MODEC : Notice Regarding Secondary Offering of Shares and Changes of Affiliated Companies, Principal Shareholder, and Largest Shareholder (which is also a Principal Shareholder)

May 14, 2024 at 03:24 am EDT

This document has been translated and summarized from the Japanese original for reference purposes only. In the event of any discrepancy between the translated version and the Japanese original, the original version shall prevail. The Company assumes no responsibility for this translation or for any direct, indirect or any other form of damage arising from the translation.

May 14, 2024

MODEC, INC.

Hirohiko Miyata, President & CEO

Code	TSE 6269
Contact	Ryo Suzuki
	Executive Managing Officer
TEL	+81-3-5290-1200

Notice Regarding Secondary Offering of Shares and Changes of Affiliated Companies, Principal

Shareholder, and Largest Shareholder (which is also a Principal Shareholder)

MODEC, INC. (the "Company") hereby announces that a resolution was adopted at a meeting of the board of directors held on May 14, 2024 in relation to a secondary offering of its shares of common stock (the "Offering") as follows and that changes in its affiliated companies, principal shareholder, and largest shareholder (which is also a principal shareholder) are expected following the Offering.

Secondary Offering of Shares

1. Secondary Offering of Shares (Offering by way of Purchase and Subscription by the Underwriters)

(1)	Class and Number of	21,908,400 shares of common stock of the Company
	Shares to be Offered
(2)	Selling Shareholder	MITSUI E&S Co., Ltd.
(3)	Selling Price	To be determined.
		(The selling price will be determined in accordance with the method
		stated in Article 25 of the Regulations Concerning Underwriting of
		Securities, etc., of the Japan Securities Dealers Association, based on
		the preliminary pricing terms calculated by multiplying by a factor
		between 0.90 and 1.00, the closing price of the shares of common
		stock of the Company in regular trading on the Tokyo Stock Exchange
		Inc. (and with any fraction less than one yen being rounded down), on
		a certain date between Wednesday, May 22, 2024 and Tuesday, May
		28, 2024. (hereinafter referred to as the "Selling Price Determination
		Date") (or by using the closing price on the business day immediately
		preceding such date, if no closing price was recorded on such date,
		considering market demand and other conditions for the Offering.)
(4)	Method of Offering	The Offering shall be a secondary offering by way of purchase and
		subscription by an underwriting syndicate led by the underwriters
		designated as joint lead managers (the "Underwriters"). Consideration

Note: This document is a press release to announce a secondary offering of shares and change of affiliated companies, principal shareholder, and largest shareholder (which is also a principal shareholder) and has not been prepared for the purpose of soliciting investments whether in or outside Japan. Additionally, this press release does not constitute an offer of securities for sale, nor a solicitation of an offer to buy, in the United States or elsewhere. The securities referred to above have not been and will not be registered under the United States Securities Act of 1933, as amended (the "Securities Act") and may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act. The securities referred to above will not be publicly offered or sold in the United States.

	for the Underwriters in connection with the Offering shall be the
	amount calculated by subtracting the aggregate underwriting value
	from the aggregate selling price. As part of the Offering, shares may
	be sold to investors in overseas markets such as Europe and Asia
	(excluding the United States and Canada).
(5) Delivery Date	The fifth business day following the Selling Price Determination Date.

Determination of the selling price and all other matters necessary for the offering by way of purchase and subscription by the Underwriters will be entrusted solely to Mr. Hirohiko Miyata, President & CEO of the Company.

2. Secondary Offering of Shares by way of Over-allotment (See 2. below.)

(1)	Class and Number	3,286,200 shares of common stock of the Company
	of Shares to be	The above-mentioned number of shares to be offered represents the
	Offered	maximum number of shares to be offered, and the actual number of
		shares to be offered may decrease, or the offering by way of over-
		allotment may not be carried out at all, subject to market demand and
		other conditions. The number of shares to be offered will be
		determined on the Selling Price Determination Date, considering
		market demand and other conditions for the Offering.
(2)	Seller	The designated lead manager
(3)	Selling Price	To be determined.
		(The selling price will be determined on the Selling Price
		Determination Date. The selling price will be the same as the selling
		price in the offering by way of purchase and subscription by the
		Underwriters.)
(4)	Method of Offering	In connection with the offering by way of purchase and subscription by
		the Underwriters, the designated lead manager will, in consideration
		of market demand and other conditions, undertake a secondary
		offering of shares of common stock of the Company by borrowing no
		more than 3,286,200 shares from MITSUI E&S Co., Ltd., the selling
		shareholder of the offering by way of purchase and subscription by the
		Underwriters (hereinafter referred to as the "Share Lender").
(5)	Delivery Date	The same delivery date as in the offering by way of purchase and
		subscription by the Underwriters.

