Annual Report 2024 Appendix

APPENDIX DATED 2 APRIL 2025

THIS APPENDIX IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. PLEASE READ IT CAREFULLY.

If you are in any doubt as to the action you should take, you should consult your stockbroker, bank manager, solicitor, accountant, tax advisor or other professional advisor immediately.

This Appendix is circulated to Shareholders of Nippecraft Limited (the "Company") together with the Company's annual report for the financial year ended 31 December 2024 (the "2024 Annual Report"). Its purpose is to explain to Shareholders the rationale and provide information relating to the proposed renewal of the IPT Mandate (as defined herein) and the Share Purchase Mandate (as defined herein) to be tabled at the Annual General Meeting ("AGM") to be held at Function Room 3-2, Level 3, ISCA House, 60 Cecil Street, Singapore 049709 on Monday, 28 April 2025 at 10:00 a.m.. The Notice of AGM (as defined herein) and proxy form are enclosed with the 2024 Annual Report.

If you have sold or transferred all of your ordinary shares in the capital of the Company, held through The Central Depository (Pte) Limited ("CDP"), you need not forward this Appendix to the purchaser or transferee as arrangements will be made by CDP for a separate Appendix together with the Notice of AGM and the proxy form to be sent to the purchaser or transferee. If you have sold or transferred all of your ordinary shares in the capital of the Company, represented by physical share certificate(s), you should immediately forward this Appendix together with the Notice of AGM and the proxy form which are enclosed with the 2024 Annual Report, to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected, for onward transmission to the purchaser or transferee.

This Appendix has been reviewed by the Company's sponsor, SAC Capital Private Limited (the "Sponsor").

This Appendix has not been examined or approved by the Singapore Exchange Securities Trading Limited (the "SGX-ST") and the SGX-ST assumes no responsibility for the contents of this Appendix, including the correctness of any of the statements or opinions made or reports contained in this Appendix.

The contact person for the Sponsor is Ms. Charmian Lim (Tel: (65) 6232 3210) at 1 Robinson Road, #21-01 AIA Tower, Singapore 048542.

• (i) THE PROPOSED RENEWAL OF THE INTERESTED PERSON TRANSACTIONS MANDATE

• (ii) THE PROPOSED RENEWAL OF THE SHARE PURCHASE MANDATE

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CONTENTS

DEFINITIONS ......................................................................................................................................................................... 4

LETTER TO SHAREHOLDERS

1. INTRODUCTION ............................................................................................................................................................... 7

2. THE PROPOSED RENEWAL OF THE IPT MANDATE ................................................................................................... 8

3. THE PROPOSED RENEWAL OF THE SHARE PURCHASE MANDATE ....................................................................... 9

4. INTERESTS OF DIRECTORS AND SUBSTANTIAL SHAREHOLDERS ........................................................................ 23

5. DIRECTORS' RECOMMENDATIONS .............................................................................................................................. 25

6. ABSTENTION FROM VOTING ......................................................................................................................................... 25

7. DIRECTORS' RESPONSIBILITY STATEMENT ............................................................................................................... 25

8. DOCUMENTS AVAILABLE FOR INSPECTION ............................................................................................................... 26

ANNEX A - THE IPT MANDATE

DEFINITIONS

In this Appendix, unless the context otherwise requires, the following terms or expressions shall have the following meanings:

"Mandated Interested Persons" : Has the meaning ascribed to it in Paragraph 5.1 of Annex A

The terms "Depositor" and "Depository Agent" shall have the meanings ascribed to them respectively in Section 81SF of the SFA.

The terms "treasury shares", "subsidiary holdings", "subsidiary" and "interest" shall have the meanings ascribed to them in the Companies Act and Catalist Rules.

The terms "entity at risk","interested person", "associate", "approved exchange" and "interested person transaction" shall have the meanings ascribed to them in Chapter 9 of the Catalist Rules.

The prevailing exchange rate between US$ and S$ is assessed at US$1.00 : S$1.35 for the purposes of this Appendix.

