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Toshiba and Western Digital Reach Global Settlement and Agree to Strengthen Flash Memory Collaboration

Press Releases   •   Dec 12, 2017 22:00 GMT

TOKYO Dec. 13, 2017 and SAN JOSE, Calif. Dec.12, 2017 – Toshiba Corporation (TOKYO: 6502) (“Toshiba”), Toshiba Memory Corporation (“TMC”) and Western Digital Corporation (NASDAQ: WDC) (“Western Digital”) have entered into a global settlement agreement to resolve their ongoing disputes in litigation and arbitration, strengthen and extend their relationship, and enhance the mutual commitment to their ongoing flash memory collaboration.

As part of this agreement, TMC and Western Digital will participate jointly in future rounds of investment in Fab 6, the state-of-the-art memory fabrication facility now under construction at Yokkaichi, including the upcoming investment round announced by Toshiba in October 2017. Fab 6 will be entirely devoted to the mass production of BiCS FLASH™, the next-generation of 3D flash memory, starting next year. TMC and Western Digital similarly intend to enter into definitive agreements in due course under which Western Digital will participate in the new flash wafer fabrication facility which will be constructed in Iwate, Japan.

The parties will strengthen their flash memory collaboration by extending the terms of their joint ventures. Flash Alliance will be extended to December 31, 2029 and Flash Forward to December 31, 2027. Flash Partners was previously extended to December 31, 2029.

The parties’ agreement to resolve all outstanding disputes ensures that all parties are aligned on Toshiba’s sale of TMC to K.K. Pangea, a special purpose acquisition company formed and controlled by a consortium led by Bain Capital Private Equity, LP (“Bain Capital”). The parties have agreed on mutual protections for their assets and confidential information in connection with the sale of TMC, and on collaborating to ensure the future success of TMC as a public company following an eventual IPO.

Commenting on the agreement reached today, Dr. Yasuo Naruke, Senior Executive Vice President of Toshiba Corporation and President and CEO of TMC said: “We are very pleased to have reached this outcome, which clearly benefits all involved. With the concerns about litigation and arbitration removed, we look forward to renewing our collaboration with Western Digital, and accelerating TMC’s growth to meet growing global demand for flash memory. Toshiba also remains on track to complete our transaction with the consortium led by Bain Capital by the end of March 2018. This will ensure that TMC has the resources it needs to continue to innovate and deliver for a fast-growing flash memory market, particularly in areas driven forward by advances in AI and IoT.”

Western Digital Chief Executive Officer Steve Milligan stated: “Western Digital’s core priorities have always been to protect the JVs and ensure their success and longevity, guarantee long-term access to NAND supply, protect our interests in the JVs, and create long-term value for our stakeholders. We are very pleased that these agreements accomplish these critical goals, allow Toshiba to achieve its objectives, and also enable us to continue delivering on the power of our platform. I want to thank the hardworking teams at Western Digital and TMC for the dedication they have exhibited over the past several months, operating the JVs without interruption, and we look forward to building upon the success of our 17 year partnership.”

Yuji Sugimoto, Managing Director, Head of Japan for Bain Capital said: “Bain Capital is pleased that Toshiba and Western Digital have resolved all outstanding legal disputes. The settlement represents the best possible outcome for all parties, clearing the way for the Bain Capital-led consortium to complete its acquisition of TMC as planned. We look forward to supporting TMC to achieve its strategic objectives while enhancing these important JVs with Western Digital.”

As part of the global settlement agreement, Toshiba, TMC and Western Digital have agreed to withdraw all pending litigation and arbitration actions.

About Toshiba

For over 140 years, Toshiba Corporation has contributed to a sustainable future by applying innovative technologies to value creation. Today, our business domains are centered on the essential infrastructure that supports modern life and society. Guided by the principles of The Basic Commitment of the Toshiba Group, “Committed to People, Committed to the Future”, Toshiba promotes global operations that contribute to realization of a world where generations to come can live better lives.

To find out more about Toshiba, visit www.toshiba.co.jp/worldwide/about/index.html

Toshiba Corporation, Toshiba Memory Corporation and Western Digital Corporation have entered into a global settlement agreement to resolve their ongoing disputes in litigation and arbitration, strengthen and extend their relationship, and enhance the mutual commitment to their ongoing flash memory collaboration.

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Clean Water at a Lower Cost: Promoting Innovation in Wastewater Treatment

Blog posts   •   Dec 07, 2017 07:00 GMT

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Notice regarding Closing of Financing Transaction

Press Releases   •   Dec 05, 2017 06:45 GMT

TOKYO—Toshiba Corporation (TOKYO: 6502) has proceeded with the financing transaction (the Financing) that it announced on November 19, 2017 in “Notice regarding Financing Transaction”, and successfully closed the transaction today.

