19,233,113 yen 14,218,181.82 yen 41,336,363.64 yen 15,281,818.18 yen *TCC was established on April 1, 1999, when it took over Toshiba’s air-conditioner business as the result of a company split. It took on its present form in 2008, when it merged with Toshiba Carrier Air Conditioning Systems Corporation. Ten consolidated subsidiaries of TCC will be transferred to Carrier through the transfer of TCC shares, including Toshiba Carrier Air-conditioning Sales (Shanghai) Co., Ltd. (TCSA); Toshiba Carrier (Thailand) Co., Ltd. (TCTC); Toshiba Carrier Air Conditioning (China) Co., Ltd. (TCAC); Toshiba Carrier Europe S.A.S (TCEU); TCFG Compressor (Thailand) Co., Ltd. (TCFG); and Toshiba Technical Service & Maintenance Co., Ltd. (TTS). The outlines of TCSA, TCTC, TCAC, TCEU, TCFG and TTS follow. a) TCSA (1) Name (2) Address (3) Name and Title of Representative (4) Business Outline (5) Capital Stock (6) Established (7) Major Shareholders and Shareholding Ratios (8) Relationship between Toshiba and TCSA Toshiba Carrier Air-conditioning Sales (Shanghai) Co., Ltd. (TCSA) Rm. 501, No. 268 Middle Xizang Road Shanghai PRC Takashi Nakahori, President and Representative Director Sales of air-conditioners 79,880 thousand CNY October 23, 2006 Toshiba Carrier Corporation 51% Carrier HVACR Investments B.V. 49% Capital Personnel Toshiba’s consolidated subsidiary Toshiba employees are assigned to TCSA. 3 Business Toshiba and its subsidiaries provide TCSA with shared services in certain areas of its business operations. (9) Operating Performance and Financial Condition in the Last Three Fiscal Years (Non-consolidated) Fiscal Years FY2018 FY 2019 FY2020 (ending 2019/03) (ending 2020/03) (ending 2021/03) Net Assets (Equity) Total Assets BPS Sales Operating Income Recurring Profit Net Income EPS Dividend per Share b) TCTC (1) Name (2) Address (3) Name and Title of Representative (5) Capital Stock (6) Established (7) Major Shareholders and Shareholding Ratios (8) Relationship between Toshiba and TCTC 7,607 million yen 15,033 million yen 8,610 million yen 15,498 million yen 43,832 million yen 2,725 million yen 2,628 million yen 1,952 million yen 42,656 million yen 2,267 million yen 2,141 million yen 1,585 million yen – – – – – – 9,396 million yen 22,308 million yen – 56,631 million yen 2,663 million yen 3,064 million yen 2,279 million yen – – Toshiba Carrier (Thailand) Co., Ltd. (TCTC) 144/9 Moo5，Bangkadi Industrial Park，Tivanon Road，Amphur Muang，Pathumthani 12000，Thailand Takehiko Sato, President and Representative Director room air-conditioners Import, export and wholesale of parts 1,410,001 thousand THB April 1, 1999 Toshiba Carrier Corporation 50.00003% Carrier HVACR Investments B.V. 49.99997% Capital Personnel Toshiba’s consolidated subsidiary Toshiba employees are assigned to TCTC. (4) Business Outline Manufacture and sale of commercial air-conditioners and 4 Business Toshiba and its subsidiaries have business transactions with TCTC in the air-conditioner business, including related materials. Toshiba and its subsidiaries provide TCTC with shared services in certain areas of its business operations. (9) Operating Performance and Financial Condition in the Last Three Fiscal Years (Non-consolidated) Fiscal Years FY2018 FY 2019 FY2020 Net Assets (Equity) Total Assets BPS Sales Operating Income Recurring Profit Net Income EPS Dividend per Share c) TCAC (1) Name (2) Address (3) Name and Title of Representative (ending 2019/03) (ending 2020/03) (ending 2021/03) 20,197 million yen 38,192 million yen 1,432 yen 56,801 million yen 7,309 million yen 7,022 million yen 6,958 million yen 493 yen 19,972 million yen 38,369 million yen 1,416 yen 62,635 million yen 8,535 million yen 8,380 million yen 8,284 million yen 588 yen 17,740 million yen 37,523 million yen 1,258 yen 53,445 million yen 8,012 million yen 8,626 million yen 8,206 million yen 582 yen 514 yen 824 yen 350 yen Toshiba Carrier Air Conditioning (China) Co., LTD. (TCAC) NO.181, Weiken Street, Baiyang Block, Hangzhou Qiantang New Area, Zhejiang Province, 310018, China Koji Wada, President and Representative Director (4) Business Outline Manufacture and sale of commercial air-conditioners (5) Capital Stock 360 million CNY (6) Established September 17, 2013 (7) Major Shareholders and Shareholding Ratios Toshiba Carrier Corporation 51% Carrier HVACR Investments B.V. 49% (8) Relationship between Toshiba Capital Personnel Toshiba’s consolidated subsidiary Not applicable. 