Regarding the Conclusion of a Loan Agreement with Financial Covenants

Purpose and Overview of the Agreement

PHC Holdings Corporation, aiming to secure necessary working capital for business operations and to refinance existing borrowings, resolved at the board of directors’ meeting to conclude a syndicated loan agreement with financial covenants on March 19, 2026, with Sumitomo Mitsui Banking Corporation as arranger and eight financial institutions as parties. The agreement consists of Term Loan A of 124.4 billion yen, Term Loan B of 310 million euros, and a commitment line of 50 billion yen, with a scheduled repayment due date of March 31, 2031. The loans are unsecured.

Financial Covenants and Future Outlook

This agreement includes financial covenants such as maintaining the total capital section of the consolidated balance sheet at no less than 75% of the amount at the end of March 2025 for fiscal years ending March 2026 onward, and keeping the repayment term within applied years per period (10 years as of March 2026 and March 2027, and 6 years from March 2030 onward). These covenants enhance financial flexibility, stabilize cash flows, and support the promotion of strengthening the financial structure as outlined in the medium-term management plan. The impact on consolidated financial results is expected to be minimal.