House Foods : Notice Concerning the Adoption of Trust-Type Employee Shareholding Incentive Plan (E-Ship®)

Notice Concerning the Adoption of Trust-Type Employee Shareholding Incentive Plan (E-Ship®)

House Foods Group Inc. (the "Company") hereby announces that it has resolved, at a meeting of the Board of Directors held on May 9, 2024, to adopt the Trust-Type Employee Shareholding Incentive Plan (E-Ship®) (the "Plan") as an incentive scheme for the Company's employees to improve the Company's corporate value over the medium and long term. Details of the Plan including the timing of establishment of the trust pertaining to the Plan, the total amount of monies to be borrowed by the trust under the Plan, and the term of establishment of the Plan, will be notified as soon as they are determined.

1. Overview of the Plan

The Plan is an incentive plan available for all employees participating in the House Foods Group Employee Shareholding Association (the "Shareholding Association"). Under the Plan, the Company will establish the House Foods Group Employee Shareholding Association Trust (the "E-Ship Trust") at a trust bank. The E-Ship Trust will acquire the Company's shares in advance in the number expected to be acquired by the Shareholding Association over a certain period of time after the establishment. Thereafter, the E-Ship Trust will make sales of the Company's shares to the Shareholding Association on a continuous basis. Upon the conclusion of the trust, if there are any accumulated gains on sales of shares within the E-Ship Trust, such gains on sales of shares will be allocated as residual assets to employees who meet eligibility requirements as beneficiaries. Further, since the Company will guarantee loans undertaken by the E-Ship Trust to acquire the Company's shares, if there is any accumulated loss on sales of shares within the E-Ship Trust due to the decline of the Company's share price and there are any remaining loan amounts equivalent to the loss on sales of shares as of the conclusion of the Trust, the Company will repay such loans.

The Plan aims to raise awareness of the shareholder perspective through employees' capital participation and to develop a sense of unity between the company and employees and increase work motivation through the sharing of the rewards of growth. At the same time, the Plan is intended to support asset formation by employees by promoting the acquisition and holding of shares by employees through the expanded shareholding association.

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1. Purpose of trust: Stable and continuous supply of shares to the Shareholding Association and distribution of trust assets to those who meet the beneficiary eligibility requirements
2. Beneficiary eligibility requirements:
   All persons who are participants in the Shareholding Association on the start date of the beneficiary determination procedures (the date on which the trust term ends, when all trust assets are converted to cash, the date on which all shares of the Company held as trust assets are sold to the Shareholding Association, etc.)

(Reference)

E-Ship® is a trademark of Nomura Securities Co., Ltd.

E-Ship® (Employee Shareholding Incentive Plan) is an incentive plan for employees modeled after an ESOP (Employee Stock Ownership Plan) that is widely used in the United States. E-Ship® was developed by Nomura Securities Co., Ltd. and The Nomura Trust and Banking Co., Ltd.

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