5 and TCAC Business Toshiba and its subsidiaries have business transactions with TCAC in the air-conditioner business, including related materials. Toshiba and its subsidiaries provide TCAC with shared services in certain areas of its business operations. (9) Operating Performance and Financial Condition in the Last Three Fiscal Years (Non-consolidated) Fiscal Years FY2018 FY 2019 FY2020 (ending 2019/03) (ending 2020/03) (ending 2021/03) 8,982 million yen 12,118 million yen 15,616 million yen 13,865 million yen 16,333 million yen 25,058 million yen 26,204 million yen 28,113 million yen 40,388 million yen 2,317 million yen 2,634 million yen 4,374 million yen 2,527 million yen 2,920 million yen 4,695 million yen 1,895 million yen 2,225 million yen 3,506 million yen – – – – – – – – – Toshiba Carrier Europe S.A.S (TCEU) Route De Thil-1120 Montluel, France Tamotsu Adachi, President and Representative Director Net Assets (Equity) Total Assets BPS Sales Operating Income Recurring Profit Net Income EPS Dividend per Share d) TCEU (1) Name (2) Address (3) Name and Title of Representative Shareholders and Shareholding Ratios (4) Business Outline Air-conditioning equipment design/development, product planning, sales technical support 23,232.8 thousand EUR (5) Capital Stock (6) Established November 13, 2015 (7) Major Toshiba Carrier Corporation 100% (8) Relationship between Toshiba Capital Personnel Toshiba’s consolidated subsidiary Not applicable. 6 and TCEU Business Toshiba and its subsidiaries provide TCEU with shared services in certain areas of its business operations. (9) Operating Performance and Financial Condition in the Last Three Fiscal Years (Non-consolidated) Fiscal Years FY2018 FY 2019 FY2020 Net Assets (Equity) Total Assets BPS Sales Operating Income Recurring Profit Net Income EPS Dividend per Share e) TCFG (1) Name (2) Address (3) Name and Title of Representative (ending 2019/03) (ending 2020/03) (ending 2021/03) 322 million yen 1,114 million yen 3,494 million yen 8,434 million yen 8,492 million yen 11,414 million yen 322 thousand yen 371 thousand yen 309 thousand yen 28,574 million yen 30,968 million yen 25,988 million yen 151 million yen 474 million yen 361 million yen 122 million yen 466 million yen 343 million yen 78 million yen 317 million yen 240 million yen 78 thousand yen 106 thousand yen 21 thousand yen 0 yen 0 yen 0 yen TCFG Compressor (Thailand) Co., Ltd. (TCFG) Laem Chabang Industrial Estate, I-EA-T, Free Zone 2,212 Moo 3, Thungsukhl, Srirancha, Chonburi, Thailand Kazu Takashima, President and Representative Director (4) Business Outline Manufacture and sale of twin rotary compressors for air- (5) Capital Stock conditioners 870 million THB (6) Established November 15, 2012 (7) Major Shareholders and Shareholding Ratios Toshiba Carrier Corporation 51% FGA (Thailand) Co., Ltd. 49% (8) Relationship between Toshiba and TCFG Capital Personnel Business Toshiba’s consolidated subsidiary Toshiba employees are assigned to TCFG. Not applicable. (9) Operating Performance and Financial Condition in the Last Three Fiscal Years 7 (Non-consolidated) Fiscal Years FY2018 FY 2019 FY2020 Net Assets (Equity) Total Assets BPS Sales Operating Income Recurring Profit Net Income EPS Dividend per Share f) TTS (1) Name (2) Address (3) Name and Title of Representative (ending 2019/03) (ending 2020/03) (ending 2021/03) 4,364 million yen 5,131 million yen 5,819 million yen 6,940 million yen 6,929 million yen 8,307 million yen 50 yen 59 yen 67 yen 11,134 million yen 12,730 million yen 12,652 million yen 557 million yen 1,025 million yen 808 million yen 587 million yen 1,099 million yen 747 million yen 521 million yen 1,006 million yen 705 million yen 6 yen 0 yen 12 yen 38 yen 8 yen 48 yen Toshiba Technical Service & Maintenance Co., Ltd. (TTS) 2-7-2 Kandasuda-Cho, Chiyoda-Ku, Tokyo, Japan Tadaaki Suzuki, President and Representative Director (4) Business Outline Maintenance, repair and construction