Words importing the singular shall, where applicable, include the plural and vice versa and words importing the masculine gender shall, where applicable, include the feminine and neuter genders. References to persons shall, where applicable, include corporations.

Any discrepancies in the tables in this Appendix between the listed amounts and the totals thereof are due to rounding. Any reference to a time of day and date in this Appendix shall be a reference to Singapore time, unless otherwise stated.

Any reference in this Appendix to any statute or enactment is a reference to that statute or enactment for the time being amended or re-enacted. Any term defined under the Companies Act, the SFA, the Catalist Rules, the Take-over Code or any statutory or regulatory modification thereof and used in this Appendix shall, where applicable, have the meaning assigned to it under the Companies Act, the SFA, the Catalist Rules, the Take-over Code or any statutory or regulatory modification thereof, as the case may be, unless otherwise provided.

The headings in this Appendix are inserted for convenience only and shall be ignored in construing this Appendix.

NIPPECRAFT LIMITED

(Incorporated in the Republic of Singapore) (Company Registration Number: 197702861N)

Directors:

Registered Office:

Chow Wai San (Independent Non-Executive Chairman)

2 Venture Drive

Raja Hayat (Executive Director and Chief Executive Officer)

Chan Cheng Fei (Executive Director and Chief Financial Officer)

#24-01 Vision Exchange Singapore 608526

Raymond Lam Kuo Wei (Independent Director)

Eddie Foo Toon Ee (Independent Director)

Yek Boon Seng (Independent Director)

2 April 2025

To: The Shareholders of Nippecraft Limited

• (I) THE PROPOSED RENEWAL OF THE INTERESTED PERSON TRANSACTIONS MANDATE

• (II) THE PROPOSED RENEWAL OF THE SHARE PURCHASE MANDATE

Dear Sir/Madam,

1.

INTRODUCTION

1.1

We refer to the Notice of AGM convening the 2025 AGM, and in particular:

• (a) the ordinary resolution 7 under the heading "Special Business" in relation to the proposed renewal of the IPT Mandate; and

• (b) the ordinary resolution 8 under the heading "Special Business" in relation to the proposed renewal of the Share Purchase Mandate.

The purpose of this Appendix is to explain the rationale and provide information to Shareholders for the proposed renewal of the IPT Mandate and the proposed renewal of the Share Purchase Mandate (the "Proposals"), and to seek Shareholders' approval for the Proposals at the 2025 AGM.

The SGX-ST takes no responsibility for the contents of this Appendix, including the correctness of any statements or opinions made or reports contained in this Appendix.

2.

THE PROPOSED RENEWAL OF THE IPT MANDATE

• 2.1 Background

  The Company had, at the EGM held on 24 October 2017, sought and obtained the approval of Shareholders for the IPT Mandate to enable the EAR Group to enter into Mandated IPTs in the ordinary course of business with Mandated Interested Persons, provided that such transactions are made on normal commercial terms and in accordance with the review procedures set out in Paragraph 7 of Annex A to this Appendix.

  The current IPT Mandate was renewed and approved on 30 April 2024 and was expressed, unless revoked or varied by the Company in a general meeting, to continue to be in force until the next AGM which is scheduled to be held on 28 April 2025. It is intended that approval from Shareholders will be sought for the renewal of the IPT Mandate on an annual basis, subject to satisfactory review by the Audit Committee of its continued application to transactions with interested persons.

  The renewed IPT Mandate will take effect from the passing of the ordinary resolution relating thereto at the 2025 AGM and will (unless revoked or varied by the Company in a general meeting) continue in force until the conclusion of the next AGM of the Company. Approval from the Shareholders will be sought for the renewal of the IPT Mandate at the next AGM and at each subsequent AGM of the Company, subject to the satisfactory review by the Audit Committee of its continued relevance and application to the transactions with the Mandated Interested Persons and confirms that the methods or review procedures for the transactions with the Mandated Interested Persons are sufficient to ensure that the transactions are carried out on normal commercial terms and will not be prejudicial to the interests of the Company and/or its minority Shareholders.