With the successful completion of the Financing, Toshiba Group, as the new Toshiba, will focus on four business domains: Social Infrastructure as the core, along with Energy, Electronic Devices and Digital Solutions. Toshiba will continue to strengthen its revenue base, and work to achieve stable growth in each business domain and to recover its financial base.

In connection with the Financing, no securities will be or have been registered under the United States Securities Act of 1933, as amended, and may be offered or sold in the United States‎ absent registration or an applicable exemption from registration requirements.

The information contained herein shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration, or qualification under the securities laws of any such jurisdiction. This announcement contains forward-looking statements concerning future plans, strategies and the performance of Toshiba Group. These forward-looking statements are not historical facts, rather they are based on management’s assumptions and beliefs in light of the economic, financial and other data currently available. Since Toshiba Group promotes business in various market environments in many countries and regions, its activities are subject to a number of risks and uncertainties that, without limitation, relate to economic conditions, worldwide mega-competition in the electronics business, customer demand, foreign currency exchange rates, tax rules, regulations and other factors. Toshiba therefore wishes to caution readers that actual results might differ materially from our expectations.

About Toshiba

For over 140 years, Toshiba Corporation has contributed to a sustainable future by applying innovative technologies to value creation. Today, our business domains are centered on the essential infrastructure that supports modern life and society. Guided by the principles of The Basic Commitment of the Toshiba Group, “Committed to People, Committed to the Future”, Toshiba promotes global operations that contribute to realization of a world where generations to come can live better lives.

To find out more about Toshiba, visit www.toshiba.co.jp/worldwide/about/index.html

Toshiba Corporation has proceeded with the financing transaction that it announced on November 19, 2017 in “Notice regarding Financing Transaction”, and successfully closed the transaction today.

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Regarding the Sale of Certain Shares Held by Toshiba

Press Releases   •   Dec 05, 2017 00:24 GMT

Please refer to our Investor Relations website below.

http://www.toshiba.co.jp/about/ir/en/news/20171204_1.pdf

About Toshiba

For over 140 years, Toshiba Corporation has contributed to a sustainable future by applying innovative technologies to value creation. Today, our business domains are centered on the essential infrastructure that supports modern life and society. Guided by the principles of The Basic Commitment of the Toshiba Group, “Committed to People, Committed to the Future”, Toshiba promotes global operations that contribute to realization of a world where generations to come can live better lives.

To find out more about Toshiba, visit www.toshiba.co.jp/worldwide/about/index.html

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Ozonation in Drinking Water Treatment

Blog posts   •   Nov 30, 2017 07:00 GMT

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Toshiba Digital Solutions Corporation to Streamline through Early Retirement Incentive Program

Press Releases   •   Nov 29, 2017 00:08 GMT

About Toshiba

For over 140 years, Toshiba Corporation has contributed to a sustainable future by applying innovative technologies to value creation. Today, our business domains are centered on the essential infrastructure that supports modern life and society. Guided by the principles of The Basic Commitment of the Toshiba Group, “Committed to People, Committed to the Future”, Toshiba promotes global operations that contribute to realization of a world where generations to come can live better lives.

To find out more about Toshiba, visit www.toshiba.co.jp/worldwide/about/index.html

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Regarding Capital Reduction at a Consolidated Subsidiary

Press Releases   •   Nov 27, 2017 07:30 GMT

Please refer to our Investor Relations website below.

http://www.toshiba.co.jp/about/ir/en/news/20171127_1.pdf

About Toshiba

For over 140 years, Toshiba Corporation has contributed to a sustainable future by applying innovative technologies to value creation. Today, our business domains are centered on the essential infrastructure that supports modern life and society. Guided by the principles of The Basic Commitment of the Toshiba Group, “Committed to People, Committed to the Future”, Toshiba promotes global operations that contribute to realization of a world where generations to come can live better lives.

To find out more about Toshiba, visit www.toshiba.co.jp/worldwide/about/index.html

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Disclosure of Progress in Respect Completion of the Sale of Shares of a Toshiba Consolidated Subsidiary to Westinghouse Electric Company

Press Releases   •   Nov 24, 2017 00:30 GMT

Please refer to our Investor Relations website below.

http://www.toshiba.co.jp/about/ir/en/news/20171124_1.pdf

About Toshiba

For over 140 years, Toshiba Corporation has contributed to a sustainable future by applying innovative technologies to value creation. Today, our business domains are centered on the essential infrastructure that supports modern life and society. Guided by the principles of The Basic Commitment of the Toshiba Group, “Committed to People, Committed to the Future”, Toshiba promotes global operations that contribute to realization of a world where generations to come can live better lives.