of commercial air- (5) Capital Stock conditioners 40 million yen (6) Established October 19, 1990 (7) Major Toshiba Carrier Corporation 100% Shareholders and Shareholding Ratios (8) Relationship between Toshiba and TTS Capital Personnel Business Toshiba’s consolidated subsidiary Toshiba employees are assigned to TTS. Toshiba and its subsidiaries have business transactions with TTS in the air-conditioner business, including related materials. Toshiba and its subsidiaries provide TTS with shared services in certain areas of its business operations. (9) Operating Performance and Financial Condition in the Last Three Fiscal Years (Non-consolidated) 8 Fiscal Years FY2018 FY 2019 FY2020 (ending 2019/03) (ending 2020/03) (ending 2021/03) Net Assets (Equity) Total Assets BPS Sales Operating Income Recurring Profit Net Income EPS Dividend per Share (2) Outline of Purchaser (1) Name (2) Address 87 million yen 349 million yen 589 million yen 1,291 million yen 1,946 million yen 2,483 million yen 436 thousand yen 1,744 thousand yen 2,946 thousand yen 4,569 million yen 6,808 million yen 9,297 million yen 63 million yen 420 million yen 840 million yen 64 million yen 408 million yen 837 million yen 37 million yen 262 million yen 539 million yen 186 thousand yen 1,308 thousand yen 2,696 thousand yen 0 thousand yen 1,494 thousand yen 2,696 thousand yen Carrier Corporation United Agent Group 3411 Silverside Road Tatnall Building #104, Wilmington, New Castle County, Delaware, 19810, United States (3) Name and Title of Representative Mark Thompson Chairman & President, Carrier Corporation (4) Business Outline Provider of heating, ventilating, air conditioning, refrigeration and fire and security solutions (5) Capital Stock Not disclosed (6) Established 1978 5.8 billion USD (as of September 30, 2021) 13.9 billion USD (as of September 30, 2021) 100.0% owned by Carrier Global Corporation (7) Consolidated Net Assets (Equity) (8) Consolidated Total Assets (9) Major Shareholders and Shareholding Ratios between Toshiba and the company (10)Relationship Capital Not applicable. Personnel Not applicable. Business Not applicable. Status of Related Not applicable. 9 (3) Shares held by Toshiba before and after the transfer Parties (1) Shares held before the 60% Transfer (2) Shares transferred 55% (3) Purchase price (4) Shares after the 5% Transfer Approx. 100 billion yen (enterprise value for 55% of the shares)* * The final purchase price will be determined on the basis of the financial condition of the companies at the closing. (2) Signing of the Share Purchase February 7, 2022 (today) February 7, 2022 (today) (3) Expected completion of the By September 30, 2022 (planned) (4) Schedules (1) Resolution Agreement Transfer 3. Future Outlook In its FY2022 (April 1, 2022–March 31, 2023) consolidated results, Toshiba expects to record a profit from the transfer, but the specific figures are under scrutiny. There will be no impact on FY2021 results. Toshiba will make an announcement if any further decision is made that requires disclosure. Disclaimer: This report of business results contains forward-looking statements concerning future plans, strategies and the performance of Toshiba Group. These statements are based on Toshiba’s assumptions and beliefs in light of the data currently available to the Company. Actual results are subject to a number of risks and uncertainties and may differ significantly from Toshiba’s assumptions. Major risk factors are as indicated below, though this list is not necessarily exhaustive. ・ Major disasters, including earthquakes and typhoons; ・ Lawsuits or other disputes in Japan or in other countries; ・ Success or failure of businesses promoted by Toshiba Group in collaboration with other companies; ・ Success or failure of new businesses or R&D investment; ・ Changes in political or economic conditions in Japan or abroad; or regulatory changes; # # # 10 ・ Rapid changes in the supply and demand situation in major markets or intensified price competition; ・ Significant capital expenditure for production facilities and rapid changes in the market; ・ Changes in financial markets, including fluctuations in interest rates and exchange rates. 11