Determination of the selling price and all other matters necessary for the offering by way of over- allotment will be entrusted solely to Mr. Hirohiko Miyata, President & CEO of the Company.

Note: This document is a press release to announce a secondary offering of shares and changes of affiliated companies, principal shareholder, and largest shareholder (which is also a principal shareholder) and has not been prepared for the purpose of soliciting investments whether in or outside Japan. Additionally, this press release does not constitute an offer of securities for sale, nor a solicitation of an offer to buy, in the United States or elsewhere. The securities referred to above have not been and will not be registered under the United States Securities Act of 1933, as amended (the "Securities Act") and may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act. The securities referred to above will not be publicly offered or sold in the United States.

1．Purpose of the Secondary Offering of Shares

The Company's Mid-Term Business Plan 2024-2026 is guided by the slogan "Explore a Sustainable Future with Innovation." True to those words, the Company's goal during those three years is to advance the initiatives set for itself to address some of its most important challenges, including the decarbonization of its FPSOs and the development of new businesses. The Company believes that this represents a crucial step in its journey to fulfill its Vision 2034 and grow into a "Global Leading Player in Connecting Ocean and Humanity." The Company will endeavor to make this a reality by strengthening the profitability of its core business, FPSO, making strategic progress in FPSO decarbonization and new business, as well as to strengthen its business foundation including its human capital to prepare for the future, while also promoting sustainability management.

The Company recognizes that enhancing corporate governance will also be important going forward as it looks to pursue these strategies over the medium to long term. The Company has engaged in sustained dialogue, both internally and with its shareholders, about the appropriate shareholder configuration for addressing those concerns. Out of that dialogue came a proposal to put the Company's shares on the market through a secondary offering, which would improve liquidity and expand the Company's shareholder base. Having obtained the consent of the would-be selling shareholder, the Company is pleased to announce the launch of this Offering. The Company's goal with this Offering is to reconfigure its shareholder mix so that it will have a larger and more diverse base of shareholders who support its long-term strategies. The Company also believes that it will lead to a better tradable share ratio for its shares and in accordance with the criteria for maintaining listing on the Tokyo Stock Exchange's Prime Market.

2．Secondary Offering of Shares by way of Over-allotment, etc.

The secondary offering of shares by way of over-allotment refers to an offering, in connection with the offering by way of purchase and subscription by the Underwriters, in which the designated lead manager will, in consideration of market demand and other conditions, carry out the secondary offering of the Company shares, by borrowing up to 3,286,200 shares from the Share Lender. While 3,286,200 shares are scheduled to be offered under the offering of shares by way of over-allotment, such number of shares represents the maximum number of shares to be offered, and the actual number of shares to be offered may decrease, or the offering of shares by way of over-allotment may not be carried out at all, subject to market demand and other conditions.

If the offering of shares by way of over-allotment is carried out, the designated lead manager will be granted the right from the Share Lender to acquire additional shares of the Company's common stock, separately from the shares subject to the sale through the offering of shares by way of purchase and subscription by the Underwriters, up to the number of shares to be sold by over-allotment (hereinafter referred to as the "Greenshoe Option"), starting from the delivery date of the sale through the offering of shares by way of purchase and subscription by the Underwriters and the offering of shares by way of over-allotment and ending on Friday, June 21, 2024.

Furthermore, the designated lead manager may purchase shares of common stock on the Tokyo Stock Exchange, Inc., up to the number of shares to be sold in the offering of shares by way of over-allotment,

with the purpose of returning the borrowed shares (referred to as the "syndicate cover transaction") in the period from the day following the last day of the subscription period for the sale through the offering of shares by way of purchase and subscription by the Underwriters and the offering of shares by way of over-allotment until Wednesday, June 19, 2024 (hereinafter referred to as the "syndicate cover transaction period"). All the common stock acquired by the designated lead manager through the syndicate cover transaction will be allocated for the return of the borrowed shares. It should be noted that during the syndicate cover transaction period, the designated lead manager may decide to discontinue the syndicate cover transaction entirely or terminate the syndicate cover transaction with a number of shares that does not reach the number of shares to be sold through the offering of shares by way of over-allotment.