To find out more about Toshiba, visit www.toshiba.co.jp/worldwide/about/index.html

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Toshiba to Explore Alternatives to Sell its Westinghouse Related Assets

Press Releases   •   Nov 19, 2017 10:10 GMT

TOKYO - Toshiba Corporation (TOKYO:6502) (Toshiba) announced today that , as approved by its Board of Directors, it has decided to explore alternatives to sell to a third party its claims against Westinghouse Electric Company LLC (Westinghouse), including for reimbursement, along with the investment in Westinghouse,subject to obtaining certain required regulatory approvals. The successful completion of such efforts will allow Toshiba to significantly reduce the internal resources that it is required to allocate to Westinghouse’s rehabilitation proceedings, and to focus them on cultivating its new businesses.

Following Westinghouse’s filing of Chapter 11 in March 2017, Toshiba successfully negotiated with the owners of the Vogtle project, and entered into a settlement agreement in June 2017. The agreement sets the limit of Toshiba’s parent company guarantee obligation at US $3.68 billion, and specifies that payments are to be made in installments during the period from October 2017 to January 2021. In July, Toshiba also successfully entered into a settlement agreementwith the owners of the V.C. Summer project, which sets the limit of Toshiba’s parent company guarantee obligation at US $2.168 billion, and specifies that payments are to be made in installments during the period from October 2017 to September 2022.

However, both maximum guarantee amounts are specified in US dollars, and payments to both are to be made at the same time, exposing Toshiba to extremely high risks in respect of fluctuations in currency exchange rates associated with such huge amount of debt.

Further, since occurrence of the goodwill impairment in connection with Westinghouse’s acquisition of CB&I Stone & Webster Inc. (S&W), Toshiba has been required to devote material internal resources in monitoring and participating in Westinghouse’s Chapter 11 proceedings. Considering Toshiba’s other priorities that are unrelated to Westinghouse, Toshiba believes that it is the best interests of Toshiba and its stakeholders to resolve as many issues in connection with Westinghouse’s Chapter 11 proceedings as it can, as soon as practicable, in order to focus Toshiba's internal resources on its core business.

For these reasons, Toshiba has decided to find the necessary funding to offer to make early payment of the parent company guarantee obligation in the full amount, and to obtain the right to demand reimbursement from Westinghouse of the amount paid. Toshiba intends to sell its claims* to a third party, including such reimbursement against Westinghouse, and also Westinghouse-related interests that it holds.

*Note: as reported in Toshiba’s Quarterly Report of FY2017 Second Quarter as of November 9, 2017, Toshiba recorded losses regarding the parent company guarantee obligation, and made provision with respect to these assets. As a result, Toshiba recorded 1,394,157 million yen of net loss before income taxes from discontinued operation regarding the Westinghouse Group’s nuclear power systems business. Most of such loss requires an additional declaration under tax returns, the amount of which is approximately 1,400.0 billion yen, consisting of 640.0 billion yen of the shares relevant to Westinghouse, 100.0 billion yen of the loan receivables for Westinghouse, and 660.0 billion yen of the subrogation right against Westinghouse in connection with the parent company’s guarantee.

Given that Toshiba has been spending immense internal resources in connection with Westinghouse’s rehabilitation proceedings, Toshiba believes that it is highly reasonable to make early payment of the parent company guarantee obligations, to gain subrogation rights obtained by the full repayment, and to sell Westinghouse-related assets to a third party.In addition, it is also highly reasonable to now accelerate payment of the parent company guarantee obligations denominated in US dollar, as doing so will avoid uncertainty in respect of future currency exchange rates and currency fluctuation risk.

Furthermore, if the proposed sales of Toshiba’s Westinghouse-related assets**, is completed by the end of March 2018, Toshiba is expected to be able to reduce the tax impact recorded as a result of determining the value of the memory business, which would contribute a minimum of JPY240 billion to further remedying the negative consolidated balance sheet.

** Note: among these assets, since claims including reimbursement will not be subject to approval by respective regulatory authorities, if such sale of the claims is completed by the end of March 2018, at least 100.0 billion yen of the loan receivables for Westinghouse and 660.0 billion yen of the subrogation right against Westinghouse in connection with the parent company’s guarantee is likely to contribute to Toshiba’s consolidated shareholders equity for 240.0 billion yen (aggregate amount of the subrogation right and the loan multiplied by 30.9% of effective tax rate.)

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The information contained herein shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration, or qualification under the securities laws of any such jurisdiction.This announcement contains forward-looking statements concerning future plans, strategies and the performance of Toshiba Group. These forward-looking statements are not historical facts, rather they are based on management’s assumptions and beliefs in light of the economic, financial and other data currently available. Since Toshiba Group promotes business in various market environments in many countries and regions, its activities are subject to a number of risks and uncertainties that, without limitation, relate to economic conditions, worldwide mega-competition in the electronics business, customer demand, foreign currency exchange rates, tax rules, regulations and other factors. Toshiba therefore wishes to caution readers that actual results might differ materially from our expectations.