  The IPT Mandate, including the rationale for, and the benefits to the Company, the Mandated Interested Persons, the Mandated IPTs, the review procedures for determining transaction prices and other general information relating to the Chapter 9 of the Catalist Rules, are set out in the Annex A to this Appendix. The terms of the IPT Mandate which is sought to be renewed remain unchanged. There is no change in the categories of transactions, entities at risk and interested persons in the proposed renewal of the IPT Mandate.

• 2.2 Audit Committee Statement

  The Audit Committee of the Company, comprising Messrs Chow Wai San, Raymond Lam Kuo Wei and Eddie Foo Toon Ee confirms that:

  • (a) The review procedures as set out in Paragraph 7 of Annex A to this Appendix, including the methods or procedures for determining the transaction prices under the IPT Mandate, have not changed since the EGM held on 24 October 2017; and

  • (b) the methods or procedures referred to in Paragraph 2.2(a) above remain sufficient to ensure that the transactions will be carried out on normal commercial terms and will not be prejudicial to the interests of the Company and its minority Shareholders.

  If, during the periodic reviews by the Audit Committee, the Audit Committee is of the view that the review procedures as set out in Paragraph 7 of Annex A to this Appendix are inadequate or inappropriate to ensure that the Mandated IPTs will be carried out on normal commercial terms, or that the transactions will be prejudicial to the interests of the Company and its minority Shareholders, or in the event of any amendment to Chapter 9 of the Catalist Rules, it will in consultation with the Board take such action as it deems proper in respect of such procedures, modify or implement such procedures as may be necessary and direct the Company to revert to Shareholders for a fresh mandate based on new guidelines and procedures for transactions with interested persons.

2.3

Disclosure

Disclosure will be made in the Company's annual report of the aggregate value of all IPTs conducted with interested persons pursuant to the IPT Mandate during the current financial year, and in the annual reports for subsequent financial years during which the IPT Mandate will continue in force, in accordance with the requirements of Chapter 9 of the Catalist Rules. The Company will also announce the aggregate value of transactions conducted pursuant to the IPT Mandate for the financial periods that it is required to report on pursuant to Rule 705 of the Catalist Rules and within the time period required for the announcement of such report.

3.

THE PROPOSED RENEWAL OF THE SHARE PURCHASE MANDATE

• 3.1 Background

  Under the Companies Act, a company may purchase or otherwise acquire its own shares if it is expressly permitted to do so by its constitution. The Constitution of the Company expressly permits the Company to, inter alia, purchase or otherwise acquire Shares. It is also a requirement under the Companies Act and the Catalist Rules that a company which wishes to purchase or otherwise acquire its own shares has to obtain the approval of its shareholders in a general meeting. In this regard, the Share Purchase Mandate was approved by the Shareholders at the EGM held on 24 October 2017 and the last renewal was approved on 30 April 2024 to enable the Directors to exercise all powers of the Company to purchase or otherwise acquire the Shares on the terms of the Share Purchase Mandate. The Share Purchase Mandate conferred on the Directors will, unless renewed, expire at the 2025 AGM to be held on 28 April 2025. Accordingly, the Directors are proposing to seek Shareholders' approval for the renewal of the Share Purchase Mandate at the 2025 AGM.

  If approved, the renewed Share Purchase Mandate will take effect from the date of the 2025 AGM and continue in force until the date of the next AGM or such date of the next AGM is required to be held by law or by its Constitution, unless prior thereto, purchases or acquisitions of Shares by the Company pursuant to the Share Purchase Mandate are carried out to the full extent mandated or the Share Purchase Mandate is revoked or varied by the Company in a general meeting.

• 3.2 Rationale for the Share Purchase Mandate

  The approval of the Share Purchase Mandate will give the Company flexibility to undertake purchases or acquisitions of its own Shares subject to the terms and limits described in Paragraph 3.3 of this Appendix.

  The Directors constantly seek to increase Shareholders' value and to improve, inter alia, the return on equity of the Group. A Share purchase or acquisition of Shares by the Company at an appropriate price level is one of the ways through which the return on equity of the Group may be enhanced.