In addition, the designated lead manager may conduct stabilization transactions in connection with the offering of shares by way of purchase and subscription by the Underwriters and the offering of shares by way of over-allotment and may allocate all or part of the common stock acquired through such stabilization transactions for the return of the borrowed shares.

The remaining borrowed shares after being acquired through the syndicate cover transaction and stabilization transactions and allocated for the return will be returned by the designated lead manager by exercising the Greenshoe Option.

II．Changes of Affiliated Companies, Principal Shareholder and Largest Shareholder (which is also a Principal Shareholder)

1. Reason for the Change

The Company's affiliated companies, principal shareholder and largest shareholder (which is also a

principal shareholder) are expected to change as a result of the secondary offering of shares of common stock of the Company set forth in "I. Secondary Offering of Shares - 1. Secondary Offering of Shares (Offering by way of Purchase and Subscription by the Underwriters)" above.

2. Overview of Shareholders Subject to Change

① Overview of the shareholder that will no longer be an affiliated company, a principal shareholder and the largest shareholder (which is also a principal shareholder).

(1)	Name	MITSUI E&S Co., Ltd.
(2)	Address	6-4, Tsukiji 5-chome,Chuo-ku, Tokyo
(3)	Name and title of	Takeyuki Takahashi, President and CEO, Representative Director
	representative
(4)	Content of businesses	Marine Propulsion Systems, Logistics Systems, Peripheral
		Businesses and Industrial machinery and system
(5)	Paid-in capital	8,846 million Yen
	(As of December 31,
	2023)
(6)	Date of establishment	July 31, 1937
(7)	Consolidated net assets	138,165 million Yen
	(as of December 31,
	2023)
(8)	Consolidated total assets	467,035 million Yen
	(as of December 31,
	2023)
(9)	Major shareholders and	SMBCCP Investment Limited Partnership 1	15.77%
	ownership ratios (as of	The Master Trust Bank of Japan, Ltd. (Trust Account)	8.61%
	September 30, 2023)
		3.38%
		IMABARI SHIPBUILDING CO., LTD.
		JP JPMSE LUX RE MERRILL LYNCH INTERNATI EQ	2.77%
		CO (Standing proxy: MUFG Bank, Ltd.)
		Custody Bank of Japan, Ltd. (Trust Account)	2.41%
		NORTHERN TRUST GLOBAL SERVICES SE,	2.26%
		LUXEMBOURG RE CLIENTS NON-TREATY
		ACCOUNT(Standing proxy: Securities Services
		Department, The Hong Kong and Shanghai Banking
		Corporation Limited, Tokyo Branch)
		Mitsui & Co., Ltd. (Standing proxy: Custody Bank of	2.23%
		Japan, Ltd.)

	Custody Bank of Japan, Ltd. (Trust Account for the	2.04%
	retirement allowance for Sumitomo Mitsui Trust Bank,
	Limited)
	Toshiaki Otake	1.96%
	Morgan Stanley MUFG Securities Co., Ltd	1.74%

	Capital	As of May 14, 2024, MITSUI E&S Co.,	Ltd. hold
	relationship	40.52% of the Company's common stock.


		One of the Company directors concurrently serves as
Relationship between the		an executive officer of MITSUI E&S Co., Ltd., and the
Personnel	Company has accepted four secondees from MITSUI
(10) Company and MITSUI	relationship	E&S Co., Ltd. Also, the Company has accepted three
E&S Co., Ltd.
secondees from Mitsui E&S Shipbuilding Co., Ltd., an

		equity method affiliate of MITSUI E&S Co., Ltd.
	Business	Not applicable.
	relationship

Note: Class A preferred shares which SMBCCP Investment Limited Partnership 1 has have no voting rights.

②Overview of the shareholder that will become the largest shareholder (which is also a principal shareholder)

(1)	Name	MITSUI & CO., LTD.
(2)	Address	2-1, Otemachi 1-chome,Chiyoda-ku, Tokyo
(3)	Name and title of	Kenichi Hori, President and Chief Executive Officer
	representative
(4)	Content of businesses	Utilizing global operating locations, network and information
		resources, MITSUI & CO., LTD. multilaterally pursuing business
		that ranges from product sales, worldwide logistics and financing,
		through to the development of major international infrastructure and
		other projects in the following fields: Mineral & Metal Resources,
		Energy, Infrastructure Projects, Mobility, Chemicals, Iron & Steel
		Products, Food, Retail, Wellness, IT & Communication and
		Corporate Development Business.
(5)	Paid-in capital	343,062 million Yen
	(as of December 31, 2023)