About Toshiba

For over 140 years, Toshiba Corporation has contributed to a sustainable future by applying innovative technologies to value creation. Today, our business domains are centered on the essential infrastructure that supports modern life and society. Guided by the principles of The Basic Commitment of the Toshiba Group, “Committed to People, Committed to the Future”, Toshiba promotes global operations that contribute to realization of a world where generations to come can live better lives.

To find out more about Toshiba, visit www.toshiba.co.jp/worldwide/about/index.html

Read more »
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Notice regarding Financing Transaction

Press Releases   •   Nov 19, 2017 10:09 GMT

TOKYO - Toshiba Corporation (TOKYO:6502) (Toshiba), as approved at its Board of Directors today, has decided to proceed with a financing transaction (the Financing) expected to close on December 5, 2017.

The proceeds from the Financing will be used to offer to make full payment of parent company guarantee related to nuclear power construction project of Westinghouse Electric Company LLC (Westinghouse). By obtaining funds necessary to offer to make early payment of the parent company guarantee and settling the obligations to creditors, Toshiba can obtain the right against Westinghouse to demand reimbursement of the amount paid by Toshiba. Toshiba intends to sell its claims, including reimbursement, against Westinghouse and interests held by it related to Westinghouse to a third party. If such sale is successfully made, Toshiba is expected to be able to significantly reduce its internal resources it had to allocate to the rehabilitation proceedings of Westinghouse and focus its internal resources on its new businesses after the sale of the Memory Business.

In addition to the above, Toshiba is expected to be able to avoid currency fluctuation risk related to the maximum amount of the parent company guarantee specified in US dollar by making full payment of the parent company guarantee.

Further, if the sale of the claims, including reimbursement, against Westinghouse and interests related to Westinghouse is completed by the end of March 2018, Toshiba is expected to be able to reduce the tax impact recorded as a result of the value of the memory business having been determined, and at least approximately JPY 240 billion will contribute to further enhancing Toshiba’s capital base.

If the Financing successfully completes and the claims against Westinghouse and interests related to Westinghouse are sold, it is expected that JPY 750 billion of negative consolidated balance sheet (i.e., liabilities in excess of assets) will be remedied as of the end of March 31, 2018 and thereby Toshiba’s pressing challenge will be resolved. After the closing of the transfer of the Memory Business, Toshiba will consider appropriate measures to return to shareholders while considering Toshiba group’s financial situation, business risks and other factors.

The Financing, full payment of the parent company guarantee, and the sale of the claims against Westinghouse and the interests related to Westinghouse will contribute to improve and strengthen Toshiba’s financial situation and enhance its cash balance. The detail of the impact on Toshiba’s financial results is under review.

The successful completion of the Financing will remedy a negative consolidated balance sheet and enable Toshiba to avoid the delisting of its shares, both of which have been pressing challenges of Toshiba. Subsequently, Toshiba group, as the new Toshiba, will focus on four business domains, Social Infrastructure as a core, along with Energy, Electronic Devices and Digital Solutions. Toshiba will pursue to strengthen its revenue base and achieve stable growth in each business domain and to recover its diminished financial base.

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The information contained herein shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration, or qualification under the securities laws of any such jurisdiction. This announcement contains forward-looking statements concerning future plans, strategies and the performance of Toshiba Group. These forward-looking statements are not historical facts, rather they are based on management’s assumptions and beliefs in light of the economic, financial and other data currently available. Since Toshiba Group promotes business in various market environments in many countries and regions, its activities are subject to a number of risks and uncertainties that, without limitation, relate to economic conditions, worldwide mega-competition in the electronics business, customer demand, foreign currency exchange rates, tax rules, regulations and other factors. Toshiba therefore wishes to caution readers that actual results might differ materially from our expectationsIn connection with the Financing, no securities will be or have been registered under the United States Securities Act of 1933, as amended, and may be offered or sold in the United States‎ absent registration or an applicable exemption from registration requirements.

About Toshiba

For over 140 years, Toshiba Corporation has contributed to a sustainable future by applying innovative technologies to value creation. Today, our business domains are centered on the essential infrastructure that supports modern life and society. Guided by the principles of The Basic Commitment of the Toshiba Group, “Committed to People, Committed to the Future”, Toshiba promotes global operations that contribute to realization of a world where generations to come can live better lives.

To find out more about Toshiba, visit www.toshiba.co.jp/worldwide/about/index.html

Read more »

About Toshiba Corporation

Committed to People, Committed to the Future

Toshiba’s mission to lead in innovation is based on its passion for creating products that benefit people and society, and a firm belief in the power of technology to make the world a better and safer place. The company’s commitment to Corporate Social Responsibility (CSR) is also reflected in its establishment as one of the world's foremost “eco-companies,” led by a business model that includes a greening of process, products and technology in all its operations.

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