May 10, 2022

To Whom It May Concern:

Company Name:

NAGASE & CO., LTD.

Representative:

Kenji Asakura,

Representative Director, President

Stock Exchange Listings:

Tokyo (Prime Market) Code 8012

Contact:

Yoshihisa Shimizu,

Executive Officer,

General Manager,

Corporate Management Dept.

Tel:

+81-3-3665-3101

Notice Regarding the Issuance of Sustainability Linked Bonds

NAGASE & CO., LTD. has announced plans to issue its first Sustainability Linked Bonds (*1), aiming to contribute solutions to social and environmental issues through corporate activities. Today, the company submitted an amended shelf registration statement to the director-general of the Kanto Local Finance Bureau for the issuance of these bonds.

1. Background and Purpose of the Bond Issuance

The NAGASE Group vision of an Ideal NAGASE for 2032, which is the 200th anniversary of the company's founding, is to be a business designer that creates a sustainable future. In support of this vision, the company formulated a five-yearMedium-term Management Plan, ACE 2.0, which the company launched in fiscal 2021. In formulating ACE 2.0, the company reviewed its existing philosophical framework, formulating the Sustainability Basic Policy as a shared approach to an updated philosophical framework, including its Management Philosophy and Vision. The company also identified materialities related to sustainability.

As an entity that operates globally, the NAGASE Group recognizes that addressing climate change is an important issue to be addressed by the entire group. In January 2022, the group published the NAGASE Group Carbon Neutral Declaration, a policy aimed at achieving carbon neutrality by 2050.

Specifically, the group has set the goal of achieving carbon neutrality by 2050, achieving functionally zero GHG emissions (Scope 1 and 2). By 2030, the NAGASE Group aims to reduce Scope 1 and 2 emissions by 46% (compared with 2013 levels) and Scope 3 emissions by more than 12.3% (compared with 2020 levels) (*2).

The NAGASE Group believes that achieving the above-mentioned goals will contribute to carbon-neutral and ultimately sustainable societies, deciding to issue Sustainability Linked Bonds to support this goal through the use of financing.

Through the issuance of these bonds, NAGASE will demonstrate its willingness to take a proactive stance toward sustainability, to engage in greater levels of sustainability management, and to contribute to the creation realization of sustainable societies.

2.Overview of Sustainability Linked Bonds

Term

10 years

Amount

10 billion yen

Publication Date

June 2022 or later (scheduled)

KPIs

KPI 1：Greenhouse gas emissions of the group (Scope 1 and 2)

KPI 2：Greenhouse gas emissions of the group (Scope 3)

SPTs (*3)

SPT 1：Reduce the group's greenhouse gas emissions by 46% in FY2030

(compared to FY2013) (Scope 1 and 2)

SPT 2：Reduce the group's greenhouse gas emissions by more than 12.3% in

FY2030 (compared to FY2020) (Scope 3)

Bond Characteristics

SPTs will be established as SPT1 and SPT2. If it is confirmed that any of the

SPTs have not been achieved as of the judgment date, emission credits

(credits/certificates of CO2 reduction value) will be purchased in an amount

corresponding to the achievement status of the SPTs before the redemption of

the bonds in order to accelerate efforts to address climate change. When

emission credits are purchased, the name of the credits, the date of transfer,

and the amount purchased will be disclosed in the company's integrated report

or website. As of this time, the company has identified J-Credit, renewable

energy certificates, and non-fossil fuel certificates as candidates. However, the

company will make a final decision after careful review of the factors

contributing to the non-achievement of the SPTs. If SPT 1 is not achieved, an

amount equivalent to 0.10% of the bond issue amount will be purchased. If

SPT 2 is not achieved, an amount equivalent to 0.05% of the bond issue

amount will be purchased. (If neither SPT is achieved, a total amount

equivalent to 0.15% will be purchased.)

However, in the event of force majeure, etc., under the emission rights

purchase agreement (e.g., changes in trading system rules and regulations,

system failures related to the transfer of emission rights, etc.), the company

will provide public interest incorporated associations, public interest

foundations, international organizations, local government authorized NPOs,

local governments and similar organizations that are engaged in environmental

conservation activities with an amount equivalent to the amount of the bonds

(for the amount of donation based on the achievement of SPTs, please refer to

the description in the emission credits section above). The company will make

a final decision of which institution to donate to after careful review of the

factors contributing to the non-achievement of the SPTs.

Lead Manager

Nomura Securities Co., Ltd. (administrator), Daiwa Securities Co., Ltd.,

Mizuho Securities Co., Ltd.

Structuring Agent (*4)

Nomura Securities Co., Ltd.

3.Conformance of Sustainability Linked Bonds

The company received a second opinion about the bonds from Rating and Investment Information, Inc. regarding the conformity of these bonds with the Sustainability-Linked Bond Principles of the International Capital Market Association (SLBP) 2020, the reliability and environment of this framework, and the beneficial impact on society. ・Second opinion from Rating and Investment Information, Inc.

https://www.nagase.co.jp/english/sustainability/environment/climate-change/・The NAGASE Sustainability Linked Bond Framework

https://www.nagase.co.jp/english/sustainability/environment/climate-change/

(*1) A Sustainability Linked Bond is a bond whose terms vary depending on whether it meets predetermined sustainability and/or ESG objectives. The issuer of a Sustainability Linked Bond commits to improving future sustainability outcomes within an initially defined time horizon.

Specifically, the instrument is based on the issuer's assessment of future performance using predetermined key performance indicators (KPIs) and sustainability performance targets (SPTs). The terms of the bond change depending on whether the SPTs, established as target figures with respect to the KPIs, are achieved.

(*2) Scope 1, 2, and 3 refer to the categories of greenhouse gas emissions defined in the GHG Protocol, which was developed as an international standard for calculating and reporting greenhouse gas emissions. The company will consider updating the target values for Scope 3 based on future dialogue with entities involved in the supply chain. Scope 1: Direct GHG emissions by the business itself

Scope 2: Indirect emissions resulting from the use of electricity, heat, and steam supplied by other companies

Scope 3: Indirect emissions other than Scope 1 and 2 (emissions by other companies related to the activities of the business)

(*3) Sustainability performance targets (SPTs) are targets based on the management strategy of the issuer who determines the terms of issuance of Sustainability Linked Bonds.

(*4) Structuring agents are entities that provide support for the execution of Sustainability Linked Bonds through the development of the Sustainability Linked Bond framework and advice on obtaining second-party opinions.

(Reference: Value Propositions and Materialities to Stakeholders)

(Reference materials)

・Medium-term Management Plan ACE 2.0

https://www.nagase.co.jp/english/company/management-policy/

・NAGASE Group Carbon Neutral Declaration

https://www.nagase.co.jp/english/assetfiles/tekijikaiji/20220125_1.pdf

End

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Nagase & Co. Ltd. published this content on 15 June 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 15 June 2022 08:12:01 UTC.