③Overview of the shareholder that will become the largest shareholder (which is also a principal shareholder)

(1)	Name	Mitsui O.S.K. Lines, Ltd.
(2)	Address	1-1 Toranomon 2-chome,Minato-ku, Tokyo
(3)	Name and title of	Takeshi Hashimoto, President and Chief Executive Officer
	representative

(4)	Content of businesses	Shipping Industry
(5)	Paid-in capital	65,757 million Yen
	(as of December 31, 2023)

3. Number of Voting Rights held by the Shareholders (Number of Shares Held) and Percentage of Total Voting Rights Before and After Change

MITSUI E&S Co., Ltd.

		Number of voting rights (% of total voting
		rights) and Number of shares held	Ranking
	Status	Direct	Consolidated
		among
	ownership	ownership	Total
		shareholders
		stake	stake


	Affiliated companies,	276,970		276,970
Before change	a principal
(40.53%)		(40.53%)
shareholder and the
(as of May 14,	―	First
largest shareholder	27,697,000	27,697,000
2024)
(which is also a	shares		shares

	principal shareholder)
		57,886		57,886
After change	―	(8.47%)	―	(8.47%)	Third
5,788,600	5,788,600

		shares		shares

Notes: 1. The percentage of total shareholder voting rights before the change is calculated based on 683,289 of total shareholder voting rights, as of December 31, 2023 less 16,400 shares with no voting rights from the total number of issued shares. Ranking among shareholders is based on the register of shareholders of the Company as of December 31, 2023.

The number of voting rights (% of total voting rights) after the change are calculated by deducting the number of voting rights corresponding to shares to be offered by the selling shareholder as described in "I. Secondary Offering of Shares - 1. Secondary Offering of Shares (Offering by way of Purchase and Subscription by the Underwriters)" of 219,084 voting rights (21,908,400 shares) from the number of voting rights before the change.
By exercising the Greenshoe Option as described in "I. Secondary Offering of Shares - 2. Secondary Offering of Shares by way of Over-allotment" above, the number of

voting rights after the change may decrease by up to an additional 32,862 voting rights (3,286,200 shares) from the aforementioned voting rights.

4． The percentage of total voting rights before the change is rounded to three decimal places.

(2) MITSUI & CO., LTD.

		Number of voting rights	% of total	Ranking
	Status	among
	(Number of shares held)	voting rights
		shareholders


Before change		101,623
(as of May 14,	Principal shareholder	14.87%	Second
(10,162,300 shares)
2024)


	Principal shareholder,
After change	and largest shareholder	101,623	14.87%	First
(which is also a	(10,162,300 shares)

	principal shareholder)

Notes: 1. The percentage of total shareholder voting rights before change is calculated based on 683,289 of total shareholder voting rights, as of December 31, 2023 less 16,400 shares with no voting rights from the total number of issued shares. Ranking among shareholders is based on the register of shareholders of the Company as of December 31, 2023.

2. The percentage of total voting rights is rounded to three decimal places.
Mitsui O.S.K. Lines, Ltd.

		Number of voting rights	% of total	Ranking
	Status	among
	(Number of shares held)	voting rights
		shareholders


Before change		101,623
(as of May 14,	Principal shareholder	14.87%	Second
(10,162,300 shares)
2024)


	Principal shareholder	101,623
After change	and largest shareholder	14.87%	First
(which is also a	(10,162,300 shares)

	principal shareholder)

2. The percentage of total voting rights is rounded to three decimal places.

4. Expected Date of Change

Delivery date (the fifth business day following the Selling Price Determination Date) set forth in "I. Secondary Offering of Shares - 1. Secondary Offering of Shares (Offering by way of Purchase and Subscription by the Underwriters)."

5. Any Changes in the Unlisted Parent Companies Subject to Disclosure Not applicable.

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MODEC Inc. published this content on 14 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 May 2024 07:23:01 UTC.

Market Closed - Japan Exchange Other stock markets 02:00:00 2024-05-31 am EDT			5-day change	1st Jan Change
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Modec Sets Selling Price of Secondary Offering at 2,636 Yen Per Share	May. 22	MT
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MODEC, Inc.

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Oil Related Services and Equipment

MODEC : Notice Regarding Secondary Offering of Shares and Changes of Affiliated Companies, Principal Shareholder, and Largest Shareholder (which is also a Principal Shareholder)

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