  The Share Purchase Mandate would provide the Company with the flexibility to purchase or acquire Shares if and when circumstances permit, during the period when the Share Purchase Mandate is in force. Shares purchased pursuant to the Share Purchase Mandate will either be cancelled or held as treasury shares as may be determined by the Directors. This will provide the Directors with greater flexibility over the Company's share capital structure, with a view to enhancing the EPS and/or NTA value per Share or to maintain a pool of Shares to be deployed for future purposes as deemed appropriate by the Directors.

  The Shares purchased pursuant to the Share Purchase Mandate may be held as treasury shares which may be:

  • (i) used as consideration for the acquisition of shares in or assets of another company or assets of a person; and

  • (ii) sold in the event of future share placements; and/or transferred for the purposes of or pursuant to an employee share scheme.

  The Directors further believe that Share purchases by the Company will help to mitigate short term share price volatility or trading trends which, in the reasonable opinion of the Company, are not otherwise caused by general market factors or sentiments and/or the fundamentals of the Company and offset the effects of short-term speculation (as and when they may occur), and bolster Shareholder confidence.

The Company will only purchase or acquire Shares pursuant to the Share Purchase Mandate if it can benefit the Company and Shareholders. Shareholders should note that purchases or acquisitions of Shares pursuant to the Share Purchase Mandate may not be carried out to the full extent as authorised. No purchase or acquisition of Shares will be made in circumstances which would have or may have a material adverse effect on the liquidity and capital adequacy position of the Group as a whole and/or affect the listing status of the Company on the SGX-ST.

3.3

Authority and Limits of the Share Purchase Mandate

The authority and limitations placed on purchases or acquisitions of Shares by the Company pursuant to the Share Purchase Mandate, which is proposed to be renewed are summarised below:

• (a) Maximum Number of Shares

  Only Shares which are issued and fully paid-up may be purchased or acquired by the Company. The total number of Shares which may be purchased or acquired by the Company pursuant to the Share Purchase Mandate is limited to that number of Shares representing not more than 10% of the total number of issued Shares (excluding treasury shares and subsidiary holdings) as at the date of the AGM at which the renewal of the Share Purchase Mandate is approved, unless the Company has, at any time during the Relevant Period, effected a reduction of its share capital in accordance with the applicable provisions of the Companies Act, in which event the issued share capital of the Company shall be taken to be the amount of the issued share capital of the Company as altered.

  For illustrative purposes only, based on 351,398,000 issued Shares (excluding treasury shares and subsidiary holdings) as at the Latest Practicable Date, and assuming that no further Shares are issued on or prior to the 2025 AGM, the purchase or acquisition by the Company pursuant to the Share Purchase Mandate of up to the maximum limit of 10% of its issued Shares (excluding treasury shares and subsidiary holdings) will result in the purchase or acquisition of 35,139,800 Shares. However, as stated in Paragraph 3.2 above and Paragraph 3.7 below, purchases or acquisitions pursuant to the Share Purchase Mandate need not be carried out to the full extent mandated, and, in any case, would not be carried out to such an extent that would have a material adverse effect on the liquidity and capital adequacy position of the Group as a whole and/or result in the Company being delisted from the SGX-ST. The public float in the issued Shares (excluding treasury shares and subsidiary holdings) as at the Latest Practicable Date is disclosed in Paragraph 3.9 below.

• (b) Duration of Authority

  Purchases or acquisitions of Shares may be made, at any time and from time to time, on and from the date of the 2025 AGM at which the renewal of the Share Purchase Mandate is approved, up to the earliest of:

  • (i) the date on which the next AGM is held or is required by law to be held;

  • (ii) the date on which the purchases or acquisitions of Shares by the Company pursuant to the Share Purchase Mandate are carried out to the full extent mandated; or

(iii) the date on which the authority conferred by the Share Purchase Mandate is revoked or varied by Shareholders in a general meeting.

The Share Purchase Mandate may be renewed at each subsequent AGM or other general meetings of the Company.

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